Newberg School District Turns $1.3M Deficit into $1.6M Surplus

The Newberg-Dundee Public School District has turned a major budget deficit into a surplus in just one year, according to the district’s CFO.

Last year, the district began with a $1.3 million deficit, but it starts this school year with a $1.6 million positive balance.

Nathan Roedel, the district’s chief financial officer, said the deficit was primarily caused by declining enrollment, reduced revenue, and the loss of one-time funding sources and grants. Student enrollment has dropped 18% since 2019, a steeper decline than in neighboring districts.

“Through swift action of the board and concessions by employees of Newberg-Dundee schools, we were able to change the district’s financial direction,” Roedel said. “The largest contribution to the turnaround was staff reductions and furlough days.”

Roedel said increased financial oversight and strategic use of furlough days helped bring the budget back into the positive. However, he cautioned that enrollment uncertainty will continue to influence the district’s financial outlook over the next three to five years.

In the 2023-24 school year, the mismanagement of resources depleted a $7.7 million beginning fund balance, plus $1.2 million that was not there, resulting in a negative fund balance.

No part of that swing was due to enrollment or state funding issues, Roedel said. That means the District spent 16% more revenue than was received that year for the district’s General Operating Fund—an overspend of $8.7 million.

Enrollment affects revenue because the State School Fund (SSF) is based on the higher of last year’s weighted student count or the current year’s projection. Newberg’s declining enrollment has gradually reduced its state funding.

“Newberg-Dundee Public Schools is steadily improving its financial health while keeping student success at the center,” Roedel said. “By using data-driven strategies and careful planning, the administration and board are building stability and ensuring a strong, sustainable future for students and the community.”

To address funding shortfalls, the district eliminated 86 full-time positions in spring 2024. Roedel said adjustments have minimized the impact, and the district has only filled replacement positions as staff leave.

“Many reductions made between school years have not affected the classroom environment,” he said. “NDPS students benefit from reasonable class sizes, with student-to-teacher ratios at or below those in neighboring districts.”

The district is exploring ways to stabilize funding and maintain safe facilities, including the potential creation of a boundary and school configuration committee.

“The district changed strategies for many grant funds, utilized reserves, tapped donations, and repurposed activities to improve its financial situation,” Roedel said. “Our current fund balance policy targets 5% plus a 2% contingency. While an operating fund balance of $1.6 million is a good start, more work is needed to meet this target.”

A 5% fund balance currently equals about $3 million, with the 2% contingency adding roughly $1.2 million.

“With the successful completion of the 2021 [general obligation] bond activities, we have time to explore strategies to maintain the community’s investment in local school buildings,” Roedel said.

Voters approved the 2021 bond to fund property tax–based projects for health and safety upgrades, including classroom updates and technology replacements.

“It’s a new year, and we’re scrutinizing everything,” Roedel said. “We’re reviewing all aspects multiple times to ensure we get it right. If changes are needed, we communicate them to the board and community, keeping a close eye on our progress.”

Clarification Sept. 25 at 1:43 p.m.: This story was updated from its original published form to provide more information about the fund depletion from 2023-24 academic school year.