Audit Objective
Did the Levittown Union Free School District (District) Board of Education (Board) and District officials effectively manage fund balance?
Audit Period
July 1, 2019 – June 30, 2025
Understanding the Audit Area
A key measure of a school district’s financial condition is its level of fund balance, which represents the difference between revenues and expenditures accumulated over time. School district officials must manage fund balance to ensure long-term educational stability, provide a cash flow cushion for unexpected costs (like emergencies and revenue gaps), maintain tax rate stability, comply with the 4 percent surplus fund balance limit,1 and avoid excessive reserves that burden taxpayers, all while ensuring funds are used for genuine needs rather than remaining underutilized. Proper management helps ensure resources meet student needs while maintaining financial health.
The District’s general fund expenditures for fiscal year 2024-25 totaled $241.8 million and its budgeted appropriations for the 2025-26 fiscal year are $274.1 million. The District’s six reserve funds totaled $30.2 million as of June 30, 2025.
Audit Summary
The Board and District officials did not manage fund balance effectively. The Board and District officials overestimated certain appropriations, underestimated certain revenues and appropriated surplus fund balance and reserves to balance the budget when these funds were not necessary for operations. The Board and District officials’ consistent practice of appropriating fund balance that is not needed to finance operations results in real property tax levies that are higher than needed. Further, the lack of Board-authorization and detailed reporting on reserve fund activities is not transparent to taxpayers and does not allow the Board sufficient information to make informed decisions.
For the fiscal years 2020-21 through 2024-25, the Board and District officials:
- Overestimated appropriations by $127.1 million,
- Appropriated fund balance and reserves totaling $64.9 million that was not needed to fund operations,
- Underestimated revenues by $23.6 million,
- Did not ensure reserve fund activities totaling $19.4 million were Board-authorized,
- Did not ensure reserve funds were reviewed monthly from March through May each year and that the annual reserve fund reports included each reserve’s transaction activity, needs, conditions for use and targeted funding levels required by the District policy.
As a result, the District had unplanned operating surpluses totaling $87.9 million, and the recalculated surplus fund balance exceeded the legal limit by at least 3 percentage points in each of the five years reviewed.
The report includes seven recommendations that, if implemented, will improve the District’s management of fund balance. District officials generally agreed with our findings and indicated they plan to initiate corrective action.
This audit was conducted pursuant to Article V, Section 1 of the State Constitution and the Office of the New York State Comptroller’s (OSC’s) authority as set forth in Article 3 of the New York State General Municipal Law (GML). The audit’s methodology and standards are included in Appendix C.
The Board has the responsibility to initiate corrective action. A written corrective action plan (CAP) that addresses the findings and recommendations in this report must be prepared and provided to our office within 90 days, pursuant to Section 35 of the New York State General Municipal Law, Section 2116-a (3)(c) of the New York State Education Law and Section 170.12 of the Regulations of the Commissioner of Education. To the extent practicable, implementation of the CAP must begin by the end of the next fiscal year. For more information on preparing and filing your CAP, please refer to our brochure, Responding to an OSC Audit Report, which you received with the draft audit report. The CAP should be posted on the District’s website for public review.
1 New York State Real Property Tax Law (RPTL) Section 1318