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After tightening purse strings, Harford schools end fiscal year with $7.5 million surplus

In what was described as a very difficult year financially for Harford County Public Schools, the school system ended the year with a $7.5 million surplus.

That came from higher-than-budgeted revenues and lower-than-budgeted expenses, Deborah Judd, assistant superintendent for business services, told members of the Harford County Board of Education at their meeting Monday.

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She presented a fourth-quarter financial summary, which includes estimates of year-end figures for Fiscal Year 2019. A formal audit summary will be presented to the school board at its Oct. 28 meeting.

Harford’s school system spent 98.59 percent of its budget in FY2019, she said.

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“That came through a concerted effort of the hiring freeze, the spending freeze,” Judd said. “Everyone in the system contributed to that surplus. It was a very difficult year.”

Decisions were made purposefully not to hire in order to generate a surplus, “knowing that we would need it because our fund balance was at such a low point for the system,” Judd said.

Even with the hiring and spending freezes, the school system still had to eliminate 115.5 positions, including 84.5 teaching positions and 31 administrator and central office positions to balance a $478.8 million budget for Fiscal Year 2020, which began July 1.

As of June 30, the end of FY2019, the school system’s projected unassigned fund balance was about $4 million and the projected assigned fund balance was $6 million, Judd said.

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The total fund balance at the beginning of FY2018-2019 was approximately $17.37 million, but about $14.68 million was assigned to balance the budget for the year, leaving nearly $2.7 million in its unassigned fund balance.

Adding the $7.5 million surplus from FY19 to the unassigned balance left a total fund balance for FY19 of more than $10.16 million . Of that, however, $6 million is assigned for specific expenses, $162,228 is allocated as non-spendable for inventory, leaving a little over $4 million as the unassigned fund balance.

The unassigned fund balance is used for one-time expenses as needs arise, she said.

“It’s usually of an urgent nature,” Judd said. “It’s not something we decide to spend because we want to buy something. It’s one-time, something’s come up that’s not in our budget and we need to use our savings account in order to make that purchase.”

From the assigned fund balance, $5 million was used to balance the FY2020 budget and $1 million is set aside for emergency fuel expenses, she said.

The unassigned fund balance was projected to be less than $4 million, Judd said, based on guidance given to the school system.

“It was a combination of stopping our purchasing as well as some luck," Judd said. “We had luck with the weather, we had luck with things that didn’t break down so we didn’t need to fix them during the year.”

When a purchase request was made, Judd called her colleagues to ask if the purchase could be held until July 1, when the new fiscal year began. Most of the time, they waited.

“Which is what we did for most of the purchases that came through, so that last quarter contributed to a lot of savings,” she said.

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