DPUFSD Financial Statements 2024.pdf

DEER PARK UNION FREE SCHOOL DISTRICT

TOWN OF BABYLON, NEW YORK

FINANCIAL STATEMENTS AND

SUPPLEMENTARY INFORMATION

IN CONNECTION WITH THE UNIFORM GUIDANCE

AS OF AND FOR THE YEAR ENDED

JUNE 30, 2024

PAGE

Independent Auditor's Report 1

Required Supplementary Information:

Management's Discussion And Analysis ("MD&A") 4

Basic Financial Statements:

District-Wide Financial Statements - Statement Of Net Position 16 Statement Of Activities 17 Fund Financial Statements - Balance Sheet - Governmental Funds 18 Reconciliation Of Governmental Funds Balance Sheet To The Statement Of Net Position 19 Fund Financial Statements - Statement Of Revenues, Expenditures And Changes In Fund Balance - Governmental Funds 20 Reconciliation Of Governmental Funds Statement Of Revenues, Expenditures And Changes In Fund Balance To The Statement Of Activities 21 Fund Financial Statements - Statement Of Fiduciary Net Position - Fiduciary Fund 22 Statement Of Changes in Fiduciary Net Position - Fiduciary Fund 22 Notes To Financial Statements 23

Required Supplementary Information Other Than MD&A:

General Fund - Schedule Of Revenues, Expenditures And Changes In Fund Balance - Budget And Actual 55 Schedule Of Changes In The District's Total OPEB Liability And Related Ratios 56 Schedule Of District's Proportionate Share Of The Net Pension Asset/Liability - NYSERS & NYSTRS 57 Schedule Of District Pension Contributions - NYSERS & NYSTRS 58

Other Supplementary Information (Required by the New York State Education Department):

General Fund - Schedule Of Change From Adopted Budget To Final Budget And The Real Property Tax Limit 59 Capital Projects Fund - Schedule Of Project Expenditures And Financing Sources 60 Net Investment In Capital Assets 61

Federal Award Program Information:

Schedule Of Expenditures Of Federal Awards 62 Notes To Schedule Of Expenditures Of Federal Awards 63

Independent Auditor's Report On Internal Control Over Financial Reporting And On Compliance And Other Matters Based On An Audit Of Financial Statements Performed In Accordance With Government Auditing Standards 64 Independent Auditor's Report On Compliance For Each Major Program And On Internal Control

Over Compliance Required By The Uniform Guidance 66 Schedule Of Findings And Questioned Costs 69 Summary Schedule Of Prior Audit Findings 70

Findings And Recommendations 71

TABLE OF CONTENTS

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CERTIFIED PUBLIC ACCOUNTANTS

INDEPENDENT AUDITOR’S REPORT

To the Board of Education of the Deer Park Union Free School District Town of Babylon, New York:

Report on the Audit of the Financial Statements

Opinions

We have audited the accompanying financial statements of the governmental activities, each major fund and the Fiduciary Funds of the Deer Park Union Free School District (the “District”) as of and for the year ended June 30, 2024, and the related notes to the financial statements, which collectively comprise the District’s basic financial statements as listed in the table of contents.

In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, each major fund and the Fiduciary Funds of the Deer Park Union Free School District, as of June 30, 2024, and the respective changes in financial position for the year then ended in accordance with accounting principles generally accepted in the United States of America.

Basis for Opinions

We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the Deer Park Union Free School District and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.

Responsibilities of Management for the Financial Statements

Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the District’s ability to continue as a going concern for twelve months beyond the financial statement date, including any currently known information that may raise substantial doubt shortly thereafter.

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Auditor’s Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinions. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards and Government Auditing Standards will always detect a material misstatement when it exists.

The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.

In performing an audit in accordance with generally accepted auditing standards and Government Auditing Standards, we:

Exercise professional judgment and maintain professional skepticism throughout the audit.

Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the District’s internal control. Accordingly, no such opinion is expressed.

Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements.

Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the District’s ability to continue as a going concern for a reasonable period of time.

We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control related matters that we identified during the audit.

Prior Period Adjustment

As described in Note 15 to the financial statements, the District had an analysis performed by a third party of its capital assets. The effect of this change required a restatement to the financial statements as detailed in Note 15. Our opinion is not modified with respect to this matter.

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Required Supplementary Information

Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis and required supplementary information on pages 4-15 and 55-58, respectively, be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements.

We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.

Supplementary Information

Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the District’s basic financial statements. The accompanying other supplementary information and schedule of expenditures of federal awards, as required by the New York State Education Department and by Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, are presented for purposes of additional analysis and are not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the other supplementary information and the schedule of expenditures of federal awards are fairly stated, in all material respects, in relation to the basic financial statements as a whole.

Other Reporting Required by Government Auditing Standards

In accordance with Government Auditing Standards, we have also issued our report dated October 11, 2024, on our consideration of the District’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the District’s internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the District’s internal control over financial reporting and compliance.

Hauppauge, New York October 11, 2024 jcastles Stamp

MANAGEMENT’S DISCUSSION AND ANALYSIS

FOR THE FISCAL YEAR ENDED JUNE 30, 2024

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The following is a discussion and analysis of the Deer Park Union Free School District’s (the “District”) financial performance for the fiscal year ended June 30, 2024. This section is a summary of the District’s financial activities based on currently known facts, decisions or conditions. It is also based on both the District-wide and fund-based financial statements. The results of the current year are discussed in comparison with the prior year, with an emphasis placed on the current year. This section is only an introduction and should be read in conjunction with the District’s financial statements, which immediately follow this section.

