Internal Monitoring Report
Executive Limitation Policy EL –1, Global Executive ConstraintGLOBAL POLICY PROHIBITION: The Superintendent shall not cause or allow any practice, activity, decision or organizational circumstance which is unlawful, imprudent or in violation of governmental regulations or of commonly accepted business and professional ethics and practices.INTERPRETATION: In all district matters, including dealings with the Board of Education, students, staff, parents, the community, other educational and governmental entities, public and private auditing entities, financial institutions, vendors, contractors, etc., I shall conduct business and communications in a legal, honest and ethical manner at all times.This “global” policy is the foundation for the specific executive limitation policies which guide and limit my superintendent actions and duties including the treatment of students, families and community (EL-2), the treatment of staff (EL-3), financial planning and budgeting (EL-4), managing the financial condition and activities of the district (EL-5), ensuring emergency superintendent succession (EL-6), protecting district assets (EL-7), ensuring adequate compensation and benefits for employees (EL-8), communicating to and supporting the board (EL-9), providing monitoring reports to the board (EL-10) and developing administrative policies (EL-11).REPORT: This report is my assurance that, as reasonably interpreted, the prohibited conditions have not occurred, and I am in compliance with this policy as of this date, January 28, 2008.Signed____________________________, SuperintendentInternal Monitoring ReportExecutive Limitation Policy EL-5, Financial Condition and ActivitiesGLOBAL POLICY PROHIBITION: With respect to the actual, ongoing financial condition and activities, the Superintendent shall not cause or allow the development of fiscal jeopardy or a material deviation of actual expenditures from board priorities established in Ends policies.INTERPRETATION: I will oversee the fiscal operations of the district so as to insure financial stability. As board priorities are further established in Ends policies, I will ensure that district funds are expended in pursuit of those priorities. I interpret current priorities as those activities set forth in the annual budget as approved by the board in October 2007 (the 2007-08 budget).This report constitutes my assurance that, as reasonably interpreted, these conditions (Global Policy Prohibition) have not occurred, and further that the data submitted below are accurate as of this date, January 28, 2008.Signed ________________________, Superintendent1. POLICY PROHIBITION: The Superintendent shall not expend more funds than have been received in the fiscal year to date unless the liquidity requirement and long-term reserve below are met.INTERPRETATION: I shall ensure that expenditures do not exceed revenue year-to-date unless we have cash reserves necessary to meet operating expenditures over a 30-day period. Long-term reserves are not addressed in board policy, but I interpret this as referring to year-end carry-over funds. The ideal has been to have carry-over reserves for 3 months of expenditures, though this is usually not the case.Through December 31, 2007 we have received $983,739.66 and spent $1,129,842.72. Taking into account the beginning fund balance of $757,348.27, plus other, encumbrances and payables, we have an unencumbered general fund balance of $497,709.81. It costs approximately $150,000 to run the district for a 30-day period, therefore I am reporting compliance with this policy. (Our cash reserves are down by $97,708.67 from where we were at this time last year, $497,709.81 compared to $595,418.48.) Keeping in mind that 95% of local tax revenues are received between February and June, and that we have made grant expenditures that have not been reimbursed by December 31, 2007, I am reporting sound fiscal condition for the district at this time. Our available fund balance of $497,709.81 is greater than the projected ending fund balance of $414,759 as approved in the 2007-2008 budget. Our projected fund balance of $414,759 continues to be projected at that amount.2. POLICY PROHIBITION: The Superintendent shall not allow cash and cash equivalents to drop below the amount necessary to meet operating expenditures over a 30-day period.INTERPRETATION: I will ensure that we have at least 30-days operating revenue in reserve. I interpret “cash equivalents” as investments such as savings bonds or stocks, which we do not have. All district liquidity is in cash.We currently have more than 30-days of operating revenue. (See EL-5.1)3. POLICY PROHIBITION: The Superintendent shall not allow tax payments or other government ordered payments or filings to be overdue or inaccurately filed and shall not allow the organization to incur penalties in material amounts due to late filings.INTERPRETATION: The only tax payments we have are the monthly