Reflections on Ethical Violations

Violations of the public trust or violations of ethics by anyone in the public sector are difficult from which to recover. The loss of trust from the public not only damages an individual’s professional reputation and career progression, but more importantly it damages the district’s ability to serve the students of the district in the most efficient manner. When district employees cast shadows of doubt on the ethical operation of the district, taxpayers, voters, and parents begin to question every decision. Unchecked, this distrust will lead to resistance from voters whose support is needed to raise tax revenues to fund facilities and targeted district initiatives designed to meet the needs of the students of the district. When a district leader takes a position of responsibility in expending taxpayer funds, they must administer the programs with the utmost transparency and honesty. They must strive to avoid even the appearance of unethical behavior. 

Final Reflections on EDLD 5342

EDLD 5342 ranks alongside the education law course I completed as a requirement for my Education Administration degree as the most important, practical, and significant learning a district level administrator must master in order to be an effective advocate for children The material learned in this course will be put to use, as it was learned, in any administrative position I may fill at the district level in the future. The knowledge gained was practical, and the concepts of equity, equality, and adequacy described during this course are timeless concepts that will forever influence the constitution of school finance law in Texas. Those concepts will also continue to be the basis for future legal challenges to school finance laws that will undoubtedly continue.      The course was challenging and frustrating at times. As we began work on our Wiki Groups, we had to learn how to collaborate over great distances with people with whom we were not acquainted. Our group had a slow start but found a great tool in using GoogleDocs to complete our work. We found ourselves challenging one another and learning a great deal from the insights of the other members of our team. When I did not understand a concept or could not easily find the information necessary to complete an assignment, my teammates stepped up with clarification and real examples. I found the experience of collaboration to be very intellectually stimulating and I hope to work with these teammates in the same manner in the future.      There were several assignments that provided significant learning in this course and I was glad to have completed. The exploration of the school finance formula was probably the most significant learning that occurred in this course. Knowing the intricacies of this state formula and the local factors that influence the amount of state funding is paramount in playing the role of advocate for your district and maximizing funding for your own students. Other exercises that were significant were the two comparisons completed between two differing school districts: property poor vs. property wealthy, and high enrollment vs. small enrollment. Understanding the different challenges that exist in these differing districts is key for district leaders in finding the most lucrative solutions to funding difficulties in a district. Finally, learning the history of school finance. It is always important to know what has been attempted to fix the problem in the past so that we can keep moving in a positive direction.      I feel that I have grown significantly as a professional as well as a result of this course as I indicated in my self-assessment against the Superintendent Competencies. While I still rate my self as needing improvement in the area of “facilitate and evaluate effective account auditing and monitoring that complies with legal requirements and local district policy” and the area of “apply legal concepts, regulations, and codes as required,” I did so because these areas are ones that may have constant change associated with them. As legal requirements change, administrators must stay abreast of those changes and learn about all local, state, and federal requirements in these areas. I do not think that I will ever feel that this area can be a strength that never needs to be revisited or relearned. I rated my self as having a strength in five of the eleven areas and competent in the remaining four areas. I feel that I am competent, or could master the process of budget management and planning with experience and practice. I feel that I could competently manage district purchasing in an ethical manner. With experience and practice, this will quickly be a strength for me. Finally, I believe that I have been exposed to the revenue and enrollment forecasting in my current role but I have not managed it under my direct supervision. I feel confident that I could turn this into a strength with experience and practice. The remaining five areas are rated as strengths because I feel that I have been involved either at the campus or district level in managing those aspects of administrative leadership. This is a definite improvement to the self-assessment I completed earlier in the superintendents’ course and I attribute this improvement to the learning that I accomplished during this course.      The significance of the learning imbedded in this course cannot be over stated. I will continue to stay abreast of developments in the subject of school finance and I feel that I have the key knowledge and understanding to be a contributor and leader in this area at the district level. I also have a greater understanding and motivation to be an advocate for a school funding formula in Texas that truly provides equity, equality, and adequacy.

Financial Audit Interview

ow is the external auditor selected?

Initially a request for qualifications can be made to determine which firm is most qualified to do the job.  Then a cost is agreed upon.  Districts are not allowed to use the bid process to select an audit, which would place the emphasis on cost. 

