arizona school finance summary manual - riverside … · · 2013-02-11january 2008 arizona school...

JANUARY 2008

Arizona School Finance Summary Manual

A tool developed to assist your understanding of the school budget — where the

money comes from and where it goes

Permission is granted to reproduce any portion and all portions of the 2008 School Finance Manual provided that credit is given to the Arizona Association of School Business Official for the production of this manual.

The Arizona Association of School Business Officials

(AASBO) is pleased to provide this document so that

you may better understand the ever changing world of

school finance. This document will assist you in assem-

bling and deciphering the various elements of a school

district budget as well as being a resource for other

related budgetary issues.

This manual is only one resource available to you in

your quest to understand school finance. This docu-

ment, as well as other related informa-

tion, is available to you via the AASBO

web site. The AASBO web site (www.

aasbo.org) contains numerous links

to other related organizations that

contain helpful information in the area

of school finance.

For those who desire a learning expe-

rience typically associated with a

classroom environment, including qualified instruc-

tors and interaction with peers, consider enrolling in

one of the AASBO Educational Programs. Subject

areas include: accounting, budgeting, purchasing,

food service, transportation, facility management,

human resources and school law. Advanced classes

are offered in the areas of purchasing, budget and

finance, and maintenance and operations. An intern-

ship program offering opportunities to work with

mentors is available to students who have completed

classes in each discipline. In cooperation with Central

Arizona College, participation in these classes can

lead to an Associates of Arts Degree (2 year degree

program) from the Community College System of

Arizona. Two certificate credentials, School Business

Specialist and School Business Official, are currently

being offered to AASBO members. For further infor-

mation on these programs, contact the Director of

Education Programs or an AASBO staff member.

Above all else, remember that AASBO is an organiza-

tion developed and run by individuals committed to

member service. A special thank you

to Wendy Qualls – Business Manager

Litchfield Elementary School District,

Lou Wiegand - Director of Business

Glendale Union High School District,

George Zeigler, CPA – Chief Financial

Officer Mesa Unified School District,

Lynn Pogreba – InfiniteVisions, Lyle

Friesen - Director of School Finance

Operations, Arizona Department of

Education and Chuck Essigs - Director of Government

Relations AASBO, for their assistance in updating the

information contained in this manual.

If you should have any questions, ideas, or sugges-

tions, please feel free to contact the AASBO staff at 602-

253-5576. They will be more than willing to assist you.

Tom ElliottTom Elliott2007-08 AASBO Board of Directors

“If you should have any questions, ideas,

or suggestions, please feel free to contact the

AASBO staff at 602-253-5576.”

Arizona School Finance Summary Manual

This document is divided into four (4) sections to aid in your understanding of school finance. These sections are as follows:

I. Overview II. BudgetFormulaConstruction III. WhereFormulaDollarsComeFrom IV. HowBudgetsAreCategorized

Although the information in this document is represen-tative of many public school districts in the State of Arizona, it will not portray all.

Additional information may be obtained from the following locations. Arizona Department of Education 1535 West Jefferson AvenuePhoenix, AZ 85007(602) 542-53931 (800) 352-4558 www.ade.az.gov

Arizona Auditor General2910 N. 44th Street, Ste. 410Phoenix, AZ 85018(602) 553-0333www.azauditor.gov

Arizona School Boards Association2100 North Central Avenue, Ste 200Phoenix, AZ 85004-1441(602) 254-1100www.azsba.org

Arizona Department of Revenue1600 W. MonroePhoenix, AZ 85007-2650(602) 716-6090www.revenue.state.az.us

Arizona School Facilities Board1700 West Washington, Suite 230Phoenix, AZ 85007(602) 542-6501www.sfb.state.az.us

Arizona Association of School Business Officials2100 N. Central Ave., #202Phoenix, AZ 85004(602) 253-5576www.aasbo.org

Arizona School Administrators1910 W. WashingtonPhoenix, AZ 85009(602) 252-0361www.azsa.org

Association of School Business Officials International11401 North Shore DrReston, VA 20190866-682-2729www.asbointl.org

http://www.ade.az.gov/

http://www.azauditor.gov/

http://www.azsba.org/

http://www.revenue.state.az.us/

http://www.azsfb.gov/sfb/sfbweb/sfbaays/home.asp

http://www.aasbo.org/

http://www.azsa.org/

http://www.asbointl.org

Arizona Association of School Business Officials | School Finance Summary Manual

Overview: “A Global Perspective”. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Budget Formula Construction. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Maintenance and Operations Budget. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Base Support Level (BSL). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 Pupil Transportation Funding .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. 10 Revenue Control Limit and District Support Level (DSL). . . . . . . . . . . . . . . . . . . . . 12 Capital Outlay Revenue Limit. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 Additions to the Maintenance and Operations and Unrestricted Capital Outlay Budgets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Soft Capital Allocation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18

Where Formula Dollars Come From . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 State and County Equalization Assistance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 School District Property Taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

How Budgets are Categorized. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 Maintenance and Operations (M&O) Fund 001. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 Classroom Site Fund 010. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 Instructional Improvement Fund 020 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 County, City and Town Grants Fund 050 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 Compensatory Instruction Fund 072. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 Special Projects Funds 100-499 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 School Plant Funds 500-506. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 Other Funds 510-595 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 Capital Related Funds 600-700 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 Other Miscellaneous Funds 510-595 .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. . 28

Appendix . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29

Glossary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30

Acronyms. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32

Arizona Association of School Business (AASBO) Officials. . . . . . . . . . . . . . . . . . 33

Table of Contents

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OVERVIEW: “A Global Perspective”

The public elementary and secondary schools of Arizona are governed by the Arizona Constitution and Title 15 of the Arizona Revised Statutes (A.R.S.).

The legislature has required that the Arizona Department of Education and the state’s Auditor General interpret Title 15 and design the state’s Uniform System of Financial Records (USFR) which is used in maintaining local school district financial records and preparing reports. Two USFR manuals exist, one for school districts and one for charter schools. The USFR prescribes the accounting system and includes a detailed descrip-tion of the legally established funds. The USFR and Memorandums are available to download from the Auditor General’s site (www.azauditor.gov). The USFR includes a calendar, chart of accounts and other valu-able information. A listing of the commonly used funds is included in the section of this document entitled: How Budgets are Categorized.

In 1980-81 the Arizona Legislature refined the school finance system to provide equal dollars per weighted pupil for school district operations through a balancing of the local qualifying property tax rate and State and County equalization assistance. This concept, commonly referred to as the “equalization formula” allowed school districts throughout the State of Arizona to experience similar “effort” in raising educational dollars for their students irrespective of the property valuations within their boundaries. With the exception of the suspension of County Equalization, this equal-ization formula is still utilized today in funding a district’s Revenue Control Limit (RCL), Capital Outlay Revenue Limit (CORL), and its Soft Capital Allocation. Further details of these formulas are included in the section of this document entitled: Budget Formula Construction.

In 1994, the Arizona Supreme Court ruled that the state’s statutory formula for funding school facili-ties and equipment violated the Arizona Constitu-tion. A four-year struggle to create a new capital

finance system ended July 9, 1998 when the legisla-ture passed and approved Students FIRST (Fair and Immediate Resources for Students Today) legislation.

Students FIRST created a completely new capital financing system aimed at creating minimal adequacy stan-dards for capital related issues in public schools. This system more tightly controls the capital funding as compared with the past when it was typically financed by the sale of general obligation bonds. The Students FIRST program is governed by the state School Facilities Board.

In 1995 the Legislature authorized charter schools — a new educational option. In the first years, charter school funding was based on the RCL, CORL and Capital Levy Revenue Limit (CLRL), which was calculated in the same manner as the districts. Over the years, the funding has evolved to include Addi-tional Assistance, which replaced the CORL, CLRL and Transportation funding, plus additional monies in lieu of capital funding from the School Facilities Board (SFB).

The focus of this manual is to provide an understanding of the way public school districts in the State of Arizona are funded and does not include charter school funding. The sections that follow will help to better understand some of the detailed components that make up the financing formulas.

“The focus of this manual is to provide an understanding of

the way public school districts in the State of Arizona are funded ”

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A school district budget covers a one year period from July 1st to June 30th. Each school district must propose, adopt and revise an expenditure budget according to

the following chart. The following is a schedule of the dates, publishing and meeting notice requirements for Expenditure Budgets per Arizona Revised Statutes:

Budget Formula Construction

Type of Budget Revision Publishing Requirements

Public Hearing and Board Meeting

Post Notice of Public Hearing*

Proposed budget and adoption of proposed budget (A.R.S. § 15-905.C)

Publish proposed budget or summary and notice no later than 10 days prior to public hearing or post on the Arizona Department of Education website

Not later than July 15

Yes

September 15 budget revision (A.R.S. §15-905.Q)

No Prior to October 15

Yes

December 15 budget revision (A.R.S. § 15-905.E)

Publish notice no later than 10 days prior to public hearing

On or before December 15 Yes

Final budget revision (Growth A.R.S. §15-948(D); excess utili-ties A.R.S. §15-910(D); tuition revenues A.R.S. §15-905(I); Type 03 HS tuition A.R.S. §15-905(J); Impact Aid A.R.S. §15-905(K) )

No Prior to May 15 Yes

(May 15 budget revisions and other budget revisions not indicated above.)

No Prior to May 15 Yes

*Only regular public hearing notice requirements for posting must be met.

• Maintenance & Operation • Unrestricted Capital Outlay • Soft Capital Allocation • Classroom Site Fund • Instructional Improvement Fund

• Bond Building and Capital Funds• Special Projects (Federal/State)• Building Renewal• New Schools Facilities• Other Funds

The Expenditure Budget contains categories from which school districts can expend monies. These categories (funds) fall into these major classifications:

http://www.azleg.state.az.us/FormatDocument.asp?inDoc=/ars/15/00905.htm&Title=15&DocType=ARS









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Maintenance and Operations Budget The Maintenance & Operations (M&O) Fund budget is where most of the day to day expenditures take place. Typical budgeted expenditures include: salaries, employee benefits, supplies, utilities, maintenance and repair, and miscellaneous expenditures not of a capital nature.

Although the format and formula computation of the M&O Fund is very structured, the process of deter-mining how the monies will be spent varies among school districts. Typically the budgeting process starts months before the budget year begins.

The M&O Budget limit is based on a number of formulas heavily dependent upon the Average Daily Member-ship (ADM) of the first 100 days in session (A.R.S. §15-901A.2). School districts are funded on prior year ADM and charter schools on current year ADM. ADM means the total enrollment of fractional students and full-time students, minus withdrawals, of each school day through the first one hundred days in session for the current year (A.R.S. §15-901) (A.R.S. §15-902.02

provides an option to offer and be funded on the 1st 200 days of instruction.) This basic Maintenance and Operation Expenditure Budget includes the following formulas:

• Base Support Level (BSL) (A.R.S. §15-943)

• Transportation Revenue Control Limit

(TRCL) (A.R.S. §15-946)

• Capital Outlay Revenue Limit (CORL)

(A.R.S. §15-961)

Budget Formula Construction cont.

“The M&O Budget limit is based on a number

of formulas heavily dependent upon the

Average Daily Member-ship (ADM) of the first 100 days in session ”








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Base Support Level (BSL)

Weighted Student Count

The Weighted Student Count takes into consideration the relative associated cost of educating certain clas-sifications of students. The weighted student count takes into account the size of the district, whether the students are in elementary or high school, the isolation of small rural school districts in the state, and special needs children. Weighted Student Count is specified per A.R.S. §15-943.

Group A StudentsGroup A students are defined in A.R.S. §15-901 which includes funding for the following groups of students.

For school districts with 600 or more students, the following weights by grade level are utilized:

School districts with fewer than 600 students in elemen-tary and/pr high school grades have weights that vary by grade range. Weight factors for the small isolated school districts are greater than those for the small school districts. School districts must be designated by the Superintendent of Public Instruction in order to use small isolated district weights. As defined in A.R.S. §15-901 (B) (26), a small isolated school district to be so designated must contain no school which is fewer than thirty miles, or fifteen miles if road conditions and terrain cause driving to be slow or hazardous, from another school operated by an in-state school district and which teaches one or more of the same grades as the school to be designated as within an isolated small school district. Following are the special weight-ings applicable to these school districts as identified in A.R.S. §15-943.1. (See chart below)


Weighted Student Count X Base Level Amount X Teacher Experience Index

Base Support

Level = {

Grade Level Support Level Weight

Pre-School with Disabilities (PSD) 1.450

K - 8 grades 1.158

9 - 12 grades 1.268

Support Level Weights for Small School Districts Not Designated as Isolated

Student Count K-8 Grades 9-12 Grades

< 100 1.399 1.559

> =100 & < 500 1.278 + [.0003 x (500 – student count)] 1.398 + [.0004 x (500 – student count)]

> = 500 & < 600 1.158 + [.0012 x (600 – student count)] 1.268 + [.0013 x (600 – student count)]

Support Level Weights for Small Isolated School Districts

Student Count K-8 Grades 9-12 Grades

< 100 1.559 1.669

> =100 & < 500 1.358+ [.0005 x (500 – student count)] 1.468 + [.0005 x (500 – student count)]

> = 500 & < 600 1.158 + [.002 x (600 – student count)] 1.268 + [.002 x (600 – student count)]






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Base Support Level (BSL) Group B Students Additional support level weights are provided for special needs and other students that were served the previous year. Funding for Extended School Year (ESY) is included within the funding generated by these addi-tional weights. These weights are specified in A.R.S. §15-943.2. They are as follows:

Base Level AmountThe Base Level is the amount of money deter-mined annually by the Legislature per 1.0 weighted student count. For budget year 2007-08 the Base Level is $3,226.88 without teacher compensation.

