Purpose of Audit

The purpose of our audit was to review the District’s financial condition for the period July 1, 2014 through June 30, 2016.

Background

The Port Jervis City School District is located in the City of Port Jervis, Orange County. The District, which operates four schools with approximately 2,500 students, is governed by an elected nine-member Board of Education. Budgeted appropriations for the 2015-16 fiscal year totaled approximately $65 million.

Key Findings

• Over the five-year period 2011-12 through 2015-16, the District’s unrestricted fund balance exceeded statutory limits.
• Annual fund balance appropriations were not used because budgets resulted in operating surpluses.
• The reserve policy does not state how each reserve will be funded, when reserves will be used or how much will be maintained in each reserve.

Key Recommendations

• Use surplus fund balance as a financing source for funding one-time expenditures, funding needed reserves or reducing property taxes.
• Adopt budgets that represent the District’s actual needs and discontinue the practice of appropriating fund balance that will not be used to fund operations.
• Establish reserve fund policies that identify a clear intent or plan regarding the purpose, use and replenishment of funds, when appropriate.