Plante Moran gives Farmington Public Schools a clean audit; board probes whether reserves should grow

Plante Moran partner Jeff Higgins and manager Renee Epster told the Farmington Public School District Board of Education on Oct. 14 that auditors issued an unmodified, or "clean," opinion on the district's financial statements for the year ended June 30, 2025. General fund revenues totaled about $176.6 million and expenditures about $173.4 million, producing a fund balance of about $42.5 million, or roughly 24.5% of annual expenditures.

The audit presentation noted that approximately 9 percentage points of the fund balance are committed or assigned for specific purposes — leaving about 15.25% unassigned, which Plante Moran said equates to about 27 days of operations. "Revenues were about $176,000,000. Your expenditures about $173,000,000. So you had about $3,000,000 of revenue over expenditure," Higgins told the board. He added that the district's financial reporting earned external recognition for thoroughness.

The presentation showed the district's revenue mix is driven by state foundation funding (about 59–60% of general fund revenue), with local revenue accounting for roughly 29% and federal funding reduced following pandemic-era declines. Enrollment was reported at 9,096 students, a net increase of six from the prior year.

Board members and the finance committee pressed for follow-up analyses of the committed versus unassigned fund balance. Trustee comments said the board's current fund-balance policy target is 10–15%, while national and professional guidance was described in the audit as recommending roughly 15% (or two months of operating expenditures, about 16–17%). Trustee discussion emphasized concern that a 10% floor leaves little unencumbered reserve once committed amounts are considered. "When we look at our fund balance, it doesn't necessarily reflect the amounts that we have available for what folks call a rainy day because there is this, you know, large amount that is committed, about 9% of it," a trustee said during the meeting.

The finance and facilities committee agreed to bring a more detailed proposal back to the board, including options to increase the district's target reserve percentage. The audit team also reviewed pension and retirement cost drivers and noted that salary and benefit costs represent about 83% of general fund expenditures, with retirement expense representing a growing share.

The board did not take formal action on the audit itself beyond acknowledging the report and thanking district finance staff; trustees asked staff and the finance committee to return with specific recommendations on an adjusted fund-balance target and related budget implications.

Plante Moran presented documents and slides during the meeting; board members applauded the business office for repeated recognitions of financial reporting quality. The district will receive more detailed financial reports in future committee meetings as trustees consider next steps on reserve policy.