The Hudson Budget Committee met on May 6 to hear an update from School Board Liaison Dan Kilgour, who provided new information regarding a recently released audit report for SAU 81. The report, now available on the district website, outlines generally strong financial practices but also reveals a significant error involving tax revenue calculations.
Kilgour emphasized that the audit was largely positive.
“The audit report has been shared with the Budget Committee and is available on the district website if you go to the search bar and type in ‘audit,’” Kilgour said. “Overall, the audit report went well. The district has strong audit results. The district continues to implement processes focused on student activity fund management. Recently streamlined forms and documentation for staff are good, and staff are regularly receiving training in these areas.”
Tax revenue error discovered the audit also included a letter from Superintendent Dan Moulis, who explained that the district’s beginning net position had to be corrected due to an error involving the FY2024 tax assessment revenue.
According to Moulis: “Approved warrant articles involving the use of fund balance had been applied twice within the payment request calculations. As a result, the district requested and received less tax revenue from the town than was authorized and collected.”
The mistake was discovered during the 2026 fiscal year by Business Administrator Jenny Graves, who identified inconsistencies in the assessment schedule. Budget Committee seeks clarification the revelation prompted confusion among Budget Committee members, who questioned how the error occurred and why it went unnoticed for so long.
Committee member Shawn Jasper expressed frustration.
“I don’t understand this in the least bit,” Jasper said. “It seems like instead of saying they’ll take that dollar amount from the school’s fund balance to correct it, the amount came out of what the town has collected. It’s going to offset the tax rate in the future? I don’t understand how that happens.”
Town Administrator Roy Sorenson attempted to clarify, noting that the issue stemmed from a calculation error during the midyear adjustment period.
“Typically, we set the tax rate and we know what is owed to the schools,” Sorenson said. “In this instance, they prepare what’s called a payment plan, we pay them once per month, 12 payments. After the six month mark, we have to make an adjustment because of the fiscal year, and there’s an estimate. That’s where the error took place.”
Sorenson also suggested that turnover in the district’s Finance Department may have contributed to the oversight. How did the district miss an $800,000 Shortfall? Budget Committee Chair James Lawrence questioned how such a large discrepancy, reportedly over $800,000, went unnoticed for nearly a full year.
“Based on that scenario, the School District didn’t pick up on the fact that they were shy over $800,000 until the end of the year?” Lawrence asked. “I found it somewhat remarkable that they went the whole year without noticing that they were missing that money.”
Kilgour confirmed that the issue was not identified until recently.
“I believe that Ms. Graves came on July 1, 2025, and we went on for quite a while without a formal Business Administrator,” he said. “We did have somebody in there, but only on a part-time basis.”
The combination of staffing gaps, midyear adjustments, and complex billing procedures appears to have contributed to the delay in detecting the error.