Business Services / Finance

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2020-2021 Insurance Coverage Rate Sheet

Request: Provide information relating to the District’s irrevocable trust for retired employees’ health care costs. This included identifying when the trust was established and how it was funded; determining if health care costs were paid out of the District’s General Fund; and, if health care costs were paid out of the General Fund, determining if the irrevocable trust reimbursed the General Fund. 

OSA Recommendation: We recommend the District develop a plan describing when amounts will be determined to be paid from the Post-Employment Benefits Trust Fund. Those amounts should be determined prior to the release of the annual financial statements so that the financial statements disclose the amount in the trust for future benefit payments.

District Response: The District is currently developing an Other Post-Employment Benefits (OPEB) advisory committee with the participation of its Financial Advisory Council (FAC), with a resolution approved by the School Board on May 18, 2020. As stated in the OSA report, Minnesota Statutes, section 471.6175, subdivision 7(b), authorizes the District to withdraw funds from the irrevocable OPEB trust for post-employment benefits paid for former officers and employees. 

In 2019, the District asked MMKR (independent external auditors) to prepare a reconciliation of the OPEB trust, comparing eligible post-employment expenses paid by the District to the amount the District chose to draw down from the irrevocable OPEB trust account in prior years. MMKR determined the District was drawing less funds from the trust than the amounts paid out, with the District covering many of the costs; the District had $4,749,736 that had not been drawn down from the OPEB trust in previous years. In December 2019, the District drew down the $4,749,736 as a one-time draw, which was allowed via statute listed above as well as with approval by MMKR and the Minnesota Department of Education.

Request: Provide information relating to the fund balance and the budget of the District's General Fund.

OSA Recommendation: We recommend the District balance its budgets and increase the fund balance in the General Fund to avoid possible statutory operating debt.

District Response: The Robbinsdale Area School District’s fiscal year commences July 1 of each year, which is consistent with most school districts. The School Board, by law (Minnesota Statutes, section 123B.77, subdivision 4), must have a budget adopted for the upcoming fiscal year prior to July 1.  District budgets can be found on the Business Services / Finance webpage.

School finances are complex and include various funding streams including tax dollars, state and federal funding, which can fluctuate from year to year. Enrollment also contributes to our district funding and can impact budgets as well. The District has worked hard over the past five years to strategically re-align budgets so we can move forward with balanced budgets and rebuild the fund balance through various methods, including:

• Guidance of Baker Tilly Report (2014/2015)
• Collaborated with our employee groups
• Worked with our community to pass an operational referendum increase in 2018 (effective fiscal year 2019)

BallotPedia, a nonprofit organization, shows we’ve been working since 1992 to work on rebuilding balances. 

Request: Provide information on the District's policies and usage of credit cards (also known as purchasing cards or P Cards).

OSA Recommendation: We recommend the District's P Card policy and procedures manual be reviewed and updated to include items for which the District can and has been using P Cards, such as travel. We also recommend the audits of the District's P Cards, as required by the P Card policy and procedures manual, be performed on a routine/rotating basis. To comply with Minnesota statutes, all purchases should be supported by itemized receipts or claim forms. The documentation should include information on what is being purchased and who it is for (i.e., building site, classroom, program). Meal-related purchases should include a description of who the meal(s) was purchased for and who was in attendance, the reason for having to purchase the meal(s), and why it was necessary to provide a meal at that time. 

District Response: District policy requires documentation for purchases paid with P cards. Monthly transactions are reviewed and signed off by either an Executive Director or Program Director. The District implemented new travel authorization guidelines during the 2019-2020 school year. To ensure accounting practices and controls are in alignment, the District is conducting a thorough review of the P Card manual. In addition, district finance staff will implement a monthly P card sampling review as part of the reconciliation process.

Sept. 2020 District Update: The P Card manual review and update was completed in August 2020. The sampling review process began August 2020.

Request: Provide information regarding the District's authorization for the payment of expenditures, including what documentation should be included in the School Board meeting minutes relating to expenditures.

OSA Recommendation: We recommend the School Board consider delegating the approval of expenditures to the Superintendent or the Director of Finance as allowed under Minnesota Statutes, section 123B.52, subdivision 2.

