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previous use of reserves for ongoing expenses

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  • ALYSON WECKSTEIN
    I spoke on this last night, and today sent this letter by fax and email to the Board and Staff on the details of my findings. June 10, 2003 Dear Ms. Vedovellie
    Message 1 of 1 , Jun 10, 2003
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      I spoke on this last night, and today sent this letter by fax and email to
      the Board and Staff on the details of my findings.

      June 10, 2003

      Dear Ms. Vedovellie and Mr. Stewart:

      I spoke at the public meeting last night on the expenditure of reserves for
      ongoing expenses. This letter further documents my questioning of prior use
      of reserves for ongoing expenses.

      My research shows that in the March 12, 2003 District Certification of
      Interim Report page 5, the General Fund fund balance of the Board Approved
      Operating Budget went from $26,725,184 in July 1, 2002 to a projected
      $15,499,659 for June 30, 2003 � a reduction of reserves of over $11M (See
      Attached). I do not believe that the report includes the impact of the
      recent state deferrals since the projected revenues are actually higher than
      the original budget. Reviewing the expenditures, there are only a few
      million dollars that could possibly be one-time expenditures. Most of the
      increases that are causing expenditures to be greater than revenues are
      labor dollars.

      I am not questioning the accuracy of the reserve, revenue, or expenditure
      numbers, but I am puzzled by the approval of using $11M of reserves on labor
      expenses. Please explain how the District Certification of Interim Report
      can show the use of $11M of reserve on what appears to be ongoing expenses
      and not violate the rule of �no use of reserves on ongoing expenses.� This
      Certification was found to be positive and was approved by the Board on
      March 12, 2003. I am not aware of Mr. Stewart�s role in reviewing or
      approving the certification.

      The bottom line is that I believe there is a precedent for spending some of
      the reserve for ongoing expenses during time of fiscal stress. Maybe it is
      done as Mr. Price suggested last night by reclassifying contracts and other
      operating expenses as one-time expenses. If is possible to use the
      unappropriated reserves (amount above state required) to fund critical
      programs for another year or two while other solution are developed, please
      let the Board know it can be done.

      I look forward to hearing your response to this issue. If you have
      questions, you can contact me at (510) 287-0399 (day) or (510) 527-2977. I
      am also sending you a copy of this letter without the attachment by email;
      you can respond to my email address aweckstein@....



      Richard Lou


      Attachment

      Cc: WCCUSD Board Members
      Gloria Johnston, Superintendent
      Helen Bean, Kensington School PTA

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