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What you need to know for 04/26/2017

Audit criticizes draining reserves for Maplewood

Audit criticizes draining reserves for Maplewood

Losses from the county-owned Maplewood Manor nursing home have drained millions from Saratoga County

Losses from the county-owned Maplewood Manor nursing home have drained millions from Saratoga County’s financial reserves in recent years, and county leaders need to restore stability, a new state comptroller’s audit recommends.

The audit by Comptroller Thomas P. DiNapoli covers Jan. 1, 2010, through May 31, 2013, a period when more than $15 million was taken from the county fund balance to cover budget deficits or Maplewood Manor’s losses.

The fund balance figure — also referred to as the surplus — fell from $24.7 million in 2010 to $10.3 million at the end of 2012.

That’s low enough that county officials — who manage a $300 million annual budget — have said they want to build it back up.

“The county should ensure it maintains an adequate level of unexpended surplus fund balance,” the audit released Friday found. “The depletion of unexpected surplus funds could limit its options to finance unanticipated costs or revenue shortfalls that may arise in the future.”

In addition, the auditors noted the county’s adopted budgets are realistic and have been closely monitored by the county’s financial team.

In June, DiNapoli’s fiscal stress monitoring system rated Saratoga County as under “moderate stress.”

County officials acknowledged the findings of the audit, and noted that it was only a few years ago that state auditors were criticizing the county for maintaining an unnecessarily large surplus.

“It is gratifying to have Comptroller DiNapoli’s acknowledgement that Saratoga County adopts realistic budgets and effectively monitors our fiscal condition,” said county Board of Supervisors Chairman Alan R. Grattidge, R-Charlton.

During the years audited, the fund balance was drawn down to cover both Maplewood Manor losses and routine expenses.

In those years, the county general fund provided $13.7 million in subsidies to Maplewood Manor, the audit found.

However, the county has also drawn at least $1.9 million from the surplus each year to balance the general fund — a practice dating from when the surpluses exceeded $30 million, and were criticized as too high. Using the surplus kept property taxes from rising, county officials noted.

County officials contend the nursing home — like public nursing homes across the state — loses money because federal Medicaid reimbursements for patient care don’t keep up with the actual cost of providing the care.

Last year, a consultant hired by the county found the situation to be “unsustainable,” and recommended the nursing home be sold to a private buyer. The county is in the process of following through on that, and has formed a local development corporation to negotiate a sale.

The LDC is currently reviewing seven proposals from prospective buyers, with the goal of making a decision by the end of this year. Review by the State Health Department is then expected to take most of 2014.

“The Board of Supervisors has taken decisive actions over the past several years on many important issues, including the sale of the nursing home, which demonstrate our commitment to thoughtful and responsible stewardship of taxpayer dollars,” Grattidge said in a statement in response to the audit. “These decisions have not been easy ones, but the comptroller’s audit is further evidence that they were necessary.”

County officials are in the process of preparing the 2014 county budget, which will be released in late October. It was unknown Friday on whether surplus funds would again be used in 2014 to balance the budget.

“Our goal would be to not use any surplus,” Grattidge said in an interview Friday.

The county should receive a $4 million initial payment for the sale of the county landfill in Northumberland to Finch Paper in early January, Grattidge said.

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