District Response: District expenditures will continue to be listed as a disbursement report under the consent agenda during School Board meetings. District procedures provide for approval of purchases by the district purchasing department, school principals or department heads. The District has a procedure for contracted services and invoices are reviewed to ensure proper approvals are in place prior to processing payments. 

September 2020 District Update: The District reviewed administrative procedure 701AP and recommended the School Board adopt it as Policy 70, which allows the District to delegate approval of expenditures to the Superintendent or Director of Finance. The Board voted on Sept. 21 to approve.

Request: Provide information regarding the access to budget information by principals of the various schools.

No recommendation given by the OSA. The report says that based on their tests, principals have access to the budget information for which they are responsible. The principal is responsible for managing the budget total. Thus, line item overages need to be covered by line item underages elsewhere in their budget. 

District Response: The District has a process in place for school principals to access budget information. Building principals and program directors can access their budget information through the Skyward Financial System. Principals, Program Directors and/or their designated staff can run a report in the Skyward Financial System to get summary budget information to include budget, expenses, purchase orders and balances. A detailed report can be run to view all transactions for each budget code. Either of these reports can be run at any time.

Request: Provide information regarding the approval of contracts with TIES/Sourcewell. The petitioners also requested information regarding the relationship between the District and TIES/Sourcewell, which is addressed in item 14.

OSA Recommendation: We recommend the School Board implement procedures to ensure professional service contracts are Board approved or the approval is designated to the Superintendent or Business Manager as allowed under Minnesota Statutes, section 123B.52, subdivision 2.

District Response: The District has a process in place by which contracts are approved by the school board.

Request: Provide information regarding how the Title I program is funded and information about payments to other school districts with these funds.

No recommendation given by the OSA. The report provided information about the District's Title I expenditure reporting and payments to other districts, noting no discrepancies, and identified that the District provided corrective action plans to address findings reporting during its annual audits.

District Response: Based on recommendations from the Fiscal Year 2019 annual audit conducted by MMKR (independent external auditors) the District's Fiscal Operations Director and Title I Coordinator review all salaries and benefits being charged to the Title I program to ensure only allowable costs are being claimed for federal reimbursement. This process began fiscal year 2020 (July 1, 2019).

Request: Provide an explanation on what schools districts need to do to determine how compensatory funds are allocated and used.

No recommendation given by the OSA. The report outlined how the District allocates and chooses eligible uses for compensatory funds. Compensatory funds are determined under Minnesota Statutes, section 126C.10, subdivision 3(a).

District Response: The District’s procedures are in compliance with Minnesota State statutes.

Request: Provide clarification on the open enrollment requirements and process.

No recommendation given by the OSA. The report outlined the open enrollment requirement; the District's student data; and how the District handles transportation and uses its Achievement and Integration plan. Minnesota Statutes, section 124D.03, subdivision 4, allows any student to open enroll into or out of a district that has an Achievement and Integration plan approved by the MDE at any time during the school year. 

District Response: Our District does not have a closed boundary, and open-enrollment is permissible through Minnesota Statutes, section 124D.03, subdivision 4. Open enrollment totals for the 2015-2019 school years are listed below.

2015-2016 School Year
Resident Students Enrolled Out: 1,643
Non-Resident Students Enrolled In: 1,739
Net Impact of Open Enrollment: 96

2016-2017 School Year
Resident Students Enrolled Out: 1,677
Non-Resident Students Enrolled In: 1,745
Net Impact of Open Enrollment: 68

2017-2018 School Year
Resident Students Enrolled Out: 1,732
Non-Resident Students Enrolled In: 1,653
Net Impact of Open Enrollment: (79)

2018-2019 School Year
​​​​​​​Resident Students Enrolled Out: 1,760
Non-Resident Students Enrolled In: 1,818
Net Impact of Open Enrollment: 58

Request: Provide information regarding the contracting process and if School Board authorization was received.

OSA Recommendation: We recommend all contracts and related documentation be maintained by the District.

District Response: The District has a procedure in place for contracted services. The District follows the recommended retention schedule for all contracts and any related documentation.