FINANCIAL HIGHLIGHTS

The District’s investment in capital assets, net of related debt, increased $2,830,043 due to the District making improvements to its’ buildings and upgrading their equipment and instructional technology, offset by depreciation charges.

Capital asset balances as of July 1, 2023 have been restated to reflect the results of an analysis performed by a third party (see Note 15).

The District’s expenses for the year, as reflected in the District-wide financial statements, totaled $140,467,645. Of this amount, $11,385,615 was offset by program charges for services and operating grants. General revenues of $139,381,417 amount to 92% of total revenues.

Total governmental fund’s assets exceeded liabilities and deferred inflows of resources by $39,375,915

(see pages 18 and 20).

OVERVIEW OF THE FINANCIAL STATEMENTS

This annual report consists of three parts: required supplementary information including management’s discussion and analysis (this section), the basic financial statements, and other supplementary information.

The basic financial statements include two kinds of financial statements that present different views of the District:

The first two financial statements are District-wide financial statements that provide both short-term and long-term information about the District’s overall financial status.

The remaining financial statements are fund financial statements that focus on individual parts of the

District, reporting the District’s operations in more detail than the District-wide financial statements. The governmental fund financial statements tell how basic services such as regular and special education were financed in the short-term as well as what remains for future spending. Fiduciary fund financial statements provide information about the financial relationships in which the District acts solely as a trustee or agent for the benefit of others.

The financial statements also include notes that explain some of the information in the financial statements and provide more detailed data. The financial statements are followed by a section of required supplementary information that further explains and supports the financial statements with a comparison of the District’s budget for the year.

FOR THE FISCAL YEAR ENDED JUNE 30, 2024 (CONTINUED)

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Table A-1 summarizes the major features of the District’s financial statements, including the portion of the District’s activities they cover and the types of information they contain. The remainder of this overview section of management’s discussion and analysis highlights the structure and contents of each of the financial statements.

Table A-1: Major Features of the District-wide and Fund Financial Statements

District-wide Financial

Statements

Fund Financial Statements

Governmental Funds Fiduciary Funds Scope Entire District (except fiduciary funds) The activities of the District that are not proprietary or fiduciary, such as special education and building maintenance

Instances in which the District administers resources on behalf of someone else, such as scholarship programs and student activity monies

Required financial statements

Statement of Net Position

Statement of Activities

Balance Sheet Statement of

Revenues, Expenditures and Changes in Fund Balance

Statement of Fiduciary Net Position

Statement of Changes in Fiduciary Net Position

Accounting basis and measurement focus

Accrual accounting and economic resources focus

Modified accrual accounting and current financial focus

Accrual accounting and economic resources focus

Type of asset/deferred outflows of resources/liability/ deferred inflows of resources information

All assets, deferred outflows of resources, liabilities, and deferred inflows of resources both financial and capital, short-term and long-term

Generally, assets and deferred outflows of resources expected to be used up and liabilities and deferred inflows of resources that come due or available during the year or soon thereafter;

no capital assets or long-term liabilities included

All assets, deferred outflows of resources (if any), liabilities, and deferred inflows of resources (if any) both short-term and long-term;

funds do not currently contain capital assets, although they can

Type of inflow/outflow information

All revenues and expenses during year, regardless of when cash is received or paid

Revenues for which cash is received during or soon after the end of the year;

expenditures when goods or services have been received and the related liability is due and payable

All additions and deductions during the year, regardless of when cash is received or paid

District-Wide Financial Statements

The District-wide financial statements report information about the District as a whole using accounting methods similar to those used by private-sector companies. The Statement of Net Position includes all of the District’s assets, deferred outflows of resources, liabilities and deferred inflows of resources. All of the current year’s revenues and expenses are accounted for in the Statement of Activities regardless of when cash is received or paid.

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The two District-wide financial statements report the District’s net position and how it has changed. Net position - the difference between the District’s assets, deferred outflows of resources, liabilities and deferred inflows of resources - is one way to measure the District’s financial health or position.

Over time, increases or decreases in the District’s net position are an indicator of whether its financial position is improving or deteriorating, respectively.

To assess the District’s overall health, one needs to consider additional non-financial factors such as changes in the District’s property tax base and the condition of school buildings and other facilities.

In the District-wide financial statements, the District’s activities are shown as governmental activities. Most of the District’s basic services are included here, such as regular and special education, transportation and administration. Property taxes and State formula aid finance most of these activities.

Fund Financial Statements

The fund financial statements provide more detailed information about the District’s funds, focusing on its most significant or “major” funds - not the District as a whole. Funds are accounting devices the District uses to keep track of specific sources of funding and spending on particular programs:

Some funds are required by State law and by bond covenants.

The District establishes other funds to control and to manage money for particular purposes (such as repaying its long-term debts) or to show that it is properly using certain revenues (such as Federal grants).

