Tax and Spend – Citizen’s Tax Group
Dear Editor:
Year after year, the Edgecomb school board creates large surpluses by under budgeting revenue and over budgeting expenses. The most obvious example is the underbudgeting of tuition. This year, for example, there are 37 nonresident students that should produce $696,081 in tuition revenue. The Edgecomb school board, however, only budgeted $236,000, thereby creating a “windfall” surplus of $460,081.
So, where do those surpluses go? Based upon Maine DOE accounting principles* that surplus resides in the “General Fund” of the Edgecomb Education Department. Prior to 2021, after adjusting for any overrun of the approved school budget, the majority of any surplus would be assigned to the “Committed” sub-fund to be carried over to the following year’s school budget thereby lowering the school tax assessment.
Unfortunately, a change in the school accounting regulations in 2020 (H.P. 1366 - L.D. 1918) allowed the school board to create a series of “reserve” accounts that effectively shelter those surpluses and allows them to be spent outside the normal budget process. Exactly how those surpluses are spent is currently a mystery, as the school board meeting minutes make no reference to expending those funds.
Why don’t we see those surplus funds in current school budget presentations? Simple, the school budget presentations focus almost exclusively on the “Unassigned” fund which is just one component of the “General” fund. Maine DOE accounting* subdivides that “General” fund into sub-funds including “Non-spendable (7100), Restricted (7200), Committed (7300), Assigned (7400) and Unassigned (7500)”. Therefore, any budget presentation that fails to provide the details of the “General” fund and all those sub-accounts (including any “reserves”) is incomplete and can easily misrepresent the full financial picture.
What can taxpayers do? Again, the answer is simple: Demand a complete, honest accounting of all elements of the “General” fund. Insist the school board provide a clear explanation of how those surpluses and any reserve accounts (which we are now told have $0 (zero) balances) were spent. Hundreds of thousands of dollars spent outside the normal budget process is unsustainable and unacceptable.
Kathryn Rohr MD
Edgecomb
