The writing herein is made in the Yonkers Tribune. The brilliant remedy and concept resides elsewhere. A respectful, Thank you!” is in order in deference to the person who shared it with us. To appreciate the solution, permit the initial telling of what has transpired and that which is known.
What is known is that sometime within the last two weeks, Yonkers Public Schools Superintendent Bernard Pierorazio, circumventing the Yonkers Board of Education Trustees, personally advised Yonkers Mayor Mike Spano of a $55 million shortfall to the Yonkers Board of Education (YBoE) budget that had accrued over FY 2012-2013 and FY 2013-2014. The deficit for FY 2012-2013 amounts to $26.9 million, while the deficit for FY 2013-2014 amounts to $ 28.1 million, adding up to the aforementioned $55 million shortfall.
In the landmark Campaign for Fiscal Equity case, CFE v State of New York, the court explicated the State’s constitutional obligation to provide essential resources to all public school children. To that end, the Education Budget and Reform Act of 2007 was passed in April of that year. In the first two years, the NYS Legislature provided installment of the Foundation Aid Formula totaling $2.3 billion. In 2009, aid was frozen at 37.5 percent of the four-year target and aid was cut $2.7 billion in 2010 and 2011. The cut was achieved through a mechanism called the Gap Elimination Adjustment (GEA) which sought to balance the state’s overall budget during the great recession by reducing state school aid.
The FY 2011-2012 YBoE budget included a Gap Elimination Adjustment (GEA) to cover the shortfall said to have impacted the Yonkers Public School (YPS).
The practice of including GEA authorized funds in the YBoE budget, when approved by NY State, balanced the budgetary needs of the YPS. The unauthorized respective GEA amount of $26.9 million in FY 2012-2013 and the $28.1 million for FY 2013-2014 were not approved and not authorized. The Office of Yonkers Mayor Mike Spano contends the YBoE budget had made two false and unauthorized entries into the financial ledger of the YBoE. Whether inadvertent or fraudulently posted, the City of Yonkers (CoY) is at its worst possible standing facing a blatant $55 million shortfall. That figure assumes the sum of both FY entries listed was spent in entirety. An audit is due to be presented to Mayor Mike Spano in entirety by January 31, 2014. Only then will the shortfall be revealed.
Allegations that revolve about this issue at present are that the ledger entries somehow made their way into the proposed budgets for Fiscal Years 2012-13 and 2013-14. The allegation is that YPS Superintendent Bernard Pierorazio hand a hand in their being insinuated into each of the respectively proposed budgets over a two-year time frame with little if any oversight by the Yonkers Board of Trustees.
The budgets are alleged to have been created and formulated under the aegis of YPS Superintendent Pierorazio. The Certified Public Accounting (CPA) firm engaged in putting the budget together at that time as per Superintendent Pierorazio’s guidance made an error in designating entries valued as much as $55 million over two distinct fiscal years. Further, under YBoE Trustee rulings, “Fiscal Accounting and Reporting – Series 6000, adopted July 20, 2011, stipulates “the Board of Education insists on clear, complete, and detailed accounting of all financial transactions for which the Board is held accountable.” Further, “the accounting system will yield information necessary for the Board to make policy decisions.” And lastly, “the Board directs the Superintendent of Schools to keep it informed of the financial status of the district through monthly and annual reports. These shall be filed with appropriate governmental bodies as required under law or regulation.”
Something went very wrong. It seems Superintendent Pierorazio’s guidance was off the mark. That guidance was not verified by the CPAs employed at that time. City Hall has not divulged who they were. The endorsed documents were thereafter sent to the Office of the Mayor of Yonkers. The Mayor’s Office did not validate the entries; had they, the error would have initially been caught. Next the proposed education budgets were referred to the Yonkers City Council who did a cursory verbal walk-through to the YBoE documents and garnered a 7-0 vote approving the budgets to the delight of Yonkers City Hall and the City Council membership. Deadlines toward approval eclipsed study of the budget proposals. The final step was to present the city and school budgets to the New York State Comptroller’s Office who would come to approve the budget proposals. They process has thereby soiled the New York State Comptroller's Office. The accounting firm engaged at that time is unknown to the Yonkers Tribune.
Every possible form of scrutiny fell short of protecting the taxpayer from this calamitous financial outcome.
The only solution, thanks to the brilliant mind that distilled a solution for the City of Yonkers and New York State, is both correct and doable, should remedy be at the heart of this crisis.
Yonkers Corporation Counsel must be instructed to file suit for malpractice again the CPAs that prepared the financial books at the behest of the YBoE.
Superintendent Pierorazio, should he have an explanation as to what transpired could have advised the Yonkers Tribune Editor who called Mr. Pierorazio’s personal cell phone three times this past week to no avail.
Further Mr Pierorazio’s offer of resignation to Mayor Spano is meaningless. Superintendent Pierorazio must tender his resignation to his boss, the Yonkers Board of Education Board of Trustees. They have the power to accept his resignation.
No matter how this crisis settles down, has Yonkers City Hall devised any protocol by which false entries can be found, rejected and expunged prior to winning endorsement and validation from all those authorized to pass judgment on the document?
There are many more issues that are ancillary to those mentioned herein. They will be broached in the near future.