Fiscal discipline urged by school district consultants
August 24, 2005
South Lake Tahoe student enrollment declines are still expected, but are a bit less than previous Lake Tahoe Unified School District projections.
However, credit card spending needs to be curtailed, staffing reductions will continue and buses need to be replaced.
Those were among many findings and recommendations in a report by Fiscal Crisis and Management Assistance Team that was hired to analyze the present and future financial state of a penny-pinching district with a brief history of staff and program cuts.
Focusing more on the management assistance portion, the team found the district can maintain the critical 3 percent required budget reserve used only when a district is sinking in a monetary emergency.
“We need careful oversight. We need careful planning,” Teresa Ryland, a school business consultant, told the school board Tuesday night. “We need to continue to develop and implement budget policies and budget standards as you have been doing and doing well.”
While that was the good news, there are several areas the district should look at, Ryland said.
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In all, the team reviewed enrollment projections, multi-year financial projections, developer fees, payments from the South Lake Tahoe Redevelopment Agency to the district, credit card use, maintenance fund, food services, transportation and staffing.
The team examined the county birthrate to determine kindergarten enrollment, a crucial number which gives administrators an idea of future enrollment in elementary, middle and high schools.
Calculating the number of babies born in the county who were enrolled in kindergarten five years later, the team determined 17 percent of county babies become district kindergartners.
The calculation led to a higher projected kindergarten enrollment than the district’s expectation. It led to a projected enrollment decline of 540 students in the next three years; lower than the district’s 617 prediction.
Since the 1996-97 school year, when 5,978 students were enrolled, more than a 1,000 students have left the district. An expensive housing market approaching surreal status receives most of the blame.
“The more that your future resembles the past, the easier it is to do enrollment projections,” Ryland said.
The team also believes the district had too many credit cards, 12, with a total monthly balance from $10,000 to $12,000. There was no evidence of misuse, Ryland said, but the potential was there.
CAL-Cards were recommended. The cards offer more oversight, reduce accounting paperwork and improve processing time, the report stated. Limits and controls, and a handbook, were advised to be implemented.
On the topic of transportation and the fleet of 19 buses, the district lacks bus diagnostic equipment, has an insufficient vehicle maintenance staff of four and should make a bus replacement plan, the report stated.
“Your buses are old and they’re ridden hard,” Ryland said.
Superintendent James Tarwater said a new bus has been purchased for this school year and money will be reserved each year for a new bus.
The team recommended eliminating the director of facilities position, held by Steve Morales, and give those duties to the chief financial officer, a position vacated in June which should be replaced, the report stated.
Currently financial matters are being handled by Tarwater. Tarwater refuted the recommendation to eliminate the director of facilities position.
“Now that I’ve been up here for two months, I see what this kind of climate does (to schools),” Tarwater said. “We’ll always have projects. We’ll always have facilities that need construction and work. That’s one of your most critical pieces.
“I like clean schools, well kept-up schools,” he added. “It’s a hallmark of the community.”
But Tarwater said only one of two open administrative positions – assistant superintendent of curriculum and instruction and the chief financial officer – will be filled.
The report discovered an overestimated average daily attendance, which calculates the number of students attending school and is used by the state to fund districts, in the 2006-07 school year of 95 students. The discovery shorts the district an estimated $450,000. It will be reported to the county office of education.
At the end of the meeting, Norma Santiago, a member of the district’s finance subcommittee, looked over the packet like she just hit the jackpot.
“This is great. This is great. This is very good,” she said.
The finance subcommittee will filter the team’s assessments and advice and turn in its own recommendations to the board late next month.
Five team members visited the district for three days in April to talk to staff, look over documents and gather information. The district’s 2004-05 second interim budget report was the base financial document used. The cost to bring in the team, and its subsequent report, was $10,000, with the county paying for half.
Tarwater said the team will be invited in six months for a follow-up review.
– E-mail William Ferchland at firstname.lastname@example.org