Does North Shore have $34,000,000 ....

Does North Shore have $34,000,000 in cash or reserves that could be returned to taxpayers?

The short answer is No.

More importantly, the reserves we do have exist not just to manage the long-term obligations of the district but to protect the taxpayer in multiple ways.

But the long answer is long because school finances are complicated, heavily regulated and very long-term.

You may have seen the $34m figure on social media. It's not what we have in reserves.

The district posts a tremendous amount of financial information on its website. That figure is from pg 10 of our most recent external audit report found here entitled "Financial Analysis of the District's Funds". (The district has multiple layers of audits annually.)  It's a list of all funds as of 6/30/19. This list includes debt service fund, food inventory in our cafeterias, appropriated (spent) funds, restricted reserves - everything - and it's not even a third of our annual operating budget which educates 2600 students across five buildings. 

It also includes reserves used to offset the budget and decrease the tax levy. The district routinely uses fund balance to hold down taxes. The auditors note that these funds decreased from the previous year because of this practice. The percent of our budget paid by taxes has been around 82%  - the lowest in decades.

We do have restricted reserves which are actively used, save the district money and are lower than many of our neighboring districts.

North Shore's restricted reserves are around $15 million. Jericho's has $42 million and Roslyn and Syosset are also higher, as examples. See more examples and sources here. Manhasset's are lower which is why the NYS Comptroller gives their district a higher fiscal stress score than North Shore's (which is 0).

Reserves save us money. For example, one restricted reserve is Workers' Comp. The district self-insures because it saves money. To self-insure, you need a reserve to cover any spikes in claims. If it were theoretically legal to liquidate the reserve and hand it out to taxpayers, a homeowner could get on average around $280 - once - and all future taxpayers would have to spend more on workers' comp and presumably less on education. 

We actively use these reserves - they are not a 'stash of cash' without purpose - they are a tool districts have to use. One example is the Capital Reserve fund. To be able to renovate a nurse's office and our middle school locker rooms, with the permission of the voters, we saved funds here until we could afford the repairs and now want to spend them on our buildings. Reserves just are the legal mechanism districts use.

 We do have "unassigned fund balance" of around $4 million. State law allows up to 4% of your budget in this kind of fund balance because budgeting cannot anticipate everything that may happen to a district over the course of a year. One LI district had to suddenly close a building mid-year, for example. We return part of these funds every year by using them for next year's budget, reducing the tax levy. The district also uses part to save for upcoming capital repairs and other needs.

But let's say there was still another $4,000,000 and a way to just write checks.

Here's what you'd get: About $500 per household once -- except the district won't have that money to offset the tax levy next year. Utilities pay taxes, too, so a good chunk of that money will go to them.

Here's what you would lose: The community loses $4,000,000 it collectively invested in our schools and was being put to good use. A budget cut of this size is about 27 teaching positions and another $800,000 cut elsewhere.

But I think this point is lost on a lot of people: Our schools have been built over generations. The reserves are more recent than our buildings but they were not all paid for by the current taxpayers of the district. Why would it be ok for a group of people to suddenly decide it was time to just take that money for themselves?