The District’s governmental funds are described as follows:

Governmental funds: Most of the District’s basic services are included in governmental funds, which generally focus on (1) how cash and other financial assets that can readily be converted to cash flow in and out and (2) the balances left at year-end that are available for spending. Consequently, the governmental funds financial statements provide a detailed short-term view that helps you determine whether there are more or fewer financial resources that can be spent in the near future to finance the District’s programs. Because this information does not encompass the additional long-term focus of the District-wide financial statements, reconciliations of the District-wide and governmental funds financial statements are provided which explain the relationship (or differences) between them.

Fiduciary funds are used to account for assets held by the District in its capacity as custodian or trustee and utilize the accrual basis of accounting. All of the District's fiduciary activities are reported in separate statements. The fiduciary activities have been excluded from the District-wide financial statements because the District cannot use these assets to finance its operations.

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FINANCIAL ANALYSIS OF THE DISTRICT AS A WHOLE

Net Position

The District’s net position increased by $10,299,387 from the year before to a net deficit position of $156,546,330, as detailed in Tables A-2 and A-3.

The restricted net position balance of $22,086,901 represents the District’s reserves for employee benefit accrued liabilities, unemployment insurance, retirement contributions, tax reductions, workers’ compensation, scholarships and extraclassroom activities. These assets are restricted by external sources, imposed by laws through constitutional provisions or enabling legislation.

As of June 30, 2024, the District has an unrestricted net deficit position of $189,964,444. This deficit is driven by the District’s required recognition of its obligation to post-employment benefits which currently totals $181,303,117.

Table A-2: Condensed Statements of Net Position - Governmental Activities

(As restated) 6/30/2023 6/30/2024 $ Change

Current assets 20,230,830$ 22,891,718$ 2,660,888$ 13.2 Other assets 24,862,437 24,958,750 96,313 0.4 Capital assets, net 27,281,017 32,135,501 4,854,484 17.8

Total assets 72,374,284$ 79,985,969$ 7,611,685$ 10.5

Deferred outflows of resources 43,641,488$ 37,606,752$ (6,034,736)$ (13.8)

Current liabilities 16,082,534$ 17,071,399$ 988,865$ 6.1 Noncurrent liabilities 213,411,017 212,576,588 (834,429) (0.4)

Total liabilities 229,493,551$ 229,647,987$ 154,436$ 0.1

Deferred inflows of resources 53,367,938$ 44,491,064$ (8,876,874)$ (16.6)

Net position:

Net investment in capital assets 8,501,170$ 11,331,213$ 2,830,043$ 33.3 Restricted 18,073,298 22,086,901 4,013,603 22.2 Unrestricted (deficit) (193,420,185) (189,964,444) 3,455,741 1.8

Total net position (166,845,717)$ (156,546,330)$ 10,299,387$ 6.2

% Change

As of June 30, 2024, the District had positive working capital of $5,820,319 as compared to $4,148,296 as of June 30, 2023. The increase is primarily due to increases in state and federal aid receivables offset by increases in accrued liabilities.

Capital asset balances as of July 1, 2023 have been restated to reflect the results of an analysis performed by a third party (see Note 15). Capital assets, net increased by $4,854,484 mainly due to the District’s capital outlay exceeding depreciation during the fiscal year.

Deferred outflows and deferred inflows decreased by $6,034,736 and $8,876,874, respectively, mainly due to the net changes in the total OPEB liability as well as the District’s proportionate share of pension liabilities during the fiscal year.

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Changes in Net Position

The District’s fiscal year 2024 revenues totaled $150,767,032 (See Table A-3). Property taxes, other tax items and State sources accounted for most of the District’s revenue by contributing 48 cents, 8 cents and 32 cents, respectively, of every dollar raised (See Table A-4). The remainder came from fees charged for services, operating grants, sale of property and compensation for loss, use of money and property, and other miscellaneous sources.

Real property tax revenue increased $1,878,365 as a result of a budgeted increase in the levy for fiscal

2023-24.

State sources increased $9,447,020 as a result of the District receiving more in general and lottery aid.

Instruction expenses increased $13,216,730 as a result of the net changes in the total OPEB liability as well as the District’s proportionate share of pension liabilities during the fiscal year.

The District’s fiscal year 2024 expenses totaled $140,467,645 (See Table A-3) on the full accrual basis of accounting. These expenses (90%) are predominantly related to instruction and general support (See Table A-6).

Table A-3: Changes in Net Position from Operating Results - Governmental Activities Only

6/30/2023 6/30/2024 $ Change

Revenues Program revenues:

Charges for services 1,074,594$ 1,092,532$ 17,938$ 1.7 Operating grants 7,281,207 10,293,083 3,011,876 41.4 General revenues:

Real property taxes 70,774,834 72,653,199 1,878,365 2.7 Other tax items 12,537,065 11,701,265 (835,800) (6.7) Use of money and property 868,876 1,270,124 401,248 46.2 Sale of property and compensation for loss 92,569 40,380 (52,189) (56.4) State sources 39,048,775 48,495,795 9,447,020 24.2 Federal sources - Medicaid 143,871 44,347 (99,524) (69.2) Miscellaneous 4,077,936 5,176,307 1,098,371 26.9

