Purpose of Audit

The purpose of our budget review was to determine whether the significant revenue and expenditure projections in the District’s tentative budget for the 2014-15 fiscal year are reasonable.

Background

The Liberty Central School District, located in Sullivan County, issued debt totaling $1.3 million to liquidate the accumulated deficit in the District’s general and food service funds as of June 30, 2002. Local Finance Law requires all local governments that have been authorized to issue obligations to fund operating deficits to submit their tentative budgets for the next fiscal year to the State Comptroller for review while the deficit obligations are outstanding.

Key Findings

• Based on the results of our review, except for certain matters related to the food service fund, we found that the significant revenue and expenditure projections in the proposed budget are reasonable.
• District officials have prepared a projection of year-end fund balance for the food service fund while also improving the overall solvency of the fund. However, the food service fund continues to rely on a transfer from the general fund to balance the budget and still has outstanding amounts to other funds.
• The District’s proposed budget complies with the property tax levy limit set by statute.

Key Recommendations

• Continue to prepare projections of year-end fund balance for the food service fund.
• Develop a long-term plan to reduce the need for general fund subsidies to fund the food service fund.