By Kurt Rohrs, Chandler Unified School District Governing Board member
So how much money does the Chandler Unified School District have in reserve in case of a contingency event that interrupts their regular revenue stream?
There seems to be a universal understanding that it is reasonable and prudent for the District to have cash reserves on hand. This is generally considered to be a sound financial management practice.
It would be similar to a household savings account that one would have at home in case of emergencies.
Reserve Funds help the district through contingencies such as the financial crisis of 2009-2010 and through periodic delays in the delivery of state funding for use by the District. Since more than 80% of the operating expenses of the district are used to pay the salaries and benefits of our employees, this is a critical consideration.
So why is the District continuing to be so secretive and evasive in answering this rather simple question? After several attempts to get them to disclose this important information, the public still does not have a clear answer.
Various explanations have been put forth that complicate and hinder the resolution of this issue.
We have been told that the required financial reports required by the state of Arizona do not provide a way to report this. However, there are several items of financial interest not required by state financial reporting rules that are disclosed in the notes of the Annual Financial Report (AFR). These reserve calculations, which, having not been previously disclosed, could easily be reported there.
We were also told that there are 65 “Special Revenue” funds, which are defined by the state with respect to how the funds are collected, that hold balances for the District making this much too complicated to report. However, a more careful look at these funds reveals that 98% of the total balance of $140.6 million in Special Revenue funds, as of the end of the last fiscal year, is comprised of only eleven funds.
Several of those Special Revenue funds have balances of over $10 million each. The remaining fund balances are trivial by comparison.
We were also told that Special Revenue funds balances are “Restricted." However, that does not mean they cannot be used or should not be counted. It was never explained exactly what these spending restrictions actually are.
Presumably, the funds can still be used to pay ongoing liabilities that the District would have, in case of a shortfall in collection of revenues.
The district’s general fund, which is not “restricted”, also held $89.5 million as of the end of last year. Special Revenue funds and the general fund added together totaled $230.1 million.
Perhaps it is time for the District Administration to make a better effort and disclose the amount of their reserve funds in a clear way so that the public understands it. The public has a right to know and the District Administration does have a responsibility to report it to the taxpayers who provide their funding.
Kurt Rohrs is a member of the Chandler Unified School Board taking his seat in January 2023. The views expressed here are his own and do not reflect the views of the Governing Board as a whole or the views of the Chandler Unified School District Administration.
We’d like to invite our readers to submit their civil comments, pro or con, on this issue. Email AZOpinions@iniusa.org.
