As you may have seen, Spackenkill made the news yesterday with reports about the District’s financial operations. Since you may hear conversations in the community about the report and resulting news articles, I thought I would share with you some of my views on the highlights.
How Spackenkill will use the report? The Comptroller’s report is very useful in pointing out opportunities for Spackenkill to improve internal procedures related to fiscal operations. These procedures involve who does what in the business office, and in what sequence. Most of the comments concerning fiscal operations relate to actions being taken out of sequence, or actions that were taken but not documented. In some instances, functions were performed by the “wrong” people in the business office. As reports indicate, the business office had corrected a majority of issues raised before the report was issued. Some recommendations will require staff training that will take place over time and on a continuous basis. Others call for a realignment of staff roles in the business office, and these changes will be recommended to the Board of Education for the 2009-10 school year. In summary, the report includes useful recommendations and the District has either acted or plans to act on all recommendations.
Are taxpayer / district assets being used properly? With the exception of a $19 error, there were no misappropriations of funds actually uncovered during the course of the audit. To put this in some perspective, the audit covered 17 months of financial transactions for an organization with revised budgeted expenditures for 2006-07 of $31.9 Million. The Comptroller’s review of Spackenkill’s fiscal operations lasted over a year, suggesting it was rather thorough.
What about the separation payments of $17,839 to two employees? The Comptroller correctly points out that there were no provisions to pay this amount to these employees as separation payments. While true, the Comptroller doesn’t say that the District owed the money to these employees. These employees had contracts that permitted them to work during vacation periods and accumulate vacation time for later use. When they retired, they had accumulated a significant number of vacation days and could have simply stopped working when they did and gone on vacation before they actually retired. There would have been no difference in the number of days they actually worked for the District or the amount of pay they received.
Can the District really save $30,000 by printing checks in-house? No. The District simply disagrees with the Comptroller’s cost analysis because it includes only the cost of checks and a printer. It does not include software, staff training, staff time, trouble-shooting and support, or transition costs. It also ignores the fact that payments for payroll must be produced on time, every time, and without error, which it has in the past. By using BOCES to print checks, the District brings greater resources and “back-up” options that are simply not available in-house. The Comptroller analysis also ignores the amount of BOCES aid generated by using this service. BOCES aid for the 2006-07 school year was $934,975, and the aid generated by having BOCES print checks is included in this figure. While it is understandable that the Comptroller would ignore BOCES aid from a state perspective, the District is clearly acting in the best interests of District taxpayers by taking this opportunity to generate as much state aid as possible.
If any of you have questions or concerns about other aspects of the audit or the district’s response to the audit, please let me know. I believe it’s important for District employees and our taxpayers to have an honest and straight forward view of the audit.