While the Pella Community School District is far from any major budget cuts, it’s clear that the fund they use to pay for staff will be running in the red for awhile as they hope that state aid increases and enrollment growth can offset some of those hurdles.

Superintendent Greg Ebeling led discussion during a financial overview given to the Pella School Board at their meeting this week, and while the overall financial health of their accounts is strong, a lack of what he feels are adequate state budget packages, coupled with modest enrollment growth and several additional hires made in the past few years for different growing needs, has the board staring at a nearly $1 million deficit in the general fund this coming year.

Due to school finance laws, other fund balances for facilities and other needs can be effectively increased by property taxes, sales tax growth, and fundraising according to Ebeling — but the money used to pay for salaries and benefits comes directly from state allocations based on enrollment and an increase provided by the legislature. While many school districts in Iowa increased their fund balances due to COVID-related federal funds, Ebeling says the Pella School District did not get as much due to the formula leaning on student populations with free and reduced lunch — so much of the expenses related to the pandemic were not covered exclusively by extra dollars.

However, Ebeling says while a frustrating situation to be in, generally speaking, the overall financial health of the Pella School District is strong due to fiscally conservative approaches taken overall, and that future enrollment growth and larger state aid increases could offset the issues more quickly, and early retirement packages may also be an option again in a few years.