Fiscal Crisis and Management Assistance Team (FCMAT) Chief Management Analyst Michelle Giacomini addressed the Yosemite Unified School District board Monday night on two areas - business office staffing and organization and preparation of an independent multiple-year budget projection.
The FCMAT assistance was requested by the board to guide them in their fiscal planning and budgeting.
“We get involved with districts who need additional solvency help,” Giacomini explained.
The district is deficit spending more than $1.3 million during the current fiscal year (July 1, 2007-June 30, 2018) and about $240,000 and $44,000, respectively, over the next two years putting the district $32,000 below the state mandated 3% reserve.
Giacomini recommended a three pronged approach: 1) Freeze your spending until you figure out your budget. 2) Be brave. 3) You need to make the cuts.
“A budget cut plan has to be made, otherwise I’ll be back,” Giacomini said. “If you don’t get it under control, it gets worse.”
She alluded to the progressive nature of the law, AB1200, which strips a district of its local control if it cannot balance its budget.
The district is currently in the midst of its annual audit. The day of the board meeting, auditors found that the district had not filed a state required Governmental Accounting Standards Board (GASB) post employment benefits actuarial report. As a result, the audit cannot be completed and filed with the state by the Dec. 15 deadline.
“The auditors made a verbal comment several years ago that an actuarial study for GASB 73 must be done,” District Superintendent Cecilia Greenberg said in response. “Last year, a management letter was issued by the auditors indicating that the actuarial study must be done. It was not done last year and current staff was not aware of the requirement until late yesterday afternoon.”
FCMAT and the auditors suggested the district ask Madera County Office of Education to file a waiver on the district’s behalf for an extension of the deadline to allow them time to complete the actuarial report.
If the state does not grant that deadline, the district would receive a “qualified” audit jeopardizing the district’s ability to borrow money.
While Giacomini’s fieldwork in the district office wraps up this week, FCMAT’s full report will not be completed until the end of January at the earliest. Before that, FCMAT’s goal is for their independent audit and the district’s budget plan to show the same outcome.
“This didn’t start today. You have been deficit spending for awhile. . .but it is doable,” Giacomini said. “I wouldn’t want your job.”
Board member Joe Smith asked if FCMAT would make specific suggestions as to where those cuts should be made.
“FCMAT will give the board the dollar total of cuts needed but will not pin point specific areas,” Giacomini responded.
“We had hoped attrition would help [balance the budget] along with increased revenue,” Smith said.
However, the state’s funding formulas have changed, driven by student populations served, more to the benefit of urban rather than rural districts. YUSD’s enrollment has declined and state mandated district contributions for STRS and PERS have risen.
During the public comment portion of the meeting, Danielle Vawter, classified employee bargaining unit president, delivered an emotional plea to the board to recognize and appreciate the multiple hats worn by the district’s employees as they have taken on additional responsibilities due to cuts made in the past.
Stacy Montalto expressed frustration after hearing about all the things that are wrong including the district having to play catch up with regulatory reporting not previously done in a timely manner and possibly costing the district half a million dollars. “I am developing sympathy for Superintendent Cecelia Greenberg,” she said. She referred to an earlier report given the board that Greenberg had gone to the State Board of Education asking for a time extension to file the necessary comprehensive audit reports not completed for previous budget years before Greenberg took over the reins of the district.
Filing for board vacancy
YUSD board member Joe Smith has tendered his resignation from the board effective Jan. 1, 2018. The district will post the procedures and instructions to fill that vacancy on its website, www.yosemiteusd.com; then “District Board Policy under the “Navigation” heading on the left side of the page. You will then be prompted to log in to “Board Policy” with user name: yosemite and password: public. Go to a box on the right under “Search GAMUT” and type in “vacancy.”