Teacher CompensationA district can increase its Base Level amount by an additional 1.25% if its teacher performance evalua-tion system receives approval from the State Board of Education, in accordance with A.R.S. §15-952. Funds received by this increased budget capacity may be expended only for additional teacher compensation. For budget year 2007-08, the Base Level is $3,267.22 with teacher compensation.

Career Ladder and Optional Performance Incentive ProgramsA limited number of districts approved by the State may also increase the Base Level amount by up to an addi-tional 5.5%, if it participates in a teacher compensa-tion program entitled “Career Ladder” (A.R.S. §15-918 et al) or an Optional Performance Incentive Program (A.R.S. §15-919 et all). The elementary and high school districts must increase their Qualifying Tax Rate (QTR) by 2¢ for each percent increase in their Base Level amount. Unified school districts must increase the QTR by .04 cents for each percent increase in their Base Level amount.

Teacher Experience Index (TEI)This factor is derived from the formula specified in A.R.S. §15-941. Its purpose is to allow extra budget capacity for school districts whose average years of experience for teachers exceed the State of Arizona average. Districts that qualify are allowed to increase the support level by 2.25% for each year of experience above the State of Arizona average. The average and each district’s TEI factor is calculated from the School District Employer Report (SDER) that is due annually by October 15; this report is commonly compiled by a district’s Human Resources or Payroll department.


K 1.352

Hearing Impairment 4.771

K-3 0.060

ELL (English Language Learners) 0.115

MD - R, A-R and SMR - R 6.024

MD - SC, A-SC and SMR - SC 5.833

Multiple Disabilities Severe Sensory Impairment

7.947

Orthopedic Impairment (Resource) 3.158

Orthopedic Impairment (Self Contained) 6.773

Preschool-Severe Delayed 3.595

ED, MIMR, SLD, SLI, and OHI 0.003

Emotionally Disabled (Private) 4.822

Moderate Mental Retardation 4.421

Visual Impairment 4.806








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Pupil Transportation FundingA.R.S. §15-945 and §15-946 provide increased budget limits for districts that transport or contract for the transportation of students to-and-from school. There is additional funding for academic, vocational and athletic trips. The subsections below provide details on the computation of the transportation limits.

Transportation Support Level (TSL)The Transportation Support Level (TSL) is based on the average daily route miles per eligible student transported. Districts are required to use the prior year Approved Daily Route Mileage in calculating this amount for the budget year. Eligible students are those in elementary school (grades PSD-8) whose place of residence is greater than one mile from their school of attendance, and those in high school (grades 9-12) whose place of residence is greater than one and a half miles from their school of attendance. The formula is based on 180 school days.

The first step in calculating the TSL is to divide the district’s total daily route miles by the total number of eligible students transported. The quotient obtained from this calculation is used in this chart to determine the district’s funding per route mile.

The factor chosen from the chart is multiplied by the total route mileage and then actual expenditures for bus passes and tokens for eligible students is added to that product to determine the to-and-from school support level.

The second section of the support level is for academic, vocational and athletic trips. This add-on amount varies by type of district and is determined by the following chart:

Type 02 = unified district, type 03 = elementary district not in a high school district, type 04 = elementary district in a high school district and type 05 = high school district.

The factor determined above is multiplied by the to-and-from support level (excluding bus tokens and passes) to calculate this add-on.

The third part of the calculation is the support level for the extended year programs which is determined by multiplying the total extended school year route miles for students with disabilities attending the extended school year program by the per mile factor used in the basic to-and-from support level.

The sum of the above three items, the to-and-from, academic/vocation/athletic, and extended school year constitutes the TSL.


Daily Route Mileage Per Eligible Student

State Support Level per Route Mile for 2007-08

0.5 or less $2.23

More than 0.5 through 1.0 $1.81

More than 1.0 $2.23

Daily Route Mileage Per Eligible Student

Transported

District Type

02 or 03

District Type04

District Type05

1.0 or less 0.15 0.10 0.25

More than 1.0 0.18 0.12 0.30

“The Transportation Support Level (TSL) is based on the average

daily route miles per eligible student

transported.”



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Pupil Transportation Funding cont.

Transportation Revenue Control Limit (TRCL)The Preliminary Transportation Revenue Control Limit (TRCL) is determined by adding the increase in the budget year TSL from the prior year TSL to the prior year TRCL.

In accordance with A.R.S. §15-946, the budget year TRCL cannot increase from the prior year TRCL amount if the budget year TRCL would exceed 120% of the budget year TSL.

If the budget year Preliminary TRCL is greater than 120% of budget year TSL, then the budget year TRCL is the same as the prior year TRCL.

In 2007, the Arizona legislature amended A.R.S. §15-946 to set the TRCL to equal the TSL, when the TSL is greater than the TRCL (Laws 2007, 1st Regular Session, Chapter 234, Section 1).


“The Preliminary Transportation Revenue Control Limit (TRCL) is determined by adding

the increase in the budget year TSL from the prior year TSL to the prior year TRCL”




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Revenue Control Limit (RCL) and District Support Level (DSL)

The RCL is a spending limit and is calculated by adding the BSL to the TRCL. The Revenue Control Limit may be allocated, in amounts determined by the district, between the M&O fund budget and the unrestricted capital fund budget.

The District Support Level (DSL) is that portion of the RCL that is eligible for equalization assistance. It is calculated by adding the BSL to the TSL.

Common school districts not within a high school district (Type 03) are funded for high school students based on high school tuition paid to other districts. The Base Support Level formula for those districts

uses the elementary student count only. The tuition amount paid for high school students from these districts is included in the DSL and the RCL for purposes of determining the General Budget Limit, but excluded when calculating the amount of budget overrides.


“The Revenue Control Limit may be allocated, in amounts determined by the district, between the M&O fund budget and the unrestricted capital fund budget.”

13


Capital Outlay Revenue LimitJust as there is a formula that determines the Revenue Control Limit, there is also a formula for Capital Outlay in A.R.S. §15-961. The Capital Outlay Revenue Limit (CORL) is a spending limit and, like the RCL, may be allocated, in whole or in part, to either the M&O or unre-stricted capital fund. The CORL calculation is a multiplication of the unweighted actual student count (100th Day adjusted ADM) by the appropriate support levels.

The 2007-08 formula for districts of 600 or more students is as follows:

The sum of the above products is the Capital Outlay Base. If a district’s student count is greater than 5% over the prior year student count, the Capital Outlay Base is increased by the actual percentage increase in the school district’s student count.

The final factor in the CORL formula is an increase for textbooks for high school students. Prior to 1984, high school students had to pay a rental fee for textbooks. In 1984, the Legislature adopted a compulsory educa-tion statute which requires students to be 16 or to have completed the 10th grade prior to leaving school. In conjunction with the compulsory school requirement, the Legislature commenced the process of furnishing textbooks free to high school students. In 2007-08, the allowable amount for high school textbooks is $69.68 per high school student count. It should be noted that these provisions apply only to required textbooks and related printed materials. School districts may continue to charge a reasonable rental fee for other supplemen-tary materials.

Student Count of Less Than �00There are no special provisions for Rapid Decline districts, so the actual 100th Day adjusted ADM must be used as the student count. For small and isolated districts, the basic formula per student dollar amounts for K-8 and 9-12 are multiplied by the corresponding weights determined from the chart indicated in Section II.A.1.b of this report and prescribed by A.R.S. §15-943 (for small school districts).


Grade Level Support Level

PSD $225.76

K-8 $225.76

9-12 $267.94



14



Additions to the Maintenance & Operations and Unrestricted Capital Outlay BudgetAfter allocating the RCL and the CORL between the Maintenance & Operation Budget and the Unrestrict-ed Capital Budget there are certain adjustments to be made in arriving at the total budget for these funds. There are numerous reasons for an increase, but most districts will typically only have some of the adjustments noted below. Unless otherwise noted the adjustment may be made to both the M&O and Unrestricted Capital Outlay budgets.

Growth FundingThe district’s Revenue Control Limit for the budget year is computed utilizing the prior year’s 100th day Resident ADM calculation. If the 100th day ADM for Group A and/or Group B is greater than the prior year 100th day ADM, a district’s budget may be revised to include an increase to the RCL. (A.R.S. §15-948) Budget OverridesA.R.S. §15-481 allows a district to increase its budget up to 10% of its Revenue Control Limit if the voters of the district approve by election. The voter authorization is given for up to seven years. If the additional increase is for five years or more, the percentage increase remains constant (up to 10%), except during the next to last year when the percentage decreases to two-thirds of the initial percentage and during the last year when it decreases to one-third of the initial percentage. A district can renew its authorized percentage (up to 10%) in the last two years of an existing override by passing another election. This override may only be allocated to the M&O Fund.

A special override election for academic achievement in grades K-3 may be held by an elementary or unified district. Five percent of the Revenue Control Limit attributable to the weighted count in PSD, kindergarten

and grades 1-8 can be requested under the provisions of A.R.S. §15-482. However, when this provision is used in combination with the use of proceeds from the sale or long-term lease of school property (A.R.S. §15-1102) or with an override in accordance with A.R.S. §15-481, the total increase cannot exceed 15% of the Revenue Control Limit. This special K-3 override can be for the same period as the 10% override. Budget balance carryover for K-3 override is limited to 50% of unex-

pended budget balance. This override may be allocated to the M&O or Unre-stricted Capital Outlay Fund.

A.R.S §15-481 allows for a special over-ride election for capital outlay. For over-rides approved by a vote of the qualified electors of the school district at an elec-tion held from and after October 31, 1998,

the period of the additional increase prescribed in this subsection shall not exceed seven years for any capital override election. This override may be allocated to the Unrestricted Capital Outlay Fund only.

Overrides may not be increased for growth in student counts. Equalization Assistance is not provided for override amounts.

Tuition RevenueDistricts are allowed to budget an additional amount for tuition and/or certificates of educational conve-nience (CEC) revenues. If this revenue was underes-timated, the district may increase the budget prior to May 15. If this revenue was overestimated, the district must reduce expenditures and the general budget limit based on actual revenues.

Excess Utility CostsA district may budget for utility costs that are exempt from the Revenue Control Limit, as provided in A.R.S. §15-910. Excess utilities are direct operational costs of heating, cooling, water, electricity, telephone communi-cations and sanitation fees that exceed a base amount. The base amount is calculated by increasing or

“Overrides may not be increased

for growth in student counts.”









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decreasing the utilities cost for the base year of 1984-85 by the percentage change in the combined Revenue Control Limit and Capital Outlay Revenue Limit from the base year to the budget year.

A district may expend from the excess utility budget category only after it has expended the full amount budgeted in the base utility lines of the budget. The amount budgeted for excess utilities may be revised, after notice is given and a public meeting is held, any time before May 15.

The ability to budget for excess util-ities ends after FY 2008-2009. This increase is made only to the M&O Fund.

Budget Balance CarryforwardA district may carry forward any unused M&O budget balance, limited to 4% of the prior year RCL. None of this carry forward can be attributable to required reduc-tions such as excess utilities, tuition revenue budgeted and not received or expenditures for the debt service portion of the cost of tuition. Authorization for this addi-tion is found in A.R.S. §15-943.01.

A district may also carryforward any unused Unre-stricted Capital Fund budget plus interest earned for the prior fiscal year. Interest earnings from the prior year may not be used to increase the M&O budget.

Desegregation CostsAdditional budget capacity for a district to comply with or continue to implement activities relating to a court-ordered desegregation or administrative agree-ment with the United States Department of Education Office for Civil Rights is allowed under A.R.S. §15-910. A district qualifying and choosing to budget for these expenses may budget both maintenance and operation and capital outlay funds outside of the RCL and CORL. A separate desegregation budget must be prepared on forms prescribed by the Superintendent of Public

Instruction. Equalization assistance is not provided by the state or county for these costs. Current law has capped the desegregation budget for 2007-2008 at

the 2006-2007 budget level plus a percentage increase based upon the ADM increase of the school district and a 2% inflation increase (Laws 2007, 1st Regular Session, Chapter 264, Section 15). Unspent deseg-regation budget may not be carried forward.

Small School District ExemptionSchool districts that have a student count of 125 or less students in grades K-8 or 100 or less students

in grades 9-12 may adopt a budget in excess of their normal calculated budget limit. Districts that utilize this provision are allowed to add any needed dollars at the time the budget is proposed (A.R.S. §15-949).

Registered WarrantsDistricts may budget for interest expenses for regis-tering warrants or net interest expense for tax anticipa-tion notes (TANS) incurred in the fiscal year two years prior to the budget year, if the county treasurer pooled all district monies for investment and the district applied for early payments of their state aid apportionment or the district was not eligible for state aid.

Title � PL 103-3�2 Districts may budget for P.L. 81-874 assistance received for the education of children with disabilities, children with specific learning disabilites and children residing on Indian lands. A.R.S §15-905 K., O. and P.

Accommodation SchoolsIf an accommodation school has a positive total cash balance at year end, the county school superinten-dent may authorize an addition to the accommodation school’s revenue control limit for the following fiscal year. A.R.S. §15-974 C. This increase is made only to


“A district may expend from the excess utility budget category only

after it has expended the full amount budgeted in the base utility lines

of the budget. ”






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the M&O Fund. This increase is limited to the lesser of the ending cash balance minus the amount budgeted as budget balance carry forward (A.R.S. §15-943.014) or 10% of the RCL.

