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Explanation of SGFCSD’s designation as a district “susceptible of fiscal stress”

March 13, 2015

In January 2015, New York State Comptroller Thomas DiNapoli’s office released the second annual report of the state’s Fiscal Stress Monitoring. His office evaluated 672 school districts with fiscal years ending on June 30, 2014.

The report classified the SGF Schools as “susceptible to fiscal stress,” which is the lowest of the designations a district can receive and still be considered in fiscal stress. This year, 10 school districts were labeled in “significant financial stress,” 27 were found to be in “moderate fiscal stress,” and 53, including SGF, are being considered “susceptible to fiscal stress.” South Glens Falls received a score of 28.3 percent out of 100 percent.

“Despite this designation, South Glens Falls is in good standing with the state and our fiscal accountability,” said Superintendent of Schools Michael Patton. “We have been transparent in the way we are managing our funds and we are continuously looking at a long-term plan to maintain our district’s fiscal health. We will continue to balance efficiency with the needs of the district.”

The scores are based on financial information that is submitted as part of each district’s ST-3 report, which were filed with the State Education Department, as of Dec. 31, 2014. The scores were compiled by using financial indicators such as year-end fund balance, short-term borrowing and patterns of operating deficits.

Of the seven indicators that are used by the Comptroller’s Office, South Glens Falls was noted for having a lower-than-desirable unassigned fund balance, as well as an operating deficit in the general fund balance.

The district planned to use reserve funds to account for the budget shortfall – a decision that was made as part of the planning process for the 2014-15 school year. The use of reserves to cover the operating deficit meant that the unassigned and overall fund balance was lower than the amount the state wanted to see as a minimum.

If the district had not used reserves to bridge the budget gap, it would have had to either eliminate additional staff or programming, or it would have had to propose a larger tax levy increase to generate additional revenue.

“Budget constraints are not unique to South Glens Falls—they are something all districts in New York are facing,” said Business Manager Audrey Varney. “Our district is committed to being a good steward of our financial resources and we will continue to be fiscally responsible moving forward.”

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