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December 18, 2009

DiNapoli: Baldwinsville CSD Overestimated Expenses by $11.3 Million and Overfunded Reserves by $7.7 Million

Over two years the Baldwinsville Central School District overestimated expenses by $11.3 million and used the surplus to overfund reserve accounts by more than $7.7 million. This surplus could have been used to significantly reduce the districtís property tax rate, according to an audit released today by State Comptroller Thomas P. DiNapoli.

"Setting money aside for a rainy day is a good idea, but reserves have to be funded the right way," DiNapoli said. "All across New York, families are struggling to make ends meet. Now is not the time to be over-taxing homeowners. The Baldwinsville Central School District needs to more accurately estimate its expenses, stop overfunding reserves and use the money to reduce the tax levy or pay for one-time expenses."

The audit, which looked at the districtís finances for the 2006-07 and 2007-08 fiscal years, found the district did not make sure its budget estimates were reasonable and did not maintain reserves in accordance with state law. By underestimating revenues and overestimating expenses, reserve funds have increased to more than $16 million.

Additionally, auditors discovered the district allowed a former interim superintendent to defer salary payments so she could collect her full pension while still working full-time for the district in the 2002-2003 school year. Since that time, the former interim superintendent has received salary payments of $87,690. DiNapoliís auditors referred their findings to the New York State Teachers Retirement System for review.

DiNapoliís auditors recommend the district:

  • prepare budgets that realistically estimate the revenues and appropriations needed to finance district operations;
  • include an accurate budget provision for the amount the Board intends to transfer to reserves and other funds;
  • properly account for and report post-retirement health insurance costs and the moneys held by the district to fund the costs;
  • review all reserves currently established and determine if the balances are necessary, reasonable and in compliance with statutory requirements;
  • use the surplus fund balance to benefit district taxpayers, including increasing necessary reserves, paying off debt, financing one-time expense or reducing district property taxes; and
  • review the employment status of any retirees paid by the district and verify they are properly reported to the retirement systems.

District officials generally agreed with the auditís findings and have indicated they will take corrective action.

Click here for a copy of the audit, or go to

School District Accountability
In order to improve accountability of the stateís schools, DiNapoliís office will audit all of New Yorkís school districts and Boards of Cooperative Educational Services by 2010. The State Comptroller's office has completed 700 school audits and approximately 30 school audits are currently underway.


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