Fiscal Monitoring System

Unrestricted cash, late arriving invoices, and delayed state aid lead to “susceptible” designation for DCS in state fiscal monitoring system
Posted on 02/01/2022
The Dolgeville Central School District has implemented a plan to create and fund reserve accounts well in advance of the recent annual Fiscal Stress Monitoring System review by New York State Comptroller Thomas P. DiNapoli, who designated the district as “susceptible to fiscal stress.”

Under the “fiscal stress monitoring system,” the New York State Comptroller assesses the financial health of school districts by using a variety of factors, including year-end fund balance, cash position and patterns of operating deficits. It then assigns them a score between 1-100 percent. A score of between 65-100 percent signifies “significant fiscal stress,” anywhere between 45-64.9 percent qualifies as “moderate,” and 25-44.9 percent earns a district a “susceptible” designation. Districts below 25 percent do not make the list.

For the fiscal year ending in 2021, the state issued the Dolgeville CSD a score of 26.7, barely out of the “no designation” category the district was placed in the year before.

“The district is disappointed by this designation, as the state does not recognize the district’s responsible fiscal management to balance funds or our intended use of reserves,” said business manager, Jessica Radley.

District leaders attributed its 2021 classification to the following factors:
  • NYS delayed 20 percent of school aid payments during the 2020-2021 school year;
  • The state monitoring system calculation does not acknowledge restricted reserve funds. (The district utilizes restricted reserves rather than keeping a surplus of funds in  unrestricted cash);
  • The district received invoices that arrived after the fiscal year closed; Last year's expenses needed to be carried as a liability for the current school year.
Over the last four years, the district has created “restricted reserve” funds to pay for various items, which include a capital reserve, vehicle reserve, retirement reserve, insurance reserve, and more. 

“We have available fiscal resources, but they have been placed in reserve accounts through creative fiscal management,” said DCS Superintendent Joseph Gilfus.

“One example showing the district's use of reserves is the recently established transportation reserve fund that allows us to purchase buses with cash rather than borrowing funds; thus saving on interests and fees.

Another great example is utilizing capital reserve funds to offset the communities share with district capital improvement projects. This method keeps the tax impact low or at a zero tax increase when the district needs to improve, repair, or replace facilities.”

Meanwhile, during the past few years, the district has taken the necessary steps to reduce the amount of cash in its unassigned fund balance in order to comply with the advised 4 percent state maximum.

“We continue to do our best to monitor where the State wants us to be and where we believe we should be,” Radley said.

“We will continue to operate under sound fiscal management by funding reserves as planned, while being cognizant of unrestricted cash at years’ end.”
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