Each year our board approves the audit work with our existing auditor through the approval of an audit engagement letter from the auditor which states the scope of work and approximate cost for that year.  

H does the auditor conduct the audit?

The auditor gets an electronic file of our books/balances to use for the audit.  Any changes or adjustments she makes to our books based on their work are delivered to us as journal entries to apply to our finance system.

The auditor spends time at the district reviewing/testing payroll and accounts payable transactions.  They also interview staff and review policies, board minutes, grant funds, activity accounts and contracts.  There are also several supplementary schedules the auditor produces to go in the audit book.

What does the audit conclude about district financial procedures and actions?

The agenda item explains this pretty succinctly.

How are the results communicated?

The auditor prepares an annual audit book which is presented to the board at the meeting when the auditor makes their annual presentation to the board.  The board accepts the audit ( generally speaking). 

TEA receives a copy of the audit, as well as any number of our creditors past or present that request a copy. 

It is important to know that the district’s financial health and practices will be looked at closely. This will keep superintendents on their toes and practicing in a responsible and honest manner that will be beyond reproach.

A 5% Pay Raise?

In Belton ISD, personnel costs make up 81.8% of the budget ($55,240,723). A five percent salary increase would amount to an additional $2,762,036 to the budget or would take that much away from some other expenditure. If the total budget did not change, this increase would raise the total percentage expended on personnel costs to over 85%. If the budget was expanded to include the increase in personnel costs the percentage of personnel would raise to 82.5% (total budget of $70,293,482.)  Of course a raise in the total budget would require an increase in the tax rate. Currently in Belton, one penny of tax effort will raise approximately $216,064. To pay for the pay raise through a simple tax increase without reduction in other expenditures would require a tax increase of over 13 cents.  Of course there would be positive impacts of a 5% pay increase. First, morale of staff would be positively impacted along with our ability to remain competitive with neighboring larger districts. We would also be able to attract more high quality applicants and the increase in disposable income would, theoretically help the local economy through “the income effect.” This might also lead to a positive impact on the local tax base as a large increase in pay might allow employees to afford homes of increased value in the boundaries of the district. However, there are numerous and serious possible negative impacts of such a  large increase in pay. First, the increase would result in a larger percentage of the budget being expended on personnel to the possible detriment of other expenditures such as instructional supplies. The resultant increase in the percentage of budget spent on salaries might also cause the district to exceed TEA guidelines for the allowable percentage of budget spent on personnel.  Additionally, such a pay raise might be difficult to justify in a struggling economy when others in our community are losing jobs. Finally, a pay increase of this magnitude might require a tax increase to fund it and might cause animosity from taxpayers. In an economy that is suffering and refusing t grow for so long, a pay raise of this nature would be difficult to sustain – especially in this uncertain economic atmosphere.

Week 3, Part 4

In Belton ISD, local revenue makes up 35.7% of the district’s M&O budget. The local revenue is made up of local tax collections (our M&O Rate is at the maximum $1.17), interest earnings, gate receipts from athletic and fine arts events, tuition paid for summer school and transfer students into the district, and rent collected for use of district facilities. We are a property poor school district and most of our funding comes from state aide which makes up 63.7% of the total revenue. The remaining portion of the budget comes from federal grants such as Title I funds and IDEA part B. The budget priorities for the district which were approved by the board of trustees are: improvement of instruction, improving student achievement, maintaining instructional priorities and programs, maintaining comparable salaries, implementing and monitoring well-designed processes, and maintaining efficient operations. The expenditures in Belton ISD seem to line up well with the stated goals with approximately $55 million of the $66 million budget used to pay for salaries, instructional materials, professional development and other items that have a direct impact on instruction with students. Historical data tells us that approximately 82% of our district budget is expended for salaries and benefits of personnel, so there is not a great deal of discretionary spending relative to the total budget. Funds allocated to the district for a particular purpose are expended on those targeted programs. For example, the total expenditures to support child nutrition services were $3.8 million while funding from state and federal sources totaled only $2.2 million. M&O expenditures in order by amount appear to align with the stated budget goals in order of precedence.