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BC audit reveals predictable trends

Administrators foresee PR problem in tax cap

— An independent audit has resulted in a “clean opinion” on Bethlehem Central School District operations, but it has also given weight to a few troubling trends that have been brewing in recent years.

The figures were presented by Chief Business and Financial Officer Judith Kehoe at a meeting of the school board on Wednesday, Oct. 5. The full report, which covers a 12-month period from the end of June 2010 to June 2011, should be online at the district’s website in a few weeks.

Perhaps the most dramatic finding was one the district was already aware of: The fund balance shrunk over the past year. Though the undesignated fund balance (a rainy day fund) is right around the state-mandated maximum, the district spent some of its savings to offset the tax hike in the most recent budget, which played a big role in shrinking that fund by $2.1 million to about $8.9 million.

“We are in good fiscal shape, but the trend is something that’s not positive,” Kehoe said.

“The budgeting process moving into the next year will sadly look much like other years,” she added.

Expenditures were predictably up during the past school year by about $2 million. That’s mostly accounted for in increased employees benefit costs, namely the ballooning amount the district is mandated to pay into the retirement system for its employees.

Simultaneously, revenues shrunk by $2.4 million, mostly due to less state and federal aid coming in. That still includes about $1 million of Recovery Act money, the last the district will see from that program.

In other fiscal news, the district’s cafeterias are in the black for the first time in the past few years.

After operating at a $162,00 loss last year, the first few weeks of the 2011-12 school year has the meal program making a few thousand dollars. This year, the district raised meal prices. At the high school, they went from $2.25 to $3.25 for a full lunch.

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Comments

truthteller 2 years, 9 months ago

Charles - you are a good reporter and writer, but like your predecesor did, you need to verify BCSD's fiscal talking points, they can put on a smooth show.

i think it is important to note that the district misrepresented some key facts: 1) ms. kehoe presented that the percent of unrestricted funds for last year was 4.3% - NOT! the NYS Comptroller's office cited them for having 6.5% of their subsequent year's budget in UNRESTRICTED FUNDS (that is, $1.89-million too much according to NYS law). this money was hiding in the district's 'tax reduction reserve" fund that was illegally established a while ago. according to ms kehoe's presentation, the district (quietly) did away that money this spring (on what we may never know), but it was most certainly not used to close last spring's purported budget gap.

2) the district's final expenses were $2.5-mill under budget last year (10-11). the year before that the district came in about $2.7-mill under budget (09-10). unfortunately, since this district uses last year's budgeted expenses rather than actual expeditures to begin the subsequent year's budget, it is money in the bank for the district. this is called budget smoke and mirrors.

In sum for this year, the district found about $4-million in play money.

I also found it completely ironic that for this year with the tax cap, ms. kehoe discussed how they could above the 2% tax levy due to certain exemptions in the law, creating the purported PR matter. wasn't it absolutely irresponsible (esp given the demographics of this community) that the district locked in at 2% levy last year to create a hole in the budget ?

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