Perhaps we saved the most boring part for last, but it’s important news and turns out to be very good. This final installment of Eyes On SAA’s Unofficial and Unauthorized Report on SAA’s 2021 Constituency Meeting focuses on the Financial Report and Home & School Association (HSA) Report. We think the highest value of our report is to be found in sections covering “The Principal’s Report” and “Delegate/Non-Delegate Questions/Comments”. Even so the financial portion of the evening’s presentation was very important in its detailed description and analysis of SAA’s financial health, which is crucial to its future viability and functioning (particularly in a pandemic), and which will have an effect on the tuition and fees we are charged. So if you can stay awake and focused, you will find important information to consider. The HSA Report was brief, but introduced the newest slate of officers who will volunteer their time to run fundraising programs and social events to benefit the school, parents, and children. Eyes On SAA commends and applauds the HSA Officers who represent the highest spirit of parental involvement and dedication to their children’s school and education. We at Eyes On SAA also volunteer on this blog to serve our children’s education but in a different way that’s not as sweet or glamorous.
Spoiler Alert: SAA’s financial condition is very good, at least per the report of the Financial Committee’s Chairperson, Walt Fennell. This is good news for everyone, and credit is due to the hard work and competence of the Financial Committee.
So just before we bring you our report on the Financial & HSA Reports, we again present our Report Card for the 2021 Constituency Meeting and links to our series of reports of Eyes on SAA’s Unofficial and Unauthorized Report on SAA’s 2021 Constituency Meeting:
The Principal’s Report: C
Delegate Questions/Comments: A
Financial Report: A (this post)
HSA Report: B (this post)
Non-Delegate Questions/Comments: A
Overall Constituency Meeting Delegate Selection, Transparency, and Accessibility: F
For more context, click on any of the links below to read our full series of posts covering Eyes on SAA’s Unofficial and Unauthorized Report on SAA’s 2021 Constituency Meeting:
H. Our Summary Report on SAA’s 2021 Constituency Meeting (posted 8/29/2021)
I. Principal's Report - Part 1 (posted 9/3/2021)
J. Principal's Report - Part 2 (posted 9/3/2021)
K. The Main Event 1: Delegate Q&A - Part 1 (posted 9/23/2021)
L. The Main Event 2: Delegate Q&A - Part 2 (posted 9/24/2021)
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Section C: Financial Report: [Our commentary is noted in bold italicized and underlined print.]
1. Finance Committee responsibilities.
2. GCAS (General Conference Auditing Service) Financial Audit.
3. Liabilities.
4. Income/Expenses.
5. Positive Audit Reports.
6. Working Capital Threshold.
7. Financial challenges facing school.
8. Financial aid to families.
9. Tuition freeze for 2021-2022.
10. Personnel salaries make up biggest financial expense.
GCAS Audit Opinion of SAA Accounting Statement (provided to delegates only):
Warning: To grasp this audit opinion of SAA’s financial statement will require a finance degree to decipher and the patience of Job to finish reading.
Financial Report (as of 6/30/2020): Presented by Walt Fennell [This information is already 15+ months old, but that appears to be a function of the when the Constituency Meeting falls on the calendar.]
1. Finance Committee: What do we do? Hold monthly meetings, talk about budgets, review financial statements each month from Brittany [Thorp – SAA’s Business Manager], set tuition rates, make recommendations to the School Board, discuss financial aid and student assistance, discuss capital and physical plant improvements.
2. Audit report from GCAS (General Conference Auditing Service) – This is our yearly audit. We hold $2.3M in assets, mostly in the Columbia Union Revolving Fund (68%). Another 27% is in plant assets (stuff inside the building, but not the actual building and land which are both owned by the Chesapeake Conference (CC). [If you didn’t know, the school and exclusive constituent local church, Spencerville SDA Church, paid for the building itself through loans, donations, and tuition payments, but the CC gets to be the owner. Sounds like the old feudal system, or perhaps more like the post-slavery sharecropper arrangement of the absentee landlord (CC) and tenant farmer (SAA). This provides the leverage for stuff like the CC Superintendent Janesta Walker, who probably couldn’t identify 25 SAA students by name if her life depended on it, to swoop in to fire SAA’s Elementary Principal in the middle of the night. Check out our Epilogue & Lessons Learned for more information on that].
3. Liabilities: Deferred income (money paid to school that is not yet earned (e.g.. prepaid registration fees for 2021-22 which have not yet been earned). 34% are accounts payable. There are also agency accounts (money held on behalf of other people).
4. Income & Expenses: Income: Tuition from parents, subsidies from the Chesapeake Conference (about $800,000) and Spencerville Church (about $150,000), plus fees charged, and donations received. Expenses: Instructional costs, utilities, student services, payroll/benefits are 68% of costs.
5. Positive Audit Reports: We received the coveted “3 Green Checkmarks” which signify that our financial statements have been prepared following GAAP (Generally Accepted Accounting Principles), that they are materially accurate, and we are in compliance with financial management at school (insurance coverage, investing in the right places); and our internal financial controls are designed and working appropriately. Most SDA schools and even many Fortune 500 companies do not receive “3 Green Checkmarks”. [This is excellent. SAA’s Financial Committee is doing great work, and deserves high credit and commendation for this result. By contrast, what would an independent audit reveal about the condition of representative democracy, transparency, and accountability at SAA? Not “3 Green Checkmarks” but “3 Red X-marks.”]
