A seemingly innocuous report on the school system’s finances turned into a major concern for school board members who said they didn’t understand where more than $3 million had gone during the 2021-22 fiscal year that ended in June.
ABSS chief finance officer Kim McVey this week presented a quarterly “review of local funds,” detailing how much county revenue that ABSS received and spent in 2021-22, as part of the new superintendent’s previously-announced goal of being transparent about how taxpayer dollars are spent.
Figures presented to school board members Monday night revealed that last fiscal year, ABSS received $44.5 million in county funding; county-funded current expenses totaled $47.8 million during the administrations of then- superintendent Dr. Bruce Benson and former interim superintendent Dr. Jim Merrill. McVey highlighted that ABSS had spent $3.3 million more in county funding in 2021-22.
ABSS started the previous, 2021-22 fiscal year with about $6.8 million in undesignated fund balance (“rainy-day savings”) and had $3.4 million in undesignated fund balance left as of June 30 of this year, McVey told the board Monday night.
The state doesn’t require school systems to keep a percentage of the total budget set aside in fund balance, unlike counties and municipalities, to cover unplanned expenses. But the school system’s auditor recommends keeping at least two to three months of expenses on hand for that purpose, McVey explained.
Several board members seemed taken aback to learn they had gone over budget during the fiscal year that ended in June.
“My question,” school board vice chairman Patsy Simpson interjected, “is how did we overspend by $3 million?”
McVey explained, “In the very beginning [of the 2021-22 fiscal year, fund balance] was allocated to build the budget in the first place, so there had to be some anticipation of utilizing that amount.”
The CFO recalled that, between a delay in the passage of a state budget, in November 2021, and inflation in fuel, utilities, and other expenses, “all of that came together.”
At no time during the discussions about the county budget this spring was it ever mentioned “that we were going to be overspent by that amount,” Simpson insisted, adding, “I would ask you and Dr. Butler, please be clear.”
“I can’t understand what’s happened,” school board member Tony Rose said Monday night.
“We went through this budget process from January to May; we went through Excel spreadsheets. I complained and said, ‘we’ve never been involved in this granular level…’
“I heard you say, Ms. McVey, this was attributed to increased costs in things like transportation and the inability to predict what the state would do, and their budget coming in late,” Rose added. “But $3.2 million? I’ve never seen this; I’m speechless. I don’t think anything has been hidden in the past; as far as I know, we’ve seen everything that’s been brought here. I don’t know, but something doesn’t add up.”