OBSERVER photo Silver Creek Central Schools

Silver Creek Central Schools has indicated in a letter to state Comptroller Thomas DiNapoli it does not agree with a recent audit that was made public this week.

In the audit, DiNapoli’s office said the board and district officials need to improve their budgeting practices and transparency. The audit found that board and district officials overestimated general fund appropriations by $6.7 million and appropriated $2.7 million of fund balance and reserve funds that were not needed to fund operations from 2018-19 through 2020-21.

District officials also adopted annual budgets totaling $25 million, which gave taxpayers the impression the district would have operating deficits when it had operating surpluses. As of June 30, 2021, the district maintained a surplus fund balance that exceeded the legal limit of 4% by approximately $7.1 million — or 27%.

Silver Creek board President Martha Howard, in a letter dated Dec. 6, accepted the findings while noting concerns. “This district does not agree with the characterization of these findings,” she wrote. “We feel that any report that fails to cite or recognize first the threat and secondly the actual withholding of state aid by up to 20% within the 2020-2021 school year, followed by restoration at the every end of the year is incomplete at best. Additionally, failure to recognize the uncertainty and volatile economic climate of this time frame in which the COVID pandemic occurred misrepresents the district’s response to the event.

DiNapoli’s office noted the uncertainty was faced throughout the state in its response. “District officials consistently overestimated appropriations, appropriated fund balance that was not needed and unnecessarily increased the real property tax levy prior to the pandemic,” the audit stated. “In addition, while the audit report indicated that District officials planned for a 20 percent cut in State aid that did not materialize, there are other budgeting practices that contributed to the District’s accumulation of excess surplus fund balance.”