‘Clean’ external audit report for LPOSD and update on accountability

By Tom Albertson
Reader Contributor

As we approach Nov. 5, Election Day, it is timely for me to share with you the financial accountability report presented at the Oct. 22 school board meeting by the lead external auditor from Magnuson, McHugh and Co. accounting firm. 

Tom Albertson.

The external auditor explained the job of his team was “not to make the school district look good but to give findings of financial position and to obtain reasonable assurances that financial statements are free from material misstatements.” This includes giving a ruling on “checks and balances” in place to assure financial handlings are accurate.

For the 15th consecutive year, I am happy to report the audit was designated “clean” with no material misstatements, strong internal controls and in compliance with all major federal programs. Furthermore, the report commends operational effectiveness and efficiency, reliable financial reporting and compliance with all laws, regulations and policies. The external auditor commended LPOSD for being a model for other government agencies and school districts to follow.

You may ask why is this important? Prior to 2007, education in Idaho was partially funded through a non-voter approved property tax called “equalization.” The property tax rate at that time was $300 per $100,000 of net taxable value, about 30% higher than the current 2019 rate for LPOSD. In 2007 the equalization property tax was repealed and replaced with a statewide 1 cent sales tax increase as an alternative tax to fund schools. This sales tax increase did not generate sufficient funds (less than the property tax), thus, requiring local school districts to depend on voter-approved supplemental levies (maintenance and operation) to bridge the funding gap.

LPOSD has had a maintenance and operational levy in place for 20 years, which currently makes up 35% of the operational budget. State law allows a district to ask voters to approve this type of levy either every year, every two years or on a continuous basis if the levy has been in place for more than seven years and is more than 20% of the budget. On Nov. 5, LPOSD is asking voters to approve this flat dollar amount levy on a continuous basis. In previous messages, I have elaborated on the importance of the current levy to the operation of our district from staffing to maintaining small rural schools, curricular materials, professional development and extra-curricular activities, to name a few. 

Through an election process, patrons have the opportunity to vote on their representation on the five-member governing school board. By Idaho law, the annual budget must be set by the school board in an open meeting allowing public input and, by law, an external audit must be conducted annually to assure sound financial practices. Furthermore, all the budgets and audits are available for patrons to view on the LPOSD website (lposd.org). Additional accountability will always be in place, as the levy dollar amount cannot increase without further voter approval. 

It is extremely important to me, as superintendent, to assure you these accountability measures must continue by law, regardless if the levy is voted on annually, every two years or on a continuous basis. Stabilizing funding for budgeting and planning purposes is essential to our continued trajectory as a notable and highly effective school district. 

Tom Albertson is superintendent of the Lake Pend Oreille School District.