The state subcommittee determining whether the Clark County School District needs to be placed under “fiscal watch” by the Nevada Department of Taxation says CCSD does not warrant such monitoring.
The subcommittee determined that CCSD’s budgeting and accounting missteps last fall were at relatively low-dollar amounts and have been corrected.
Three members of the taxation department’s Committee on Local Government Finance — all current or former chief financial officers for Nevada school districts — formed the subcommittee in October to decide if the budgeting challenges rose to the level of a “severe fiscal emergency,” a status state law says is necessary to be placed under fiscal watch.
The committee will discuss its findings in a meeting today.
CCSD faced a potential budget deficit of up to $20 million because of miscalculations of teacher salaries and funding to assist at-risk students. As of December, though, officials said the district did not have a deficit.
Its amended final budget for the current fiscal year showed an ending balance $9,945,000 lower than it was in May — which represents less than 1% of its $3.5 billion in general fund revenues.
Officials had said for weeks that any deficit confirmed after reconciling the budget would be covered by tapping the unassigned ending fund balance, which is unspent money that isn’t restricted or committed to other use and essentially serves as a cushion.
“Twenty million dollars seems like a huge amount of money, and I can understand the sticker shock if a deficit of that amount would have been identified,” subcommittee member Paul Johnson, who is the White Pine County School District’s chief financial officer, said when the group met last week. “But relative to the Clark County School District budget, it’s relatively minute.”
Subcommittee member Jim McIntosh, a former CCSD chief financial officer and the current CFO for the Las Vegas Convention and Visitors Authority, said CCSD “is not an organization that is in severe financial emergency.”
There were district miscalculations in teacher salaries and per-pupil funding for at-risk students that took principals by surprise when they were forced to recast their budgets in September.
District officials said those have also been corrected, in some cases with assistance from the central office to cover the school-level shortages.
The budget challenges made CCSD subject to scrutiny from state officials, including the governor, the superintendent of schools and lawmakers. The Nevada Department of Education has appointed a compliance monitor, at CCSD’s expense, to ensure that CCSD follows a law decentralizing control of the massive district — a law state officials alleged the district broke when schools did not have up-to-date financial information prior to the start of this school year.
As CCSD’s one-time finance head, McIntosh said he understood how challenging large budgets could be.
“There seemed to have been an overreaction in this process,” he said. “I think there was an expectation of somebody from the outside looking in that this must have been a really large deficit or error for the chief financial officer to have been let go.”
Tom Ciesynski, business manager for the Nevada Association of School Boards and a former CFO for the Washoe County School District, said he reviewed the standard annual audit for CCSD’s last fiscal year and didn’t see any issues.
“I don’t believe that Clark County (School District’s) financial situation is in distress. I think they’ve worked very hard to address the issues that have come their way,” Ciesynski said. “A budget is an estimate, and we all, as finance people, do the best that we can to put the best estimates together at given points in time. But things happen from the time that we put things together to when reality takes place.”
Johnson said the challenges didn’t merit the “panic” he’d read about in the media.
“If we’re less than 1% on a guess,” Johnson said about budgeting in his own district, “that’s a good guess.”
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