Total revenues 135,899,727 150,767,032 14,867,305 10.9

Expenses General support 14,705,235 16,018,865 1,313,630 8.9 Instruction 97,716,859 110,933,589 13,216,730 13.5 Pupil transportation 8,015,819 9,346,700 1,330,881 16.6 Debt service - interest 1,378,456 1,562,197 183,741 13.3 School lunch program 1,453,955 2,606,294 1,152,339 79.3

Total expenses 123,270,324 140,467,645 17,197,321 14.0

Change in net position 12,629,403 10,299,387 (2,330,016) (18.4)

Net position (deficit), beginning of year (165,738,318) (166,845,717) (1,107,399) (0.7)

Prior period adjustment, see Note 15 (13,736,802) - 13,736,802 (100.0)

Net position (deficit), end of year (166,845,717)$ (156,546,330)$ 10,299,387$ 6.2

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Table A-4: Sources of Revenues for Fiscal Year 2024

Real property taxes, 48.2%

Other tax items, 7.8%

Use of money and property, 0.8%

Sale of property and compensation for loss, 0.05%

State sources, 32.2%

Federal sources - Medicaid, 0.05%

Miscellaneous, 3.4% Charges for services, 0.7%

Operating grants, 6.8%

Table A-5: Sources of Revenues for Fiscal Year 2023

Real property taxes, 52.1%

Other tax items, 9.2%

Use of money and property, 0.6%

Sale of property and compensation for loss, 0.1%

State sources, 28.7%

Federal sources - Medicaid, 0.1%

Miscellaneous, 3.0%

Charges for services, 0.8%

Operating grants, 5.4%

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Table A-6: Expenses for Fiscal Year 2024

Instruction, 78.9%

General support, 11.4%

Pupil transportation, 6.7%

School lunch program, 1.9% Debt service -interest, 1.1%

Table A-7: Expenses for Fiscal Year 2023

Instruction, 79.3%

General support, 11.9%

Pupil transportation, 6.5%

School lunch program, 1.2%

Debt service -interest, 1.1%

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FINANCIAL ANALYSIS OF THE DISTRICT’S FUNDS

Variances between years for the fund financial statements are not the same as variances between years for the District-wide financial statements. The District’s governmental funds are presented on the current financial resources measurement focus and the modified accrual basis of accounting. Based on this presentation, governmental funds do not include long-term debt liabilities for the funds’ projects and capital assets purchased by the funds. Governmental funds will include the proceeds received from the issuance of debt, the current payments for capital assets and the current payments for debt.

At June 30, 2024, the District’s governmental funds reported a combined fund balance of $39,375,915 which is an increase of $2,748,687 from June 30, 2023.

General Fund

The General Fund reported an increase in fund balance of $6,757,083 for fiscal 2024, as compared to an increase in fund balance of $3,606,213 for fiscal 2023. Revenues increased $11,649,081 mainly as a result of an increase in real property taxes and state sources. Expenditures increased $7,376,134 due to increases in all categories. Other financing sources (uses) equated to $1,242,540, which is an increase of $1,122,077 from the prior year.

Special Aid Fund

Increases in federal and state grant funding caused an increase in revenue in the Special Aid Fund.

Revenues increased $2,596,360. The General Fund transferred $250,000 to the Special Aid Fund as the required amount to be subsidized for summer school handicap programs. The remaining costs of that program are paid by State aid and are a receivable of the District.

School Lunch Fund

The School Lunch Fund reported a decrease in fund balance of $270,594 for fiscal 2024. Increases in federal and state grant funding caused an increase in revenue in the School Lunch Fund. Expenses related to food service operations increased $1,152,339 as a result of an increase in food services costs during the fiscal year.

Capital Projects Fund

The District spent $6,794,845 on necessary District-wide improvements in fiscal 2023-24. The General Fund transferred $1,200,000 to the fund to subsidize those improvements. The District issued installment purchase debt in the amount of $1,738,864. As a result of the long-term financing, the Capital Projects Fund balance ended in a net position of $1,605,265.

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Fund balances for the District’s governmental funds for the past two years were distributed as follows:

Table A-8: Fund Balances - Governmental Funds

6/30/2023 6/30/2024 $ Change

General Fund Restricted:

Employee Benefit Accrued Liability 5,204,399$ 4,928,266$ (276,133)$ (5.3) Unemployment Insurance 957,709 970,503 12,794 1.3 Retirement Contributions 5,908,185 6,307,426 399,241 6.8 Tax Reduction 4,414,674 3,519,745 (894,929) (20.3) Workers' Compensation 1,359,066 1,110,953 (248,113) (18.3) Capital Projects - 5,000,000 5,000,000 100.0

Assigned:

Appropriated for subsequent year's expenditures 2,250,000 3,860,000 1,610,000 71.6 Encumbrances 2,876,787 3,810,387 933,600 32.5 Unassigned 5,554,317 5,774,940 220,623 4.0

Total General Fund 28,525,137 35,282,220 6,757,083 23.7

School Lunch Fund Nonspendable:

Inventory 29,756 25,563 (4,193) (14.1) Assigned:

Food service operations 1,792,332 2,165,774 373,442 20.8 Encumbrances 686,928 47,085 (639,843) (93.1)

Total School Lunch Fund 2,509,016 2,238,422 (270,594) (10.8)

Other Miscellaneous Special Revenue Fund Restricted:

Scholarships and extraclassroom activities 229,265 250,008 20,743 9.0

Total Other Miscellaneous Special Revenue Fund 229,265 250,008 20,743 9.0

Capital Projects Fund Restricted:

Capital Projects 5,363,810 1,605,265 (3,758,545) (70.1)

Total Capital Projects Fund 5,363,810 1,605,265 (3,758,545) (70.1)

36,627,228$ 39,375,915$ 2,748,687$ 7.5

General Fund Budgetary Highlights

Reference is made to page 55, which presents original and final budget amounts, as well as actual results for the District’s General Fund.

