GUILDERLAND — For the second year, the state’s comptroller has issued a report on school districts under fiscal stress and, also for the second year, Guilderland has been named as “susceptible” to stress.

“At the end of the day,” Neil Sanders, Guilderland’s assistant superintendent for business told the school board on Tuesday night, “it’s been about what we need to have to insure a good educational program for children…At the end of the day, we’ve done the right thing for students.”

The district has dipped into its fund balance, or rainy-day savings, in recent years to preserve programs; then, with less cash on hand, it has borrowed money to be able to meet payroll and other expenses in case state aid was delayed.

Since 2009, the state’s Foundation Aid to Guilderland has been flat and, since 2010, the gap elimination adjustment subtracted $19.2 million in aid. To close multi-million-dollar budget gaps, the district has cut 227.6 posts since 2009.

In December, when school board members looked ahead to next year’s budget, listing priorities, the top recommendation for most was building up the fund balance.

Guilderland currently has a $92 million budget with the fund balance estimated at 2.1 percent, Sanders told The Enterprise. State law allows districts to have up to 4 percent, and the comptroller would like to see at least 3 percent.

The data that was used for the comptroller’s Jan. 29 report is from the 2013-14 fiscal year when Guilderland was at 2.69 percent of the possible 4 percent. The comptroller’s formula starts adding points for any amount less than 3 percent. “You don’t get penalized if you have more than 3 percent,” said Sanders.

For several years in a row, before the 2008 recession, Guilderland was cited in its annual state-required audit for having a fund balance that was higher than the percentage allowed by law; a majority of board members at the time felt that was prudent so that the district could be prepared for an emergency and also could meet payroll without borrowing if state-aid payments were delayed.

After the recession, the board was willing to use more of the fund balance to keep the tax rate down and to avoid cutting more staff and programs.

Comptroller Thomas DiNapoli’s report listed over 13 percent of the 672 districts statewide as being in fiscal stress — 10 districts were labeled as in “significant fiscal stress” in this year’s report; 27 were listed in “moderate fiscal stress”; and 53, including Guilderland, were listed as “susceptible to fiscal stress.”

Fiscal scores for other local districts include rural Berne-Knox-Westerlo at 6.7 percent (the same as last year) and suburban Voorheesville at 0 percent (an improvement from last year’s 6.7 percent) — both well below the 25-percent threshold for designation as being “susceptible to fiscal stress.”

Guilderland had the same fiscal score as last year — 26.7 percent. DiNapoli’s financial indicators are based on seven different calculations in four categories: year-end fund balance, operating deficits, cash position, and short-term debt. Guilderland’s fiscal score of 26.7 percent is at the bottom end of the susceptible-listing threshold. The higher the fiscal score, the more susceptible to stress a school district is, according to the report.

 The Capital Region, with 12 stressed districts, tied with Western New York for having the second highest number of stressed districts behind Long Island, with 19.

The comptroller has come up with a similar system for evaluating stress on municipalities. The town of Guilderland has a fiscal score of 0 percent (an improvement over the previous year’s 5 percent) while the village of Voorheesville has a fiscal score of 5 percent — both well below the threshold of being designated as under fiscal stress.

In his statement to the school board on Tuesday, Sanders emphasized that the formula and weightings used by the comptroller’s office are “indicators” of fiscal stress, “not absolute determinations of fiscal stress.”

Sanders said Guilderland’s designation was based in large part on a $4 million short-term tax anticipation note issued in July and paid off in October 2013. He said the borrowing was needed to cover bills and payroll during the summer before the district receives state aid and tax revenues. Without the summer borrowing, Guilderland’s score, by the comptroller’s calculations, would have fallen below the threshold for designation as “susceptible to fiscal stress.”

The roughly $4 million that Guilderland typically receives from the state in the fall by law doesn’t have to be paid until Sept. 30. Usually, Sanders said, the payment came in the beginning of September but, in recent years, had lagged to the middle of the month. He also said the interest for borrowing the $4 million was $10,889.

“You have to borrow ahead of time to make sure you have the money at hand,” said Sanders.

Board member Gloria Towle-Hilt asked if the district could have taken money out of its fund balance instead of borrowing. “We didn’t have enough cash on hand to do that,” responded Sanders.

Board President Barbara Fraterrigo said she was frustrated. “It’s the state’s inconsistency…that wastes taxpayers 10,000 bucks,” she said.

Board member Christopher McManus said that, except for the Watervliet City School District, which for the second year was labeled as being in “significant fiscal stress,” no other Albany County school district besides Guilderland was listed in the report. Watervliet had a fiscal score in this year’s report of 80.0 percent, a slight improvement from last year’s 88.3.

“It doesn’t put us in the best light,” McManus said. “When people write the story, they’re not going to explain what you explained,” he told Sanders.

Sanders said he anticipates Guilderland will not be on the list next year; there was no summer borrowing in 2014, he said.

Last year, a third of the 12 Suburban Council school districts were designated as being “susceptible” to fiscal stress. This year, only Averill Park (with a fiscal score of 31.7 percent, down from 43.3 last year) and Guilderland retain that designation.  The other two Suburban Council districts that were designated last year by the comptroller improved their scores enough to avoid designation; Ballston Spa improved its fiscal score from 25 percent last year to 6.7 this year and South Colonie improved its fiscal score from 28.3 percent last year to 21.7 this year.

In addition to a fiscal score, the comptroller‘s report also assigns each district an environmental score, which Jennifer Freeman, a spokeswoman for the comptroller’s office, last year termed “the flip side.”

That score is based on such factors as the number of students who qualify for free or reduced-price lunches, and the homes in the district below the statewide median price, Freeman said. They are factors largely outside of a district’s control that have a bearing on its capability to raise revenues as well as on its demand for services.

The environmental indicators are based on six calculations in five categories: property value, enrollment, budget vote results, graduation rate, and free or reduced-price lunch. The higher the score, the more susceptible to stress a district is judged to be.

Last year’s report showed Guilderland with an environmental score of 16.7 percent while this year’s report showed Guilderland with a score of 10.0 percent, the same as Voorheesville’s, while Berne-Knox-Westerlo’s was 33.3 percent.

Last year, Sanders said, commenting on the district’s environmental score, that Guilderland underwent “a change in property values.” He said, “There was a decrease in property value in Guilderland for the first time.” He also noted that the district has declining enrollment; currently, close to 5,000 students attend Guilderland schools.

This year, Sanders said that two factors affected Guilderland’s environmental score. The change in property values was at the 1-percent reduction threshold set by the comptroller’s office. Last year, it had been at 1.9 percent, Sanders said.

“The only other category with a score,” said Sanders, “was change in enrollment.” The threshold in reduction set by the comptroller is 1.5 percent. Last year, Guilderland generated a point because the rate was 1.9 percent; this year, it was at 1.3 percent so no points were generated.

“We have a dichotomy between the governor and the comptroller,” Sanders concluded last year. “The governor says school districts have money in fund balances and reserves that need to be used to solve budgetary problems. The comptroller is saying, if you use up your reserves, be careful because you’re putting yourself in fiscal stress. They are mixed messages.”

Sanders said the same is true this year.  He told The Enterprise, “Part of the governor’s rationale not to provide more funds to schools is they have enough to work with.  The comptroller is really pushing the fund-balance issue, to maximize that to provide a safety net.”