Trustees Bolster District’s Reserve Funds

The Huntington School District shows no signs of abandoning its traditional frugal financial philosophy. It has one of the lowest levels of indebtedness of any school system its size on Long Island due to an absence of long-term borrowing. This has helped the district avoid debilitating interest costs and helped it hold down tax increases. It has also freed-up monies for use in continuing to offer a strong academic and co-curricular program.

District executives credit conservative budgeting, realistic financial assumptions and tight oversight of spending for ending each year with a budget surplus. Those annual surpluses have been returned to taxpayers by keeping the tax rate as low as possible while adhering to a pay-as-you-go approach to meeting the district’s expenses.

At their public meeting on Monday, September 30, Huntington School Board members allocated more than $6.15 million in surplus monies to four reserve funds. The monies will have the ultimate effect of holding down taxes and will prevent the need for borrowing or for excessively cutting programs to meet the district’s needs.

Cullen & Danowski, a certified public accounting firm hired by the Huntington School Board to conduct an external audit of the district, calculated the Huntington School District’s excess fund balance at $6,156,376. This figure is in addition to the district’s undesignated fund balance, which is at the statutory maximum of four percent. Trustees designated $2,180,953 from the fund balance to the 2013/14 school budget to keep the tax rate lower than it would have been without the use of these monies.

Trustees approved a series of four resolutions at their Monday night meeting that authorized allocating the $6.156 million in surplus revenues among the 2008 and 2013 capital reserve funds, the Employees Retirement System reserve fund, the employee benefits and accrued liabilities reserve fund and the Workers Compensation reserve fund.

Specifically, Huntington School Board members unanimously approved the transfer of $1,656,376 to the 2008 capital reserve fund and $2 million to the 2013 capital reserve fund. The funds were authorized by district voters during public referendums in 2008 and 2013, respectively. Annual allocations from surplus monies are capped at $2 million to any one fund. The funds can only be used for renovation and reconstruction projects approved by a vote of district residents. There will now be $6,959,159 in capital reserve monies held by the district.

“Although they are well maintained, our facilities are not getting any younger,” Superintendent James W. Polansky said. “There are upcoming projects that must be undertaken, such as boiler and roof replacements that are critical to respective building infrastructures and functioning. The capital reserve allocation is therefore essential, as are the contributions to the other reserve funds which must be used for the purposes specifically designated for those funds.”

Trustees also approved the transfer of $1 million to the ERS reserve fund “for the purpose of funding retirement contributions for the 2013/14 school year and thereafter and for any purpose authorized under General Municipal Law, Section 6-r.” The fund will now hold $3,172,839.

Trustees authorized the addition of $1 million to the district’s employee benefits and accrued liabilities reserve fund, which will now hold $1,666,588. The fund is used to pay for unused accumulated leave time contractually provided to certain groups of employees. It cannot be used to pay for retirement incentives, FICA or Medicare assessments or retiree health insurance.

Trustees also authorized the transfer of $500,000 to the district’s Workers Compensation reserve fund, which will now have $3,352,305 in it. The fund is used to pay actual Worker’s Compensation claims related to medical expenses and self-insurance administrative costs.