Actual revenues were greater than the final budgeted revenues by $3,262,765. Other tax items resulted in higher balance related to PILOT amounts. Use of money and property was greater than expected due to funds held in interest bearing accounts with more favorable interest rates. Miscellaneous revenues were greater than expected related to increases in health insurance contributions for teachers.

Actual expenditures were $5,128,258 less than budgeted primarily due to reduced spending and lower than anticipated employee benefit costs.

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At June 30, 2024, the District’s unassigned fund balance was $5,774,940, which was within the allowable 4% of the subsequent year’s budget ($144,373,492) as promulgated by New York State (see page 59).

The following is a reconciliation of the General Fund’s unassigned fund balance for the year ended June 30, 2024:

Unassigned fund balance, beginning of year 5,554,317$ Add:

Prior-year appropriated fund balance 2,250,000 Prior-year encumbrances 2,876,787 Board approved planned use of Employee Benefit Accrued Liability Reserve 400,000 Board approved planned use of Unemployment Insurance Reserve 10,000 Board approved planned use of Workers' Compensation Reserve 400,000 Board approved planned use of Retirement Contributions Reserve 350,000 Board approved planned use of Tax Reduction Reserve 1,000,000 Net change in fund balance 6,757,083 Less:

Current-year appropriated fund balance (3,860,000) Transfer to Employee Benefit Accrued Liability Reserve (including allocated interest) (123,867) Transfer to Unemployment Insurance Reserve (including allocated interest) (22,794) Transfer to Retirement Contributions Reserve (including allocated interest) (749,241) Transfer to Workers' Compensation Reserve (including allocated interest) (151,887) Transfer to Tax Reduction Reserve (including allocated interest) (105,071) Transfer to Capital Reserve (5,000,000) Current-year encumbrances (3,810,387)

Unassigned fund balance, end of year 5,774,940$

CAPITAL ASSETS AND DEBT ADMINISTRATION

Capital Assets

By the end of 2024, the District had invested $32,135,501 net of depreciation (Table A-9), in a broad range of capital assets, including school buildings, maintenance facilities, athletic facilities, computer and audio-visual equipment, and administrative offices. See Note 6 in the accompanying notes to the financial statements for more information on capital assets.

Table A-9: Capital Assets (net of depreciation)

(As restated) 6/30/2023 6/30/2024 $ Change

Land 230,750$ 230,750$ -$ 0.0 Construction-in-progress 5,367,204 10,560,510 5,193,306 96.8 Land improvements 3,012,363 2,985,808 (26,555) (0.9) Buildings and building improvements 13,965,331 13,581,182 (384,149) (2.8) Furniture and equipment 3,859,650 4,188,152 328,502 8.5 Right-to-use lease assets 722,147 499,406 (222,741) (30.8) Subscription-based IT arrangement assets 123,572 89,693 (33,879) (27.4)

Totals 27,281,017$ 32,135,501$ 4,854,484$ 17.8

Capital asset balances as of July 1, 2023 have been restated to reflect the results of an analysis performed by a third party (see Note 15).

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Long-Term Liabilities

At year-end, the District had $212,234,503 in general obligations bonds and other long-term liabilities.

Table A-10: Outstanding Long-Term Liabilities

6/30/2023 6/30/2024 $ Change % Change

Bonds payable, net 13,230,808$ 12,170,280$ (1,060,528)$ (8.0) Installment purchase debt payable 10,235,885 9,772,676 (463,209) (4.5) Workers' compensation claims payable 1,359,066 1,110,953 (248,113) (18.3) Lease liabilities 669,516 465,105 (204,411) (30.5) Subscription-based IT arrangements liabilities 7,448 1,492 (5,956) (80.0) Other post-employment benefits 176,248,175 181,303,117 5,054,942 2.9 Compensated absences 6,168,452 7,410,880 1,242,428 20.1

Totals 207,919,350$ 212,234,503$ 4,315,153$ 2.1

FACTORS BEARING ON THE FUTURE OF DISTRICT

At the time these financial statements were prepared and audited, the District was aware of the following existing circumstances that could significantly affect its financial health in the future:

The use of reserves to assist in balancing the budget each year will be more difficult because of the inability to fund them to the extent the District was able to in the past. The “Tax Levy Limitation Law” which was enacted on June 24, 2011 restricts the amount of property taxes that may be levied by or on behalf of a school district in a particular year. Although there are exceptions, exemptions and overrides to the limitation, the Law is expected to make budgetary decision more difficult.

The General Fund budget for the 2024-2025 school year is impacted by certain trends affecting school districts. These include potential increases in health insurance costs, retirement costs, workers’ compensation judgments, and potential unemployment insurance claims, which are beyond the District’s control.

