SANBORN – Thirteen school superintendents in Niagara and Orleans counties signed a statement defending the budgetary policies of the county’s BOCES organization following a negative state audit.
The audit of the Orleans-Niagara Board of Cooperative Educational Services contends that it has an unauthorized $5.2 million fund that it plans to use to pay future retirement benefits.
The New York State Comptroller’s Office says in the Aug. 19 audit there is no law that allows BOCES to set aside money for that purpose, and if the money were sent back to the 13 local school districts in the two counties, it would brighten their financial picture and perhaps reduce local taxes.
BOCES Superintendent Clark J. Godshall doesn’t see it that way. He said if the money were returned to the local schools all at once, it could be considered a large enough instance of unexpected revenue that it might cause a reduction in the districts’ state aid.
“It could. It has that potential,” agreed Roger J. Klatt, superintendent of the Barker and Royalton-Hartland districts.
Instead, BOCES sends the districts refunds in the form of annual cost reductions.
“We are fully compliant,” Godshall said. “We have some funds we collected over decades to pay for post-retirement benefits. They didn’t pass legislation, so we had to give it back. We have a five-year plan to give it back to the districts.”
BOCES isn’t allowed to carry a fund balance. Klatt said, “Each year, we do receive a refund based on surplus. Based on that, we think he’s doing a good job.”
Many of the local superintendents have also been on the receiving end of recent audits from the State Comptroller’s Office, charging them with maintaining overly large surpluses.
Figures included by BOCES in its response to the audit show refunds to the component districts, totaling between $1.6 million and $2.2 million during each of the past six years. “Our independent annual audits have confirmed that we’re giving back all the proper amounts,” Godshall said.
The state audit contends the refunds would have been larger if BOCES weren’t transferring money into reserve funds, such as a 2015 transfer of $1.2 million into a capital reserve fund.
“Dr. Godshall is more experienced in the BOCES business, and we trust his judgment,” Klatt said.
“Dr. Godshall is an outstanding manager in terms of finances,” Wilson Superintendent Michael S. Wendt said. “He is in good company when he is criticized for having funds the comptroller thinks are excessive.” Klatt and Wendt are among the superintendents criticized by the state for the size of their district’s reserve funds and fund balances. It’s been a consistent theme in recent state audits of school districts. Most of the districts have replied that they were trying to build cushions in case the state cut their aid again, as it did with the large “gap elimination adjustment” in 2008, a cut that wasn’t made up until this year.
“If I ran this organization like New York state, I’d be in big trouble,” Godshall said,