Did City exceed Net School Spending by $9.1 Million in 2015/2016?

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Attached is the end of year report that every school district has to submit to the state Dept of Elementary and Secondary Education. This report is filed by the School Administration not the City with information supplied and I assume verified by the City Auditor who works for both the School and City side and is hired and Supervised by the City Council NOT a direct report to the City Manager.

That needs to be said because sometimes people are led to believe the Auditor falls under the City or works/reports to the Manager but the fact is he works equally for BOTH the City and School side and has no bias.

I don’t ever pretend to fully understand these reports because they contain so much information but if I am reading these particular lines correctly it is very surprising in a positive way.

According to this year end summary under the tab named Reports in the section named FY16 Net School Spending

The City Spent $187,745,931 on items that fall under Net school spending (line 28 – 15. Net School Spending (13 – 14c)

The City was required again if Im reading this report correctly to spend $178,601,206 to meet the State mandated Net school spending. (line 29 – 16. FY16 Required Net School Spending)

Based on those numbers it would appear that the City of Lowell would be in excess of their required Net School Spending by $9,144,725

The report shows the amount of Net School spending, transportation cost, maintenance cost and many other cost that the city of Lowell pays.

It also shows cost that do NOT count towards it’s net school spending requirements.

The following expenses are reported to DESE (Massachusetts Department of Elementary and Secondary Education ) however they do not count toward net school spending, Lowell doesn’t have charges for every item listed below but they do for many:

Short Term Debt Service/Interest (BANS)- Actual interest paid in borrowing for Bond anticipation Notes (BANS) on bonds and loans used to finance the purchase of textbooks, equipment or technology and school building maintenance and construction.

Health Services for Non-Public Schools – The salaries of health personnel who provide direct services or instruction to non-public school students, as well as the related costs for supplies and materials

Other Fixed Charges – The actual expended budget for crossing guards and The actual expended budget for public safety inspections

Acquisition, Improvement and Replacement of Fixed Assets – The total actual fees to the City of Lowell Parking Department for the rental of monthly parking spaces at the George Ayotte and Joseph Downes Parking Facilities as of June 30 of each given year. Beginning in the 2016/2017 budget the City is paying all the parking cost,in the past they charged $100,000 to the SCHOOL DEPT.

Long Term Debt Retirement/School Construction – The annual principal of loans used to finance the purchase or construction of schools.

Long Term Debt Service/School Construction – The annual interest payment on bonds and loans used to finance the purchase or construction of schools.

Long Term Debt Service/Educational Expenditures – The annual interest payment on bonds and loans used to finance the purchase of books, instructional equipment and extraordinary maintenance projects.

Long Term Debt Service/Other – The annual interest payment on bonds and loans used to finance the purchase of non-instructional equipment, and to pay for capital maintenance projects in excess of fifty thousand dollars.

Massachusetts School Building Authority Construction Aid – MSBA Annual Contract Revenues MSBA One-Time Revenues

One item in this report raises my concern about the growing rift between the School and City side.

According to the report under Schedule 1 II Expenditures B By City / Town the City of Lowell spent $840,715 on maintenance of grounds and buildings

Line 495 – 1975 Maintenance of School Grounds (4210) $403,619
Line 496 – 1976 Maintenance of School Buildings (4220)$437,096

Yet when questions about how much the City has spent on maintenance at a joint facility meeting with the Council and this past week’s School Committee meeting the Assistant Superintendent of Finance couldn’t or wouldn’t supply an exact figure. Why not?

My understanding is that this report is compiled by the Finance / Business Office so I would expect both the Asst.. Supt and Superintendent to have this information. Why the deliberately chose to not share it is troublesome.

This to me is another huge red flag about the honest communication between the school side and the city side.

Trying to figure out the City’s overall contribution in cash and chargebacks or maintenance of efforts wasn’t something I could do.

Based on the amount the Net School spending was over, I expected the cost of maintenance for buildings and grounds to be higher.

If you look at the history of what chargebacks have been since 2011-2015 which used to be supplied on a very easily readable excel spreadsheet supplied by the Deputy Supt. of Finance
I would think the total would be around $49,000,000 based on the excess in Net School.

Chargebacks or maintenance of effort spending includes cost of Police Resource Officers, School Nurses, MIS , Auditing, Treasurer, Parking, plowing driveways and parking areas at each school among other items.

However this School Administration either doesn’t update this list or if so haven’t made this information available to the City Council or public in any SC packet.

Here again is the breakdown for the prior years chargebacks before this administration.

City of Lowell NSS (FY11 – FY15)

What I also found very interesting was a sentence in the response I received from DESE that said

Please note that the district has up to two years to make any changes to the report based on audit findings.

That statement wasn’t included last year when I asked for a copy of this report. So i’m wondering what they expect an audit to turn up?

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