Determine whether the Board reasonably and transparently financed reserves.
The Board has not adopted a reserve policy. The Board did not include provisions to fund reserves in its annual budgets. Seven reserves with balances totaling $9.4 million (72 percent of total reserves) are overfunded by $7.8 million and potentially unnecessary.
The Board should adopt a reserve policy. Appropriately budget to fund reserves. Determine if the amounts reserved are necessary, reasonable and in compliance with statutory requirements.