Now that the California State Budget has been settled, the School Board is beginning to ready itself for continuing mediations with MDEA (and the other bargaining units). As such, at last week's board meeting, a projected 3-year budget was looked at. On that budget was a line item that read 'IRS Tax Payment' and listed an amount of $833,550.
Gary Eberhart questioned the line item and as we came to find out, the $833,550 was an IRS PENALTY that is being assessed, due to underpayment of taxes, penalties for underpayment, and interest on the monies due. I won't go into the details on this post--the Contra Costa Times, the MDUSD Blog, even Mr. McHenry have all given their explanation and account of these penalties (and who's fault it is or isn't). See below for a list of links to research this topic.
The important issue for teachers to note is that this $833,550 is now off of the negotiating table. In other words, due to either incompetence, accounting errors, papers being lost in the shuffle, or whatever, there is now less available money to settle our contract. Even if it turns out that every single penny of the $833,550 that the IRS says we owe, stays in the MDUSD coffers, at the negotiating table we have to pretend that money does not exist!
How long will it take to work this out with the IRS? The MDUSD has 6 weeks to submit documentation to the IRS. I wonder how long it will take for the IRS to respond? In the mean time, we are still working without a contract. . . . .
For more info:
http://mdusd.blogspot.com/2008/09/83355000-tax-blunder.html (Blog post by Gary Eberhart explaining how this line item was discovered and discussed at the Board meeting)
http://www.ibabuzz.com/aparentlyspeaking/2008/09/30/mt-diablo-incurs-irs-wrath-again/ (aParently Speaking from CC Times)
http://www.contracostatimes.com/education/ci_10594161?nclick_check=1 (Contra Costa Times Article)
http://claycord.blogspot.com/2008/09/message-from-superintendent-mchenry.html (Claycord Blog with a message from Gary McHenry, Superintendent)
http://mdusd.blogspot.com/2008/09/mchenrys-desparate-attempt-to-explain.html (Paul Strange's response to Gary McHenry's memo)
1 comment:
Hi Carissa,
Very nicely written. And, don't forget the other gem revealed during the September 23, 2008 Board meeting. We discovered that the $900,000 budget for Durham busing expenses needs to be increased by $581,390. That's a 65% increase over the amount budgeted.
Management assured the Board they are taking steps to reduce that amount and try to get back to the $900,000 originally budgeted. But, here again, that's a good chunk of change that is off the bargaining table at this time.
I was looking at a summary of Special Education Revenues and Expenditures and noticed we received $3 or $4 million in revenues related to busing expenditures. Is Mr. McHenry saying that a $581,390 increase in restricted busing expenditures will result in absolutely no increase in restricted busing revenues? Why does the entire $581,390 get charged to the general fund?
The Agenda and Board packet also explained the increase was due to an increase in ridership and a 3.5% annual increase as provided in the contract with the County (who retains Durham to provide the bus services). The increase in ridership and the 3.5% explains less than half of the 65% increase in busing expenditures. What else happened that Mr. McHenry doesn't want us to know about?
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