Tuition Out Debt ServiceDistricts may budget the bond issues portion of the cost of tuition charged to the district as provided in A.R.S. §15-824 for pupils attending school in another school district. A.R.S §15-910 L. This increase is made only to the M&O Fund.

The money to support the Revenue Control Limit, Capital Outlay Revenue Limit, and Soft Capital Alloca-tion, as set forth in the preceding sections, are obtained from two main sources - state equalization assistance and property taxes.


“Districts may budget the bond issues portion of thecost of tuition charged to the district as provided inA.R.S. §15-824 for pupils

attending school in another school district.

A.R.S §15-910 L.”

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Dropout Prevention ProgramsSchool districts which participated in the dropout prevention program as originally established pursuant to Laws 1987, Chapter 333 and continued by Laws 1990, chapter 399, may continue to budget for the dropout prevention program in an amount not to exceed the amount budgeted in fiscal year 1990-1991 (Laws 1992, Chapter 305, Section 32). Expenditures for programs serving grades 4 through 12 are allowed.

Joint Career and Technical Education and Vocational Education CenterDistricts that have entered into an intergovernmental agreement to establish a jointly owned and oper-ated joint career and technical education and voca-tional education center as provided in A.R.S. §15-789 may budget for vocational maintenance and operation expenses which are specifically exempt, in whole or in part, from the revenue control limit for a period of not to exceed three years beginning the first year that the career and technical education and vocational educa-tion center is operating. (A.R.S. §15-910.01)

Career Ladder Budget Balance CarryforwardA district that has implemented a career ladder program may budget any budget balance in the maintenance and operation section of the budget that is directly attribut-able to a career ladder program from the current fiscal year for use in career ladder programs in the budget year. The amount budgeted shall not be included in the allowable budget balance carry forward calculated pursuant to A.R.S. §15-943.01. A.R.S. §15-918.04 C. This increase is made only to the M&O Fund.

Optional Performance Incentive Program Budget Balance CarryforwardA district that has implemented an optional perfor-mance incentive program may budget any budget balance in the maintenance and operation section of the budget that is directly attributable to the optional performance incentive program from the current fiscal year for use in the optional performance incentive program in the budget year. The amount budgeted shall

not be included in the allowable budget balance carry forward calculated pursuant to A.R.S. §15-943.01. A.R.S. §15-919.04 (D). This increase is made only to the M&O Fund.

Performance Pay Budget Balance CarryforwardA district that has a performance pay component in its salary schedule may budget any budget balance in the maintenance and operation section of the budget that is directly attributable to the performance pay compo-nent in the salary schedule from the current fiscal year for use in the performance pay component of the salary schedule in the budget year. Budget balance for this item means the difference between the actual and budgeted performance pay component of a district’s salary schedule. The amount budgeted shall not be included in the allowable budget balance carry forward calculated pursuant to A.R.S. §15-943.01. A.R.S. §15-920. This increase is made only to the M&O Fund.

Other AdjustmentsDistricts shall adjust the budget for adjustments required by the department of education or adjust-ments required by the State Board of Education (eg., budget reduction for prior year for overexpenditure pursuant to A.R.S. §15-905 L.) A.R.S. §15-905 M.











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Soft Capital AllocationDistricts can spend Soft Capital Allocation budget only for short-term capital items that are required to meet academic adequacy standards such as technology, textbooks, library resources, instructional aids, pupil transportation vehicles, and furniture and equipment. All of the soft capital monies must be spent in the Soft Capital Allocation Fund and cannot be spent for main-tenance and operation expenses. Districts may use soft capital monies to meet administrative soft capital purposes after complying with adequacy standards.

Student Count of �00 or More

Grade Level Support Level

PSD $225.00

K - 8 $225.00

9 - 12 $225.00

Student Count of Less Than �00Districts with a K–12 student count of less than 600 students are allowed a special transportation soft capital adjustment. A district must make applica-tion and obtain approval through the State Board of Education for this special adjustment, and it must meet several requirements set forth in A.R.S. §15-963.

As is with the M&O and Unrestricted Capital Outlay funds, there are adjustments to the soft capital alloca-tion limit that are made to arrive at the Soft Capital Allo-cation Budget Limit. The adjustments are as follows:

• Unused Soft Capital Allocation budget may be carried forward to the subsequent budget year.

• The soft capital allocation may be increased by interest earned in the prior year.

• Districts shall adjust the budget for adjustments required by the department of education or adjust-ments required by the State Board of Education (eg., budget reduction for prior year for overex-penditure pursuant to A.R.S. §15-905 L.) A.R.S. §15-905 M.





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The money to support the Revenue Control Limit, Capital Outlay Revenue Limit, and Soft Capital Alloca-tion, as set forth in the preceding sections, are obtained from two main sources - state equalization assistance and property taxes.

State Equalization AssistanceThe school finance formula attempts to ensure that each district has equitable budget capacity compared to others in the state. Equalization assistance helps to ensure that the revenues available for district budgets are shared equitably as described in A.R.S. §15-971. Equal-ization assistance is the amount of money that the state provides to school districts over and above the uniform Qualifying Tax Rate (QTR). If the local tax rate neces-sary to fund the RCL/DSL, CORL and Soft Capital allo-cation formulas is equal to or lower than the Qualifying Tax Rate, no state equalization assistance is given. If the tax rate necessary to fund the formulas is greater than the Qualifying Tax Rate, state equalization assistance is provided in order to keep this portion of local prop-erty taxes uniform throughout Arizona. The amount of equalization assistance provided varies inversely with a district’s per weighted student assessed property valua-tion. As the district assessed valuation per student goes up, the equalization assistance goes down. The state equalization aid formula can be described as follows:

1. Equalization base is the sum of the lesser of the RCL or DSL, the CORL, and the Soft Capital allocation.

2. Qualifying Tax Rate (QTR) - The qualifying tax rate for 2007-2008 is $1.602 for elementary level students and $1.602 for high school students. Unified and Type 03 elementary districts must separately determine

equalization based on PSD-8 student count and 9-12 student count and the qualifying tax rate for each is $1.602. The QTR for Career Ladder and Optional Performance Incentive Program districts for 2007-08 is $1.712 for both elementary and high school students.

3. District Primary Assessed Valuation (A.V.) -including valuation of in-lieu contributions.

4. Equalization Base formula: (QTR x A.V./100) = Total Equalization Assistance

The State Board of Education is charged with distrib-uting state aid (equalization assistance) from the state aid entitlement for school districts. A.R.S. §15-973 provides the following schedule for state aid distribu-tions to school districts:

1. July 15 1/12 of the total amount is distributed2. September 15 1/12 of the total amount is distributed3. October 15 1/12 of the total amount is distributed4. December 15 1/12 of the total amount is distributed5. January 15 1/12 of the total amount is distributed6. February 15 1/12 of the total amount is distributed7. March 15 1/12 of the total amount is distributed8. April 15 1/6 of the total amount is distributed9. May 15 1/6 of the total amount is distributed

10. June 15 1/12 of the total amount is distributed

If a school district has cash flow problems, it can apply to the Superintendent of Public Instruction for early payments on the schedule shown above. Advance payments will be made if state funds are available and if approved by the State Treasurer, the Director of the Department of Administration and the Superintendent of Public Instruction. In no event is a school district allowed to receive more than three-fourths of its total apportionment before April 15 of the fiscal year.

School District Property TaxesA significant portion of school district financing in Arizona comes from local property taxes on real and

Where Formula Dollars Come From

“Equalization assistance helps to

ensure that the revenues available for

district budgets are shared equitably.”



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personal property. As outlined in the previous section on equalization assistance, the funding for the Revenue Control Limit, Capital Outlay Revenue Limit, and Soft Capital Allocation for each district is based upon what a tax rate raises in each district. This system results in districts with high taxable property values per pupil paying a higher percentage of the total cost with local taxes. In contrast, school districts with lower taxable property values per pupil pay a lower percentage of the total cost. Items outside the RCL and CORL that don’t have a dedi-cated funding source are from the local property tax levies of each district.

In August the County School Superinten-dents’ offices transmit tax levy require-ments for each district to the county finance departments who, in turn, inform the county Board of Supervisors of the necessary levy by fund for each district. The levy, placed on property in August, applies to the assessed valuation deter-mined for real property in the district through the previous January. For the unsecured personal prop-erty in each district, the new tax rate for each year is not applied until the following January. This variation in assessing practices for real and unsecured personal property can result in a revenue lag if district tax rates increase substantially over a previous year.

Property tax levies are determined by applying tax rates against the primary assessed valuation and the secondary assessed valuation. Primary and secondary valuations are applied to the same properties. However, the primary category limits the increase in property values to 10% from the previous year, while there is no limit to the increase in property values for secondary valuation. Override and debt service tax rates are applied to secondary assessed valuation and all other tax rates are applied to the primary assessed valuation.

Property taxes are collected and distributed in November and April of each year. Generally in Arizona, the delinquency rate on taxes has been on the average about 5%, which can account for cash flow problems

in some school districts. A portion of the taxes due is paid by the state in the form of additional state aid as provided by the homeowners tax reduction provisions pursuant to A.R.S. §15-992. Salt River Project funds are in lieu of property taxes.

Regardless of the collection of taxes or the timeliness of being received in a district, the district can spend

up to the budget capacity authorized by the previously described limitations. The district must register warrants if the cash is not available at the time of expenditure.

Registering warrants is the system estab-lished in A.R.S. that allows the county trea-surer to provide short-term financing to school districts for cash flow problems in its primary levy funds (M&O, Soft Capital, Adjacent Ways and Unrestricted Capital) and the Classroom Site Fund (CSF).

Checking the CalculationsThe budget limit and equalization assistance calculations can be checked by obtaining the APOR 55-1 report on the ADE’s web site. This report is updated each month of the fiscal year, except August and November.

The ADE web site also provides the BUDG25 and BUDG 75 reports. The BUDG25 report compares the budget submitted by the district to a calculation of the district’s budget that is performed by ADE and notes the differences. The BUDG75 report compares the actual expenditures in the Annual Financial Report (AFR) submitted by the district to the ADE calculated budget limits and calculates the budget balance carryfor-ward for the next year. With student counts continuing to be adjusted after the budgets are revised in May, it is important for districts to reconcile their budgets and AFR’s to the BUDG75 to ensure they are using the correct budget limits, carry forwards, etc.

Where Formula Dollars Come From cont.


http://www.ade.az.gov/Districts/EntitySelection.asp

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Maintenance and Operations (M&O) Fund 001This fund is divided into programs. The three main programs are: Regular Education, Special Education, and Pupil Transportation. For reporting and accounting purposes, each of the programs is further subdivided by function (instruction, support services, and opera-tion of non-instructional services) .

The total budget for the M & O Fund cannot exceed the budget limits previously specified except for items outside the limit, and the expenditures cannot exceed the budget. If a district does not have sufficient cash balance in the M & O and other levy funds, it may still spend up to the budget limit by registering warrants. The budget limit determines spending authority rather than cash availability.

Regular Education — Program 100This program is used to account for expenditures relating to activities that provide students in prekindergarten through grade 12 with learning experiences. Expendi-tures not specifically assigned to other programs should be classified here.

Special Education Programs — Program 200This program is used to account for expenditures relating to activities for students receiving services outside the realm of “regular programs” in accor-dance with the disability classifica-tions as defined in A.R.S. §15-761, and programs for gifted, remedial, English immersion, vocational and technolog-ical, and career education.

Special Education, Disability — Program 300This program is used for Title 8 P.L. 103-382 add-on monies (Impact Aid).

Pupil Transportation — Program 400This program is used to account for operating expendi-tures relating to transporting pupils to-and-from school or school activities.

Desegregation Expenditures — Programs �10-�1�This program is established to account for the expen-ditures related to a desegregation plan either court ordered or by administrative agreement with the United States Department of Education Office for Civil Rights for the purpose of remediating alleged or proven racial discrimination. A separate budget must be maintained for these expenditures. Expenditures must be solely for the purpose of satisfying the compliance with an approved desegregation plan.

Special K-3 Program Override Expenditures —Program �20This program is used to account for expenditures relating to the funds obtained through a K–3 over-ride, as prescribed in A.R.S. §15-482. Budget balance

carryover for K–3 override is limited to 50% of unexpended budget balance.

Dropout Prevention Program — Program �30Eligible districts participated during FY 91 in the dropout prevention program as provided under the Laws 1992, Chapter 305 Eligible districts are allowed to budget using local tax monies above their Revenue Control Limit equal to the FY91 budget. The monies must be spent on dropout prevention as outlined in the legislation.

How Budgets are Categorized

“This (M&O) fund is divided into

programs. The three main programs are: Regular Education, Special Education,

and Pupil Transportation.”



22


Joint Career and Technical Education and Vocational Education Center —Program �40A school district may enter into an intergovernmental agreement (up to three years) with other school districts or community college districts to establish a jointly owned and operated vocational and technical center. The expenses, which are exempt in whole or in part from the revenue control limit as prescribed by A.R.S. §15-910.01, are accounted for in this program.

Other Instructional Programs — Program �10-�30These programs are used to account for activities that add to a student’ educational experience. These activi-ties typically include events and activities that take place outside the traditional classroom. Some examples of such activities are athletics, band, choir, and debate.

Classroom Site Fund 010The Classroom Site Fund (CSF), as prescribed by A.R.S. §15-977, was established in fiscal year 2002 to account for the portion of state sales tax collec-tions and State Trust Land income provided to school districts as an additional source of funding for teacher salary increases and other specified maintenance and operation purposes. The amount that school districts receive from the State to use at school sites is based on actual tax collections, not to exceed the Joint Legis-lative Budget Committee (JLBC) annual estimate.

