{KXLG – Watertown, SD} The Watertown School Board will hold its regular meeting on Monday, August 12, 2024, at 5:30 PM. The board will begin the meeting by addressing routine administrative tasks, including approving the previous month's minutes and financial reports.
Watertown School District 14-4 Financial Report: July 31, 2024
General Fund:The Watertown School District 14-4 received its first monthly State Aid payment for the 2024-25 fiscal year, estimated at $1,154,796. This amount is subject to adjustment once the district's enrollment for the year is verified. Additionally, the district received $394,565 in federal revenue related to ESSER grant funds. As is typical for July, expenditures exceeded revenue. Critical expenditures included the renewal of workman's compensation insurance at $104,708 and an annual early retirement payment to Security Benefit amounting to $552,139. The General Fund's ending cash position is $8.7 million, reflecting a slight increase from the previous year. This increase is attributed to the timing of the liability insurance payment scheduled for August.
Capital OutlayRevenue for the Capital Outlay fund primarily consisted of typical July property taxes. Expenditures included $1,094,551 in debt service payments and $535,337 towards the construction in progress of the athletic complex. The ending cash position for this fund is $7 million, showing an increase compared to the prior two years.
Special EducationThe Special Education fund received its first monthly State Aid payment, estimated at $244,413. This amount will fluctuate slightly until final enrollment numbers are confirmed. As is typical for July, expenditures exceeded revenue. The fund's ending cash position is $2.5 million, reflecting improvement over prior years. The steady increase in the fund balance is a positive trend as the district aims for a year-end fund balance closer to 15 percent of annual expenditures.
Lake Area Technical College (LATC)LATC received several revenue sources, including $533,147 in federal grants. The decrease in cash position is directly related to the ongoing construction of the Archway. A foundation contribution of $3.5 million is expected in August. When considering the remaining contribution to be collected, the cash balance reported at $3.9 million reflects $7.4 million, above the previous year's balance when accounting for the receivable contribution revenue.
Financial AidRevenue and expenditures for Financial Aid are associated with providing federal support to students attending Lake Area Technical College.
Claims and administrative costs exceeded Employee Benefit Trust. Premiums were collected during July. This is typical, as the district's ten-month employees do not contribute to the plan during July and August. The ending cash position reflects a decrease. Premium increases to the plan will be implemented in the September payroll. The trend indicates that increased premiums will be necessary to offset rising claims and high-cost claimants in future years.
K-12 NutritionThere was limited activity in the K-12 Nutrition fund. Increased revenue is expected in August as families replenish their lunch accounts.
Arena ConcessionThe Arena Concession fund experienced limited activity.
LATC Book StoreSales and expenditures for the LATC Book Store were typical for this time of year, with increased activity anticipated in the upcoming months. The fund's ending cash position is $1.1 million, fluctuating as inventory moves through the bookstore.
LATC Food ServiceSales and expenditures for LATC Food Service were typical for this time of year, with increased activity expected in the upcoming months. The cash balance of $309,468 is above that of the previous year.
LATC EducareServices and expenditures for LATC Educare were typical for this time of year, with increased activity anticipated in the upcoming months. The cash balance of $364,616 is above the previous year, and the program continues to operate at a successful student-to-staff ratio.
Drivers EducationExpenditure activity for Drivers Education was related to summer programming.
Pre-School ServicesThere was limited activity in the Pre-School Services fund.
Custodial FundsCustodial Funds experienced routine activity.
Following this, the public can address the board on any agenda or non-agenda items.
The board is expected to consider resignations, contract recommendations, and addendums. It will also deliberate on education stipends.
The board has a list of property and facility items to address. This includes authorizing airplane purchases, but no bids were received for planes to consider.
The board will consider a proposal to purchase adult patient nursing simulators for Lake Area Technical Institute (LATI) during their upcoming meeting. The proposed purchase would provide LATI with three "Nursing Anne Simulators" from Laerdal Medical Corporation if approved. These simulators are designed to provide realistic training for nursing students in various healthcare scenarios.
