Study of the Mount Diablo Unified School District - Mt. Diablo Unified ...

District Operations and Associated Financial Effectivenessfunding, the amounts transferred by MDUSD are excessive. Based on data provided by theDepartment of Finance and review of documents, MGT consultants did not find any specificpolicy or procedure related to fund balance other than state requirements establishingminimal levels. Without such a policy or procedure, it is difficult to regulate internal budgettransfers.Fund balance reserves are like savings accounts, and school districts and other organizationsestablish reserves for payroll and other expenditures in the event that regular revenues arenot available. In a school environment any delays in receiving federal or state funding, orany unforeseen expenditures, necessitate having reserves to ensure that the district can payfor regular operating expenditures.Without a fund balance policy, the district may be inclined to over‐spend or commitresources that do not exist.Considerations for Issue 2‐1:• Adopt and adhere to a fund balance policy to ensure that adequate reserves aremaintained.• Hold administrative staff to the proposed fund balance policy and include suchaccountability in the administrative evaluation process. Administrators must notonly effectively manage federally mandated services to students, but also maintain afiscal responsibility to the district.• Develop strategies to reduce the amount of general funding that is provided tospecial education. The current practice will continue to deplete the district’s fundbalance reserves, as well as to diminish resources available for general educationpurposes.Cost Implications for Issue 2‐1:The cost implications of this issue cannot be estimated at this time.Issue 2‐2: Special Education Transportation Budget.MDUSD overspent its special education transportation budget and nonpublic schooltransportation budget for FY 2008‐09 as shown in Exhibit 2‐4. A total of $2.7 million(revised budget) was approved for the period, but actual expenditures exceeded the budgetby $880,471, or almost 33 percent.District staff explained that due to payroll coding errors that were not caught in a timelymanner, these figures are overstated. Although some incorrectly charged expenditureswere identified and corrected, there remains a portion of general fund transportationexpenditures under Special Education transportation that could not be identified.MGT of America, Inc. Page 2‐5