News

July 18, 2002

"We're tracking it (spending) on a daily basis and keeping our fingers crossed," said David Blowman, the Brandywine School District's new chief financial officer, after the district finished fiscal 2002 in the black -- but barely so.

Blowman told a meeting of the district's finance committee on July 17 that the critical local-funds balance on June 30 amounted to $814,990.

He was to have presented the same report to the board the following evening, but that was not done because it had not been formally approved by the committee, which lacked a quorum when only one member, Zarah Aimbinder, showed up for its meeting. A somewhat smaller version of the monthly financial report was distributed to the public attending the board meeting, but no reference to the district's financial situation was made during the meeting.,

The full report showed that the district spent nearly $26.5 million of its own money while taking in $24 million, of which $23.5 million was from property taxes. That all but depleted the $3.1 million balance carried over last year and would have more than done so had the district not 'found' an untapped state account. The account held accumulated interest on Brandywine's share of the proceeds from the sale of school buildings in the early 1980s.

The end-of-fiscal-year balance has been spoken of as a cushion the district uses to meet its payrolls and pay bills that become due before tax revenue starts rolling in during the autumn months. School taxes are due Sept. 30. However, in the arcane world of Delaware school financing, that is an oversimplification.

Blowman's June report shows that the district in July, August and September, 2001,  received $3.2 million in tax revenue while spending a hair over $3 million. That would indicate, he said, that it could squeak by -- albeit barely -- without having to borrow from the state.

"If we get into September [without running out of money], we're in fairly good shape," he said at the finance committee meeting.

That is not to say, however, that Brandywine's much-discussed financial problems are behind it.

On the contrary, Blowman said, there is considerable work to be done to assign proper accounting codes to past spending and to craft a reliable budget for the present fiscal and academic year.

Illustrative of the situation, the monthly report shows that the district came in under budget during the past fiscal year, spending only 96% of what was expected. Blowman calls that "totally misleading." He points out that the salary account -- by far the largest portion of the budget, was overspent by 3% while spending for supplies and materials was just over half of what was budgeted.

Another part of the report -- which deals with total spending including state and federal funds -- shows spending amounting to $102.3 million, or about 92% of the $111.6 million budget. Of 11 explanatory footnotes in that section, 10 say simply that reported overages were "due to higher-than-anticipated expenditures."

"All through it, there was overbudgeting and underbudgeting," he said. "I don't know if we'll ever learn the full story [about what happened]."

"I don't want to dwell on the past. I'm more interested in building a solid budget for the future," he added.

David Adkins, newly elected president of the school board, told Delaforum after the board's meeting that he does not look for a quick solution to the district's financial problems. "It will take a long time to straighten out, but we will stick with it until it's done," he said.

He said members of the board, including himself, did not realize there were problems "until Dr. Harter (Superintendent Bruce Harter) brought it to our attention." He added, however, that he now has "complete confidence in all the people (administrators) we have aboard."

Regarding a related matter, the district apparently is clear with its new tax rate despite some confusion in the process of establishing it.

Mark Dufendach, associate state secretary of education, told Delaforum that the Brandywine board's not taking action on whether to keep or pass through to residential taxpayers the $2.1 million the General Assembly appropriated as its share of state-financed tax relief was tantamount to voting to keep the money. It was not required to take action on tax relief for senior citizens because that is a continuing annual program, he said.

He declined to speculate on an apparent disparity in the form of board action and its official reporting of the new tax rate. All the pre-vote discussion centered around the 48.8 which is the Brandywine current-expense rate -- about half of one of five components of the total rate. Tax rates are expressed by amounts applied to each $100 of assessed property value.

As Delaforum reported, the new rate is $1.1745, a 21% increase over last year's rate. That figure was included in a printed recommendation by Harter distributed at the special tax-setting meeting, but not mentioned during the discussion. That rate is approximately the amount projected before Brandywine's April referendum as the likely 2002-03 tax.

The official warrant to the New Castle County treasurer and receiver of taxes, signed by Harter and board president Nancy Doorey, uses the total figure. In an attachment it refers to a 95.6 current expense rate, which adds the Brandywine rate to the rate carried over from the time when Brandywine and three other districts made up a single consolidated New Castle County district. The 48.8 rate is not stated in the warrant or the attachment. In past years, Brandywine practice has been to refer to the combined rate as the current expense or operating rate. The other districts also follow that practice.

The warrant also refers to "a resolution duly adopted" to set the rate although the board actually did so by a unanimous voice vote on a simple motion to "accept the superintendent's recommendation."

2002. All rights reserved.

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