Reserve funds: A means of survival

According to Governor Cuomo, the state aid to education cut was 2.3 percent, and school districts have more than enough money in their fund balances to get through this terrible financial crisis.

I can't speak for other school districts, but I know that the North Syracuse Central School District would lose $6 million under the governor's plan. The number is really $9 million, but the school board designated $3.1 million in Federal Jobs Fund Money to save approximately 40 positions for next year. Jobs Fund Money will no longer be available after June 30, 2012. The $9 million reduction amounts to a 15.7 percent loss for North Syracuse, not 2.3 percent.

What about the fund balance issue:

First, keep in mind that we have a shortfall of approximately $12.7 million.

Secondly, we are projecting a fund balance reserve of $4,787,784 or 3.53 percent of our budget, as of June 30, 2011. New York State law allows school districts to reserve 4 percent of the budget as an unrestricted fund balance. Last year, we had $3,502,996, or 2.59 percent. I only wish we had more!

Let's look at the school district's reserves. Remember-reserves are to pay expenses which are likely to occur or have been incurred. Our local share of total reserves, which amounts to $4,931,337, are the following:

+ Debt Service ($3,143,997) pays the local share of renovation projects previously approved by voters and the local share of anticipated future projects. Expenditures from reserves must be authorized by district voters for the project specified in the proposition.

+ Tax Certiorari Reserve ($299,998) used to pay judgments, claims and tax certiorari awards by the courts.

+ Liability Reserve ($44,341) is used for property loss and liability claims.

+ C-NS Athletic Complex Reserve ($301,520)-in their wisdom, voters approved this reserve fund in 1998 to pay the local share of replacing the turf field and refinishing the track when it became necessary at a future time. At that time, any expenditure from this account must be approved by district voters.

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