Taylor Releases Performance Audit of Federal Hocking Local School District

Thursday, September 13, 2007

Athens County -

State Auditor Mary Taylor released the performance audit of Federal Hocking Local School District today. The report outlines several steps district officials should consider when seeking to improve the district’s overall financial health and eliminate projected deficits.

Federal Hocking Local School District was originally placed in fiscal caution on October 18, 2006. Since then, the district’s financial condition has progressively deteriorated. A five-year financial forecast submitted by the district in January reveals a projected $1.8 million deficit by the end of the 2007-2008 school year. The district forecast indicates that the deficit could balloon to as much as $9.2 million by the 2010-2011 school year. The district was declared to be in fiscal emergency on May 21, 2007.

“This performance audit provides recommendations to district officials to improve operational efficiencies and save tax dollars,” Taylor said. “School administrators have already taken steps to reduce the district’s financial burden, but more is needed. My hope is that they look closely at the recommendations outlined in this report in their ongoing efforts to achieve financial stability and improve operational efficiencies.”

The performance audit indicates that if school officials implement the recommendations outlined in the report, and limit future spending, the district would operate with positive fund balances through fiscal year 2011.

Performance audits report on the efficiency and effectiveness of government operations through peer comparisons and benchmarking to industry standards. A performance audit can be a useful tool for agencies seeking to improve operations, identify cost savings and make better use of existing resources.

The performance audit of Federal Hocking Local School District reviewed financial systems, human resources, facilities, transportation, food service and technology.

The audit recommends that school officials reconfigure buildings the district uses for teaching certain grades and consider consolidating all grades into a single campus. This is consistent with proposals made by district administrators. The audit reveals that declining enrollment trends indicate the single campus option could produce the greatest reduction in costs as enrollment continues to drop.

Additional recommendations district officials should consider in order to save approximately $1.7 million annually, include:

  • Making certain staffing reductions to place the district in line with peer averages and state minimums.
  • Increasing bus utilization.
  • Negotiating changes to certain contracts regarding benefits and compensation.
  • Developing a district wide strategic plan to increase the accuracy of financial forecasts.

The Ohio Auditor of State’s Office is one of the largest accounting offices in the nation.  The office strives to ensure that all public funds are spent legally and appropriately and works aggressively to root out fraud, waste and abuse in public spending. Taylor encourages anyone suspecting fraud or misspending of public dollars to contact her office toll free at 1-866-FRAUD-OH (1-866-372-8364).

A full copy of the audit is available online at www.auditor.state.oh.us.