Details of the Purchase:
- Quantity: 3
- Product: Nursing Anne Simulator Medium (320-05050)
- Description: Includes manikin, wig, pupil set, female genitalia, ostomy set, blood pressure cuff, lubricant spray, silicone dressings, subcutaneous injection pads, simulated blood, adult gown, and user guide.
- List Price: $21,299.00 per unit
- Total Price: $63,897.00
The proposal also includes the following additional services:
- On-site installation: $8,397.00 (includes unpacking, setup, software installation, and product inspection)
- LLEAP Software Licenses: $17,481.18 (provides access to simulation software)
Total Cost: The total purchase cost, including simulators, installation, and software licenses, is estimated at $90,633.18.
The new simulators are expected to enhance the nursing program at LATC by providing students with a more realistic and interactive training experience. This can lead to improved skills and better preparedness for real-world healthcare settings.
The board is considering purchasing a skid steer loader for Lake Area Technical College (LATC). The loader would support various programs at the technical school.
Details of the Proposed Purchase:
- Vendor: Eastside Equipment, Watertown, SD
- Model: Kubota SVL972HFC Skid Steer Loader
- Features:
- Final Tier 4 Certified Kubota Diesel Engine
- Electronic Travel Torque Management System
- Vertical Lift Path Loader Frame
- Standard Front Quick Coupler
- Loader Arm Self-Leveling
- Open ROPS/FOPS (Rollover Protective Structure/Falling Object Protective Structure) Cab (optional enclosed cab available)
- 23.1 gpm Auxiliary Hydraulics (standard, 40.0 gpm option)
- Rearview Camera
- KubotaNOW Telematics
- Lockable DEF Cap Guard
- Hydraulic Joystick Controls
- High Back, Adjustable Seat with Suspension
- Attachments Included:
- 80" Heavy Duty, Low Profile, Long Floor Bucket
- Block Heater
- Radio
The total cost of the skid steer loader, including attachments and delivery fees, is estimated at $75,947.40.
The skid steer loader is expected to be a valuable asset for several programs at LATI. It can be used for various tasks such as:
- Landscaping and grounds maintenance
- Construction projects
- Material Handling
- Snow removal
LATC is seeking approval to bid on a substantial amount of new equipment for its various technical programs. The district has outlined a list of proposed purchases totaling over $2 million, which will be presented to the school board for consideration.
The equipment, which includes a wide range of items from automotive technology trainers to surgical booms, is aimed at enhancing the educational experience for students enrolled in programs such as automotive technology, building trades, heavy equipment operation, law enforcement, medical/fire rescue, nursing, precision machining, robotics/electronics, and surgical technology.
Breakdown of Proposed Purchases:
The district has identified a need for the following equipment and estimated costs:
- Automotive Technology: $144,000 for automotive technology trainers
- Building Trades Technology: $573,500 for scaffolding planks and a commercial crane
- Heavy Equipment Operator: $195,000 for a semi-tractor and heavy equipment simulator with GPS
- Law Enforcement: $98,000 for a driving simulator
- Medical/Fire Rescue: $216,500 for a fire truck
- Nursing: $165,194 for neonatal and obstetric patient simulators
- Precision Machining: $140,000 for a wire electrical discharge machine (EDM)
- Robotics/Electronics: $250,000 for CNC for robot cell, automation sensors, 3D scanner, and fusion laser
- Surgical Technology: $409,128 for surgical lights and a surgical boom
Total Estimated Cost: $2,211,322
A potential property lease for the nursing program at the Capital City Campus is also on the agenda.
The board will also discuss curriculum matters, including the first reading of policies ACAA and IJNDC and a summer curriculum update.
Financial decisions will be a cornerstone of the meeting. The board will review and approve bills, consider a park and recreation facility agreement, and deliberate on a surplus resolution.
Watertown School District and Watertown Parks and Recreation Department have entered into a facility-sharing agreement to optimize the use of community resources and promote shared recreational opportunities. The agreement, effective for the 2024-2025 school year, outlines a mutual exchange of facility access and financial considerations.
