Last year I was stunned to read how after salary freezes, program cuts, and staff reductions in the schools, somehow CCPS ended up with a surplus of nearly $1 million for Fiscal Year 2009. Several thoughts went through my mind as I read the article. First, how can a school system with an operating budget of less than $19 million leave so much on the table? Especially given the cuts. Second, I was amazed at how no one on the Joint Finance Committee lobbied on behalf of the students to have this carryover directed towards the operational or capital needs of the school system. When the carryover was discussed by the Board of Supervisors, it was decided to transfer $500,000 of the nearly $1,000,000 towards the County debt. As I saw it, deep cuts were made into the operational funding of school system, and none of the Joint Finance Committee members felt it necessary to lobby for the funds to address operational / capital needs of the school… technology comes to mind. I’m particularly distressed by the actions, or inactions, of the elected School and Supervisor officials who sit on the Joint Finance Committee, and who are directly tied to the funding of the schools. While I can’t reconcile the latter concern, I think I may have discovered some insights as to what caused the carryover to occur in the first place.
Recently, the Joint Finance Committee invited the accounting software vendor, RDA, with whose system the county has used for the better part of the last two decades, to come in and provide a “Best Practices” analysis. The study was performed this past fall and was given to the Joint Finance Committee on or around December 13th. Yes, the vendor has an interest in selling upgrades for their product but it is unusual to take on an endeavor like this with such honesty. It can be argued that RDA lacks the credentials of the Government Financial Officers Association (GFOA), there is truth to that argument. But it can also be argued that nobody understands the capability of the RDA Software better than RDA. After all, who better to report the difference between the current status of Clarke County financial reporting to what the RDA system can provide? The subsequent text comes straight from the RDA Best Practice report and is centered on the financial data the schools and the county are relying on to track expenditures and make financial decisions. I’ll allow the readers to draw their own conclusions.
“ v. Financial Data in disarray
a) Examples of data issues:
- Encumbrances are either not understood or aren’t a priority. Encumbrance accounting manages the difference between our commitments and year to date activity. This is essential for effective forecasting by administrators.
- Fiscal year 2011 expenditure subsidiary accounts display $33,167,907.51 for encumbrances for the school district.
- Purchase Orders by Account Sum to $23M for School Definition Type and Fiscal Year 2011.
- Entire 2011 budget for the school district is $24M.
- Year to Date expenditures for the school district already over $10M.
- Review of the previous items together reflects a $20M short fall.
- Budget Availability.
- Numerous Accounts still in the system no longer in use.
- COA not adapted with growth of organization.
- Detail level elements for supplies, utilities, etc.
- Summary elements for rolling up reports for leadership and board review.
- Need Location in County Definition type for pulling accurate financial reports by facility.
- Need additional Account Codes based on COA Improvements.
- Reconciliation of cash with bank balances isn’t happening.
b) Key players need training
- Account Managers
- Facility Managers
- County Administration
c) Special Revenue donated from fund-raisers earmarked for specific purposes must be kept out of the general fund and shown on its own project’s revenue.
d) Training on Use and Preparation of Financial Reports desperately needed.
e) Review VA School Accounting Requirements against current setup.
f) Work with key players to develop screen defaults, etc
vii. Budget Preparation doesn’t appear to be implemented.
No evidence budget preparation is automated. High percentage of school budgets are HR related. Leveraging this data will allow very accurate forecasting with minimal effort. Furthermore, this information may again be leveraged when preparing payroll for the next fiscal period. This avoids duplication of work and reduces opportunity for human error.
No Capital Assets.
No Historical Work Sheets or data to provide same.
Moving Allocations while losing historical perspective at times of extreme budget constraint prevents proper planning by decision makers.
Budget Amendments removed. This prevents review of historical cause and affect relationships when forecasting.”
Best Practices Clarke County Open RDA, December 2010
I do not have the ability to cross reference the accuracy of this report but it should be noted that the information contained in the RDA Best Practices was derived by direct input from the county/school end-users of the RDA system. While the full report is much too large to include in this writing, anyone wishing to obtain a copy by downloading it here (RDA Best Practices Clarke County) or by submitting a FOIA request to either the school system or county government office.
This is the type of information the public has a right to know. The RDA report has been available for over 8 weeks and yet nobody on the street has ever heard of itâ€¦until now. When reading the report it is obvious that a tremendous amount of County and School personnel time was spent on this study. In other words, the citizens of Clarke County have a financial interest in this study. In addition, when nearly one million dollars of school operating funds are left unspent, and no one seemed to know about it until after the year was over, it’s a community issue. The Joint Finance Committee and the Board of Supervisors have sat on the RDA report since December 13th. . Hiding the facts, for whatever reason, (fear of “hexing” the financials maybe) does not help the community or the county as a whole.
It is my understanding that in response to this report, the BOS has authorized yet another study. This one was performed by the Government Finance Officers Association (GFOA). I have been told the study will cost between $20,000 and $30,000 and was conducted last week. Given the fact that the County has had at least a month and a half to clean things up, I trust things were found to be in much better shape, in all departments. The question is how did it ever get like this? (The Joint Finance Committee is made up of BOS Chairman Mike Hobert, former SB Chairwoman Robina Rich Bouffault (who will be replaced by Emily Rhodes at the next meeting), Director of Joint Administrative Services Tom Judge, Superintendent of Schools Michael Murphy, and Treasurer Sharon Keeler.)