School district financial risk analysisDecember 2020

District

Demographic information

Less common revenues

County: Yavapai County
Operational peer group (FY 2020): 9
Legislative district(s): 1 and 6
FY 2019 FY 2020
Students attending: 1,983 1,935
Number of Schools: 5 5
FY 2020
Desegregation
0
Federal impact aid
0
Small school adjustment
0
Voter-approved budget overrides
1,112,719
Total less common revenues per pupil
575

Analysis results

Summary of risks identified:

The District’s weighted student count has declined 9 percent since fiscal year (FY) 2017, including a 7 percent decline since FY 2020, reducing its student-count-generated revenues and budget limits. Though the District’s student loss was more gradual before FY 2021, by not cutting spending below available revenues (i.e., negative operating margin), the District diminished its General Fund balance in FYs 2019 and 2020. The District also overspent its operating budget limits in FYs 2019 and 2020 by over $73,000 and $48,000, respectively. On average since FY 2017, the District redirected 42 percent of its capital monies to operational spending, including 82 percent in its FY 2021 budget to date. Those redirected monies contributed to its capital budget reserve declining 91 percent in FY 2020. The District was notified in November 2020 that it is one of the highest-risk districts based on the most recent financial and student count data. We will begin periodic meetings with the District in early 2021 to discuss more about the actions it has taken or is evaluating to lessen its financial risk.

District response:

The Risk Analysis reveals the financial impacts of the challenges facing the District from the combination of Current Year Funding, an increase in SPED students and related costs, and servicing the economically disadvantaged students in the community. For FY21 the District estimated and budgeted for a reduction in ADM of 50 students and eliminated one administrative position and four certified positions. The actual loss of ADM is 140 students, which will further stress the financial position and lead to additional personnel reductions for FY22.

Change in weighted student count
-6.5% -8.5%
(1-year) (4-year)
Fiscal year Group A WSC
2021 2,071
2020 2,216
2019 2,268
2018 2,208
2017 2,264
Operating budget limit reserve
34.1% -100.0%
(1-year change) (3-year change)
Fiscal year Balance
2020 ($48,423)
2019 ($73,451)
2018 $256,166
2017 $228,778
Capital budget limit reserve
-91.0% 100.0%
(1-year change) (3-year change)
Fiscal year Balance
2020 $6,543
2019 $72,883
2018 ($11,403)
2017 ($11,403)
General Fund operating reserve ratio
0.7% 3.4%
FY 2020 unaudited 2019 audited
Fiscal year Balance Expenditures
2020 unaudited $99,887 $13,392,121
2019 audited $483,079 $14,304,779
General Fund operating margin ratio
-3.1% -7.7%
FY 2020 unaudited 2019 audited
Fiscal year Revenue Expenditures
2020 unaudited $12,993,128 $13,392,121
2019 audited $13,276,196 $14,304,779
General Fund change in fund balance
-55.7% -62.5%
FY 2019 to FY 2020 unaudited 2018 to 2019 audited
Fiscal year Change amount
2019 to 2020 unaudited ($125,405)
2018 to 2019 audited ($803,521)
Capital monies redirected to operations
81.7% 41.8%
(FY 2021) (5-year average)
Fiscal Year Capital monies Amount redirected
2021 $722,258 $590,000
2020 $594,071 $225,071
2019 $303,870 $40,000
2018 $97,789 $40,000
2017 $114,055 $40,000
Small school budget limit adjustment

N/A - District is too large to be eligible for adjustment.

Fiscal year Adjustment
2021 $0
2020 $0
2019 $0
2018 $0
2017 $0
Frozen tax rate

District's primary property tax rate is not frozen.

Receivership

District is not in receivership.