Under the agreement, the Watertown School District will pay the Watertown Parks and Recreation Department $10,000 for using various facilities. This fee includes a $4,500 credit for the early termination of a previous agreement to utilize the City Auditorium.
Specific facility usage and costs include:
- Prairie Lakes Wellness Center Active Heating Sports Zone: $7,500 for the 2024-2025 school year
- Cattail Crossing Golf Course: $4,000 for two seasons and a cross-country meet
- Other City Facilities: $3,000 for up to 50 hours of use, and additional hours will be billed at $75 per hour. Facilities included in this category are the Ice Arena, Prairie Lakes Wellness Center Pool and Member Gym, Racquetball Courts, and the Fieldhouse Turf.
In addition to the financial arrangement, the agreement outlines a reciprocal use of facilities. The Watertown Parks and Recreation Department will have access to Allen Mitchell Field upon request, while the Watertown School District will have access to softball fields at the Premier or Koch Complex.
The agenda also includes a change order for the Athletic Complex Phase II and a request for proposals for underwriting services.
The Watertown School District has issued Change Order No. 1 for the ongoing construction of the Athletic Complex Phase 2 project. The change order, dated August 7, 2024, outlines several modifications to the original contract with Hasslen Construction.
The primary changes to the project include:
- Reductions in concrete work: Modifications to the grandstand footings and foundations resulted in a $3,735.24 cost reduction.
- Grandstand deck material change: The material has been revised to an interlocking anodized aluminum system, reducing the contract amount by $69,480.52.
- Additional work for water cap: Due to requirements from Watertown Municipal Utilities, a water cap and road patch were added to the project, increasing the contract amount by $4,731.00.
As a result of these changes, the total contract amount has been adjusted from $10,839,400.00 to $10,770,915.20, reflecting a net deduction of $68,484.80. The change order does not affect the project timeline, with substantial completion still scheduled for July 12, 2025. The project's construction contingency has been adjusted to reflect the changes outlined in the change order. The remaining construction contingency is now $594,354.80.
The Watertown School District is seeking proposals from underwriters to finance Phase II of the Athletic Complex construction project. The district is looking to issue Capital Outlay Certificates to fund approximately $3.2 million for the project.
Firm | Construction Funds | Bond Counsel Fees | Printing | Registrar | Underwriter's Discount | Bond Insurance | Contingency | Total to be Funded | Total Interest | Total Debt Service | Interest Percent |
Colliers Securities LLC | $3,202,703 | $6,066 | - | $1,200 | $16,830 | $15,250 | $3,825 | $3,245,874 | $1,548,575 | $4,608,575 | 3.87% |
D.A. Davidson & Co. | $3,320,000 | $6,571.50 | - | $1,100 | $12,106.75 | $15,250 | $4,628.40 | $3,363,487.90 | $1,806,321.53 | $4,871,321.53 | 3.96% |
Two firms, Colliers Securities LLC and D.A. Davidson & Co., have submitted proposals for the underwriting services. Both firms offer competitive interest rates and utilize the State of South Dakota's State Aid Pledge Program to enhance the district's credit rating.
Based on the submitted proposals, the Watertown School District recommends selecting Colliers Securities LLC as the bond underwriter for the Athletic Complex Phase II construction funding. Colliers Securities offers a lower interest rate of 3.872% compared to D.A. Davidson & Co.'s 3.955%. This lower interest rate will lower overall debt service costs for the district.
The proposed certificates' 20-year amortization schedule indicates an average annual payment of $227,375, with the first payment due in August 2025.
The district's participation in the State Aid Pledge Program administered by the South Dakota Health and Education Facilities Authority (SDHEFA) is instrumental in achieving a favorable credit rating of AA+ from S&P Global Ratings, contributing to lower interest costs.
If approved, the school district will proceed with the necessary steps to finalize the underwriting agreement with Colliers Securities LLC and issue the Capital Outlay Certificates for the Athletic Complex Phase II construction project.
The meeting will conclude with administrative reports and the approval of the 2024-2025 Consolidated Application.
Stay tuned to KXLG News for individual in-depth stories following the meeting.
Download PDF
