DELMAR — At the October meeting of the Bethlehem Board of Education, board members were presented with the school district’s annual financial audit and then voted to bring a proposed $32.1 million bond project before residents on Nov. 29.
“We wanted to remind everybody,” said Chief Business and Financial Officer Judith Kehoe, “how this particular presentation relates to the goals that have been adopted by the board, and its mission overall. The audit effectively provides accountability to the community and, ultimately, the assurance that all taxpayer resources are being well managed. That is part of the value component of the district’s mission.”
“We did your audit for the June 30, 2016 financial statement,” said Heather Lewis of Marvin and Company, a CPA firm based out of Latham, “We tested some of your internal controls, we’re not responsible for giving an opinion on it, but we do give a report on the financial statements, and we believe the statements are materially correct and in accordance with generally-accepted accounting principals.” As far as internal controls, she said, her company found no deficiencies or weaknesses that they felt should be brought to the district’s attention.
“Also,” said Lewis, “because you receive over $750,000 in federal awards, we also have to consider compliance with major federal programs. We did that work and we had no findings in that area either, so it was overall a very clean report.”
Additionally, no issues were identified with the “extra-classroom activity” funds – extracurricular club funding—according to Lewis. “There were no disagreements,” she said. “Management was truthful and accurate. Especially in our first year as your external auditors, we did not have any major issues or anything.”
“Schools districts are required to have an annual independent audit,” said Kehoe, “and the reports need to be completed and submitted to both the State Education Department and the office of the state comptroller by October 15. And, again, there are a lot of taxpayer resources devoted to the support of the school, so it’s part of the accountability that we’re doing what we’re supposed to be doing with those assets.”
Kehoe went on to explain that, last year, the school district ended the year under budget by $2.4 million, which she called a “relatively small percent.” Spending increases, she said, could be attributed to infrastructure upkeep, staffing costs and the expansion of student programming.
“You’ll note the sizable uptick in state and federal aid,” she said. “Remember that that was the first year that we had a pretty sizable, or partial, increase in our Gap Elimination Adjustment and it was really the increase in that aid that allowed us to keep the tax levy at the .45 percent amount.”
Last year’s budget, said Kehoe, went approximately $629,000 over the $94 million target, which she called “pretty close.” “You’ll also note,” she said, “kind of extraordinarily, that the revenues did increase at a rate faster than the expenditures—we were at a 3.07 percent increase on the revenues and only at a 2.45 percent on the expenditures.” Calling it “an anomaly,” Kehoe said the district could expect to see the same this year, due to the final restoration of the Gap Elimination Adjustment, a withholding of state funding to school districts to offset a $10 billion state budget deficit in the 2010-2011 fiscal year. “Obviously,” she said, “the goal is to have the revenues and expenditures growing at about the same rate so that we can break even from one year to the next.”
The fund balance, Kehoe continued, was increased from $12.04 million to $14.89 million last year. The undesignated, or rainy day, portion of that fund was kept within state requirements at just under four percent, and the majority of the surplus went into the district’s capital projects fund to pay toward a capital bond project that will go before voters on Nov. 29.
The district netted a small deficit in its food service program, but, said Kehoe, hoped to make it up this year as early-year revenues have proven to be higher than expected for this fiscal year.
Following the audit and financial presentations, the board voted to put a $32 million bond project before voters late next month. The total capital improvement project would cover 111 individual projects at each of the district’s school buildings, as well as maintenance structures.
The high school would receive just over 50 percent of the funding for projects related to upgrading the auditorium, which is used by community members as well as district students and educators, to the tune of $7.8 million. The upgrades will update the interior, improve sound and lighting systems, replace and extend the stage floor, add air conditioning and new seating, improve accessibility and widen the proscenium, among other things. In addition to the auditorium, the high school would also see improvements to its library media center. At an estimated cost of approximately $811,504, the district expects to purchase new furniture, widen windows and replace carpeting, as well as create “flexible learning environments,” and convert office space to “teaching/learning rooms.”
Other improvements at the high school include improvements to the varsity and junior varsity baseball fields, field drainage improvements, replacement of the stadium press box and bleachers, as well as adding restrooms near the event parking lot.
$3.6 million would go to asbestos abatement. According to the district, all identified asbestos is listed and inspected every six months and, based upon that report, a total of $13.6 million is needed to remove all remaining asbestos in the district. The removal of $3.6 million represents 26 percent of the identified remainder. Another $2.1 million would replace windows at the middle and high schools, as well as at Elsmere Elementary.
Nearly $2 million would pay to upgrade the pools and the high school and middle school, according to the proposal, including fixing tiling and drainage. Another $30,000 would be spent, per building, to install security cameras.
District officials estimate that the project will utilize no more than $4.9 million of the district’s 2015 capital reserve fund and that the fiscal impact to taxpayers will be approximately $40 a year for homeowners with property valued at $250,000. A more detailed breakdown of projects and anticipated costs can be found on the district’s website at www.bethlehemschools.org/potential-bond-project-horizon. Residents will be able to vote on the entire raft of proposed projects during a special district meeting on Nov. 29.