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Thursday, October 13, 2016

The districts unsound budgeting practices

Here is what I know about the budget. The state legislature passed a one percent increase to education funding, yes, just one percent. Duval however dropped the millage rate and our overall budget fell by 40 million dollars and yes why does the QEA get such accolades (fifty million over three years) if we can just cut our budget by that amount and not bat an eye.

However some people are batting an eye such as school board member Becki Couch and as she mentions, it has gone largely unnoticed.

The community wouldn’t know, during this media frenzy that was created by my colleague there was something else taking place that drew little attention, the budget was deferred.  This was the first time ever the budget was deferred due to concerns from the board. Recently, the board discovered the budget had $20 million in unfunded cabinet add on positions. A matter of concern I have brought forward over the last three years. In years past there were a large number of cabinet add ons but the budget had an unrestricted funding source, this year there was nothing. This is a dangerous budget practice and the board was once again backed into a corner to make a decision that they were uncomfortable making because as we were told by our attorney, we would be penalized by the state withholding FTE if we did not approve the budget on Monday. Thus, we were required to use 2% of the 5% fund balance we set aside and “borrow” $8.3 million from the maintenance budget. This money will have to be paid back through lapse salary which the board has given direction before that they wanted to avoid this practice. It is not good budget practice to approve positions at the beginning of the year based on what you hope to get back in lapse salary. This can lead to the appearance of not filling school based positions in order to pay for the cabinet add on positions approved at the beginning of the year (after the board approved the tentative budget). The board requested a one page document during the budget process which included cabinet add on positions. While we received a document, it did not reflect this exorbitant amount.

Maybe getting rid of Vitti for not wanting to put forth ambitious improvement recommendations
wasn't the most feasible plan, but maybe doing so because he repeatedly jeopardizes  the  financial health of the district to expand his cabinet is?

1 comment:

  1. The word is that the total reserves are down to 3 percent or lower, rather than good practice of 10-15 percent. Funds were recently transferred TO the maintenance account to cover what was borrowed. The auditor and the CFO have different account balances (by millions). Why doesn't the board ask about reserve balances?