A report released Monday by the Office of the Colorado State Auditor reveals that even among declining revenues and shrinking budgets, Montezuma-Cortez School District Re-1 is financially stable.
The Fiscal Health Analysis of Colorado School Districts report, presented to the Legislative Audit Committee Monday, examined the fiscal state of Colorados 178 school districts. The report, produced annually by the state auditor, covered a three-year period ending June 30, 2010.
In the report, 26 districts had a least one warning indicator of potential financial stress, down from 49 in the 2010 report. The local school district received high marks on the audit, with no warning indicators.
Six ratios are used to determine patterns of concern in districts, including general fund liabilities exceed assets, debt payments exceed the revenue dedicated to repayment, general fund ending balance would cover less than a weeks operating expenses, declines in reserves, previous deficits being paid off by current revenues and declines in general fund balance.
Wise financial planning has allowed the district to weather recent storms, including a decrease in revenue from the state and two significant budget cuts.
We are where we are by monitoring basically every fiscal decision we make very carefully, said Superintendent Stacy Houser in a phone interview Tuesday. Really, that is pretty much what it comes down to.
The districts fiscal security was aided in the audit by the absence of debt. In two categories, Re-1 received no ratio because the district carries no debt and does not have an existing deficit fund balance.
In the other four categories, the school district showed improvement over the past three years, with a 2.75 asset sufficiency ratio, indicating the districts total assets are adequate to cover its obligations. That number was up from 2.46 in 2008 and 1.97 in 2009.
Large improvements were also visible in the operating margin ratio, which measures the amount added to the school districts reserves for every $1 generated in revenue, and the change in fund balance ration, which indicates whether the school districts reserves in its general fund are increasing or decreasing. Decreases in reserves were noted in 2008 and 2009, though the decrease came through efforts to balance the budget, not from discretionary spending.
Houser said much of the credit for the districts solid fiscal situation belongs to Re-1s chief financial officer, Melissa Brunner, and her staff, as well as the school principals and department members who examine spending and cuts.
They all have to look at every decision we make in positions or programs or general expenditures and they look at it very carefully, he said. We work hard to make sure we are where we need to be.
While the state audit is useful in terms or trend analysis, school districts across the state are still required to submit to yearly in-depth audits that are tied to the districts accreditation with the Colorado Department of Education.
Re-1s formal audit of the 2010-2011 school year will take place in late September or early October.
Reach Kimberly Benedict at email@example.com.