Schools say jurors in dark on reserves
District: $88M is already earmarked for uses such as supplies and salaries.
Everyone has ideas about how public schools should spend their money. Grand jurors are no exception.
More police officers. Higher salaries. New police cars. Self-locking doors.
More police dogs. More counselors. More psychologists. More training. Magnetized ID cards for every student. And impact-resistant glass in thousands of classroom doors.
On Wednesday, a 21-person grand jury convened by Palm Beach County State Attorney Dave Aronberg delivered 72 pages of recommendations to make the county’s public schools safer. Unsurprisingly, most suggestions required a lot of money.
District officials estimated the total price tag at upward of $50 million in annual expenses, not including millions more in onetime costs.
School administrators are used to lectures about how to spend the taxpayer dollars they’re entrusted with. What riled up district officials about the grand jury’s report wasn’t the recommendations — many of which the district was already working to address — but
the way the jurors suggested paying for it all.
Rather than suggest new sources of money or places to cut in its existing budget, the grand jury recommended that the school district spend money from its reserves — pointing especially to an $88 million “miscellaneous reserve” that the district said exists only on paper.
Administrators bristled at what they called a facile-sounding suggestion, saying it’s a well-known rule of thumb that governments shouldn’t use reserve money to pay for recurring expenses like new positions and higher salaries.
“Using that money for additional headcount doesn’t make any sense to me,” Schools Superintendent Donald Fennoy said. “It’s not a fiscally responsible thing to do. Those monies don’t come to us like that.”
Contrary to the jurors’ insinuation that the district is sitting on a excessive stockpile of money, administrators say their $55 million “contingency” reserve is lower, proportionally, than that of most Florida school districts, the county government and even the state government.
State law calls for school districts to stockpile the equivalent of 3 percent of their annual budget for emergencies, and federal guidelines for districts recommend as much as 10 percent, administrators said. The district said its reserve amounts to 7 percent.
“To suggest you don’t have any reserves is kind of irresponsible and foolhardy,” said Mike Burke, the school district’s chief financial officer.
What most surprised district administrators was jurors’ and prosecutors’ fascination with $88 million in the school district’s budget slated as “miscellaneous reserves.”
“There’s this $88 million reserve fund in the budget, and there are things the money can be used for during the course of the year,” Assistant State Attorney Michael Rachel said at a news conference Wednesday. “And the grand jury was concerned: Well, why isn’t this reserve budget maybe being reserved in part for the school police?”
But district administrators say the so-called “reserve fund” is just a place where money earmarked for other uses — like classroom supplies, teacher salaries and state-mandated school-award money — is parked until the district determines where and when it has to be distributed.
“These are things that are budgeted that are going to be doled out during the school year,” Burke said. “We have to hold it, so we hold it in reserve.”
Steering the money from there into the police department isn’t skimming money off an idle rainy-day fund. Using it could mean cutting teachers’ pay, removing supplies from classrooms and cutting other school functions — and, in some cases, misusing restricted state money.
“I tried to explain this (to the grand jury),” Burke added, “but it’s obvious to me after reading the report that they did not get it.”
Administrators said they agreed in principle with most recommendations, although they said some were impracticable or cost-prohibitive.
Fennoy said he hadn’t seen anything in the report that district officials hadn’t already weighed or considered in the months since the Parkland school shooting.
Indeed, some suggestions are already being implemented, such as the recommendation to hire more officers, now mandated by state law.
The district is also planning to ask voters for a property tax increase that would generate an extra $150 million next year, much of which would be dedicated to police and safety spending.
Fennoy said the jurors’ recommendations weren’t surprising. Public school financing is notoriously complicated.
So much so, officials said, that even in a school district with a $2 billion budget, it’s very difficult to find large pots of money that aren’t already spoken for or restricted.
“It just highlights that as such a large organization, (the district) is very complex,” Fennoy said.