ISD 88 investment, budget, staffing updates

School Board canvassing, two incumbents, one new member

NEW ULM - During Tuesday's Study Session, New Ulm Public Schools Business Manager Matthew Moline gave a presentation on district investment earnings, budget and staffing. 

Moline said the amount invested fluctuates depending on the amount of idle money.

As an example, Moline said "Hey we just got this big tax payment in from the county. We can probably put this in a CD (Certificate of Deposit) for three months until the bonds are due."

A CD creates interest through an agreement to keep a certain amount of money in an account for a determined period of time.

Market rates also determine when investments are made. 

"We really can only do what the market allows us," Moline said. "If they're dropping rates we're going to make less money."

Moline said that the district is very limited with the investments they can make. 

"We don't get to own actual stock," Moline said. "It's basically CDs and some other bonds."

Currently, District 88 has funds in MN Trust and MSDLAF (Minnesota School District Liquid Asset Fund), along with CDs and savings accounts. 

Total earnings through these bring in approximately $34,000 a month in interest alone. 

During the year, roughly $3 million was invested at any given time. 

Moline said that in addition to the $34,000, scholarship fund CDs made $44,500. 

"That helps go right back out to the students," Moline said. 

Moline then gave an update on the General Fund for fiscal year 2026, all of which is subject to change as the year comes to an end.

Both revenue and expenses exceeded the budget, revenue by $262,000 and expenses by $591,200. With these and the $1.98 million budget cut decided on in April, there has been a loss of $1,057,300 in the General Fund. 

The current amount in the General Fund sits at $4,034,457.

In 2025, the General Fund lost $1.8 million.

Moline said that despite the losses, they are still ahead of the fund balance policy they follow. 

"That's where we hope to stay," he said.

Lower expected enrollment, taking on two months of costs following the teacher health insurance alterations and about $400,000 of special education services resulted in exceeding budget expenses. 

"SpEd (special education) is reimbursed at a certain amount but we won't see that money until next year," Moline said. 

One-to-one support, special transportation and nursing support all contribute to special education expenses. 

Superintendent Sean Koster said that new students moving into the district who need IEPs (Individualized Education Program) account for many of the expenses exceeding the budget. 

"They weren't here last year so we couldn't budget for them," Koster said. 

Moline wrapped up the presentation talking about 2027 staffing projections. He said that teacher lane changes (increases to teacher salary following completion of additional schooling) are already up from the average by $20,000 for the 2027 fiscal year, currently sitting at $58,000. 

In regard to substitute teachers, Moline said that for the current school year, $41,000 has already been spent. Last year $440,000 was spent on substitute teachers. 

There have been more substitute teacher needs with teachers taking longer leaves. 

While reflecting on the budget, Groebner said that recent legislative changes have had significant impacts. 

"Districts have to make cuts across the state because of these costs that we have to incur now that we never used to have to incur," Groebner said. 

The ISD 88 Financial Audit is due December 31. 

Prior to the study session, Board members canvassed the school board election, certifying the 2026 results. 

Three seats, each having four-year terms, were up for election. Two incumbents, Chair Steve Gag and Board Member Melissa Sunderman ran. School Board Clerk Amanda Groebner, who joined the board in 2019, decided not to seek reelection. 

This final seat was filled by Tara Nilson. Nilson is from Northeast Minneapolis and moved to New Ulm in 2010. She is a stay-at-home mom with two children in the school district. Priorities for Nilson include advocating for classroom resources and focusing on student/teacher mental health.

Steve Gag received the most votes, with 6,883. Melissa Sunderman had the next most with 6,322. Tara Nilson finished with 6,049. There were 224 write-in votes.

The three terms will officially begin the first Monday in January 2027.