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NYS Comptroller

THOMAS P. DiNAPOLI

Audits of Local Governments and School Districts

Freeport Union Free School District – Financial Condition (2016M-300)


Released: December 9, 2016 -- [read complete report - pdf]

Purpose of Audit

The purpose of our audit was to evaluate the District’s financial condition for the period July 1, 2012 through April 30, 2016.

Background

The Freeport Union Free School District is located in the Town of Hempstead, Nassau County. The District, which operates eight schools with approximately 7,000 students, is governed by an elected five-member Board of Education. Budgeted appropriations for the 2015-16 fiscal year totaled approximately $167 million.

Key Findings

  • The District’s unrestricted fund balance was as much as 12 percent of the ensuing year’s budget, or more than three times the legal limit.
  • The Board appropriated an average of $8.7 million each year to finance operations for the 2013-14 through 2015-16 fiscal years but did not use any of the appropriated fund balance because expenditures were overestimated for each of those years.
  • The District maintained five reserve funds with balances totaling $35.6 million as of June 30, 2015, four of which were overfunded.

Key Recommendations

  • Develop a written plan to reduce the level of unrestricted fund balance to legal limits and consider adopting a fund balance policy to require compliance.
  • Discontinue the practice of adopting budgets that result in the appropriation of unrestricted fund balance not needed to fund District operations.
  • Use excess reserve funds identified to benefit District residents in accordance with statutory requirements.

Local Government and School Accountability Contact Information:

Phone: (518) 474-4037; Email: localgov@osc.state.ny.us
Address: Office of the State Comptroller, Division of Local Government and School Accountability
110 State Street, 12th Floor; Albany, NY 12236