Determine whether the Board and District officials effectively managed the District’s financial condition.
- The surplus fund balance in the general fund exceeded the 4 percent statutory limit for the past three fiscal years. As of June 30, 2018, the District’s surplus fund balance was $2.15 million, which was 4.9 percentage points or nearly $1.2 million over the legal limit.
- During the past three fiscal years, the District appropriated fund balance and reserves that it did not use and generated operating surpluses totaling about $5 million. The District also overestimated appropriations by an average of $2.4 million each year or by 10.5 percent. During this time, total reserves increased by $3.9 million.
- District officials have not developed a comprehensive multiyear financial plan.
- Ensure the surplus fund balance complies with the statutory limit and use surplus funds to fund one-time expenditures or needed reserves, pay off debt and/or reduce property taxes.
- Develop a comprehensive multiyear financial plan.
District officials generally agreed with our recommendations and indicated they planned to initiate corrective action.