• Finance

    36 McElwain Street
    Merrimack, NH 03054
    (603) 424-6200

    Matt Shevenell, Assistant Superintendent for Business 

     

    Retaining Surplus – Explained

    This article gave us the ability to retain surplus – voted April 2022.

    ARTICLE 7  Shall the District vote to authorize the School Board indefinitely, until specific rescission of such authority, to retain year-end unassigned general funds in any fiscal year, in an amount not to exceed 5% of the current fiscal year’s net assessment, in accordance with RSA 198:4-b,II? 

    The accounting mechanics of it is as such.

    The amount retained if not spent, is returned into the general pool of surplus, then before the tax rate setting process, an amount not to exceed 5% of the current fiscal year’s net assessment can be retained once again. The money does not go away but then is reclassified from unassigned fund balance to retained fund balance. The point is that each year, we can’t have retained anymore than 5% of the net assessment.

    We therefore by law, can’t build up and accumulate anything more than that 5%. This is where a TOWN has no restrictions as we do.

    The total retained can’t exceed 5% or for this past year or 3,175,065. We can never build up a reserve like the town of 8 to 9 million dollars.

    ARTICLE 7  Shall the District vote to authorize the School Board indefinitely, until specific rescission of such authority, to retain year-end unassigned general funds in any fiscal year, in an amount not to exceed 5% of the current fiscal year’s net assessment (Gross Budget Less Revenues) , in accordance with RSA 198:4-b,II?  

     198:4-b Contingency Fund. –I. A school district annually by an article separate from the budget and all other articles in the warrant, or the governing body of a city upon recommendation of the school board, when the operation of the schools is by a department of the city, may establish a contingency fund to meet the cost of unanticipated expenses that may arise during the year. A detailed report of all expenditures from the contingency fund shall be made annually by the school board and published with their report.II. Notwithstanding any other provision of law, a school district by a vote of the legislative body may authorize, indefinitely until specific rescission, the school district to retain any unused portion of the year-end unassigned general funds, from the preceding fiscal year in subsequent fiscal years, provided that the total amount of year-end unassigned general funds does not exceed, in any fiscal year, 5 percent of the current fiscal year's net assessment under RSA 198:5.(a) Prior to expending retained general funds, the school board shall hold a prior public hearing on the action to be taken with such funds. Notice of the time, place, and subject of such hearing shall be published in a newspaper of general circulation in the relevant municipality at least 7 days before the meeting is held.(b) An annual accounting and report of the activities of the retained general funds shall be presented to the school board of the district and published in the annual report.III. The legislative body of the city of Manchester, upon recommendation of the school committee, may authorize, indefinitely until specific rescission, the school district to retain year-end unassigned general funds.

    Matt Shevenell, Assistant Superintendent

    Merrimack School District