A larger than expected loss in a key enrollment-based figure is costing the Higley Unified School District more than $2 million on its maintenance and operations budget for fiscal year 2024-25.
The HUSD governing board adopted a second budget revision Tuesday on a 5-0 vote with an M&O budget of $125.94 million, down nearly $2.13 million from the first revision from August of $128.06 million.
Chief Financial Officer Tyler Moore presented the updated budget, emphasizing the impact of lower average daily membership, a key metric used in the state’s education funding formula. Average daily membership is the total enrollment of fractional and full-time students, minus withdrawals, of each school day through the first 100 days of the school year.
He noted that the district originally budgeted for a modest 1% decline but has now recorded a 3% drop from the previous year, equating to a loss of 381 students.
The decline has been attributed primarily to demographic shifts. Lower birth rates have led to smaller kindergarten classes, which are "trending declining enrollment," according to Moore. This pattern affects all elementary grades as smaller classes move through the system.
Additionally, secondary schools, which had seen growth in prior years, have experienced a slight decline this year.
The impact is muted this year at the district because of its budget balance carryforward, the amount of unspent money from one year that is carried over to the next year's budget.
“We do have a budget balance carry forward, so we will not be making any operational changes to our district at this time,” Moore said. “We'll be utilizing the budget balance carry forward to absorb this loss in this fiscal year.”
However, the district faces additional pressures from the November override election results, which will reduce funding by $4.8 million in fiscal year 2026. The district’s override question failed by about 300 votes, less than 1%, meaning the 15% override must begin sunsetting next year, falling back to 10%.
Vice President Anna Van Hoek asked if the district had data on families who are leaving the district.
"We ask for that information, but sometimes parents aren’t truthful or don’t provide a reason," Moore said, suggesting that more comprehensive exit surveys could help identify trends.
The unrestricted capital budget, however, came out ahead in the revision, showing a net change of $3.9 million due to adjustments and some interest earnings.
The biggest adjustment came in its budget balance carryforward, as some expenditures were paid this fiscal year when they were anticipated for last. Prior year average daily membership also is used in the capital budget, as opposed to current year used in the M&O budget, making the budget figure easier to project.
Looking ahead, the board will consider budget reductions to address enrollment trends and funding challenges beginning in its January meetings.
Meet Tom Tom Blodgett joined Independent Newsmedia, Inc., USA, in 2022, when the company acquired Community Impact Newspaper's Phoenix-area properties. Raised in Arizona, he has spent more than 35 years in journalism in the state.
Community: He has served as an instructional professional in the Walter Cronkite School of Journalism and Mass Communication since 2005, and is editorial adviser to The State Press, the university's independent student media outlet. He also is director of operations for an 18U girls fastpitch softball team from Gilbert.
Education: Arizona State University with a BS in Journalism.
Random Fact: He lived in Belgium during his freshman year of high school.
Hobbies: Tweeting enthusiastically about ASU softball (season-ticket holder) and grumpily about other local sports (pessimistic fan).
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