Request: Provide information regarding the reimbursements for relocation expenses to District Cabinet executives hired by the District.

No recommendation given by the OSA. The report outlined payments for the Superintendent's interview and relocation expenses (the only person eligible for these) and found the payments were allowed by contract.

District Response: Relocation reimbursements are permissible per employee contract, which is a common practice among school districts.

Request: Provide information regarding the purchase of two video scoreboard for the high schools (Armstrong and Cooper) in the District, specifically the approval of the purchase, funding and policies for advertising.

OSA Recommendation: We recommend the Board approve contracts and agreements for sponsorships or advertising and authorize any revenue related to advertising.

District Response: The District has a process for advertising approval to ensure contracts for school sponsorship and advertising revenue receive board approval. For more information, see Administrative Procedure 905AP.

Request: Provide information regarding the Long-Term Facilities Maintenance (LTFM) Revenue program, specifically if it is in compliance with state regulations related to funding the program and if overhead costs were included in the program.

No recommendation given by the OSA. The report outlines that the LTFM Revenue Program was in compliance with state regulations and no overhead charges were noted as all costs were vendors, permits, bond issuance and payroll for staff working directly with the program.

District Response: The District’s Long-Term Facilities Maintenance Revenue Program continues to be in compliance with state regulations, including funding and overhead costs. Every year, the plan is approved by the School Board and the Minnesota Department of Education. Minnesota Statutes, section 123B.595 identifies the requirements for the LTFM Revenue Program. 

Request: Provide information regarding a potential conflict of interest relating to School Board member Mr. John Vento (Board member Vento) and the services provided to the District by TIES/Sourcewell.

No recommendation given by the OSA nor were there findings of a violation of statutory conflict of interest. The OSA report  notes that if a board member had a conflict for this type of service contract, there exists an exception in the statute.

District Response: Allegations of a conflict of interest had been brought forth against School Board Director John Vento in October 2019, when he was at that time board chair. Mr. Vento was employed by TIES/Sourcewell with whom the district has had contracts for technology services. Director Vento disclosed a conflict of interest (identifying his employer) with the school district each of the seven years he has served on the board. Director Vento abstained from all four board votes relating to contracts with his employer during his time on the board. 

Request: Provide information on the District's policy for reimbursing professional development, continuing professional education and technology stipends.

OSA Recommendation: We recommend that consistent tracking and recording be applied to all tuition and technology stipend reimbursements, including following School District policy. We also recommend the District treat employee fringe benefits appropriately for the purposes of federal and state income taxes. 

District Response: The District has a process for tracking tuition and technology stipends. The District will begin taxing employees for income received through technology reimbursements in fiscal year 2021 (beginning July 1, 2020). 

September 2020 District Update: Technology reimbursements are now managed through our payroll department, with appropriate taxes processed. This began on the Aug. 28, 2020 payroll. 

Request: Provide information regarding the District's hiring practices.

No recommendation given by the OSA. The report outlines that they tested the policy of School Board approval of new hires. All staff tested were in compliance with the Board policy. The District has a process in place regarding hiring policies and practices.

District Response: No wrongdoing was found in the District's hiring processes and hiring decisions in June 2019 after an inquiry by an independent third-party investigator hired by the School Board. In addition, the Robbinsdale Area School District follows the 400-series of policies and administrative procedures approved by the School Board for employees and personnel, as well as state and federal hiring requirements. 

Request: Provide information regarding School Board meetings and compliance with open meeting laws and the publication of School Board meeting minutes.

OSA Recommendation: We recommend that a written roll of School Board members and all other persons present at meetings closed for labor negotiations be made available to the public after the closed meeting, as required by Minnesota Statutes, section 13D.03, subdivision 1. As a best practice, we recommend that the specific time of commencement and location of such closed meetings be specified at the open meeting. We also recommend minutes of School Board meetings be published within 30 days of the meeting, as required by Minnesota Statutes, section 123B.09, subdivision 10.  The appropriate state office for the School District or members of the public to contact for additional information on open meeting requirements is the Data Practices Office at the Minnesota Department of Administration. 

District Response: The District continues to refine practices to ensure existing Administrative Procedures are followed and adhere to Minnesota statute for open meetings.