Guest Column: Taking stock of district resources

Written by Michael Jumper
Thursday, 05 November 2009 00:00

As we look to the Dec. 8 referendum on whether to allocate capital reserve funds for playing fields and cultural arts facilities, this seems like a good time to take stock of building conditions, maintenance programs, and the financial resources of the Katonah-Lewisboro School District.

The maintenance of district facilities is a continuous process. Each year, a thorough inspection is conducted at every building. A written report identifies the condition of 50 structures, utilities, and systems, along with any work that is needed and its expected cost. This information is used to update the district’s facilities plan, which summarizes short- and long-term goals and projects for each facility. The current inspection reports confirm that all of our facilities are in at least “good” condition, but it is recommended that we build a storage facility on the high school campus and improve the air quality in our bus garage, projects being reviewed by the district.

The district has 17 construction projects underway; they have been completely funded by various sources including EXCEL, New York City Department of Environmental Protection, prior year inter-fund transfers, and BANs (bond anticipation notes). The value of these capital projects exceeds $12 million. We do not need to raise taxes or budget for any of this work.

In August 2008, The Portolan Group performed an independent audit of the district’s operations and maintenance performance, related ratings, and condition of facilities. It identified potential areas of improvement that would help make “a good program better.” These areas of improvement largely relate to organization, time management, and utilization of existing resources, not increased capital expenditures.

With respect to financial resources, over the past several years the district’s external auditors have commented on the district’s healthy balance sheet, which, in turn, is a product of good fund equity and sufficient reserve funds. In addition to the capital reserve fund, the district has established and funded 10 additional reserve funds. Currently, there is in excess of $14 million in these reserve funds. For a complete list of these reserve funds and the dollar amount in each, visit the district Web site.

Just as homeowners evaluate their savings before making an expenditure, taxpayers should look at the state of the district’s reserve funds before considering whether to approve the Dec. 8 referendum. One difference, though, is that while homeowners may access their savings as they wish for whatever purposes they choose, the district cannot tap a reserve fund for any purpose other than the specific purpose established for that reserve. For example, the Reserve for Unemployment Insurance may only be used to pay unemployment claims. Similarly, the capital reserve fund may only be used for “developing the AP Farm Athletic Fields and/or renovating other school district fields and/or renovating high school cultural arts facilities and/or renovating other district classrooms and/or replacing boilers or HVAC equipment in district buildings.” The purpose of this long-established rule of reserve fund segregation is to ensure that taxpayers know where their reserves are being held, why the district is setting aside those tax dollars, and, ultimately, how those dollars will be spent.

This is not to say that the district lacks an emergency fund. We maintain a state-authorized, non-specific, undesignated fund available for general purposes. If there were an emergency and an unforeseen repair was needed, we would first look to insurance. If there were no coverage, we could tap into this undesignated fund, which contains approximately $4 million, the maximum allowed by law. This undesignated fund provides us with a cushion against unforeseen or emergency expenses.

As outlined above, the district has strong processes for evaluating infrastructure needs, guarding against unforeseen expenses, and monitoring its financial status. These processes allow the district to recommend what it believes are appropriate expenditures. The Dec. 8 referendum will be presented to the community in the context of those procedures and the status of the district’s finances and facilities.

Mr. Jumper is the Katonah-Lewisboro School District’s assistant superintendent for business.