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Ilyse Spertus Will Lead a New Rochelle Revival

September 13, 2011 - 15:46
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I am the Treasurer for the campaign to elect Ilyse Spertus to City Council representing District 5. Ilyse asked me to join her team after examining some of the analytical work I did for Bob Cox when he was running for School Board. So, in addition to managing the campaign’s cash flow, Ilyse has asked me to look into the state of affairs for our city.

Where the school had a spending problem, the city has a revenue problem. Unfortunately, that means the city’s deficiencies will take more time and effort to correct. A lack of engagement by the community (myself included) has led to the creation of a local government that is lacking in some needed skills and, worse, has a mindset that we need to beg for business. But New Rochelle has some fantastic assets: an ethnically diverse population with a wide range of skills (from real estate to finance to contract negotiation to marketing and more), fantastic topography like our crown jewel waterfront properties, and a fair amount of affluence. These assets are just begging to be tapped, and one reason I support Ilyse is because she wants to lean on the community to help our city realize its potential.

A Financial Analyst’s View of New Rochelle - The Last Word

May 16, 2011 - 19:14
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When I first started paying attention to matters of the school board back in March, I was shocked with what I had found: out-of-control spending, a broken budgeting process, and a seemingly disengaged Board of Education. As I dug into the school’s finances, I turned up more and more disturbing information. For example, the sum of the Principal’s salaries in Appendix C don’t match the budget line item on page 42 (Section 2020.150). The over-budgeting in that line could fund 2-3 more teaching positions alone! To hear the whole sordid tale, read my full account in the following links:

A Financial Analyst’s View of the New Rochelle School System - Part 1

A Financial Analyst’s View of the New Rochelle School System - Part 2

A Financial Analyst’s View of the New Rochelle School System - Part 3

A Financial Analyst’s View of the New Rochelle School System - Part 4

A Financial Analyst’s View of the New Rochelle School System - Part 5

Adam D. Egelberg, CFA

A Financial Analyst’s View of the New Rochelle School System - Part 5

May 13, 2011 - 23:22

For this article, I’m going to move away from story telling and get right to the point. Here are my preliminary findings from reviewing the budget history and the audited financial statements of the school district.

It appears the Board of Education is making staffing and programming decisions without critical financial information that they need. One would think that if there was any single item in the budget that should be accurate, it would be the Superintendent’s salary. But even that appears to be off, as you will see below. I believe that many of the staffing cuts planned for the upcoming school year are not necessary, and I encourage the Board to bring in an outside party to perform a forensic accounting analysis of the school’s financial position and produce a plain language report that is easily understandable for the layperson.

My earlier findings that the Administration’s budget projections were too high appear to be correct. From 2006 through 2010 it appears that the school system generated a “profit” of almost $16 million by spending less than it was allocated.

A Financial Analyst’s View of the New Rochelle School System - Part 4

May 11, 2011 - 11:00

NRBudgetedvActual2006 09 455The Importance of Accurate Budgeting

The creation of an accurate budget is crucial when it comes to figuring out how much money we have to spend and where to spend it. If the Board of Education accepts budgets that are inaccurate, they could end up spending money they don’t have, or lay off staff they might otherwise keep. In my mind, the annual budget is the key tool available to the Board for managing the finances of the school system.

A Financial Analyst’s View of the New Rochelle School System - Part 3

May 09, 2011 - 18:31
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NewRochelleFinancialProjectionsBefore I start going into the numbers, I want make a brief mention of those expensive budgets I purchased. Nine of the ten were left-over bounded copies from prior years. Only one was a photocopy. So the Administration, with the full knowledge of the School Board, charged me for budgets which I had already paid for with my property taxes.

Now that you have the background story, it’s time to dig into the numbers. I believe the New Rochelle school system is facing a $35 million cumulative deficit over the next five years as shown in the chart above. If this comes to be, then we will have to make massive cuts in staffing and elective programs. For those who may think I’m crying wolf, consider that we are already cutting teachers, nurses, busing and other services despite a rising revenue base.

How did this happen?

A Financial Analyst’s View of the New Rochelle School System - Part 2

May 06, 2011 - 14:49
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NRbudgethistory455In Part I, I explained how I came to be involved with the New Rochelle school budget. In Part II, I explain why the school budget provided to the public makes a performance evaluation difficult.

The preliminary budget presented to the School Board and the community in early March of this year was more remarkable for what it did not contain than for what it did contain. The first section of the budget book shows 11 years of enrollment trends, 11 years of state aid, and 22 years of history showing the decline in New Rochelle property tax assessables. But there was no history for school spending beyond a single year, and without that it is impossible for the Board to gauge the long term effectiveness of the administration in spending its funds wisely. So I set off to create that history.

A Financial Analyst’s View of the New Rochelle School System - Part 1

May 04, 2011 - 18:18
3 comments

NRBOEBudgetMtg1I first got involved with the New Rochelle school budget when the administration proposed cutting busing to out-of-district private schools in an effort to save money. I was surprised by the need to cut services, when for nine years my wife and I had faithfully voted for tax increases to support a vibrant school system that should never, in our minds, be wanting for funds. While we currently have no children in the public school system, our long term plan has always been for them to attend the high school. So we had “skin in the game” in a number of ways: our desire to live in a great community with thriving schools; our understanding that a weakened school system would drive down property values and lead to flight out of the city; and our longer term intention to take advantage of the fantastic programs at the New Rochelle High School (they have a radio station and a planetarium!).

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