FCMAT finds "high risk" fiscal score for SFUSD, flags budget monitoring and controls

FCMAT presenters told the San Francisco Board of Education that an independent fiscal health risk analysis (FHRA) scored SFUSD 42.9, a rating the auditors call "high risk." Jennifer Noga of FCMAT said the FHRA is a checklist tool based on 20 functional areas and cautioned it is a snapshot rather than a plan. "This report was a result of ... the staff provided a ton of documentation," she said.

Jeff Potter, FCMAT's auditor, summarized the result: "The overall score for San Francisco Unified, when we completed this, study was 42.9." The auditors identified primary concerns in budget development and adoption, budget monitoring and updates, ongoing deficit spending in the unrestricted general fund, position-control accuracy, internal controls and leadership stability. Potter and Noga said many FHRA answers are "no" by design when evidence could not be independently verified during field work.

District staff told the board they have implemented or are launching a number of fixes: improved budget-to-actual reporting, a new position-control system, a newly created internal-audit function, and closer monitoring of cash and payroll processes. Deputy Superintendent of Business Services said the district is moving to real-time budget-to-actual tools and has begun training principals and staff on operational budgeting.

Board members sought measurable monitoring tools. "How are we to know we are staying in lockstep with our progress towards fiscal stability?" President Kim asked. Staff agreed to develop a dashboard with high-leverage indicators (budget-to-actual variance, payroll accuracy, fraud-reporting mechanisms) and to provide regular updates. FCMAT cautioned that the FHRA looks back two years and that some checklist items cannot be changed retroactively, even as staff noted progress since the FHRA field work.