PATRICIA LaFLAM,STEPHEN LaFLAMand FRANK HAY
---- — There has been a lot of discussion about Beekmantown School District's fund balance and how it has been spent.
The Press-Republican has published multiple articles, discussions have occurred at board meetings, and discussions are occurring around the community regarding the fund balance.
United for the Kids would like to summarize the findings from the July 1, 2008-March 31, 2010 audit report from the New York State Comptroller's Office. You can find the report at
The following information will detail the fund balance from the 2009-10 fiscal year, which is the year the fund balance was the highest it has ever been. Highlights from school budgets since 2009-10 will be provided to show how much of the fund balance was used each year.
The entire fund balance was $11.9 million in 2009-10, according to the comptroller's report, but according to state law, a school district is not allowed to have more than 4 percent of the operating budget in a reserve fund. In 2009-10, the allowed amount was around $1.4 million. The $10.5 million was the amount of fund balance above the legal limit.
According to school budgets, for:
2009-2010: $1.75 million of the fund balance was applied to the budget.
2010-2011: $2.75 million of the fund balance was applied to the budget.
2011-2012: $3.5 million of the fund balance was applied to the budget.
2012-13 proposed: $2.1 million is being used. In the last four school budgets, including the current proposed budget, approximately $10.1 million of the original $11.9 million fund balance was used, leaving the district with approximately $1.5 million. This data was presented during the May 8 budget hearing.
These are the facts as laid out in the audit report and proposed school budgets, and while it addresses the amounts that got us from $11.9 million to $1.5 million, it does not address how the money was used.
When you look at the comptroller's report, there were four recommendations for ways to use the fund balance: reducing district property taxes, increasing necessary reserves, paying off debt and financing one-time expenditures.
In general, when you look at the school budgets, it appears that the fund balance was used to slow the growth of the property taxes but not reduce them. Neither was the fund balance used to pay off debt or finance one-time expenditures. Instead the fund balance was used to help pay for recurring expenses.
By using the fund balance for recurring expenses as opposed to one time expenditures, it creates a looming budget crisis when the fund balance has been depleted. For 2012-13, the school budget calls for the use of $2.1 million of the fund balance, but as of 2013-14, there will be little to no additional fund balance remaining, which will leave the school with a shortfall of at least $2.1 million.
By improperly utilizing this surplus money and not addressing budget deficits in a timely manner, the district was lulled into a false sense of security, and no steps were taken to create sustainable savings.
Instead, we padded our last several budgets with fund-balance dollars. Now the surplus is nearly depleted, and we are entering a fiscal crisis.
United for the Kids believes it is important that district residents understand what has happened to the surplus fund balance and how Beekmantown has gone from what appeared to be a strong financial future to two years of contentious budgets and instability.
BCSD has the largest tax base of any local district, including Plattsburgh and Peru. Our district is in a good position to turn things around. These problems can be solved if everyone works together, but first everyone needs to understand how we got here.
— Patricia LaFlam, Stephen LaFlam and Frank Hay are representing the United for Kids organization in Beekmantown.