Finance & Audit Committee Meeting/Notes October 21, 2019

Agenda 

October 21, 2019 Board Finance and Audit Meeting Agenda
Panorama Village Administrative Centre
Meeting Room A - 11:45 a.m.
240 Villa Crest Drive
State College, PA  16801

1. Call to Order
   
   
2. SPPA Cost Collection Agreement (attachment)
   1. Discuss revisions
      
      
3. Capital Reserve Fund Projections (attachment) 
   
   
4. Update - ESSA Reporting (attachment1) (attachment 2) (attachment 3)
   
   
5. Public Comment  
   Each individual will be limited to comments of five (5) minutes as time permits for items on this agenda or related to Board business.
   
   
6. Future Agenda Items
   • Cohort Review
   • 2020-21 Budget Development Review
     
     
7. Adjournment

APPROVED
October 21, 2019 Board Finance and Audit Committee Meeting Minutes
11:30 a.m. - Meeting Room A, Panorama Village Building
240 Villa Crest Drive
State College, PA 16801

1. Call to Order
   Mr. Fozard called the Board Finance and Audit Committee Meeting to order at 11:47 a.m. and turned the meeting over to Randy Brown.
   
   Committee Members Present: ​Amber Concepcion, Scott Fozard, Jim Leous, Laurel Zydney
   Committee Members Absent:
   Others: Gretchen Brandt, ​Randy Brown, Scott Etter, Nancy Reese, Donna Reinhart
   
   A copy of all materials Distributed to the committee members for discussion are included with the official minutes, unless otherwise indicated.
   
   Mr. Brown asked Scott Etter to join the meeting to update the Finance and Audit Committee on the sale of the Lemont building. Mr. Etter stated that the buyer recently requested the district pay half of the $39,000 transfer taxes, which clearly states in the agreement of sale, the buyer would pay in full. The language in the agreement of sale states: Upon delivery of the Deed, Volos shall pay the applicable realty transfer taxes, if any, shall be due. Mr. Etter stated that the buyer made several changes to the agreement of sale, but never questioned the transfer taxes until now. Mr. Etter feels that this was clearly stated in the agreement and that the language used has been standard for over 25 years. He also stated that the agreement of sale was approved by the Court with the current language and was what was presented to Judge Oliver. Also when considering the purchase price alone, the District actually had an offer that was slightly higher, but deemed this offer to be a better deal because it came without contingencies, the closing would occur sooner, and Volos was an educational entity which the District uses. Mr. Etter stated that he would be uncomfortable making changes to the Agreement of Sale, that was presented to the Court, and would need to file a return with the details of the transaction, albeit comparatively small as a departure.
   
   The Finance and Audit Committee members agreed with Mr. Etter’s conclusion. Mr. Etter will send the buyer a formal communication rejecting the request. The closing should remain on schedule and the wire transfer will be on October 22, 2019.
   
   
2. Solar Power Cost Sharing Agreement
   Mr. Brown and Gretchen Brandt presented the Solar Power Cost Sharing Agreement to the committee. Discussion and questions followed. Concerns on the unknown costs of retaining an Energy Consultant and attorney fees, along with the unknown cost of solar power, was discussed. Language in the current agreement would mean that the district would be responsible for 53% of the cost of the consultant and attorney fees; with only having two votes on who is retained for this initial process was a concern raised by committee members. Discussion on asking for 50% of the voting power to ensure that the district is in favor of the consultant and attorney costs was also discussed, raising a concern that this would cause other entities to feel their vote didn’t count was also expressed. With the district being responsible for over half of the initial costs, as stated in the agreement, and not knowing what those costs are, the committee felt that the following revisions in the Cost Sharing Agreement should be made:
   
   1. Section 3 edits to include:
      • The addition of the name of the energy consultant with a cost or not to exceed amount, following the request for qualification process
      • Clarification of attorney fees
      • Addition of requirements of an affirmative vote by the district in selecting the energy consultant
   2. Section 8: remove in its entirety
   3. Section 22: amended and labeled as Section 23
      
      The committee also felt that they needed guidance from the Board on how to proceed and would present the suggested revisions to the Board at their October 21 meeting for further discussion and review.
      
      
3. Capital Reserve Fund Projections
   Mr. Brown reviewed and discussed the actual and projected numbers to the committee. The projected 2019-20 ending fund balance in June showed $59,227,797 and is now showing an ending balance of $66,076,797, giving a capital reserve projection of a little over $8 million. This includes the revenue of $1.3 million from the Lemont building.
   
   
4. Update - ESSA Reporting
   Mr. Brown updated the committee on the ESSA reporting requested by the Pennsylvania Department of Education (PDE). PDE still hasn’t given clear direction on areas in the reporting tool which is due to PDE by October 31. Review of the centralized expenditure allocation was given and discussion and questions followed.
   
   
5. Public Comment 
   There were no public comments.
   
   
6. Future Agenda Items
   Cohort Review
   2020-21 Budget Development Review
   Budget Presentation
   
   
7. Adjournment
   Mr. Fozard adjourned the Board Finance and Audit Committee meeting at 1:03 p.m.

Submitted by,

Nancy Reese