A.R.S. §15-978 establishes the Classroom Site Fund Budget Limit (CSFBL) as the JLBC’s current esti-mate, plus any prior year’s unex-pended budget balance and interest earnings in the CSF. Budget control is applied at the total CSF level (i.e., Fund 010 expenditures cannot exceed the CSFBL). The restrictions placed on the original allocation of revenues apply in all future years. Therefore, the unexpended budget balance must be carried forward in each of the three

CSF detailed special revenue funds (011, 012, and 013) separately.

The CSF is a budget-controlled fund, therefore districts may make expenditures in the Fund that are within the CSFBL, prior to receiving cash in which case warrants would be registered for the fund.

The monies in the three funds must be used to supple-ment, rather than supplant, existing monies and must not be used for administrative purposes.

011 Classroom Site Fund —Base SalaryThis fund includes 20% of the current CSF allocation and any prior year’s unexpended budget balance and interest earnings. Monies in this fund can only be used for teacher base salary increases, teacher employment-related expenses, and registered warrant expenses for this fund.

012 Classroom Site Fund —Performance PayThis fund includes 40% of the current CSF alloca-tion and any prior year’s unexpended budget balance and interest earnings. Monies in this fund can only be used for performance-based teacher compensation increases, teacher employment-related expenses, and registered warrant expenses for this fund.

Each district must submit a Classroom Site Fund Pay for Performance Compensation Plan to the Arizona Department of Education on or before December 31st of each year.

013 Classroom Site Fund — OtherThis fund includes 40% of the current CSF allocation and any prior year’s unex-pended budget balance and interest earnings. Monies in this fund can only be used for the following maintenance and operation purposes: class size reduction; teacher compensation increases; AIMS intervention programs; teacher devel-opment; dropout prevention programs; teacher liability insurance premiums; and

How Budgets are Categorized cont.





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registered warrant expenses for this fund. Expenditures for class size reduction, AIMS intervention, and dropout prevention programs must be appropriate expenditures under function 1000-Instruction, excluding athletics.

Instructional Improvement Fund 020The Instructional Improvement Fund was established in FY 2003-2004 and consists of monies received from Indian Gaming and interest earned. Districts may utilize up to 50% of these monies for teacher compensation increases and class size reduction. The expenditures for class size reduction, if any, must be appropriate expenditures under function 1000-Instruction, excluding athletics. Monies not used for teacher compensation and class size reduction shall be utilized for the following mainte-nance and operation purposes:

1. Dropout prevention programs.2. Instructional improvement

programs including programs to develop minimum reading skills for students by the end of 3rd grade.

The monies in this fund may not be used to supplant existing state and local monies. This fund is cash controlled and the monies received in this fund are non-reverting. Therefore, expenditures cannot be incurred prior to the receipt of monies and unspent monies at fiscal year-end may be used in subsequent years.

County, City and Town Grants Fund 050Fund for the accounting of revenues and expenditures of grants received from counties, cities and towns.

Structured English Immersion Fund 071This fund is used to account for monies received to provide for the incremental cost of instruction to English language learners (ELLs) and must be used to supple-ment existing programs. In accordance with A.R.S. §15-756.03, monies must not be used to supplant federal, state, or local monies, including desegregation monies, previously used for ELLs, or used to pay for the normal costs of conducting programs for English proficient students. As defined in A.R.S. §15-756.01, incremental costs are the costs that are associated with a structured English immersion program pursuant

to A.R.S. §15-752 or a program pursuant to A.R.S. §15-753 and that are in addition to the normal costs of conducting programs for English proficient students. Incre-mental costs do not include costs that replace the same types of services provided to English profi-cient students or compensatory instruction. A.R.S. §15-756.04 as added by Laws 2006, Chapter 4.

Compensatory Instructions Fund 072 This fund is used to account for monies received for compensatory instruction. Per A.R.S. §15-756.11., “compensatory instruction” means programs in addi-tion to normal classroom instruction that may include individual or small group instruction, extended day classes, summer school or intersession school and that are limited to improving the English proficiency of current English language learners and pupils who were English language learners and who have been reclassi-fied as English proficient within the previous two years.

Monies shall not be used to supplant any federal, state or local monies, including desegregation monies levied pursuant to A.R.S. §15-910, used for compensatory instruction that were budgeted for English language learners as of February 23, 2006.










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Special Projects Funds 100-499Another category of funds used for operating and capital expenses is called Special Projects. These are federal and state grants which are used for supplemental educational programs. Guidelines for accounting and reporting of these funds are set forth by the appropriate department of the Arizona Depart-ment of Education. Federal grants are recorded in funds 100-399; state grants are recorded in funds 400-499.

Medicaid Reimbursement - Fund 2�0This fund is used to account for monies received from Medicaid. Since the original expenditures that result in the Medicaid reimbursement are accounted for in the M&O Fund and the reimburse-ment in the Medicaid Reimbursement Fund, this fund can be spent for any allowable M&O purpose.

School Plant Funds 500-506

School Plant Fund (Sale or Lease for Over One Year) - Fund �00This fund is used to account for the monies derived from the sale of school property before July 1, 1998 or lease of school property for over one year. Limita-tions related to the maximum amount that can be used from this fund in any fiscal year are detailed in A.R.S. §15-1102. Prior to sale of school sites and facilities, a school district must have a successful election of its voters. Common or high school districts that are bonded in excess of 7% of their secondary assessed are subject to specific restrictions as set for in A.R.S. §15-1102.C.

School Plant Fund (Sale or Lease for One Year of Less) - Fund �0�This fund is used to account for monies received from the lease of school property for one year or less. There is no specific time limit in which the monies must be

used. Limitations related to the maximum amount that can be used from this fund in any fiscal year are detailed in A.R.S. §15-1102. Common or high school districts that are bonded in excess of 7% of their secondary assessed valuation or unified districts that are bonded

in excess of 14% of their secondary assessed valuation cannot use these proceeds for anything other than payment of bonded indebtedness.

School Plant Fund (Sale) - Fund �0�This fund was established in fiscal year 1998-99 and is used to account for monies received from the sale

of school property on or after July 1, 1998. These proceeds cannot be used for maintenance and opera-tion purposes.

Other Funds 510-595

Food Services - Fund �10This fund is used to record the financial operations of school activities which have as their purpose the prep-aration and serving of regular and incidental meals, lunches, breakfasts and snacks in connection with school functions - primarily school cafeteria operations. Civic Center - Fund �1�The governing board of a district may permit the use of school property, under its direction, for civic activi-ties, as defined in A.R.S. §15-1105. Monies received for use of school facilities and the related expendi-tures are accounted for in this fund. A reasonable fee shall be charged for lease of property, unless the board permits uncompensated use for activities that promote the educational functions of the district. In accordance with A.R.S. §15-342(29), if program needs are met, excess monies may be expended for maintenance and operation or unrestricted capital outlay purposes.


“Prior to sale of school sites and facilities, a school district must have a successful

election of their voters.”








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Community School - Fund �20This fund is used to account for revenues and expen-ditures for the purposes of academic and skill develop-ment for all citizens in accordance with A.R.S. §15-1141, 42 and 43. This fund can be used to account for such areas as summer school on a tuition basis, GED testing, and audit adult basic education programs. In accor-dance with A.R.S. §15-342(29), if program needs are met, excess monies may be expended for maintenance and operation or unrestricted capital outlay purposes.

Auxiliary Operations - Fund �2�This fund is used to account for revenues and expendi-tures related to the bookstores and athletic activities in accordance with A.R.S. §15-1125. It can also be used for class fees and miscellaneous classroom collections, such as field trips and book clubs. Examples can be found in the USFR. Extracurricular Activities Fees Tax Credit - Fund �2�This fund is used to account for reve-nues and expenditures of monies collected in support of extracurric-ular and character education activi-ties. Contributions to this fund may be taken as a tax credit by the taxpayer in accordance with A.R.S. §43-1089.01. Amounts in this fund should be spent on the activities for which they are collected. In accor-dance with USFR Memorandum No. 214, districts may choose to account for these transactions in Auxiliary Operations – Fund 525, rather than the 526 fund.

Gifts and Donations - Fund �30This fund is used to account for the revenues and non-capital expenditures of gifts, donations, bequests and private grants made to the district (A.R.S. §15-341.15). Fund 650 can be established for gifts and donations for capital items.

School Opening - Fund �4�This fund is used to account for monies transferred in from the Maintenance and Operation Fund ending cash balance to be expended for maintenance and operation purposes incurred in the first year of operation of a new school within the district. Monies in this fund are not subject to reversion, except that at the end of 5 years without any activity in the fund, any remaining monies must be reverted to the Maintenance and Operation Fund. A.R.S. §15-943.01

Insurance Proceeds - Fund ��0This fund is used to account for the monies received from insurance claims and the related expenditures (A.R.S. §15-1103.A.) These funds are primarily for the

replacement of capital facilities and equipment.

Textbooks - Fund ��This fund is used to account for monies received from students to replace or repair lost or damaged textbooks and library books, supplementary books or instructional computer software. (A.R.S. §15-729).

Indirect Costs - Fund ��0This fund is used to account for monies transferred from federal projects, including the Food Service Fund, for administrative costs. A district may use this fund only when it has obtained an indirect cost rate approved by the Arizona Department of Education.

Unemployment Insurance - Fund ��This fund is used by districts using the reimbursement (self-insured) method of accounting for unemployment insurance contributions. Deposits are made into this fund based on an appropriate percentage of salaries in various funds. s former employees draw upon their benefits, expenditures are made from this fund to reim-burse the Department of Economic Security.


“The governing board of a district may permit the use of school property, under its direction, for

civic activities”




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Joint Technological and Education Districts - Fund ��This fund is used to account for revenues received by member districts from Joint Technological and Educa-tion Districts for use in vocational education programs.

Capital Related Funds 600-700

Unrestricted Capital Outlay - Fund �10The Unrestricted Capital Outlay section of the budget accounts for budgeted expenditures for acquisitions by purchase, lease-purchase, lease or long-term lease of capital items are defined in the Uniform System of Financial Records, which include the following areas:

1. Land, buildings, and improvements to land and buildings, including labor and related benefits costs and materials if the work is performed by school district employees.

2. Furniture, furnishings, athletic equipment and other equipment, including software.

3. Pupil and non-pupil transportation vehicles and equipment, including all capital expenditures within a contract, if the district contracts for pupil transportation.

4. Instructional aids, including instructional software.5. Library books.

Adjacent Ways - Fund �20This fund is used to account for special property tax assessments used for constructing, maintaining or otherwise improving any public way adjacent to any parcel of land owned by the school district or leased for school purposes by the school district, or an intersection of any public way adjoining a quarter block in which the parcel of land is situated, and for the construction of sidewalks, sewers, utility lines, roadways and other related improvements in or along such streets and intersections. The monies gener-ated from this assessment shall not be used for any construction, main-

tenance or other improvements to the school district’s property except improvements necessary to assure the safe ingress and egress for buses and fire equipment in accordance with A.R.S. §15.995. Unexpended funds can be carried over from year to year and interest earned should be credited to the fund.

Soft Capital Allocation - Fund �2�This fund is used to record Soft Capital Allocation monies in accordance with A.R.S. §15-962, and shall only be used for short-term capital items that are required to meet academic adequacy standards such as technology, textbooks, library resources, instruc-tional aids, pupil transportation vehicles, furniture and equipment. School districts shall not use any portion of Soft Capital Allocation monies for maintenance and operation expenses. School districts may use Soft Capital Allocation monies to meet administrative soft capital purposes after complying with the adequacy standards prescribed in A.R.S. §15-2011.

Bond Building - Fund �30This fund is used to account for proceeds from the sale of bonds following a successful election. The money is used to acquire land, purchase pupil transportation vehi-cles or pay contractors, consultants, and equipment vendors providing materials and services for facility proj-ects and equipment as designated on an appropriate election ballot. Bond proceeds shall not be expended for items whose useful life is less than the average life of the bonds issued or whose useful life is less than five years. The money not being used to satisfy payments may be invested. Income from investments must be used to reduce the debt service levy rather than add to

the funds available for land acqui-sition, construction or equipment, unless a school district had asked a second question on the bond elec-tion ballot which provided autho-rization from the voters to use the interest earnings for additional bond purchases. (Arbitrage rules may apply if interest earned on investments exceeds interest paid on the bonds issued).





2�


Districts are limited as to the maximum value of bonds they can have outstanding at any time. Under A.R.S. §15-1021, common and high school districts can bond up to 15% of its secondary assessed valuation, and unified districts can bond up to 30% of its secondary assessed valuation.

Class A Bonds may not be issued after December 31, 2000. After December 31, 1998, districts may issue class B Bonds. A common or high school district may issue class B bonds to an amount in the aggre-gate, including the existing class B indebtedness, not exceeding 5% of the taxable property used for secondary property tax purposes. A unified school district may issue class B bonds to an amount in the aggregate, including the existing class B indebtedness, not exceeding 10% of the taxable property used for secondary tax purposes.

Impact Aid Revenue Bond Building - Fund �3�Bond building funded by Impact Aid Revenues, rather than property tax levies. See Bond Building Fund 630.

Deficiencies Correction - Fund ��While this phase of the program has since been completed, the Students FIRST law established a deficien-cies correction fund for the purpose of correcting deficiencies in existing school facilities. The School Facili-ties Board was charged with adopting rules establishing minimum school facility guidelines, assessing school buildings against these guidelines, and providing monies to bring the buildings up to the guidelines.

