The New Albany-Plain Local School District is considering a policy on cash reserves that would trigger action when the carryover balance drops below a certain level.
District officials presented the idea Feb. 10 to the financial review and reporting committee.
Treasurer Rebecca Jenkins said the district is expecting to have a cash balance of $5 million at the end of 2015, which would carry the district through the first 30 days of 2016.
Jenkins said she would recommend maintaining enough carryover cash reserves to pay expenses for three months, between $12 and $15 million, before triggering any need for action.
She said the policy could outline what steps to take when the carryover reserve dips below the recommended level, requiring district officials to recommend the board cut costs or pursue a levy.
Superintendent April Domine said a policy would provide the district with higher bond ratings but also require it to educate community members on the necessity of maintaining a large cash reserve, especially during a levy cycle.
The FRRC members asked if a policy should include a percentage or dollar amount. Jenkins said either could be used.
FRRC member Brian Steel said the district should be conservative, perhaps keeping a 60-day cash reserve, which would not be enough to alarm residents and still maintain good financial stewardship.
Committee members talked about pros and cons of having a policy. In past years, district officials have presented financial information to the board, which decides when a levy is needed.
FRRC member William Neville said he would prefer district officials draft a policy for the committee to review.
FRRC member Phil Derrow suggested being specific in the draft about actions to be taken instead of saying the board should take "all actions" to maintain the carryover balance.
School board President Mark Ryan said the suggestions would be used to craft a recommendation to the board.