Cary School Board President Scott Coffey weighs in on the $100 flat rate very partial rebate of money unneeded in the $40 million Valley Hi Nursing Home Fund:
Should not the resolution of the question of how much fund balance Valley Hi SHOULD have, drive the amount of the refund and not the other way around?
It appears as though an arbitrary amount of $100 per household was selected, which will result in a fund balance draw down of approximately $8.8 million.
That will still leave $31+ million in fund balance (or more than 3 years of expense coverage).
$31 million is still an excessively high and unsupportable level given the current level of spending for this operation.
The Board should first decide what the correct level of fund balance should be.
I would suggest that six months of expense coverage may be an appropriate base target (approx $5 million), plus a slight allowance for any near-term CapEx programs, if any are needed.
The entire remaining excess balance of roughly $30-35 million should be returned to the taxpayers in a form to be decided by the Board.
The Board should fix this issue appropriately and in its entirety rather than take weak action which still leaves the problem of excessive fund balance still on the books.