How Did D207 Ever Get That $45,000,000 Rainy Day Fund?

Here’s how it’s done. And please forgive the long post. 

I've seen a lot of budgets and forecasts over the 50 years I spent in business.  A common technique practiced by some budgeteers is that of understating revenue while overstating expenses.  This almost guarantee's they’ll stay within budget and always get that reassuring pat on the back and a hearty “well done” from their boss. This way they never get into trouble while putting the organizations goals at risk.  In their minds, they are the good guys. 

We used to call these wanabe heros, “white-hatters.” Because good guys wear white hats! Unfortunately, there are REAL LIFE COSTS to this activity, which I’ll talk about later.

 

Pros Don’t Always Wear White Hats

Not every budgeteer needs to be the hero. The Pros understand the value of an honest budget. They understand the budgets role as a numerical representation of the “plan” and as a management tool. They understand that it helps to drive the organizations decisions and they appreciate the contribution an accurate budget makes to the decision making process.

 We have two “white-hatters” leading our team: our Superintendent and Asst. Superintendent Business.

 

I’ve just made my claim. Time to back it up.

 

The numbers presented here were delivered to me as part of FOIA# 20180818-001 which read:

 

“At the end of a School District’s accounting year a monthly report is printed informing the reader the total amounts budgeted and spent for that year. All accounting packages have this type of report. You can’t produce next years budget without it. I am looking to see that report page only. Please provide copies of this final report page for: 2009, 2010, 2011, 2012, 2013, 2014, 2015, 2016, 2017 and 2018.”

Example Page:

Remember, “white-hatters” understate revenue while overstating expenses. 

Revenue And Expense Data From FOIA Reports

 

Report	Original	Actual	Original	Actual
Year	Revenue	Revenue	Expense	Expense
2012	$151,956,771	$154,974,599	$150,578,202	$148,026,501
2013	$144,498,953	$152,109,930	$140,509,740	$143,531,290
2014	$149,815,887	$151,756,119	$144,323,620	$147,225,250
2015	$149,931,172	$144,578,017	$151,264,125	$149,726,548
2016	$153,636,287	$156,160,189	$160,162,449	$154,016,761
2017	$150,012,815	$161,873,794	$148,516,196	$145,086,521
2018	$168,027,470	$170,165,632	$175,968,988	$166,018,822

Source: D207 FOIA Response dated: Aug 22 at 3:22 PM. 

 

From this point on, we're going to look at D207's data in three different ways; Revenue, Expenses and Actuals. Although we asked for and received revenue and expenses going back to 2009, we've chosen to display only that data for years 2012 and beyond. 2012 is the year D207 spent $101,000 on the valuable ARCON study we'll talk about later.

 Revenue

 

Original Understated Revenue Forecast vs Actual Revenue Comparison

 

Report	Original	Actual
Year	Revenue	Revenue	Difference
2012	$151,956,771	$154,974,599	$3,017,828
2013	$144,498,953	$152,109,930	$7,610,977
2014	$149,815,887	$151,756,119	$1,940,232
2015	$149,931,172	$144,578,017	($5,353,155)
2016	$153,636,287	$156,160,189	$2,523,902
2017	$150,012,815	$161,873,794	$11,860,979
2018	$168,027,470	$170,165,632	$2,138,162
SevenYears:	$1,067,879,355	$1,091,618,280	$23,738,925

 

Six out of seven years, Superintendent and Asst. Superintendent Business and Board understated the amount of revenue received by D207 from all revenue sources.
 

Expenses

 

Original Overstated Expenses Forecast vs Actual Expense Comparison

 

Report	Original	Actual
Year	Expense	Expense	Difference
2012	$150,578,202	$148,026,501	$2,551,701
2013	$140,509,740	$143,531,290	($3,021,550)
2014	$144,323,620	$147,225,250	($2,901,630)
2015	$151,264,125	$149,726,548	$1,537,577
2016	$160,162,449	$154,016,761	$6,145,688
2017	$148,516,196	$145,086,521	$3,429,675
2018	$175,968,988	$166,018,822	$9,950,166
SevenYears:	$1,071,323,320	$1,053,631,693	$17,691,627

 

For five of seven years,  Superintendent and Asst. Superintendent Business and Board  overstated the amount of expenditures incurred by D207 from all expense sources.


When you compare the money actually received to the amount actually spent, you'll understand the activity perpetrated on us.

Actuals

Actual Revenue vs Actual Expense Comparison

 

Report	Actual	Actual
Year	Revenue	Expense	Difference
2012	$154,974,599	$148,026,501	$6,948,098
2013	$152,109,930	$143,531,290	$8,578,640
2014	$151,756,119	$147,225,250	$4,530,869
2015	$144,578,017	$149,726,548	($5,148,531)
2016	$156,160,189	$154,016,761	$2,143,428
2017	$161,873,794	$145,086,521	$16,787,273
2018	$170,165,632	$166,018,822	$4,146,810
SevenYears:	$1,091,618,280	$1,053,631,693	$37,986,587

 

$37,986,587 Surplus!

Six out of Seven years D207 “white hatted” Revenue on purpose. Five out of seven years D207 “white hatted” Expenses on purpose. 

Now Taxpayers are being asked to accept at face value D207’s view of the future. A view all of us now can see, is historically predisposed toward understating revenue and overstating expenses.

So how did D207 get that $45K “Rainy Day Fund?” They put on their white hats!

 

Finally, I heard a story the other day. It was about a mother complaining. Seems her son came home from school upset, believing that should the Referendum not pass, the alleged “asbestos problem” at his school would make him sick.

Remember those REAL LIFE COSTS I mentioned earlier?

 $101,000 - 2012 ARCON Study 

 

Based on review of the $101,000 2012 ARCON study - the afore mentioned asbestos problem could easily have been eliminated had Superintendent Wallace, Asst. Superintendent Business Kalou and Prior and Current Board Presidents made this safety issue, THEIR priority instead of squandering the available resource by squirreling it away, without public knowledge or consent, into a bank account.

 

Just my opinion.  What do you think?