Report 2021-108 Recommendation 4 Responses

Report 2021-108: Bellflower Unified School District: Has Not Used Its Significant Financial Resources to Fully Address Student Needs (Release Date: June 2022)

Recommendation #4 To: Bellflower Unified School District

To ensure that Bellflower is not underinvesting in its current students, the board should adopt a general fund reserve policy by August 2022 that establishes a healthy but reasonable reserve amount (target reserve) for the district. It should require Bellflower's staff to use the target reserve when determining funding available for the services the district provides, and staff should ensure that the budget presents any actions necessary to maintain the target reserve.

1-Year Agency Response

The District is currently in the process if updating many of their policies including this one. We hope to have them all updated by December 2023. The language from this recommendation will be considered as part of the review. In the meantime the Board passed a resolution at its June 15, 2023 Board meeting committing any ending funds (reserves) above 10% with specific expenditures that those funds are held in reserve for.

California State Auditor's Assessment of 1-Year Status: Pending

6-Month Agency Response

The District currently has Board Policy 3100 which states that the Board shall establish and maintain a general fund reserve for economic uncertainty that meets or exceeds the requirements of the law which is 3% and anything that is over 3% is to be committed based on reserve requirements. Funding has been committed and District has provided information regarding the reserve.

California State Auditor's Assessment of 6-Month Status: Pending

The board policy Bellflower referenced in its response does not implement our recommendation. Although Bellflower's board policy reiterates the legal requirement that school districts must maintain a minimum reserve of their total expenditures, it does not establish a healthy but reasonable reserve amount (target reserve) for the district.

60-Day Agency Response

The Board shall establish and maintain a general fund reserve for economic uncertainty that meets or exceeds the requirements of law. (Education Code 33128.3; 5 CCR 15450) The District has adopted a resolution committing funds that exceed this requirement. Committed funds include economic uncertainties as well declining enrollment to help sustain programs based on decreased revenue expected to be apportioned to the District. The District will also be committing reserves that are specifically designated for students of specific subgroups.

California State Auditor's Assessment of 60-Day Status: Pending

All Recommendations in 2021-108

Agency responses received are posted verbatim.