Budget committee flags $700,000 HRA encumbrance, rising PERS and fuel costs as risks to 2026–27 plan

At the North Wasco County SD 21 budget committee meeting, Chief Financial Officer Dan Peterson pointed to several items that could require technical adjustments before adoption: a roughly $700,000 HRA accounting encumbrance discovered in the budgeting system, a large PERS bill and transportation fuel assumptions that committee members said may be underbudgeted.

"There is this weird thing in the budgeting software...we had a $700,000 hit," Peterson said, describing an HRA (health reimbursement account) encumbrance that had been recorded in a way that understated prior-year expenses. He told the committee the amount is an accounting/encumbrance issue that will be cleared up as payroll and encumbrances settle during the fiscal year but that it required adjustments to the budget presentation.

Peterson also called attention to PERS, saying, "$8,134,265 — that's the cost of PERS. That's 12.5% of our entire budget," and warned that PERS rates are projected to rise again in the future as the district's side account used to partially buy down rates is set to expire in late 2027/early 2028.

On transportation, committee members noted the fuel budget decreased from a prior-year budgeted $170,000 to $150,000 in 2026–27 while actuals in one recent year were around $114,000. One member said higher market fuel prices make an increase likely; the committee asked the transportation director and CFO to prepare a proposal quantifying any needed midyear correction and potential offsets to preserve a legally balanced budget.

Committee direction: staff will return at the next meeting (May 12) with detail on the HRA encumbrance correction, proposed transportation adjustments and clearer mapping of district-wide special-education FTE and expenditures.