The PLSAS District Services Center is located on Tower Street.
An auditor for Prior Lake-Savage Area Schools recommended Monday the district consider amending its budget in January due to ongoing financial woes.
In its annual financial audit, accounting firm LB Carlson found the district was in compliance with state guidelines. However, Jim Eichten, LB Carlson principal CPA, said PLSAS’ 2024 unrestricted operating funds — money that is not legally earmarked for a specific purpose — as a percentage of the total operating expenditures were 13-percentage points lower than the statewide average.
The 2023-2024 statewide average was 23.4% while PLSAS was 10.3%. For the budget year ending in June 2025, it was down to 9.5%.
The general fund balance has fallen significantly each year since it reached more than $22 million in the 2021-2022 school year, according to Eichten’s audit. The fund balance dropped to $19.3 million in the 2022-2023 school year, decreasing even more to $15 million in the 2023-2024 school year.
The fund dropped by $1.5 million — $460,000 more than expected — to $13.5 million in the 2024-2025 school year, Eichten said in the audit.
The unassigned fund balance — the portion of unrestricted funds the district has not specifically assigned for use — went from 8.1% of the district’s $123.9 million in 2023-2024 expenditures to 7.6% of $125.9 million in 2024-2025 expenditures, according to Eichten. School board policy states it will strive for an unassigned fund balance of no less than 8% of its annual budget, though the board is not required to take action if they go below that amount.
“This information is now up to the administration of this district to take and look at next steps,” Eichten said at the meeting. “It’s up to the board to take and make the decisions.”
The highest expenditures were from special education and transportation costs, Eichten said. Rising transportation costs are common among most districts in the state.
Eichten said that best practice would suggest that, after receiving the audit in November, a district with these types of budget issues should consider amending its budget after the end of the year.
The audit is the latest indicator of troubled financials for the school district. At the Monday meeting, the board approved a boundary redistricting plan necessitated by the closure of WestWood Elementary as a neighborhood school for financial reasons. The district warned of a possible $2 million budget shortfall by 2028 at an Oct. 27 study session.
As part of their budget restructuring plan, the district voted to move forward in its efforts to sell the current district office building at 4540 Tower St. SE. The board on Monday selected Cerron Properties as its brokerage firm over Transwestern Real Estate Services.
District director of operational services Dan Powers said in his recommendation to the board Cerron was especially focused on maximizing value for the district. Cerron also offered different contract rates if they are the listing agent, the purchasing agent or both.
Cerron estimated a price range for the building of between $2.5-$2.9 million.