Report 2017-104 Recommendation 6 Responses

Report 2017-104: Montebello Unified School District: County Superintendent Intervention Is Necessary to Address Its Weak Financial Management and Governance (Release Date: November 2017)

Recommendation #6 To: Montebello Unified School District

To improve its current financial condition and ensure future viability, Montebello should create a robust budgeting process within 90 days using best practices of the Government Finance Officers Association to ensure Montebello's ability to meet its priorities while maintaining the required level of reserves that buffers the district from drastic cuts in times of economic instability.

1-Year Agency Response

MUSD has worked closely with the Los Angeles County Office of Education to establish a robust budgeting process that ensures maintaining the required level of reserves while it continues to provide and enhance education programs for the students it serves. Furthermore, on August 9, 2018 district and school leadership hosted the Fiscal Crisis and Management Assistance Team to review allowable and non-allowable district expenditures. MUSD is utilizing the Government Finance Officers Association's budget monitoring to guide our budgeting process.

  • Completion Date: November 2018
  • Response Date: November 2018

California State Auditor's Assessment of 1-Year Status: Pending

Montebello had not demonstrated that it has fully implemented our recommendation. It used one-time transfers to help meet certain obligations, but its approved budget projects deficit spending in the two subsequent years.

  • Auditee did not address all aspects of the recommendation

6-Month Agency Response

MUSD continues to work with staff to discuss budget development including review of expenditures across all funding sources. Departments have been directed that funding level will be at a ten percent reduction across the board for fiscal year 2018-2019 and 2019-2020. This will be included in our adopted budget and narrative for the 2018-2019 fiscal year provided to the Los Angeles County Office of Education (LACOE) for the next three years and will be subject to their approval.

  • Estimated Completion Date: 6/30/2018
  • Response Date: May 2018

California State Auditor's Assessment of 6-Month Status: Pending

Montebello should review the best practices of the Government Finance Officers Association when creating its budgeting process.


60-Day Agency Response

MUSD continues addressing its ongoing commitments and ability to meet its priorities, including maintaining the legally required level of reserves. Effective November 8, 2017, MUSD was assigned a Los Angeles County Office of Education (LACOE) Fiscal Adviser, Mr. Mark Skvarna, who on an on-going manner is assisting with all fiscal matters. Furthermore, on December 21, 2017, the Board of Education approved the First Interim Budget with a "Positive" certification. A budget monitoring process is also evident via the Revenue and Expense Committee whereby representatives from the District Office, Classified School Employees Association (CSEA), Montebello Teacher Association (MTA), and Association of Montebello School Administrators (AMSA) meet to review the annual allocated budget and expenditures on a monthly basis.

  • Completion Date: December 2017
  • Response Date: December 2017

California State Auditor's Assessment of 60-Day Status: Pending

Montebello's proposed monitoring process does not address the recommendation. Montebello needs to create a budgeting process to develop and implement a planned budget. Montebello should review the best practices of the Government Finance Officers Association when creating its budgeting process.

  • Auditee did not address all aspects of the recommendation

All Recommendations in 2017-104

Agency responses received are posted verbatim.