New York State imposed a maximum tax levy increase of the lesser of 2% or the CPI for the fiscal year

2024-2025 budget, subject to certain exclusions. Based on the value of obligatory contractual increases and continued increases in the State’s unfunded mandates, it is expected that reductions may be necessary. If the downward economic trend continues, and State mandates and legal requirements continue to escalate, there will be an inevitable negative impact on District programs.

Planning for future capital projects, the voters approved the establishment and funding of a Capital

Reserve fund in May 2024. The District transferred $5 million to the Capital Reserve Fund from excess fund balance for the year ended June 30, 2024.

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CONTACTING THE DISTRICT’S FINANCIAL MANAGEMENT

This financial report is designed to provide the District’s citizens, taxpayers, customers, investors and creditors with a general overview of the District’s finances and to demonstrate the District’s accountability for the money it receives. If you have any questions about this report or need additional financial information, please contact:

Deer Park Union Free School District District Offices

Attn: Assistant Superintendent of Business 1881 Deer Park Avenue

Deer Park, NY 11729

(631) 274-4020

Unrestricted cash 14,062,288$ Receivables:

State and federal aid 5,782,928 Due from other governments 3,020,939 Inventories 25,563 Noncurrent assets:

Restricted cash 24,958,750 Capital assets:

Non-depreciable/amortizable 10,791,260 Depreciable/amortizable, net 21,344,241

Total assets 79,985,969

Deferred outflows from OPEB 10,253,123 Deferred outflows from pensions 27,353,629

Total deferred outflows of resources 37,606,752

Accounts payable 344,952 Accrued liabilities 1,095,821 Accrued interest payable 237,249 Due to other governments 101 Due to teachers' retirement system 6,015,532 Due to employees' retirement system 394,512 Compensated absences 420,000 Unearned revenues 10,303 Retainage 259,731 Long-term liabilities, due within one year:

Lease liabilities 210,354 Subscription-based IT arrangement liabilities 1,492 Bond payable, net 1,085,528 Installment purchase debt payable 1,320,872 Other postemployment benefits liability 5,674,952 Long-term liabilities, due after one year:

Lease liabilities 254,751 Bond payable, net 11,084,752 Installment purchase debt payable 8,451,804 Workers' compensation claims payable 1,110,953 Compensated absences 7,410,880 Proportionate share of net pension liability 8,635,283 Other postemployment benefits liability 175,628,165

Total liabilities 229,647,987

Deferred inflows from pensions 4,352,623 Deferred inflows from OPEB 39,945,109 Deferred inflows from grants received in advance 193,332

Total deferred inflows of resources 44,491,064

Net investment in capital assets 11,331,213 Restricted:

Retirement Contributions 6,307,426 Workers' Compensation 1,110,953 Tax Reduction 3,519,745 Unemployment Insurance 970,503 Employee Benefit Accrued Liability 4,928,266 Capital Projects 5,000,000 Scholarships and extraclassroom 250,008 Unrestricted (deficit) (189,964,444)

Total net position (deficit) (156,546,330)$

LIABILITIES

DEFERRED INFLOWS OF RESOURCES

NET POSITION

DEER PARK UNION FREE SCHOOL DISTRICT

STATEMENT OF NET POSITION

JUNE 30, 2024

ASSETS

DEFERRED OUTFLOWS OF RESOURCES

The accompanying notes to financial statements are an integral part of this statement.

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Net (Expense) Revenue and

Charges for Operating Changes in Expenses Services Grants Net Position

Functions and programs:

General support 16,018,865$ 92,400$ 973,921$ (14,952,544)$ Instruction 110,933,589 639,890 6,744,586 (103,549,113) Pupil transportation 9,346,700 53,914 568,264 (8,724,522) Debt service - interest 1,562,197 - - (1,562,197) School lunch program 2,606,294 306,328 2,006,312 (293,654)

Total functions and programs 140,467,645$ 1,092,532$ 10,293,083$ (129,082,030)

General revenues:

Real property taxes 806,523 72,653,199 Other tax items 5,116,054 11,701,265 Use of money and property 354,203 1,270,124 Sale of property and 6,276,780 compensation for loss 40,380 State sources 48,495,795 Federal sources - medicaid assistance 44,347 Miscellaneous 5,176,307

139,381,417

10,299,387

(166,845,717)

Total general revenues

Change in net position

Total net position, beginning of year, as restated (see Note 15)

Total net position, end of year (156,546,330)$

DEER PARK UNION FREE SCHOOL DISTRICT

STATEMENT OF ACTIVITIES

FOR THE YEAR ENDED JUNE 30, 2024

Program Revenues

The accompanying notes to financial statements are an

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Other Total Special School Miscellaneous Capital Governmental

General Aid Lunch Special Revenue Projects Funds

ASSETS

Unrestricted cash 12,016,502$ -$ 2,045,786$ -$ -$ 14,062,288$ Receivables:

State and federal aid 1,826,812 3,514,029 442,087 - - 5,782,928 Due from other funds 5,569,581 1,076,802 - - 179,403 6,825,786 Due from other governments 3,020,939 - - - - 3,020,939 Other - - - - - - Prepaid expenditures - - - - - Inventories - - 25,563 - - 25,563 Restricted cash 21,836,893 1,191,272 - 250,008 1,680,577 24,958,750