6. GCAS (General Conference Auditing Service) Working Capital Threshold: This threshold was met in 2020. Most SDA institutions do not have this to be able to survive an unexpected financial crisis. 10 years ago SAA was nearly bankrupt. But just prior to the pandemic the school’s finances were “top-notch, button-down, and ship-shape.” This is a result of divine providence and leading, and 10 years of board decisions to put us in this position. [Again, this is excellent. SAA’s Financial Committee is doing great work, and deserves high credit and commendation for this result.]
7. Challenges/Priorities: The 2019-20 school year ended with SAA’s highest enrollment on record. Then it dropped 15% (about $600,000 less in tuition received). There were also increased costs because of the pandemic (meeting needs of students and teachers). We set aside money for need-based financial assistance to families, we made laptops/tablets and hotspots available to families who could not afford it. We increased bandwidth in-house to do all the video-conferencing that was needed. We did our best to keep as many staff jobs as possible, but some had to go because they were not sustainable under our budget. We passed a negative/loss budget of about $300K, but were able to that because of our Working Capital Threshold. Fiscal Year 2021 is expected to have a loss of between $100-200K. We are prepared financially to face this next school year (2021-2022). [Broken Record: Again, this is excellent. SAA’s Financial Committee is doing great work, and deserves high credit and commendation for this result.]
8. Financial Aid to Families: 25% of students needed financial aid. 50% needed aid of between 1-30% of tuition; about 50% needed between 31-50% of tuition. If a family needed aid for more than 50% of their tuition, then they simply cannot afford this school and should probably look elsewhere because that’s too steep for the school to handle. Part of our mission is to provide a Christian education to as many as possible, and so we helped 92 students needing financial aid, and help round out more programs and increases diversity for the school. [Some cold, hard financial facts.]
9. Tuition Freeze for 2021-2022: 0% tuition increase next year. We can afford it this year, but not indefinitely into the future. It’s been a hard year. Many SDA church workers had a decrease in their pay, and they send their children to this school. Also a thank you for sticking with SAA during the tough pandemic year. [Everyone can be happy about a tuition freeze. Thank you!]
10. Personnel Salaries make up biggest financial expense. Workers at SAA are employees of the CC and salaries are not set by SAA’s Finance Committee because they are not our employees. [Another inequitable characteristic of the feudal landlord/sharecropper system: SAA personnel serve students at SAA, are paid by SAA from tuition charged to parents, but “employed” by the absentee landlord Chesapeake Conference. Another shell game.]
Comment by Alex Ramirez (Non-Delegate): Are there any strategical finance conversations and plans for honoring teachers who serve long-term (5 years, 10 years, etc.) with financial bonuses? These types of raises are typical and also create stability and structure for our school.
Answer by SAA (By Walt Fennell): I have thought about this a lot over the years. Once we are back into a stable financial position and can right the ship, which will take some time. Once we bounce back, I would like to bring that issue up again.
FINANCIAL REPORT ACCEPTED:
Section D: Home & School Association (HSA) Report (by Melissa Reinhardt, HSA President)
1. Introduction of HSA Officers.
Melissa Reinhardt, President
Lisa Burrow, Vice-President for High School
Rich Reinhardt, Vice-President for Middle School
Falvo Fowler, Vice-President for Elementary School
Nancy Fennell, Secretary
Ken Ninala, Treasurer
Cheryl Toscano, PR Leader
Karen Miranda, Assistant PR director
Lauren Esveld, Room Parent Coordinator
Stephanie Roberts, Governance Officer
[Eyes On SAA commends and applauds the HSA Officers who represent the highest spirit of parental involvement and dedication to their children’s school and education.]
2. HSA Events:
COVID-19 caused us to lose most of our fundraising events. Did 5K race and SkyZone event near the end of 2020-2021 school year, one or two fundraisers were done, Road Rally event in Fall 2020. We hope to go back to our full schedule of events for next year.
If anyone would like to help with HSA, please let any of the officers know and they will find work for you to do.
HSA REPORT ACCEPTED
End of our Report on the Financial & HSA Portions of the 2021 SAA Constituency Meeting.
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Look out for our upcoming post "Lessons Learned at the 2021 SAA Constituency Meeting".
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We hope you found this report informative and helpful, and that it raises enough interest for you to stay tuned for more reporting coming soon. If you appreciated this post, please show your gratitude by subscribing to this blog, contacting us with news and information of concern to you about SAA’s programs and operations, and finally by sharing the link to this report on social media and directly with other members of the SAA Community so that they can know more about the product that they are purchasing at SAA, and take an active role in making it better with their observations and feedback.
Again, we thank our contributors that gathered and provided information, documents, and notes for us to prepare this series of reports. You are the lifeblood of Eyes On SAA and are contributing to the important work of bringing change and improvement to this school that we all care about. If the SAA of the future could speak today it would say "thank you" and that it is in your debt for your love and courage.
Shining Light. Breaking Silence. Holding Accountable.
We’ve got Eyes On SAA.
-Lillian Hepburn-Richmond
(A Cohort of Concerned Parents)
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