“I’ve got good news and bad news for you,” Mammoth Unified School District Interim Finance Director Michele McClowry told the Board of Education Thursday night, during what would be her final presentation. She explained to an incredulous Board and assembled public that while handing off her duties to the district’s new full-time Business Manager, Donnie Salamanca it had been discovered that last fiscal year’s 2011-2012 unaudited budget actuals had an extra $100,000 floating around in them.
McClowry said that the District’s reserve, originally estimated at about 29% of the operating budget for last year, was actually closer to 40%, in light of the found funds. The money was discovered after McClowry and Salamanca closed out last year’s budget, and were making some streamlining changes to the Accounts Receivable and Accounts Payable process, to make them function on more of an “accrual basis,” preferred by Certified Public Accountants.
When running the final AR and AP reports, money that the District owed and was owed, some of it dating back as far as 2009 and 2008, amounted to a final balance of about $100,000 in extra unassigned money. The money wasn’t hidden, she indicated, but rather something akin to hiding in plain sight, waiting to be discovered, which happened when the budget and accounting processes were retooled.
“Some of the money we found has to be paid back, but most of it is money owed that’s been sitting out there. We are sending out notices to collect it,” she reported.
The discovery was received as a shock, coming just a few weeks after four classified positions in the District had been laid off. Whether the money can be used to recover any of the shed positions is yet to be determined by the District and the Board, but McClowry’s forecast doesn’t seem to indicate the Board should start reversing its austerity stance, even with the found funds.
“You’re still in a serious multi-year situation,” she advised, pointing out that only a minor amount of the funds might be considered ongoing money owed to the District. Essentially the $100,000 helps bring the reserve projection for fiscal year 2014-2015 from -3% to 0%. The District, meanwhile, still has more work to do to close an $800,000 budget deficit, which still sits at almost $600,000 after the recent layoffs, and other attrition and cost-saving measures.
Currently the District is in contract renegotiation talks with the Mammoth Teachers Association union. Those talks recently reached an impasse, and have triggered mediation proceedings.