Total assets 44,270,727$ 5,782,103$ 2,513,436$ 250,008$ 1,859,980$ 54,676,254$

LIABILITIES

Payables:

Accounts payable 183,976$ -$ 160,976$ -$ -$ 344,952$ Accrued liabilities 1,095,821 - - - - 1,095,821 Due to other governments - - 101 - - 101 Due to other funds 868,363 5,698,618 4,090 - 254,715 6,825,786 Due to teachers' retirement system 6,015,532 - - - - 6,015,532 Due to employees' retirement system 394,512 - - - - 394,512 Unearned revenues 10,303 - - - - 10,303 Compensated absences 420,000 - - - - 420,000

Total liabilities 8,988,507 5,698,618 165,167 - 254,715 15,107,007

DEFERRED INFLOWS OF RESOURCES

Grants received in advance - 83,485 109,847 - - 193,332

Total deferred inflows of resources - 83,485 109,847 - - 193,332

Total liabilities and deferred inflows of resources 8,988,507 5,782,103 275,014 - 254,715 15,300,339

FUND BALANCE

Fund balance:

Nonspendable - - 25,563 - - 25,563 Restricted 21,836,893 - - 250,008 1,605,265 23,692,166 Assigned 7,670,387 - 2,212,859 - - 9,883,246 Unassigned 5,774,940 - - - - 5,774,940

Total fund balance 35,282,220 - 2,238,422 250,008 1,605,265 39,375,915

Total liabilities, deferred inflows of resources and fund balance 44,270,727$ 5,782,103$ 2,513,436$ 250,008$ 1,859,980$ 54,676,254$

DEER PARK UNION FREE SCHOOL DISTRICT

BALANCE SHEET - GOVERNMENTAL FUNDS

JUNE 30, 2024

Special Revenue Funds

The accompanying notes to financial statements are an

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Total Fund Balance - Governmental Funds 39,375,915$

Amounts reported for governmental activities in the Statement of Net Position are different due to the following:

Capital assets less accumulated depreciation are included in the Statement of Net Position:

Capital assets:

Non-depreciable/amortizable 10,791,260$ Depreciable/amortizable 89,607,405 Accumulated depreciation/amortization (68,263,164) 32,135,501

Long-term liabilities applicable to the District's governmental activities are not due and payable in the current period and accordingly are not reported in the fund financial statements. However, these liabilities are included in the Statement of Net Position:

Lease liabilities (465,105) Subscription-based IT arrangement liabilities (1,492) Bonds payable, net (12,170,280) Retainage payable (259,731) Installment purchase debt payable (9,772,676) Workers' compensation claims payable (1,110,953) Compensated absences (7,410,880) (31,191,117)

Proportionate share of long-term asset (liability), deferred outflows and deferred inflows of resources associated with participation in the State retirement systems are not current financial resources or obligations and are not reported in the governmental funds:

Deferred outflows of resources - pension related 27,353,629 Proportionate share of net pension liability (8,635,283) Deferred inflows of resources - pension related (4,352,623) 14,365,723

Long-term liability, deferred outflows and deferred inflows of resources associated with OPEB are not current financial resources or obligations and are not reported in the governmental funds:

Deferred outflows of resources - OPEB related 10,253,123 Deferred inflows of resources - OPEB related (39,945,109) Total OPEB liability (181,303,117) (210,995,103)

Interest payable applicable to the District's activities are not due and payable in the current period and accordingly are not reported in the fund financial statements. However, these liabilities are included in the Statement of Net Position. (237,249)

Net Position - Governmental Activities (156,546,330)$

DEER PARK UNION FREE SCHOOL DISTRICT

JUNE 30, 2024

TO THE STATEMENT OF NET POSITION

RECONCILIATION OF GOVERNMENTAL FUNDS BALANCE SHEET

The accompanying notes to financial statements are an

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Other Total Special School Miscellaneous Capital Governmental

General Aid Lunch Special Revenue Projects Funds

REVENUES

Real property taxes 72,653,199$ -$ -$ -$ -$ 72,653,199$ Other tax items 11,701,265 - - - - 11,701,265 Charges for services 786,204 - - - - 786,204 Use of money and property 1,172,688 - - - 97,436 1,270,124 Sale of property and compensation for loss 40,380 - - - - 40,380 State sources 48,495,795 1,739,087 623,094 - - 50,857,976 Federal sources 44,347 6,547,684 1,383,218 - - 7,975,249 Sales - - 306,328 - - 306,328 Miscellaneous 4,451,791 8,159 23,060 485,837 - 4,968,847

Total revenues 139,345,669 8,294,930 2,335,700 485,837 97,436 150,559,572

EXPENDITURES

Current:

General support 12,266,576 - - - - 12,266,576 Instruction 73,397,309 8,234,082 - 465,094 - 82,096,485 Pupil transportation 6,897,873 310,848 - - - 7,208,721 Employee benefits 34,555,767 - - - - 34,555,767 Cost of sales - - 2,606,294 - - 2,606,294

Capital outlay - - - - 6,794,845 6,794,845 Debt service:

Principal 2,657,664 - - - - 2,657,664 Interest 1,570,857 - - - - 1,570,857

Total expenditures 131,346,046 8,544,930 2,606,294 465,094 6,794,845 149,757,209

Excess (deficiency) of revenues over (under) expenditures 7,999,623 (250,000) (270,594) 20,743 (6,697,409) 802,363

OTHER FINANCING SOURCES (USES)

Issuance of installment purchase debt - - - - 1,738,864 1,738,864 Premium on debt issuance 207,460 - - - - 207,460 Transfers in - 250,000 - - 1,200,000 1,450,000 Transfers out (1,450,000) - - - - (1,450,000)

Total other financing sources (uses) (1,242,540) 250,000 - - 2,938,864 1,946,324

Change in fund balance 6,757,083 - (270,594) 20,743 (3,758,545) 2,748,687

Fund balance, beginning of year 28,525,137 - 2,509,016 229,265 5,363,810 36,627,228

Fund balance, end of year 35,282,220$ -$ 2,238,422$ 250,008$ 1,605,265$ 39,375,915$

DEER PARK UNION FREE SCHOOL DISTRICT

STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - GOVERNMENTAL FUNDS

FOR THE YEAR ENDED JUNE 30, 2024

Special Revenue Funds

The accompanying notes to financial statements are an

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Net Change in Fund Balance - Governmental Funds 2,748,687$

Governmental funds report capital outlays as expenditures. However, in the Statement of Activities, the cost of those assets is allocated over their estimated useful lives and reported as depreciation expense. The amount by which capital outlay exceeds depreciation in the current period is:

Capital outlay 7,381,819$ Depreciation/amortization expense (2,502,682) Retirement of non-depreciable capital assets (24,653) 4,854,484

Amortization of bond premium on bond issuances do not affect the governmental funds, but are recorded in the Statement of Activities. 10,528

The issuance of long-term debt provides current financial resources to governmental funds, while the repayment of the principal of long-term debt consumes the current financial resources of governmental funds. Neither transaction has any effect on net position.

Repayment of bond principal 1,050,000 Issuance of installment purchase debt (1,738,864) Repayment of installment purchase debt payable 2,202,073 Principal payments on subscription-based IT arrangement liabilities 5,956 Principal payments on lease liabilities 204,411 1,723,576

Some expenses reported in the Statement of Activities do not require the use of current financial resources and, therefore, are not reported as expenditures in governmental funds:

Workers' compensation claims payable 248,113 Compensated absences (1,242,428) Retainage payable (36,159) Accrued interest costs (1,868) (1,032,342)

Changes in the proportionate share of the collective pension expense of the State retirement plans reported in the Statement of Activities do not provide for or require the use of current financial resources and therefore are not reported as revenues or expenditures in the governmental funds.

Teachers' Retirement System (4,167,075) Employees' Retirement System (997,951) (5,165,026)

Changes in the amounts related to the OPEB liability reported in the Statement of Activities do not provide for or require the use of current financial resources and therefore are not reported as revenues or expenditures in the governmental funds. 7,159,480

Net Change in Net Position - Governmental Activities 10,299,387$

DEER PARK UNION FREE SCHOOL DISTRICT

RECONCILIATION OF GOVERNMENTAL FUNDS STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCE TO THE STATEMENT OF ACTIVITIES

FOR THE YEAR ENDED JUNE 30, 2024

The accompanying notes to financial statements are an integral part of this statement.

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Custodial

ASSETS

Cash and cash equivalents -$

NET POSITION

Restricted for individuals, organizations and other governements -$

Custodial

ADDITIONS

Real property taxes collected for the library 1,000,000$

Total additions 1,000,000

DEDUCTIONS

Real property taxes remitted to the library 1,000,000

Total deductions 1,000,000

Change in net position -

Net position, beginning of year -

Net position, end of year -$

DEER PARK UNION FREE SCHOOL DISTRICT

STATEMENT OF CHANGES IN FIDUCIARY NET POSITION - FIDUCIARY FUNDS

FOR THE YEAR ENDED JUNE 30, 2024

DEER PARK UNION FREE SCHOOL DISTRICT

STATEMENT OF FIDUCIARY NET POSITION - FIDUCIARY FUNDS

JUNE 30, 2024

The accompanying notes to the basic financial statements are an integral part of these statements.

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NOTES TO FINANCIAL STATEMENTS

FOR THE YEAR ENDED JUNE 30, 2024

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1. SUMMARY OF CERTAIN SIGNIFICANT ACCOUNTING POLICIES

The financial statements of the Deer Park Union Free School District (the “District”) have been prepared in conformity with generally accepted accounting principles (“GAAP”) as applied to government units. Those principles are prescribed by the Governmental Accounting Standards Board (“GASB”), which is the accepted standard-setting body for establishing governmental accounting and financial reporting principles. Significant accounting principles and policies used by the District are described below:

A. Reporting entity

The District is governed by the laws of New York State. The District is an independent entity governed by an elected Board of Education consisting of seven members. The President of the Board serves as the chief fiscal officer and the Superintendent is the chief executive officer. The Board is responsible for, and controls all activities related to public school education within the District. Board members have authority to make decisions, power to appoint management and primary accountability for all fiscal matters.

The reporting entity of the District is based upon criteria set forth by GASB. The financial reporting entity consists of the primary government, organizations for…