payroll taxes. Filings include a variety of electronic transfers and other reports required by government entities, primarily the Colorado Department of Education. In a $2,800,000 budget, I interpret “material amounts” to mean approximately $5,000.We continue to be in compliance with this policy. Our payroll taxes are paid immediately after payroll each month. Our reports to CDE are accurate and on time. We have not incurred any penalties.4. POLICY PROHIBITION: The Superintendent shall not acquire, encumber or dispose of real property.INTERPRETATION: I cannot purchase or sell, or enter into a contract to purchase or sell, land or buildings on behalf of the school district.With the authorization of the Board I have been able to purchase several small lots adjacent to Moffat School in hopes of improving the play field. We are still pursuing one additional lot, though it appears the owner is not interested in selling at this time. They have agreed to an easement to continue using the property as we have been doing for years. I am in compliance with this policy.5. POLICY PROHIBITION: The Superintendent shall not fail to aggressively pursue receivables after a reasonable grace period.INTERPRETATION: I interpret “aggressively pursue” as communicating through conversations, letters, or a collection agency, depending on the situation. “Receivables” refer most often to lunch bills, but could include library fines, textbook replacement, athletic costs, grants, refunds, etc. A “reasonable grace period” varies according to amount owed and the particular situation.We are dealing appropriately with the lunch bills that remain outstanding. We send out monthly statements to families with a balance. If the balance continues to grow through the year, we continue to send statements and suggest setting up a payment plan. Turning bills over to a collection agency is a last resort and one that does not work with our small amount of outstanding bills. We continue to provide lunch to students even if they owe money for lunch. We do not however, release year-end report cards or issue graduation diplomas if money is still owed the school(s). We are now requesting parents to sign a written agreement that both allows us to charge their lunch account and states their agreement to pay any outstanding charges within thirty days. I will request a resolution from the BOE to write-off of the books the older accounts that we do not have any chance of collecting . I am reporting compliance with this policy.6. POLICY PROHIBITION: The Superintendent shall not allow bond funds to be spent inefficiently or in any way other than intended.INTERPRETATION: Bond funds are the proceeds from bond sales authorized through a general or special election for a particular purpose. I interpret “inefficiently” as failing to put contracts out to competitive bidding, failing to carefully monitor contractor work, or in any way failing to insure the integrity of how bond funds are spent.We do not have any bond funds to spend at this time. We are in the processing of paying off our bond debt from remodeling and building the addition to Moffat School in 1995-96. We occasionally have been able to pay back ahead of schedule, e.g., we recently paid $95,000 extra in order to reduce the principal owed, thereby saving us interest. I am reporting compliance.7. POLICY PROHIBITION: The Superintendent shall not achieve compliance with these provisions by endangering future capacity to accomplish ends.INTERPRETATION: I interpret this as meaning I cannot provide for the district today by encumbering the district far into the future.I have not entered into any unreasonable long-term leases or excessive multi-year contracts for goods or services. I am reporting compliance.8. POLICY PROHIBITION: The Superintendent shall not commit revenues due to student enrollment growth to continuing line-items or program expenditures without considering needs associated with opening of new schools.INTERPRETATION: I interpret this policy to mean that should we find ourselves with a considerable increase in student enrollment, I may not commit the revenue associated with those additional students to continued funding of existing programs or expenditures without first considering whether putting those additional funds towards a new school, or needs associated with opening a new school, would be more appropriate.The district FTE for 2007-08 is 201 (before averaging), down from 2006-07 by 2.5 (October 2006 count 203.5; October 2005 count 213.5; October 2004 count 190.5; October 2003 count 194.5). We are not experiencing the student enrollment growth as a district to consider opening a new district school, therefore this policy is not an issue at this time. I am therefore reporting compliance with this policy.Please see the attached reports: Year-to-Date Cash Summary for 2007-08 and 2006-07 for comparison, Year-to-Date Expense, Year-to-Date Revenue, and Current Cash Balance for Activity Funds.