Emergency Deficiencies Correction - Fund ��This fund accounts for monies received from the School Facilities Board to correct emergency deficien-

cies. If a school district has an emergency, the school district shall apply to the school facilities board for funding for the emergency. The school district’s appli-cation shall disclose any insurance or building renewal monies available to the school district to pay for the emergency. “Emergency” means a serious need for materials, services or construction or expenses in excess of the district’s adopted budget for the current fiscal year and that seriously threaten the functioning of the school district, the preservation or protection of property or public health, welfare or safety.

Building Renewal - Fund ��0Students FIRST law established this fund for the purpose of maintaining the adequacy of existing school facilities. These monies can be used for major renova-tions and repairs of a building, for upgrades to building systems (e.g. heating, cooling, plumbing, etc.) that will maintain or extend the useful life of a building and for infrastructure costs. Monies from this fund may not be used for new construction, remodeling interior space for aesthetic purposes, exterior beautification, demolition, soft capital items or routine maintenance. The School

Facilities Board distributes building renewal monies to school district in two equal installments in November and May of each year. A school district may use 8% of the calculated building renewal amount for routine preventative maintenance. In order to receive this funding districts must obtain approval of a three-year building renewal plan from the SFB.

New School Facilities - Fund ��This fund is administered by the SFB and has been established for the purpose of constructing new schools to meet the minimum adequacy guidelines. The criteria to determine district eligibility for monies from the new school facilities fund are based on annual evaluation and approval of district enrollment projec-tions and the additional square footage that will be needed to maintain adequacy standards in a district.


“Districts are limited as to the maximum value of bonds they

can have outstanding at any time. ”



2�


The School Facilities Board distributes new school facil-ities monies to school districts based on the following formula: (number of students) x (square footage) x (cost per square foot) = allocation. Land costs are funded in addition to formula funding for new construction.

Debt Service - Fund �00Accounts for the accumulation of property tax revenues used for, and the payment of, long-term debt principal, interest and related costs.

Impact Aid Revenue Bond Building Debt Service - Fund �20Accounts for the accumulation of impact aid monies for the payment of long-term debt, principal, interest and related costs. See Impact Aid Revenue Bond Building – Fund 639

Other Miscellaneous Funds

Student Activities - Fund ��0Pursuant to A.R.S. §15-1121 to 1124, a school district is the custodian for monies raised by the efforts of students in connection with activities of student orga-nizations and clubs.

Internal Services - Funds ��0-��These funds are used to account for revenues and expen-ditures relating to providing services to other school functions, other school districts, or governmental units. The revenues from the operation of a district services program shall be transmitted to the county treasurer for deposit in the district Internal Services Fund. Districts may employ personnel, purchase supplies and equip-ment and incur other necessary expenses related to the operation of a district services program. Monies in these funds are not subject to reversion at the end of the fiscal year.

Intergovernmental Agreements - Fund ��This fund is used by a fiscal agent to account for monies of an intergovernmental agreement (IGA). Revenues include amounts received from participants.

The USFR Identifies Other Funds that can be estab-lished by school districts (Not an inclusive list; refer to USFR for others)

1. Career and Technical Education and Vocational Education Projects - Fund 535

2. Fingerprinting-Fund 5403. Litigation Recovery Fund-Fund 5654. Teacherage-Fund 5805. Insurance Refund-Fund 5856. School Bus Advertisement-Fund 5957. Joint Technological Education-Fund 5968. School Plant Fund Special Construction-Fund 6409. Gifts and Donations (for capital purposes) -Fund

65010. Condemnation-Fund 66011. Capital Equity – Fund 67012. Trust Funds-Funds 801-84913. Enterprise Funds-Funds 901-949



2�


Appendix A

Key Procedures for Bonds and Capital Outlay Overrides

Component Class A Bonds Class B Bonds Capital Outlay overrides

Election date Last election date was November 3, 1998

Only allowed on the first Tuesday after the first Monday in November; first opportunity is November 2, 1999

Only allowed on the first Tuesday after the first Monday in November

Limitations on type of capital expenditure

For elections held before July 9, 1998, no change. For elections after July 9, 1998, may no longer be used for “furniture and apparatus” but may still be used for pupil transporta-tion vehicles.

May not be used for “soft capital” items – including equipment and pupil trans-portation vehicles

No new restrictions on type of capital expenditure

New voter infor-mation (addi-tions to previous requirements)

No additional requirements a) Executive summary of district’s capital planb) A list of projects to be funded with the cost of each

(administrative projects listed separately)c) The tax rate associated with each project and cost to

$80,000 (cap override) or $100,000 (bond) homeowner

Restrictions tied to voter information

Not applicable Proceeds may only be expended as described in the pamphlet, except that 10% of the total may be used for general capital expenses and cost overruns

Additional ballot language

No additional requirements Ballot must state that the proposed capital improvements are to exceed the state standards and are in addition to monies provided by the state, and that the district is entitled to state monies for building renewal, net construction, and renovation of buildings

Ballot language review

None required Ballot language to be submitted to Legislative Council for review 85 days before the election

Length of override Not applicable Not applicable Seven years

Limits on issuance May not be issued after Dec. 31, 1999

Cannot be issued until all Class A proceeds have been obligated in contract

Not applicable

Public meeting Requirement for annual public meeting on the status of capital improvements (to be held between September 1st and October 31st)

Effect on state funding

The School Facilities Board may not award monies to fund new facilities financed with Class A bonds (no co-mingling). Buildings built with Class A bonds will be included in the district’s total square footage.

No effect if proceeds are used to “exceed square footage funded by the school facili-ties board”

30


AnnualFinancialReport(AFR)-An annual compre-hensive financial reporting due to ADE by October 15. The AFR includes budget and actual summary infor-mation for revenues, expenditures and fund balances for all district funds.

ApprovedDailyRouteMiles- the mileage to trans-port eligible students to-and-from school for the first 100 days of school, plus an estimate for 80 additional school days, divided by 180.

ArizonaAssociationofSchoolBusinessOfficials(AASBO) - A professional organization made up of school employees that work in the business support areas, in the State of Arizona. AASBO is an affiliate of the Association of School Business Officials – Interna-tional (ASBO – International)

Arizona Department of Education (ADE) - This agency operating under the direction of the Superin-tendent of Public Instruction provides direct services to school districts. The agency executes the policies of the State Board of Education and the State Board of Vocational and Technological Education - imple-menting state academic standards; administering statewide assessments; disseminating information; administering and allocating federal and state funds; and providing program improvement assistance to schools and districts.

Average Daily Attendance (ADA) - The actual average daily attendance through the first one hundred days in session.

AverageDailyMembership(ADM)- Average Daily Membership – a method of counting the number of enrolled students based upon the first 100 school days in session. As examples: a student who enrolls 5 days after the start of the school year = 95/100 = .95 ADM, a kindergarten student who only attends school for one-half (1/2) of the day = .50 ADM, a high school student who attends only 3 of the required 4 class periods = ¾ = .75 ADM. ADM is a key component in the school finance funding formulas.

BaseLevel- an amount determined annually by the Arizona Legislature per 1.0 weighted ADM. This amount is part of the RCL calculation.

Budg25-an ADE generated report that assists districts in analyzing their expenditure budgets. The district’s submitted budget is compared to ADE calculations. Differences indicate a need for the district to provide additional information to ADE or revise the budget.

Budg75 - an ADE generated report that assists districts in analyzing their prior year budget balance. The district’s submitted Annual Financial Report data is compared to ADE calculations. Differences indicate a need for the district to provide additional information or make adjustments in order to accurately reflect budget balance carry forward or over expenditure.

Concurrency- a concurrency occurs when a student is enrolled in two or more district or charters at the same time. If a valid concurrency exists between a charter and a non-charter and both have validated the concur-rency as true, SAIIS will allocate the ADM between the two based on the actual enrollment in both the district and charter.

District Support Level (DSL) - The Base Support Level (BSL) plus the Transportation Support Level (TSL).

EqualizationAssistance- the amount of money that the state and county provide to school districts over and above the Qualifying Tax Levy (QTL) to ensure that the revenues available for district budgets are shared equitably.

Fiscal Year - for Arizona schools, is July 1 through June 30 of each year.

GDPPriceDeflator-The average of the four Implicit Price Deflators for the Gross Domestic Product (GDP) reported by the United States Department of Commerce for the four quarters of the calendar year.

Glossary

31


GrantsManagement-ADE department that ensures the proper allocation, distribution, and expenditure of all federal and state funds administered by ADE. They process grant budget applications, revisions, cash management reports and completion reports.

Group A - Educational programs for career explo-ration, a specific learning disability, an emotional disability, mild mental retardation, remedial education, a speech/language impairment, homebound, bilingual, preschool moderate delay, preschool speech/language delay, other health impairments and gifted pupils.

Group B - Educational improvements for pupils in kindergarten programs and grades one through three, educational programs for autism, a hearing impair-ment, moderate mental retardation, multiple disabil-ities, multiple disabilities with severe sensory impair-ment, orthopedic impairments, preschool severe delay, severe mental retardation and emotional disabilities for school age pupils enrolled in private special educa-tion programs or in school district programs for chil-dren with severe disabilities or visual impairment and English learners enrolled in a program to promote English language proficiency.

M&O- a common acronym for the Maintenance and Operation fund, fund 001. Calculation of this budget is formula driven. This budget is used for most of the day to day expenditures of a school district.

QualifyingTaxRate–QTR- A hypothetical tax rate that is multiplied times the Primary Assessed Valuation and Assessed Valuation for SRP properties to deter-mine the local tax levy effort required before a district is eligible for equalization assistance. The QTR is adjusted annually, based on an inverse relationship to the assessed valuation for the entire state.

SchoolFacilitiesBoard–SFB-an Arizona govern-ment entity created in 1998 to oversee building new schools (fund 695), building and capital deficiencies (fund 685) and building renewal (fund 690).

Student Accountability Information System(SAIS) - The administrative application that collects student detail information using the Internet. School districts send this information to ADE’s SAIS database. The district’s ADM and other attendance data is gener-ated from this system.

StudentCount-ADM for the fiscal year prior to the current year, except for the purpose of budget prepara-tion student count means ADM for the current year.

Students FIRST - Students Fair and Immediate Resources for Students Today – 1998 legislation that created a new capital financing system aimed at creating minimal adequacy standards for capital related issues in public schools. Administered by the School Facilities Board.

Title 15 - a compilation of selected education laws passed by the Arizona State Legislature.

UniformSystemofFinancialRecords–USFR– a publication that is a joint responsibility of the Arizona Auditor General and ADE. This document interprets Arizona Title 15 and contains the guidelines and directions by which Arizona schools must financially comply.

USFRMemorandum-Issued by the Auditor General to update the USFR manual between major revisions. These are available on the Auditor General’s website or via e-mail.

Weights – a multiplier that is applied to an ADM number to allow for variable educational costs based on certain classifications of students.

Glossary cont.

32


A: Autistic

AASBO: Arizona Association of School Business Officials

ADA: Average Daily Attendance

ADE: Arizona Department of Education

ADM: Average Daily Membership

AFR: Annual Financial Report

AG: Attorney General or Auditor General

APOR: Apportionment Report

ARSorA.R.S.: Arizona Revised Statute

ASBA: Arizona School Boards Association

A.V.: Assessed Value

BBCF: Budget Balance Carry forward

BSL: Base Support Level

CAFR: Comprehensive Annual Financial Report

CEC: Certificates of Educational Convenience

CORL: Capital Outlay Revenue Limit

CPI: Consumer Price Index

CLRL: Capital Levy Revenue Limit

CSF: Classroom Site Fund

DSL: District Support Level

ED: Emotionally Disabled

ELL: English Language Learners

ESY: Extended School Year

FDK: Full Day Kindergarten

GDP: Gross Domestic Product

JTED: Joint Technological Education District

K–3: Kindergarten through Third Grade

K–8: Kindergarten through Eighth Grade

K–12: Kindergarten through Twelfth Grade

M&O: Maintenance and Operation

MIMR: Mild Mental Retardation

MD: Multiple Disabilities

OHI: Other Health Impairments

OI: Orthopedic Impairment

PFP: Pay for Performance

PSD: Pre-School with Disabilities

QTL: Qualifying Tax Levy

QTR: Qualifying Tax Rate

R: Resource

RCL: Revenue Control Limit

SAIS: Student Accountability Information System

SC: Self-Contained

SDER: School District Employer Report

SFB: School Facilities Board

SLD: Specific Learning Disability

SLI: Speech/Language Impairment

SMR: Severe Mental Retardation

Students Fair and Immediate Resources for FIRST: Students Today

TAPBI: Technology Assisted Project-based Instruction

TANS: Tax Anticipation Notes

TEI: Teacher Experience Index

TRCL: Transportation Revenue Control Limit

TSL: Transportation Support Level

USFR: Uniform System of Financial Records

Acronyms


AASBO Board of Directors — 200�-0�

Ernie Meza, President Pendergast Elementary School District3845 N. 91st Avenue Phoenix, AZ 85037623/[email protected]

James Brown, President-electRound Valley Unified School DistrictP.O. Box 610 Springerville, AZ 85938928/[email protected]

David Peterson, Vice PresidentScottsdale Unified School District3811 N. 44th Street Phoenix, AZ 85018480/[email protected]

Bobette Tomerlin, TreasurerPayson Unified School DistrictP.O. Box 919 Payson, AZ 85547928/[email protected]

Jim Migliorino, Immediate Past PresidentDeer Valley Unified School District20402 N. 15th Ave. Phoenix, AZ 85027623/[email protected]

