Finding Text
ELMIRA CITY SCHOOL DISTRICT
SCHEDULE OF FINDINGS AND QUESTIONED COSTS (CONTINUED)
FOR THE YEAR ENDED JUNE 30, 2023
Section III Federal Award Findings and Questioned Costs
Issue: Net Cash Resources
Federal Agency: U.S. Department of Agriculture
Federal Program: Child Nutrition Cluster
Assistance Listing Number: 10.553/10.555/10.559
Pass-Through Agency: NYS Department of Education
2023-001 School Food Account - Net Cash Resources Criteria: The School Food Authority shall limit its net cash resources to an amount that does not exceed three months' average
expenditures for its School Lunch Fund or such other amount as may be approved by the NYS Department of
Education in accordance with 7 CFR §210.9(b)(2). Condition: At June 30, 2023, net cash resources in the School Lunch Fund exceeded the allowable limit by $1,254,282. Cause: For the year ended June 30, 2023 and 2022, revenues exceeded expenditures in the School Lunch Fund by $382,261
and $1,149,007, respectively. Effect or Potential Effect: The School District is not in compliance with 7 CFR §210.9(b)(2). Questioned Costs: None. Context: The School District was $1,254,282 over the allowable limit at year end June 30, 2023 compared to $984,093 over for
the year ended June 30, 2022. Repeat Finding: This finding is a repeat of Finding 2022-001 from the prior year. Recommendation: We recommend the School District review its net cash resources in the School Lunch Fund and develop a plan to
reduce them to an allowable amount. Response/Board Action: The School District has a multi-tiered plan in place to address the excessive Net Cash Resources as so reported. The
overall plan includes equipment replacements, increased wages for cafeteria staff, avoiding procurement of grants as well
as buying more locally sourced food. During the 2022-2023 school year, as part of the 2021-2022 corrective action,
the School District appropriated $380,000 from its appropriated fund balance to afford the purchase of a new
refrigerated food truck, as well as to cover increased food costs and employee benefits. Equipment replacement
purchases took place in the 22-23 school year; however, due to supply chain issues $202,984 in encumbrances were
carried over to the 23-24 school year as they have not yet been furnished by the vendors. The School District is in the
process of finalizing a labor contract to commence in the 2023-2024 fiscal year, which will be a three year agreement.
Money from this fund will be allocated towards increases to wages negotiated in that contract. The 2023-2024 School
Lunch Fund budget is 47.45% higher than the 2022-2023 budget. The most notable increase to spending is within the
Food Service Equipment line, to coincide with the plan to replace and cycle out aging equipment. Additional increases
can be noted in the salaries, supplies, food purchases and contractual services budgetary lines. With the above in place,
the School District plans to resolve the issue of excessive cash resources by the conclusion of the 2023-2024 school
year.