B-W Schools Audit Shows Over $78 Million of Debt
But the debt has shrunk over $3 million since the last audit.
The board will vote on whether or not to accept that firm's audit—which shows a district debt of $78,676,298—at its Jan. 18 meeting.
The audit, for the period ending on June 30, 2011, shows that the district has a fund balance of $16,748,155. Approximately $4.8 million of that remain in unassigned funds.
Under Government Accounting Standards Board (GASB) Statement 34 standards, which require the district's capital assets (buildings, land, et al.) to be included, that fund balance equates to $26,833,053, which William D. McKain, the district's assistant to the superintendent for finance and operations, called "good news."
"We actually have positive net assets of $26.8 million," McKain said. "This is full accrual. When we went out, and we issued debt—and debt might be 20 years, 25 years—we utilized that money for assets that at least had that useful life. Otherwise, this (GASB 34 amount) would be negative. That's when you know you're in trouble.
"What this is saying, when you look at it, it shows that, under the net-asset accounting structure, that we actually have $26.8 million."
As for the district's approximately $78.6-million debt, McKain pointed out that the previous school year's audit, also done by Cottrill Arbutina, shows a decrease of debt of around $3.2 million, or 4 percent.
"We're starting to actually pay it down," McKain said. "We'll continue to pay it down, and it would only go up if we would have to issue new debt."
Most of that $78.6 million is made up of roughly $65 million borrowed by the district to renovate Baldwin High School.
Food Service Losses
Results of the audit also showed that the district's food services department turned in a loss of $15,806 for 2010-11. The cumulative negative net assets for the food service fund as of June 30, 2011, was $907,408.
ARAMARK is the company that provides food services to the district.
After emerging from an approximately 46-minute executive session on May 18, the B-W School Board renewed the district's contract with ARAMARK for the 2011-12 school year despite a statement on April 15 by district Superintendent Dr. Lawrence C. Korchnak that the district's food service "has been running at a loss ever since they (ARAMARK) came here."
Korchnak later clarified his quote by saying, "Patch quoted me as saying that ARAMARK has lost money ever since they came to Baldwin-Whitehall. While that is true, they came after a long string of losses (even to $300,000+ the year before they began).
"While the food service ran at a loss since then, the amount of losses have diminished to the point that they guarantee a profit next year—which is why the board elected to renew again."
At the end of Wednesday's audit report, board member George L. Pry commented, "It's (Food service has) been a thorn in our side for the last couple of years. We do need to rethink and reconsider that whole process."
Board President John B. Schmotzer instructed district administrators to bring proposals in front of the board to improve food services.
Check back with the Baldwin-Whitehall Patch later on Thursday for more odds and ends from Wednesday night’s school board meeting.