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Explanation of GCSD's designation as a district "susceptible to fiscal stress"

Jan. 22, 2014—On Jan. 16, New York State Comptroller Thomas P. DiNapoli released the first report of the state’s new Fiscal Stress Monitoring System. Using financial indicators that include year-end fund balance, cash position and patterns of operating deficits, the system creates an overall fiscal stress score which classifies whether a district is in "significant fiscal stress," in "moderate fiscal stress," as "susceptible to fiscal stress," or "no designation."

DiNapoli's office evaluated 674 school districts with fiscal years ending on June 30, 2013. According to the report, Guilderland Central School District is classified as one of 52 districts “susceptible to fiscal stress,” having earned a fiscal stress score of 26.7 percent out of 100 percent.

The fiscal stress scores are based on financial information submitted as part of each district's ST-3 report filed with the State Education Department as of Dec. 13, 2013. Scores were determined using financial indicators that include year-end fund balance, cash position and patterns of operating deficits.

“Even though we received this designation, our district is in good standing,” said Superintendent of Schools Dr. Marie Wiles. “We have been very public in how we manage our resources and are confident that we are using our resources efficiently.”

Of the seven financial indicators used by the Comptroller’s Office, Guilderland was noted for having a lower than recommended year-end fund balance.

“Guilderland has a planned, long-term approach to using its reserves and fund balance each year,” said Wiles. “This plan includes a gradual waning of reliance on these funds in future years. Last year, for example, the district decreased its use of fund balance from $2.45 million to $2 million. This was a planned reduction, as outlined in the district’s five-year financial plan.”

“We know what we have been doing, and it has worked well considering the reductions in state aid schools throughout the state have seen. Had we not used money from our fund balance, the district would have had to make additional reductions to its educational program in order to stay within the tax levy limit,” Wiles added.

Guilderland was also mentioned in the report for its cash on hand as percentage of monthly expenditures. The district’s cash per average monthly expenditures was rated at 99.5 percent by the Comptroller’s Office. Had the district’s ratio been 100 percent—the state’s next threshold level—it would not have been designated a district “susceptible to fiscal stress.”

“The monitoring system uses broad ranges that, when combined with a weighted evaluation system, may not accurately reflect the true differences among school districts of fiscal stress when designations are applied,” said Assistant Superintendent for Business Neil Sanders. “The system is intended to be an indicator of potential fiscal stress but not a determination that fiscal stress necessarily exists.”

“The slightest shift in weighting or value, in our case a 0.5 percent change, could make all the difference for a district like Guilderland who is right on the cusp of being designated,” Sanders added.

For more information on the Fiscal Stress Monitoring System, please visit the Office of the State Comptroller’s website: http://www.osc.state.ny.us/localgov/fiscalmonitoring/pdf/FiscalStressSummaryResultsSchoolDistricts.pdf

 

 

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