Hayden-Winkelman Unified School District (District) is at high risk of not being able to operate within its budget constraints and cash resources. As shown on the measure cards below, the District’s high-risk status is due to its change in weighted student count (WSC), operating and capital budget limit reserves, General Fund operating margin ratio, General Fund change in fund balance, capital monies redirected to operations, unfunded small school budget adjustment, and frozen tax rate.

While not within the high-risk threshold, the District’s WSC has declined in 2 of the last 4 years, with an overall 1.54% decline, including a 6.59% decline in fiscal year (FY) 2026, to date, impacting its budget limits and student-count-generated revenues.

The District’s operating budget limit reserve has fluctuated since its FY 2021 peak balance of approximately $603,000. The District decreased its reserve between FYs 2021 and 2023 before increasing it to almost $563,000 in FY 2024, then reducing it to just over $301,000 in FY 2025, which represents a single-year decline of 46.49% and a 4-year decline of 50.09%. The District’s capital budget limit reserve has decreased every year since FY 2021, with an overall 39.53% decline, decreasing from approximately $415,000 in FY 2021 to $251,000 in reserve at the end of FY 2025. Additionally, the District redirected $102,500, or 50.85%, of its capital monies to operational spending in FY 2026, which may result in further capital budget limit reserve declines this year. The District’s steadily decreasing capital budget limit reserve and significant redirection of capital monies to operations in FY 2026 could indicate it is delaying necessary operational spending cuts or may be at risk of overspending its capital budget limit when large capital spending needs arise.

Additionally, the District’s primary property tax rate has been frozen since FY 2016. As a result, its small school adjustment has been partially unfunded at times, leaving its FY 2025 operating and capital budget limit reserves more than $150,000 unfunded. The District’s frozen tax rate may limit the District’s ability to fully fund its small school adjustment in the current and future years.

The District’s General Fund revenues decreased while expenditures increased between FYs 2024 and 2025, resulting in the District’s General Fund expenditures exceeding available revenues (i.e., negative operating margin) in FY 2025 and reducing the District’s General Fund balance by 26.94%, leaving it with a General Fund reserve balance that would cover just under 2 months of expenditures to begin FY 2026.

While the District has not yet exceeded its statutorily prescribed budget limits or cash resources, it must identify and implement appropriate risk-mitigation measures to prevent future overspending and cash deficits. See the District’s action plan below.