Budget Committee

 


 

 February 21, 2014 MESSAGE TO TAXPAYERS

The Budget Committee will continue to provide background information regarding the alleged school department deficit and updates regarding next year’s budget. 

We have prepared a document addressing the School Department deficit and encourage parents and taxpayers to take a few minutes to review the information.

CLICK HERE to view Presentation of Issues 

With regard to the FY15 Budget, we have been meeting with department heads (on the municipal side) to review their requests.  On January 6, 2014, at a public meeting, we requested information from the school department.   At the same meeting, we requested possible meeting dates to review next year’s budget request with school officials.  To date (6 weeks later) we have not received the information we requested nor have we been provided with possible meeting dates.  Please review the most recent communication to the School Department’s attorney.

CLICK HERE to view requests for information and meeting dates

CLICK HERE to view video clip of January 6, 2014 meeting

Copies for Budget Committee members of the School Department’s revised budget for next year were delivered to the Town Clerk on Wednesday.  We will be reviewing the school department budget in the coming weeks.

Thank you for taking the time to read our message.

The North Smithfield Budget Committee

 


 

MESSAGE TO TAXPAYERS 

February  5, 2014

The Budget Committee began meeting in January as per the Town Charter to formulate a budget recommendation to the Town Council later this spring.  There is already much finger pointing and conflict surrounding a potential school department deficit.

Unlike the Superintendent, who has an email newsletter circulating to many parents of North Smithfield school children, the Budget Committee has no such vehicle. In an effort to articulate the frustrations we experienced last year as we tried to obtain information, cooperation, and transparency from the Superintendent and School Committee, we list the following. Sadly, the lack of cooperation continues as we attempt to work together to recommend a budget for FY14-15.

The Budget Committee notes the following:

1. The School Department continues to defy the request of the Town Council and the Rhode Island Auditor General to have the School Department audit performed by the Town’s Auditor, not its own.  The Office of the Auditor General has requested that the School and the Town utilize the services of one audit firm.  As a result the Town has recently issued a request for proposal for auditing services for the fiscal years 2014 through 2016.

North Smithfield is the only school district in the state which has not complied with the request of the Auditor General to have the financial records of the Town and School Department audited by the same audit firm. 

CLICK HERE to view  supporting document A.

CLICK HERE to view  supporting document B. 

2. The Town’s auditor found errors in the FY12 School Department Audit performed by the School Department’s auditor. These errors are noted in a letter to the Town Administrator from the Town’s Auditor dated 6/17/2013.

Examples: Fiscal 2012 encumbrances were overstated by approximately $187,036;

Fiscal 2012 budgetary basis fund balance understated by approximately $104,000;

Budgetary Fund balance originally stated as approximately $29,800 should have been approximately $134,000.

CLICK HERE to view  supporting documents.

 

3. Widespread over-funding of certain line items in the School Department budget created a “slush fund” amounting to hundreds of thousands of dollars. These over-budgeted line items were brought to the attention of the School Department by the Budget Committee. The FY 14 budget numbers have been adjusted.

Examples from last year’s budget: utility costs, diesel fuel costs, Out of district Charter School transportation costs, etc., all grossly less than the amount budgeted, totaling hundreds of thousands of dollars.

CLICK HERE to view  supporting documents.

 

4. The School Department failed to budget all anticipated revenue in the budget which was submitted and approved by the Town Council.  As a result, over the past five years the School Department received hundreds of thousands of dollars which could be used to fund unbudgeted expenditures. 

The Budget Committee believes that the School Department should budget all anticipated revenue.  Many school districts/departments throughout the State of Rhode Island include all anticipated revenues either as a component of the School Unrestricted General Fund or in separate Special Revenue/Capital Project Fund budgets if the revenue is to be earmarked for specific purposes.  In accordance with Governmental Accounting Standards, the Town Council will be required to pass an Ordinance if it wishes to commit the miscellaneous receipts to a specific project or purpose other than operations of the School Unrestricted General Fund. 

CLICK HERE to view  supporting documents.

 

5. In an email dated May 28, 2013, Superintendent Linberg stated that the School Department would not meet with the Budget Committee to discuss anticipated FY14 revenue.

CLICK HERE to view  supporting documents.

 

6. Hundreds of thousands of dollars of unbudgeted revenue was spent by the School Department, resulting in overspending the legal limits of the Town Council appropriation.   This was verified by the Town’s Auditor. 

Example in fiscal 2012 the School’s Unrestricted General Fund had an expenditure budget approved by the Town Council in the amount of $21,916,180.  However, actual expenditures (budgetary basis) for fiscal 2012 totaled $22,142,335.  This resulted in the over expenditure of $226,155.  Although the over expenditure was offset with the receipt of unbudgeted revenue it is the Committee’s position that the School Department violated the appropriation Ordinance as a failure to amend its budget and request that the Town Council authorize the expenditure of the additional revenue.

The Budget Committee agrees that the miscellaneous receipts are restricted for use by the School Department.  However, Committee members also believe that the funds are only available once the Town Council authorizes the appropriation.

CLICK HERE to view  supporting documents.

 

7. When requested by the Town’s auditor, the School Department failed to provide the original purchase orders to support encumbrances which were recorded at June 30, 2012.   The School’s auditor and school personnel stated that the original purchase order was not maintained by the School Department.  The system used by the School Department is said to rollover the purchase order at the end of the fiscal year and issue a new purchase order date 7/1.

School districts save original invoices and purchase orders for seven years.

CLICK HERE to view  supporting documents.

 

8. Hundreds of thousands of dollars above the budgeted amounts were spent on capital projects/outlays without approval of the Planning Board, Budget Committee, Town Administrator and Town Council.  Approval of said projects and expenditures is required for all Town departments, including the School Department, in accordance with the Town Charter.

CLICK HERE to view  supporting documents.

 

9. The School Department refused to provide the Budget Committee with requested backup, information such as: invoices, statements from vendors, enrollment documentation.

 

10. Representatives of the School Department failed to attend a joint meeting of the Town Council, Budget Committee, School Committee, and the respective audit firms, held on June 3, 2013, which was called for the specific purpose of discussing many of the issues listed above. The Superintendent of Schools, School Committee Chair and Vice-Chair along with 2 of the other 3 elected school committee members were “unavailable” to attend. All members of the Town Council and Budget Committee were present.

CLICK HERE to view  supporting documents.

 

The Budget Committee urges taxpayers to be fully informed on these issues.

 

Michael Clifford, Chair

Mary Jo Vallee, Vice Chair

Merredythe Nadeau, Secretary

John Winkleman

John Zambarano

PO Box 248  |  One Main Street  |  Slatersville, RI 02876  |  Phone: 401.767.2200

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