Tom Clark, Director of Information TechnologyMadison Elementary School District5601 N. 16th Street Phoenix, AZ 85016602/[email protected]

Tom Elliott, Director of Business AdministrationParadise Valley Unified School District15002 N. 32nd Street Phoenix, AZ 85032 602/867-5135 [email protected]

Michael Fisher, Director of Maintenance and TransportationPhoenix Elementary School District1817 N. 7th Street Phoenix, AZ [email protected]/257-3934

Kathy Glindmeier, Director of Educational ProgramsParadise Valley Unified School District20621 N. 32nd Street Phoenix, AZ 85050602/[email protected]

Geoff Habgood, Director for Food & NutritionDeer Valley Unified School District21421 N. 21st Ave., Bldg. #2 Phoenix, AZ 85027623/[email protected]

Howard Kropp, Director of PurchasingWashington Elementary School District4650 W. Sweetwater Glendale, AZ 85304602/[email protected]

Bill Munch, Director of Membership ServicesMesa Unified School District549 N. Stapley Drive Mesa, AZ 85203-7297480/[email protected]

Rosa Saenz, Vendor RepresentativeThe Professional Group Public Consulting212 W. Superstition, #103 Apache Junction, AZ 85220602/[email protected]

John Fung, Executive Director2100 N. Central Ave., Suite 202 Phoenix, AZ 85004602/253-5576 [email protected]

Chuck Essigs, Director of Governmental Relations2100 N. Central Ave., Suite 202 Phoenix, AZ 85004602/253-5576 [email protected]

Jeff Gadd, Director of Professional Development & Training 2100 N. Central Ave., Suite 202 Phoenix, AZ 85004602/350-5209 [email protected]

Darlene Kracht, Membership Services Coordinator2100 N. Central Ave., Suite 202 Phoenix, AZ 85004602/253-5576 [email protected]

Ana Sanchez, Administrative Assistant2100 N. Central Ave., Suite 202 Phoenix, AZ 85004602/[email protected]

AASBO Staff

School Finance Procedures Manual FY 2009

Version 09.01.95

ARIZONA DEPARTMENT OF EDUCATION

2

Introduction ..................................................................................................................................... 4 Defining an Instructional Program Schedule .................................................................................. 5

Minimum Annual Instructional Hour Requirements .................................................................. 5 Instructional Time, Courses, and Subjects .................................................................................. 5 Calendar Requirements ............................................................................................................... 5

The School Year ..................................................................................................................... 5 Holidays .................................................................................................................................. 6 Minimum Annual School Days Requirement ......................................................................... 6 Scheduling Limitations ........................................................................................................... 6 School Calendar Make Up Day Options ................................................................................. 6

Defining Eligibility for School Membership .................................................................................. 7 Residency and Legal Custody ..................................................................................................... 7 Admission of Resident Students ................................................................................................. 8

School Districts ....................................................................................................................... 8 Charter Schools ....................................................................................................................... 8

Admission of Non Resident Students ......................................................................................... 9 Certificate of Educational Convenience (CEC) ...................................................................... 9 Open Enrollment ................................................................................................................... 10 Children of non-resident college faculty ............................................................................... 10 Children of parents working at Certain State Institutions ..................................................... 10 Children living with resident relatives .................................................................................. 10 Children of nonresidents paying tuition ................................................................................ 10 Foreign exchange students .................................................................................................... 10 Homeless Children ................................................................................................................ 10

Age Requirements and Validations for Funding Purposes ....................................................... 11 Exceptions to when a child must be enrolled in a school ......................................................... 11

Compilation and Maintenance of Student Records ...................................................................... 12 Technology Assisted Based Instructional Programs (TAPBI) ..................................................... 13

Instructional Program Schedule ................................................................................................ 13 Enrollment................................................................................................................................. 13

Determining Full Time Equivalency .................................................................................... 13 Attendance ................................................................................................................................ 13

Joint Technological Education Districts (JTED) .......................................................................... 14 Enrollment................................................................................................................................. 14 Attendance ................................................................................................................................ 15

Reporting Student Membership .................................................................................................... 16 Enrollment Date (Membership Start Date) ............................................................................... 16 Presentation of Withdrawal Form ............................................................................................. 16 Withdrawal Date (Membership End Date) ............................................................................... 16 Readmission .............................................................................................................................. 16 Determining Student Full Time Equivalency ........................................................................... 17 Defining Homebound Membership Periods ............................................................................. 18 Concurrent Memberships .......................................................................................................... 18 Subsequent Memberships ......................................................................................................... 18 Resolving Membership Disputes .............................................................................................. 19

Tracking Student Attendance ........................................................................................................ 20 Reporting Attendance: Daily Absences .................................................................................... 20

Daily Attendance Tracking ................................................................................................... 20


Moving Dollars… Making Sense 3

Absence Reasons .................................................................................................................. 23 Excused Absences ................................................................................................................. 24

Reporting Attendance: Minutes and Daily Absences ............................................................... 25 Reporting Attendance: Instructional Minutes ........................................................................... 25


4

Introduction The purpose of this manual is to provide guidance to all district and charters throughout the State of Arizona on the rules and regulations they must follow in reporting information to the School Finance Unit of the Arizona Department of Education (ADE). The scope is to cover information and processes relevant to reporting data to the School Finance Unit that impact state funding. References to statutes are provided frequently but all who submit information should endeavor to become knowledgeable of the laws that districts and charters are bound to observe. As legislative or system changes occur, this document will be updated accordingly. For fiscal years prior to 2009, these procedures were previously published in the Instructions for Required Reports. With the approval of Proposition 301 in November 2000, effective July 1, 2001, ADE developed the Student Accountability Information System (SAIS). It replaced a data submission process in which school districts and charter holders submitted data to ADE in summary form. With SAIS, we receive and maintain detailed student data. The information collected by SAIS brings greater accountability and efficiency to school funding and reporting in Arizona. The focus of SAIS is to collect, as events occur, student-level data: individual student records reflecting specific events in the students' relationship with the school (e.g., enrollment, absence, and withdrawal). Certain events, which affect a student's status, require the related school entity to submit transactions to SAIS. The district and charters submit such data via secure Internet at www.ade.az.gov/commonlogon. ADE aggregates the data from the districts and charters and stores it in a system of databases. The Student Counts process further combines the data into applicable groupings to determine appropriate expenditure capacity and/or funding for the districts and charters. Other units within the ADE require that district and charters submit information. SAIS and various on-line applications collect data that is required by the federal government; however, because the information does not affect state funding, information on those processes is not addressed in this manual. Those units include, but are not limited to the following: Academic Achievement, Exceptional Student Services, and Research and Evaluation. Reports may include Graduation Rate Study, Year End Enrollment, ESS Census Verification, the Annual Special Education Data Collection, and Title III ELL Data Collection. The following conventions will be used when referencing statute from this document. Referencing statute

Code ●§● Title-Section (Subsection). Example… as provided in A.R.S. § 15-972(B)(1)(b)(vi)

Referencing multiple sections

Code ●§§●Title-Section1, ●Section2, ●and●Section3 . Referencing multiple subsections

Code ●§●Title-Section (Subsection1), ● (Subsection2), ●and ● (Subsection3)

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Defining an Instructional Program Schedule

Minimum Annual Instructional Hour Requirements The following table is a summary of the minimum hour requirements for a full time instructional program (A.R.S. § 15-901(A)(2)(b)(i)). Note: Federal preschool programs (i.e. Head Start) may have additional requirements. Grade Range Instructional Hours Required for the Year Preschool 216* KG (Half Day) 356 KG (Full Time),1-3 712 4-6 890 7-8 1068 9-12 720 *Derived from 360 minutes ÷ 5 Days * 180 Days

Instructional Time, Courses, and Subjects Instructional time, courses, and subjects are defined in the ADE External Guidelines under GE-18. The amount of passing time that may be included in the calculations of total instructional hours for all grades is also limited as defined in the ADE External Guidelines under GE-19.

Calendar Requirements Each district or charter is required to establish all calendars by August 31 of the school year. The calendar must be approved and active before any student detail information can be submitted to ADE. The approval process and instructions for submitting calendars are published in the SAIS LEA Calendar Application User Manual which can be found at http://www.ade.az.gov/schoolfinance/SAISSupport/PEA_LEACalendar/Manual.pdf.

The School Year The fiscal year shall begin July 1 and end June 30 and a school month is twenty school days or four weeks of five days each (A.R.S. § 15-801(A)). Throughout this document a school calendar year may be referenced by the calendar years that are covered. For example, the following terms may be used to refer to the same period of July 1st 2008 – June 30th 2009: Fiscal Year 2009 School Year 2008-2009

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6

Holidays The calendar must observe the four defined holidays (A.R.S. § 15-801(B)) :

• July 4th • Thanksgiving Day • Veterans’ Day • December 25th

Schools may not be in session on any of those days or count any instruction provided on those days towards meeting the annual hours requirement in A.R.S. §15-901.

Minimum Annual School Days Requirement A full time instructional program requires at least 720 hours over 180 days (A.R.S. §§ 15-901(A)(2)(c)(vi) and 341.01). The exception is that 180 days of instruction may mean 180 days or an equivalent number of minutes of instruction per school year based on a different number of days of instruction as long as it is approved by the school district governing board. A.R.S. § 15-902.02 allows for school districts to elect to provide 200 days of instruction and receive a calculation of average daily membership based on that basis. A copy of the summary of minutes from the election for the 200 day calendar of instruction shall be sent to School Finance to authorize the calculation. The governing board may also decide to offer an educational program on the basis of a four day school week with 144 days of instruction or for preschool or an alternative kindergarten program on the basis of a three day school week with 108 days of instruction (A.R.S. § 15-341(A)(2)).

Calendar Days Required Based on the Number of Days Per Week Head Start Preschool Disabled-KG 1-12

3 Day Week N/A 108 Days N/A 4 Day Week 128 Days (Fed) 144 Days 144 Days 5 Day Week 160 Days (Fed) 180 Days 180 Days

Scheduling Limitations The determination of the type of calendar is based on the number of days of the week used to offer instruction throughout the entire year. The weekdays set for each week do not need to be consistent throughout the year. However, the number of session days that may occur in a week is limited to 5 days. Unless otherwise authorized by the superintendent of public instruction 6 or 7 day calendars will not be approved (A.R.S. § 15-801(A)). SAIS will exclude 3 day calendars when determining the aggregation target date. When setting up a calendar, LEAs should keep in mind that changing the type of calendar from a 4 day calendar to a 3 day calendar could extend the aggregation target date for the entire district or charter holder. This may affect the availability and completeness of student count reports until the aggregation target date is actually reached.

School Calendar Make Up Day Options The number of days per week may not exceed the type of calendar selected. The recommended practice is to schedule in a few extra instructional days in anticipation of schedule changes due to weather or unforeseen occurrences. Any calendar changes that need to occur after the first 100 Session Days are limited by the implementation of the calendar application. If a school desires





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to make changes that cannot be reflected in the calendar electronically submitted to ADE, the Audit Resolution Unit would need to be consulted to determine compliance.

Defining Eligibility for School Membership

Residency and Legal Custody The residence of the person having legal custody (parent, legal guardian) of a student is considered the residence of the student, except for certain homeless children (A.R.S. § 15-824(B) and (C)) and some students with Certificates of Educational Convenience (A.R.S. § 15-825(B)). A.R.S. § 15-824 (G)(2) defines legal custody as follows: • Custody exercised by the natural or adoptive parents with whom a student resides. • Custody granted by order of a court of competent jurisdiction to a person or persons with whom a

student resides. An individual who has reached the age of 18 is considered an adult for purposes of determining residency. The statutes do not require that residency be established for a specified length of time for purposes of attending school (Attorney General Opinion 73-10(C)). If a student is between the ages of 18 and 22, resides in the district, and is identified as a child with a disability (A.R.S. § 15-761(2)) and has not completed the highest grade taught in the district, the student may attend school in the district without payment of tuition. If the student is receiving special education services at the time the student reaches 22 years of age, special education services shall continue to be provided through the end of that school year(A.R.S.15-764(A)(1)). Notwithstanding any other law, a child who resides with a family member other than the child's parent and is residing with the family member while awaiting the outcome of a legal guardianship or custody proceeding is deemed to reside in the school district where that family member resides if the family member provides written documentary proof of one of the following: • The family member is attempting to obtain legal guardianship of the child in an unresolved and

uncontested guardianship proceeding commenced in Superior Court. The family member shall provide documentation to the school district within thirty days of enrollment that the family member is attempting to obtain legal guardianship of the child. Upon obtaining legal guardianship, the family member shall provide documentation to the school district.

• The family member is attempting to obtain custody of the child in an unresolved and uncontested child custody proceeding commenced in Superior Court. The family member shall provide documentation to the school district within thirty days of enrollment that the family member is attempting to obtain custody of the child. Upon obtaining custody, the family member shall provide documentation to the school district.

(A.R.S. § 15-821(D))








8

Admission of Resident Students

School Districts All schools shall admit children between the ages of six and twenty-one years who reside in the school district and who meet the requirements for enrollment in one of the grades or programs offered in the school (A.R.S. § 15-821(A)). A school district shall not deny a pupil who is between the ages of sixteen and twenty-one year’s admission to a high school because the pupil does not hold an eighth grade certificate. Governing boards shall establish procedures for determining the admissibility of pupils who are under sixteen years of age and who do not hold eighth grade certificates (A.R.S. § 15-701(H)). School districts may refuse to admit pupils who have been expelled from another educational institution or who are in the process of being expelled from another educational institution. A school district may annually or upon the request of any pupil or the parent or guardian review the reasons for expulsion and consider re-admission (A.R.S. § 15-841(C) and (D)).

