District official says ‘surplus’ figures misleading; sinking funds and nutrition money restricted
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Summary
At a Muskogee School Board meeting, a district staff member said public figures labeled as district "surplus" were misleading because much of the money reported is held in legally restricted sinking funds and in the Child Nutrition account and is not available for general use.
A district staff member told the Muskogee School Board that widely circulated “surplus” figures did not represent funds available for day-to-day use because much of the money sits in restricted accounts such as sinking funds and the Child Nutrition Fund.
“It's money that that to pay off your debt,” the district staff member said, describing sinking funds that are used to repay bonds. The staff member said a recent public summary aggregated balances from multiple accounts and presented them as available reserves, a characterization the staff member called “very misleading.”
The staff member said that money reported for districts such as Bigsby, Piedmont, Deer Creek and Broken Arrow may appear large on paper but is not accessible for general expenditures. “So when he said that Broken Arrow had a $109,000,000, yeah. They might they may have that in their sinking fund, but that's to pay back their debt through the sinking fund,” the staff member said.
The staff member also warned that some accounts are subject to legal restrictions. “It's illegal to go into the red in the Child Nutrition Fund,” the staff member said, adding that school systems keep a carryover balance to ensure the year can start without a shortfall.
Board members noted the detail matters for public understanding. One board member said the presentation of aggregated balances could mislead the public about what dollars are available for new programs or services.
The staff member said there had been prior legislative consideration of proposals to allow broader use of certain funds, but that a bill to that effect had been voted down. “I have a feeling that may come back up next legislative session,” the staff member said, referring to possible future bills to change how meal programs are funded.
The board did not take formal action on the matter during the portion of the meeting captured in the transcript. The discussion was recorded during general business and public comment portions of the meeting.