School budget gets a 3-2 approval

Despite recent number troubles, the South Whidbey Board of Education approved a $16 million-plus budget Monday just ahead of the start of the coming school year.

By state law, first class school districts — 2,000 students or more — are required to adopt new budgets by Aug. 31. The first day of school on South Whidbey is Sept. 4.

But passage was not a slam dunk.

The budget was approved by a 3-2 vote, with Directors Ray Gabelein and Barbara Schneeman voting “no” because of budgeting errors recently disclosed in the fund balance.

But even as three members approved the new budget, all five directors called for an audit to be done by an outside agency. The cost of that audit could run into thousands of dollars not appropriated in the new budget. Private firms charge about $150 per hour compared with state’s rate of $75.60.

The road to Monday night’s budget adoption has been bumpy, with the disclosure of errors resulting in $369,000 less than expected in the district’s fund balance.

To address these errors and other questions about the budget, board members unanimously approved an outside audit of the district.

Superintendent Martin Laster had been charged at last month’s meeting with contacting the state and commercial firms about performing an audit for the district. But the report he submitted and discussed did not contain enough information for the board, so directors Gabelein and Jim Adsley will be contacting auditors with a “laundry list” of questions submitted by other board members.

What is in question is the scope and cost of the audit, and whether to have it prepared by the state auditor’s office or an outside firm.

Approval of the new budget contained the caveat that if more errors are discovered in an audit, adjustments will be made.

Laster reported he had talked with the state auditors’ office and representatives from two private firms in the Seattle area. He said it would make the audit process go more quickly if the board could identify specific areas to address. A commercial firm could take as long as three months to complete an audit, he said.

Gabelein said he doesn’t want see an audit hang over the district for three months.

“I can’t an audit on a budget our size would take three months,” Gabelein said.

The state auditor’s office currently audits all school districts annually. It provides standard audits to to meet state and federal requirements. Laster told the board the state will also provide a specialized audit.

He noted that if the district needs to contract for an audit costing $50,000 or more, it must put out for bid.

Bill Carlstrom, a private philanthropist who has worked with South Whidbey students in the past, spoke in favor of an outside audit.

“One of the the critical issues we face is to be able to pass on to our next directors a clean bill of health,” he said. “An audit at this time should be an absolute.”

Carlstrom favored a private audit over a state audit, “even if its costs us more money.”

South Whidbey resident Jamie McNett also pointed out during the meeting that the district already has a qualified person to perform the audit, John Jenft, a financial consultant who has who has worked with many school districts and the Office of the Superintendent of Public Instruction.

Jenft was called in to assist with the district’s budget preparation when the error in the fund balance was disclosed by the district’s business manager, Mike Moore. Jenft and Moore worked together to get the final budget completed in time for last month’s meeting.

During that meeting, the board requested that $100,000 internal reserve be moved to the fund balance account increasing it to $238,000.

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