Charter Schools A charter school shall enroll all eligible pupils who submit a timely application, unless the number of applications exceeds the capacity of a program, class, grade level or building. Preference may be given to

• Returning pupils • Siblings of enrolled pupils • Pupils who reside within the boundaries of the school district where the charter school is

physically located. A charter school shall not limit admission based on ethnicity, national origin, gender, income level, disabling condition, or proficiency in the English language or athletic ability. A charter school may limit admission to pupils within a given age group or grade level. A charter school may refuse to admit any pupil who has been expelled from another educational institution or who is in the process of being expelled from another educational institution (A.R.S. § 15-184(A) thru (E)).







Admission of Non Resident Students

Certificate of Educational Convenience (CEC)

The governing board of a school district shall admit pupils from another school district or area upon presentation of a certificate of educational convenience issued by the county school superintendent pursuant to A.R.S. § 15-825.

CEC-A Student: A student precluded by distance or lack of adequate transportation facilities from attending school in the school district or county of the student's residence or who resides in unorganized territory may apply to the County School Superintendent for a CEC. The County School Superintendent may issue a certificate authorizing the student to attend school in an adjoining school district or county, whether within or outside of this State. If a CEC is issued, the school enrollment is as follows:

• The enrollment of a student precluded by distance or lack of adequate transportation from

attending school in the district or county of residence is deemed for the purpose of determining student count to be in the school of the county or district of the student's residence. The student's district of residence may be charged tuition by the district of attendance or the districts may agree to exchange students and not charge each other tuition (A.R.S. § 15-825(01)(A)(1)).

• The school enrollment of a student from an unorganized territory is deemed for the purpose of determining student count to be in the district of actual attendance (A.R.S. § 15-825.(A)(2)).

Note: The governing board of a school district shall admit up to 350 pupils from another school district or area pursuant to A.R.S. § 15-824(A)(2), to a high school without presentation of a CEC, if the pupil is a resident of a common school district within the state which is not within a high school district and which does not offer instruction in the pupil’s grade. The limitation does not apply to small isolated common school districts, as defined in A.R.S. § 15-901. The common school district shall be reported as the district of residence for the purposes of determining average daily membership used in calculating state aid (A.R.S. § 15-824(A)(2)). Tuition shall be charged by the high school of attendance to the common school district (A.R.S. § 15-824(A and E)).

CEC-B Student: The County School Superintendent of any county in which a student is placed in one of the following listed facilities will issue a CEC for the student to attend school in the school district or adjoining school district(A.R.S. § 15-825(B)) . • A State rehabilitation or corrective institution • A foster home, child care agency, or institution which is licensed and supervised by the

Department of Economic Security or Department of Health Services • A residential facility operated or supported by the Department of Economic Security or the

Department of Health Services • A residence under the supervision of the Juvenile Corrections

Note: The County School Superintendent of any county may not issue a CEC for a student placed in one of the above listed facilities if the student is placed in the same district of the student's parents' or legal guardians' residence or if the student is placed without a court order and the student's parents or legal guardians are not residents of this state. (A.R.S. § 15-825(C)).


10

Open Enrollment A school district may offer an open enrollment option without charging tuition. The status of open enrollment is in reference to students that are nonresident to the district. Tuition may be charged to nonresident pupils only when the tuition is authorized under A.R.S. §§ 15-764(E), 15-797(C), 15-823(A), 15-824(A) or 15-825. These policies shall include admission criteria, application procedures and transportation provisions. A copy of the district policies for open enrollment shall be filed with the Department of Education. [A.R.S. § 15-816(01)]

Children of non-resident college faculty The governing board shall admit children of nonresident teaching and research faculty of community college districts and state universities and children of nonresident graduate or undergraduate students of community college districts and state universities whose parent's presence at the district or university is of international, national, state or local benefit without payment of tuition. [A.R.S. § 15-823(B)]

Children of parents working at Certain State Institutions The superintendent of public instruction shall assist school districts in education children whose parents or legal guardians are employed by and domiciled at the following state institutions and stations:

• The State Hospital • The Arizona State Schools for the Deaf and the Blind • Mental retardation centers • Port of entry inspection stations • Institutions and facilities maintained by the State Department of Corrections

The assistance shall be by payment of tuition [A.R.S. §15-976 (A)(1)(2)(B)(C)].

Children living with resident relatives The governing board shall admit children who are residents of the United States but are nonresidents of this state without payment of tuition if evidence indicates that the child's physical, mental, moral or emotional health is best served by placement with a grandparent, brother, sister, stepbrother, stepsister, aunt or uncle who is a resident within the school district, unless the governing board determines that the placement is solely for the purpose of obtaining an education in this state without payment of tuition. [A.R.S. § 15-823(C)], (Attorney General Opinion I87-005). These students are eligible for state aid. [A.R.S. § 15-824(D)]

Children of nonresidents paying tuition The governing board may admit children of nonresidents of the State, upon payment of a reasonable tuition fixed by the governing board (A.R.S. § 15-823(A)).

Foreign exchange students The governing board may admit nonresident foreign students who are in exchange programs without payment of tuition. [A.R.S. § 15-823(D)] These students are not eligible for state aid. [A.R.S. § 15-824(D)]

Homeless Children The governing board may admit homeless or abandoned children [A.R.S. § 15-823(E)]



Age Requirements and Validations for Funding Purposes

Grade Range Lower Limit Upper Limit Preschool *Must have one or more of the following SPED Services HI,VI,PSD,PSL,PMD

3 years old or Within 90 days of the student’s third birthday with board approval (A.R.S. § 15-771 (G))

5 years old after Sept 1st

Kindergarten 5 years old before Sept 1st or 5 years old by Jan 1st with board approval

1st – 12th Grade 6 years old before Sept 1st or 6 years old by Jan 1st with board approval

Until the 22nd birthday or until the end of the fiscal year of the 22nd birthday if receiving SPED services

Exceptions to when a child must be enrolled in a school Pursuant to A.R.S. § 15-802(D), a person is excused from school attendance if any of the following are shown to the satisfaction of the school principal or the school principal's designee: 1. The child is in such physical or mental condition that instruction is inexpedient or impracticable. 2. The child has completed the high school course of study necessary for completion of grade ten as

prescribed by the State Board of Education. 3. The child has presented reasons for nonattendance at a public school, which is satisfactory to the

school principal or the school principal's designee. 4. The child is over fourteen years of age and is, with the consent of the person who has custody of him,

employed at some lawful wage earning occupation. 5. The child is enrolled in a work training, career education, career and technical education, vocational

education or manual training program, which meets the educational standards, established and approved by the Department of Education.

6. The child was suspended and not directed to participate in an alternative education program.. 7. The child is enrolled in an education program provided by a state educational or other institution. See also (A.R.S. § 15-841(C) and (D)).




12

Compilation and Maintenance of Student Records School District Governing Boards and Charter Operator Governing Bodies are responsible for compiling and maintaining attendance records. Attendance records can be compiled by either a paper system or a paperless system.

A. Pursuant to A.R.S. §15-521(2) each teacher shall “keep a school register, which the governing board shall carefully preserve as one of the records of the school.” This can be either a paper attendance system or paperless attendance system.

B. Attendance shall be taken for each student, and maintained at all levels, in order for the Arizona Department of Education to be able to examine the school’s average daily attendance, ADA, as defined in A.R.S. §15-901.

C. Each teacher shall take attendance and indicate whether the student is either absent or present, as prescribed by the definition of “daily attendance.” See A.R.S. §15-901 (6).

D. School Districts and Charter Operators must maintain a sufficient audit trail of attendance documentation to be able to validate the accuracy of the attendance information reported to the Arizona Department of Education. This information should include the following: the original teacher attendance documents and other documents required to record any changes to the original teacher entry. Audit trail documents can utilize either a paper or electronic format.

E. The schools shall record the attendance information into their School Management System (SMS) and then into the Arizona Department of Education’s Student Accountability Information System (“SAIS”).

F. All original attendance records, whether paper or paperless, must be maintained for four (4) years pursuant A.R.S. §41-1351and according to the school district or charter operator’s record retention schedule for audit purposes. Link for Records Management for School Districts and Charter Schools; http://www.lib.az.us/records/school.cfm

G. If a school district or charter operator fails to maintain original attendance records of its students, they may be subject to an ADM adjustment in accordance with A.R.S. § 15-915.

H. TECHNOLOGY ASSISTED PROJECT-BASED (TAPBI) schools: shall maintain a daily log used by each pupil who participates in the program. “The daily log shall be used by the school district or charter school to qualify the pupils who participate in the program in the school’s average daily attendance calculations pursuant to A.R.S. §15-901”. A.R.S. §15-808 (E)

(EX-34)

http://www.lib.az.us/records/school.cfm�

http://www.ade.az.gov/Guidelines/Audit/EX-34.pdf�



Technology Assisted Based Instructional Programs (TAPBI) A.R.S. §15-808 (B)

Instructional Program Schedule TAPBI programs are required to submit calendars that define the 100 session days of a school year. Contrary to the aggregation rules in previous fiscal years, hours of student instruction reported as attendance after the 100th session day will not be used to determine absences as applicable to the calculation of Average Daily Attendance.

Enrollment Schools shall maintain sufficient records to document compliance with the following enrollment requirements:

• Each academic school year, at least 80% of the pupils who are participating must have been previously enrolled in and attended a public school in the previous school year.

• Kindergarten pupils may participate if a sibling is currently enrolled in and attending a

program.

Determining Full Time Equivalency Refer to the section in this document for Determining Student Full Time Equivalency for all schools.

Attendance Each school selected for the technology assisted project-based instruction program shall ensure that a daily log is maintained for each pupil who participates in the program. The daily log shall describe the amount of time spent by each pupil participating in the program pursuant to this section on academic tasks. TAPBI programs may record attendance according to procedures defined in this document under Reporting Attendance: Minutes and Daily Absences.


14

Joint Technological Education Districts (JTED)

Enrollment A course that is identified as having additional requirements beyond the scope of a standard educational course may be approved by Career and Technical Education (CTE) as a JTED course. Therefore a member district may not claim ADM for membership in a JTED course. All students taking a course that is approved as a JTED course must be reported as having enrollment in the JTED program for each JTED course. All students who no longer participate in any JTED approved courses must be withdrawn from the appropriate JTED programs. (A.R.S. §§ 15-391(3)(c)) , 15-393(D)(5)(d)). The ADM per pupil allowed for the centralized campus owned and operated by the JTED is 0.75 per course of at least 150 minutes. (A.R.S. 15-393 (O)) Member Districts sending students to Central JTED Campuses or to a satellite program will report separately “actual” ADM enrollment for the students enrolled in member district courses. (A.R.S. 15-901 (A) (1)) Only JTED satellite memberships of students that are resident of that member district may generate the additional .25 ADM above the limit of 1.0. Unless there is a contract for tuition established with a non-member school, JTED Satellite memberships for students that are not residing in that member district must be reported with a tuition payer code of 5 for fundable membership exclusion. Scenario 1 - Student resides in the member district is enrolled fulltime in 4 Non-JTED courses at a district or charter and 1 JTED satellite. All courses are 60 minutes long.

• The district or charter must report the enrollment of the student with the district or charter as both the District of Residence and the District of Attendance.

• The JTED must report the enrollment of the student with the JTED as both the District of Residence and the District of Attendance.

Scenario 2 – Student who does not reside in the member district is enrolled fulltime in 4 Non-JTED courses at a charter school and 1 JTED satellite. All courses are 60 minutes long.

• The charter must report the enrollment of the student with the charter as both the District of Residence and the District of Attendance with a Tuition Payer Code = 5.

• The JTED must report the enrollment of the student with the JTED as both the District of Residence and the District of Attendance.



Attendance When determining the daily absence of a student, a member district may not count instructional time in a JTED course as instructional time spent in a non-JTED course. Scenario 1 - Student is enrolled fulltime in 4 Non-JTED courses and 1 JTED satellite. All courses are 60 minutes long. The actual attendance and reported attendance for that student is as follows:

Actual Attendance

Reported Daily Attendance

Reported Daily Absence

JTED1 Present 0.25 0.00 Course1 Present 0.25 0.00 Course2 Present 0.25 0.00 Course3 Present 0.25 0.00 Course4 Absent 0.25 0.00

The Member District does not have any absences to report. The JTED Satellite does not have any absences to report. The Daily Attendance for the student would be 1.25 for that day. Scenario 2 - Student is enrolled fulltime in 4 Non-JTED courses and 1 JTED satellite. All courses are 60 minutes long. The actual attendance and reported attendance for that student is as follows:

Actual Attendance

Reported Daily Attendance

Reported Daily Absence

JTED1 Present 0.25 0.00 Course1 Present 0.25 0.00 Course2 Present 0.25 0.00 Course3 Present 0.25 0.00 Course4 Absent 0.00 0.25

The Member District must report an absence of .25 for the student on that day. The JTED Satellite does not have any absences to report. The Daily Attendance for the student would be 1.0 for that day.


16

Reporting Student Membership

Enrollment Date (Membership Start Date) For the purposes of determining Average Daily Membership (ADM) for a given school year at a given public school pursuant to A.R.S. § 15-901(A)(2), the first day of membership for continuing or pre-enrolled students, may be defined as the first day that classroom instruction is offered, provided that such students physically attend school within the first ten school days. For all other students, the first day of membership shall be defined as the first day a student physically attends school. The definition of the first member day shall be applied consistently throughout the district or charter holder. (GE-17 First Day Absence) Note: Continuing students who do not attend school during the first ten days school is in session are subject to summer withdrawal.

