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No criminal investigation underway amid Goffstown, New Boston school financial errors

Union Leader Correspondent
New Hampshire Union Leader

December 18. 2017 9:27PM
A photo of Goffstown High School from the school's website. 

Neither Goffstown or New Boston police are investigating what school officials described as “irregularities and errors” in financial information reported to state officials that resulted in about $10 million not being applied to tax relief since 2011.

SAU 19’s School Board accepted business administrator Raymond Labore’s resignation at its regular meeting last Wednesday.

“We are aware of it only because it has been shared from a perspective from the town,” Goffstown Police Chief Robert Browne said on Monday.

New Boston Police Chief James Brace said his department learned of the school district’s financial issues on Friday when Superintendent Brian Balke issued a joint news release.

“The year-end fund balance amounts reported to the school boards, tax rate-setting authorities and taxpayers were underreported and money was retained on the school districts’ books and in the bank,” the statement said. “A series of reporting errors within the SAU 19 business office resulted in an accumulation of surplus money that could have been applied to reduce taxes in both districts.”

The errors were discovered while setting the school tax rate for December. Officials determined that unreserved fund balances since fiscal year 2011 were not properly returned for tax relief.

In Goffstown, that amounted to about $9.1 million, in New Boston, about $1.1 million.

On Monday, Balke said the Goffstown School Board will begin studying all of its options, including whether to return all of the surplus money at the end of the fiscal year.

This action, he said, would reduce the school portion of the tax rate by about $6.21 per $1,000 of assessed valuation.

“Obviously this is a very challenging situation for both communities. I am very sensitive to the implications on the tax rate,” said Balke.

In Goffstown, the local school portion of the tax rate recently went from $13.55 per $1,000 of assessed valuation to $14.63, with the overall tax rate for the town at $27.42, according to its website.

In New Boston, the local school portion of the tax rate recently went up from $15.56 to $16.24, with the overall tax rate for the town at $24.35.

If the Goffstown school district had not retained the $9.1 million, Balke estimated that the school portion of the tax rate would have been lower by about $1 or $1.25 per $1,000 of assessed valuation for each of those six years.

Balke declined to comment on whether civil action could be pursued in the case. Labore apologized last week to the board and local residents, and was described as “heartbroken by these errors.”

After a mistake was made during the school budgeting process last year, Balke asked an independent auditor, Angell and Company, to review all forms submitted to the state Department of Revenue Administration on setting the school portion of the tax rates.

The Goffstown School District did its own forensic audit, which determined fund balances “were not properly returned for tax relief” in “numerous tax years,” school officials said.

Adam Jacobs, town administrator in Goffstown, said Monday that selectmen are allowing the school board to decide what to do with the surplus funds, although selectmen do have a representative on the budget committee.

“It is tough to be a passenger a little bit on this one,” said Jacobs.

The New Hampshire Department of Revenue Administration and the New Hampshire Department of Education have been notified of the errors.

“At this time, all revenue, expenditures and funds have been accounted for and there is no concern that money is missing or was spent inappropriately,” school officials said in an earlier statement.

Education Goffstown New Boston

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