Audit Finds The BHUSD Budget Short $1 Million
Beverly Hills Unified School District is bracing themselves for another monetary hit. An annual government-required independent audit revealed Tuesday a budgetary shortfall of $934,000 for the current school year.
The audit revealed several misreported entries into the budget under the previous Assistant Superintendant of Business Services Cheryl Plotkin.
The shortfall has compounded over a number of years, said the district’s Interim Chief Business Officer Mary Anne McCabe. “It is one I can not tell (the board) I can recover at this point,” she said. “But procedures will be put into place to not repeat (this).” The loss will be absorbed by the 2010/2011 budget.
The first interim budget was submitted to the state Dec. 15. According to BHUSD Board of Education member Brian Goldberg, the entry had been previously tagged in audits and labeled as a “non-issue.”
It is not entirely certain how the shortfall will ultimately affect the district’s bottom line, programs, or if staff cuts will be necessary.
“I think if we didn’t have this almost $1 million shortfall, we wouldn’t necessarily have to make any cuts,” said Goldberg. “We are being asked to make up for staff screw ups.”
Other fund shortages were revealed but will have no affect on the budget, said Matthew Miller of Vavrinek, Trine, Day and Co. LLP., certified public accountants, the company charged with conducting the independent audit.
“The district has been deficit spending for years,” said Goldberg. “The Los Angeles County Office of Education (LACOE) cautions that we do over $2 million in deficit spending a year. We need to be truly fiscally responsible, accountable, ensure that we have accurate numbers and that we cut all of the fat from the district’s budget. Until we do a line item audit and a zero-based budget, we can’t be certain of that.”
The board will look to replenishing the shortfall in creative ways, such as re-appropriating certain general fund expenses such as turf replacement and roof repair at Beverly High.
Ultimately, the Board will be asked to reduce the 2010/2011 budget by roughly $1.5 million, said Alex Cherniss, BHUSD director of human resources.
The Board of Education will be faced with making some tough decisions in coming weeks.
“The district staff is projecting the need to reduce at least eight certificated positions– teacher positions,” said Goldberg.
“The teachers know where we are overstaffed in teaching positions because we were looking at those cuts last year, but did not make them.”
Under state law, teachers must be notified by March 15 of impending layoffs.
“We anticipate layoffs based on the fact that, as a district, we are declining in enrollment,” said Cherniss. “There is good news too. We are recommending no programmatic cuts for the 2010/2011 school year.”
The transition into basic aid funding, or funding from resident and business taxes and not based on state funding, will help to ease the blow as well.
“Projections for next year are approximately $5 million more than if we were a revenue limit district,” said Cherniss.
“Basic aid is a huge help to this district.”
Other solutions such as natural attrition may also save some dollars for the district.
The board will enter into study sessions beginning Feb. 1 to discuss potential measures to cut costs.
“We will be providing the board with a variety of options to consider to make these reductions at that time,” said Cherniss.
Potential staff reductions, if necessary, will be announced at the Feb. 10 board meeting.