Monday, September 24, 2007

District looks to audit budgeting practices


A comprehensive retooling of the way budget numbers are determined and audited in the Santa Barbara School Districts is on the horizon.
A Proposal from one private auditing firm will be presented to the board of education at tonight’s board meeting, according the agenda.
The need for an independent eye when dealing with budgetary matters stems from miscalculations that left the districts with a $2.8 million surplus, which came on the heels of $2.5 million in budget cuts.

Since the surplus was uncovered in June, board members have demanded that arts and after school programs that were cut, be reinstated.
But questions loom as to how reinstating those programs will impact the district in years to come when drastic budget shortfalls are predicted.
“That becomes the point of discussion,” said Brian Sarvis, the district’s superintendent. “Whether we can actually afford to restore programs now that were cut in April or by doing so [would] we simply be put in the position of making larger cuts in the future?”
Sarvis said the $2.8 million identified as surplus is above a state mandated reserve, which is three percent of the district’s total budget.
He said the projected surplus during 2008-2009 will be just over $1 million and for 2009-2010 will be negative $2.1 million.
But future questions aside, Sarvis said accurate accounting needs to be restored to the district’s Department of Fiscal Services as soon as possible.
“I know full well that there’s a real lack of confidence in this,” Sarvis said. “Budget problems are nothing new to the district, [but] while they’re not new ot the district, the problems must be fixed.”
Sarvis said two independent firms have been asked to submit proposals to the district outlining what they can do and at what cost.
The two firms that have been solicited for proposals are School Services of California and Fiscal Crisis Management Team (FCMAT).
The proposal from FCMAT has been submitted and will be discussed at tonight’s meeting.
Sarvis said three things need to be evaluated by the chosen auditing firm.
The first is a possible reorganization of the district’s fiscal services department.
Sarvis said this could include bringing on more employees, which is one thing Ed Diaz, the district’s assistant superintendent of business services, has said needs to happen.
Since the budget surplus was uncovered in mid summer, the only public resignation came from Robert Wolf, who was the district’s Director of Fiscal Services.
Wolf, who had held the position for less than two years, resigned from his post in mid August. Though neither Diaz or Sarvis have pinned the blame for the budget inaccuracies on Wolf, he became the odd man out. Shirley Corpuz is the district’s new Director of Fiscal Services.
The chosen firm will also conduct an analyses of the current budget and complete a three-year analyses of the budget.
The proposal from FCMAT estimates the cost of its services at $15,000.
“The goal is to make sure we have accurate numbers,” Sarvis said. “We feel that we need more scrutiny in all those processes.”
But even if the districts manage to appease requests by board members and some community members to reinstate cut programs, the fallout from the surplus is likely to continue.
The more than 800 member Santa Barbara Teachers Association has demanded that the district reenter collective bargaining in regards to a multiyear labor agreement reached in February.
“The Association is taking this action due to the fact that the District provided grossly inaccurate data during the 2006-2007 negotiations,” a letter sent by Ken Stevens, the Teacher Association’s negotiations chairperson. “Thus, we were bargaining under false pretenses.”
The board letter for tonight’s meeting recommends the board reopen negotiations, but says, “The District believes that the rationale used by the Santa Barbara Teachers Association is erroneous and rejects the statement that we provided grossly inaccurate data and were bargaining under false pretenses.”
Layne Wheeler, president of the Teachers Association, said he’s in favor of the private auditing firm and hopes the district’s budget woes will get sorted out sooner than later.
“We want the financial ship to be well managed and it appears the district is doing everything they can to make that happen,” he said.
The board of education begins at 7 p.m. at the district’s Administration Center at 720 Santa Barbara Street.

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