Reed City Area Public Schools: The financial condition of the district

[Shadowninja]

Dearest reader,

We have reached the final stop in Reed City Area Public Schools: the financial condition of the district.

And this ledger needs a little context.

Reed City ended 2024-25 with:

General Fund balance: $5,402,962 
Fund balance ratio: 24.95% 
Deficit: $59,069

That is a healthy reserve, and the actual result was $80,025 better than the district's final amended budget anticipated.

But the next two budgets show that reserve being used.

2025-26 projected:

Deficit: $879,880 
Ending fund balance: $4,523,082 
Fund balance ratio: 20.87%

2026-27 original budget:

Deficit: $158,721 
Ending fund balance: $4,364,361 
Fund balance ratio: 20.37%

If those budgets play out as written, Reed City will use approximately $1.04 million of General Fund balance over two years — a 19.21% reduction.

Still above 20%.

So no, Lady B is not sounding the financial alarm bells.

But she is watching the direction of the arrow.

There are also some interesting shifts underneath those totals.

From 2024-25 actual spending to the 2026-27 original budget:

Instructional Staff Support: +60.90%

Added Needs: +34.41%

Pupil Support: +13.82%

Meanwhile:

Operations & Maintenance: −22.60%

Transportation: −45.11%

Central Support: −8.67%

The transportation number comes with important context: Reed City ended its outsourced transportation arrangement and changed how those services were handled, so that percentage should not be read in isolation.

The 2024-25 audit also came back with an unmodified opinion.

There was, however, one breadcrumb in the auditor's management letter.

Reed City's Food Service Fund ended the year with a $622,468 fund balance — more than MDE's allowable three months of operating expenditures.

The auditor recommended a spend-down plan, with the excess to be spent by June 30, 2026.

That is not the same thing as saying Reed City's General Fund is in trouble.

Quite the opposite: the district entered this period with a substantial General Fund reserve.

The question going forward is much simpler:

If you are going to use more than $1 million of that reserve over two budget years, what are you buying with it — and is that use sustainable?

That is a question for the next ledger.

With receipts and respect.

#LadyBudgetdown #ReedCity #ReedCityAreaPublicSchools #MichiganSchools #SchoolFinance #SchoolBudget #FundBalance #PublicEducation #EducationSpending #SchoolTransparency #PublicRecords #FollowTheMoney #WithReceiptsAndRespect