Presentation of Withdrawal Form As documentation helps to ensure uniform and comparable data across schools, districts and charters are to use the form: Official Notice of Pupil Withdrawal

Please refer to the

when a student withdraws during the school year. Furthermore, Arizona state law requires that a properly executed withdrawal form be presented to a school if the student previously attended another school within the state of Arizona. (A.R.S. § 15-827)

Official Notice of Pupil Withdrawal Form and Instructions available at www.ade.az.gov/schoolfinance/Forms/WithdrawalForm1.doc.

Withdrawal Date (Membership End Date) The effective date of withdrawal is the last day of actual attendance of the student. (A.R.S. § 15–901(A)(2)) Withdrawals should be reported for students formally withdrawn from school and students who have been absent for ten consecutive school days without excuse. Students who are in membership on the last scheduled day of school are not subject to withdrawal. Some of the computerized attendance systems require the date of withdrawal to be entered on the day following the last day of attendance in order to be paid for the last day of attendance. The date of withdrawal should be adjusted programmatically to the actual last day when the data is submitted to SAIS. In any case, the last day of actual attendance is to be counted as a membership day.

Readmission Readmission occurs when a student has been withdrawn from a school and reenters the same school during the same school year. The date of readmission shall be defined as the first day the student physically attends school following the date of withdrawal.


http://www.ade.az.gov/Guidelines/SchoolFinance/FirstDayAbsence.pdf�

http://www.ade.az.gov/Guidelines/SchoolFinance/FirstDayAbsence.pdf�

http://www.ade.az.gov/schoolfinance/Forms/WithdrawalForm1.doc�



Determining Student Full Time Equivalency The requirements for a student enrollment to qualify for a full time equivalency and the requirements for fractional enrollments are as follows:

GUIDELINE a. Preschool

i. A preschool child is one who is enrolled in a program for preschool children with disabilities of at least 360 minutes each week. This program must meet at least 3 days per week for each child.

ii. Fractional enrollments are not applicable for preschool children

b. Kindergarten through Eighth Grade Fractional Enrollment for Kindergarten through Eighth Grade

Hours enrolled as applied to a full year schedule Grade Range 0 0.25 0.5 0.75 1 Kindergarten <356 N/A ≥356 and <712 N/A ≥712

1 - 3 <178 ≥178 and <356 ≥356 and <534 ≥534 and <712 ≥712 4 - 6 <223 ≥223 and <445 ≥445 and <668 ≥668 and <890 ≥890 7 - 8 <267 ≥267 and <534 ≥534 and <801 ≥801 and <1068 ≥1068

c. Ninth through Twelfth Grade

Requirement A Requirement B

Full Time Program

Minimum of 720 hours AND

4 Subjects @ 123 hours each delivered over any number of days OR

Any number of subjects totaling at least 20 hours per week Three

Quarters Program



Any number of subjects totaling at least 15 hours per week

Half Time Program



Any number of subjects totaling at least 10 hours per week Quarter Time

Program



Any number of subjects totaling at least 5 hours per week


18

Defining Homebound Membership Periods A homebound or hospitalized student is one who is capable of profiting from academic instruction but is unable to attend school due to illness, disease, accident, or other health conditions, who has been examined by a competent medical doctor and is certified by that doctor as being unable to attend regular classes for a period of not less than three school months or a pupil who is capable of profiting from academic instruction but is unable to attend school regularly due to chronic or acute health problems, who has been examined by a competent medical doctor and who is certified by that doctor as being unable to attend regular classes for intermittent periods of time totaling three school months during a school year. The medical certification shall state the general medical condition, such as illness, disease or chronic health condition that is the reason that the pupil is unable to attend school. Homebound or hospitalized includes a student who is unable to attend school for a period of less than three months due to a pregnancy if a competent medical doctor, after an examination, certifies that the student is unable to attend regular classes due to risk to the pregnancy or to the student's health. Homebound or hospitalized categories can include students who are unable to attend school for a period of less than three months due to a pregnancy if a competent medical doctor, after an examination, certifies that the student is unable to attend regular classes due to risk to the pregnancy or to the student's health. (A.R.S. § 15-901 (B)(13)) To maintain homebound status the following requirements must be met:

• The student must be enrolled in the school the student would otherwise attend • The student must be receiving at least 240 minutes of instruction per week • A certified teacher must be providing the instruction

Concurrent Memberships A student may be enrolled in more than one school over the same period of time. The dates, over which the student shares membership, defines a concurrent membership period. The state funding for this student is apportioned between the concurrent memberships according to statute.

Subsequent Memberships State funding for a student may also be affected by the student’s previous or subsequent enrollment in another school. Any other membership that a student may have during the fiscal year has the potential to reduce the amount of funding received by a school. The amount of fundable membership a student generates in the state across all enrollments in a fiscal year may be limited.



Resolving Membership Disputes Memberships that have the potential of limiting the fundable membership count for your students may be reported to the state from other schools. The following section will present the set of procedures that School Finance has established to help resolve these issues.

School A reports membership for

Student

Student Enrolls in School B

School B makes a records request

to School A

TranscriptPupil

Withdrawal Form

SDADMS71-1Compare to SBE Curriculum Req

R7-2-302

School B submits membership for

Student

Was student reported

correctly by School A?

Did School A provide

records?

School B sends certified letter to School A

requesting a Change of Records

Does School A Respond?

SF invalidates School A Membership

School A Corrects the Data(15-915 if Prior Year Correction)

SF Contacts School A and gives warning of enrollment invalidation

Does School A Respond?

Proof of nonresponse

School A is noncompliant

Email [email protected]

Email [email protected]

Records Request


20

Tracking Student Attendance Reporting Methods

Reporting Attendance: Daily Absences Except as otherwise provided by any other law, beginning July 1, 2008, absences shall be forwarded electronically by the school district on a school by school basis with other records pursuant to A.R.S. 15-902 (J). This reporting method is required for the following instructional programs:

• Elementary schools grades kindergarten through sixth grade. • Middle schools grades seven and eight • High school grades nine through twelve • Joint Technological Education Districts (JTED) (A.R.S. 15-393).

Daily Attendance Tracking

For students in elementary grades (KG-8)

Attendance shall be taken at least twice a day and sufficient documentation shall be maintained to support the fractional student absence reported.

For students in high school grades (9-12)

Attendance shall be taken for each period

Minutes of Attendance Only

Minutes of Attendance AND

Daily Absences

Daily Absences Only

Alternative Schools, Charter Schools w/ approved alt. cal.,

TAPBI Schools

Disabled Preschool &

Homebound All Other Schools



For kindergarten students (excluding homebound) For students enrolled in kindergarten, a full day of attendance is a day in which a student attends more than three-quarters of the instructional time for the day. If the total instruction time scheduled for the year is at least 346 but less than 692 hours, attendance for at least three quarters of the day should be counted as one-half day of attendance. If the instructional time scheduled for the year is at least 692 hours, a full day of attendance may be counted as one-half of the instructional time scheduled for the day. A.R.S. § 15-901(A)(6)(a)(i)

• Kindergarten students are considered either to be present or absent for a full day. Incremental absences in proportions that are less than a kindergarten student’s full time equivalency are not allowed.

• Record a kindergarten student who is enrolled in a program with total instruction time between 346 and 692 hours for the year as absent if he/she is in attendance for less than three–quarters of the instructional time scheduled for the day.

• If the total instructional time for the year is 692 hours or more, a student is counted as absent if he/she attends less than half the instructional time scheduled for the day.

Example 1

• Student A is enrolled in a kindergarten program that is scheduled to include 360 instructional hours over the course of the school year. (A half day program.)

• Two hours of instruction are scheduled for a particular day.

• If Student A attends for at least one hour and 30 minutes of the two hours of instruction scheduled for the day, he is considered to be in attendance for the full day and no absences are reported.

• If Student A attends for less than one hour and 30 minutes of the two hours of instruction scheduled for the day, he is considered to be absent for the full day and an absence in the amount of 0.50 must be reported.

Note: The reported amount of a daily absence may not exceed a student’s full time equivalency. In this case, Student A is enrolled in a half day kindergarten program and has an FTE of 0.50.

Example 2

• Student B is enrolled in a kindergarten program with total instruction time of 720 instructional hours over the course of the school year. (A full day program.)

• Four hours of instruction are scheduled for a particular day.

• If Student B attends for at least two hours of the four hours of instruction scheduled for the day, she is considered to be in attendance for the full day and no absences are reported.

• If Student B attends for less than two hours of the four hours of instruction scheduled for the day, she is considered to be absent for the full day and an absence in the amount of 1.00 must be reported.


22

For students in grades 1–8 (excluding homebound) For students enrolled in first through eighth grade or an ungraded program, daily attendance is a day in which a student attends more than three-quarters of the instructional time scheduled for the day. The attendance of a pupil at three-quarters or less of the instructional time scheduled for the day shall be counted as follows:

A. If attendance for all pupils in the school is based on quarter days, the attendance of a pupil shall be counted as one-fourth of a day's attendance for each one-fourth of full–time instructional time attended.

• Attendance for at least 76% of the instructional time scheduled for the day is counted as a full day of attendance and no absence is reported.

• Attendance for 75% of the instructional time scheduled for the day is counted as three–fourths of a day’s attendance and a quarter day (0.25) absence is reported.

• Attendance between 51% and 74% of the instructional time scheduled for the day is counted as a half day of attendance and a half day (0.50) of absence is reported.

• Attendance between 25% and 50% of the instructional time scheduled for the day is counted as a quarter day of attendance and three–quarters of a day (0.75) of absence is reported.

• Record a full day (1.00) of absence for a student that is in attendance for less than 25% of the instructional time scheduled for the day.

Attendance Absence Amount

>75% of the instructional time scheduled for the day 0.00

75% of the instructional time scheduled for the day 0.25

≥50% but <75% of the instructional time scheduled for the day 0.50


<25% of the instructional time scheduled for the day 1.00

B. If attendance for all pupils in the school is based on half days, the attendance of at least three-quarters of the instructional time scheduled for the day shall be counted as a full day's attendance and attendance at a minimum of one-half but less than three-quarters of the instructional time scheduled for the day equals one-half day of attendance.

• Attendance for at least three–quarters of the instructional time scheduled for the day is counted as a full day of attendance and no absence is reported.



• Attendance for at least one–half, but less than three–quarters of the instructional time scheduled for the day is counted as a half day of attendance and a half day (0.50) of absence is reported.

• Record a full day of absence for a student that is in attendance for less than half the instructional time scheduled for the day.

Attendance Absence Amount

>75% of the instructional time scheduled for the day 0.00


<50% of the instructional time scheduled for the day 1.00

Note: The reported amount of a daily absence may not exceed a student’s full time equivalency.

For students in grades 9 – 12 (excluding homebound) For high schools or ungraded schools in which the pupil is at least fourteen years of age by September 1, the attendance of a pupil may be counted as one-fourth of that day's attendance for each sixty minutes of instructional time in a subject that counts toward graduation, except that attendance for a pupil shall not exceed the pupil's full or fractional membership. A.R.S. § 15–901 (A)(6)(e)

Absence Reasons Schools will need to record absences as excused or unexcused for the purposes of determining compliance with the withdrawal of students for 10 consecutive unexcused absences. The guideline for excused absences is published on the ADE website as EX-1. Since ADM may be adjusted due to an excessive absence rate at the district or charter holder level, the following reasons for absences need to be kept on file to apply to ADE for an exception of these absences from the calculation of the absence rate.

• Illness for any period of three consecutive days or more. • Adverse weather conditions for any period of three consecutive days or more. • Concerted refusal by students to attend classes for three consecutive days or more. • Threats of violence against school property, school personnel or students. • Chronic health problems as defined in section 15-346 if the school district is providing

services to the pupils during their absence from school. A.R.S. 15-902 (B) and (C)

http://www.ade.az.gov/Guidelines/SchoolFinance/EX-1ExcusedAbsences.pdf�


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Excused Absences • Pursuant to A.R.S. §15-901(A)(2), “…excused absences shall be identified by the

Department of Education...”. The Department of Education defines an excused absence as being an absence due to illness, doctor appointment, bereavement, family emergencies and out-of-school suspensions. The out-of-school suspension must not to exceed 10% of the instructional days scheduled for the school year. The Department of Education delegates the decision of family vacations as an excused absence to individual school districts and charter holders.

• Pursuant to A.R.S. §15-806, “the governing board of each school district shall adopt a policy governing the excuse of students for religious purposes. The policy may permit a student to be excused from school attendance for religious purposes, including participation in religious exercises or religious instruction. If the policy permits a student to be excused for religious purposes, the policy shall stipulate the conditions under which the excuse will be granted.” Pursuant to A.R.S. §15-806(1) and (2)these conditions will include at least a written consent from the person who has legal custody of the student and the religious instruction or exercises must take place at a suitable place away from school property. Pursuant to Op.Atty.Gen. No. R76-292, the total number of days of excused absences for religious purposes shall be reasonable and not abused.

• Pursuant to A.R.S. §15-902(C), a district or charter may apply to the Arizona Department of Education for an adjustment when excessive absences occur that are a result of a widespread illness, adverse weather conditions, or a concentrated refusal by students to attend classes which extends to three or more consecutive instructional days.

• Pursuant to A.R.S. §15-902(E), a district or charter may also apply to the Arizona Department of Education for absence approval for students with chronic health problems if the district or charter is providing services to the students during their absences.

• Pursuant to A.R.S. §15-803(A)(2), in order for any of the above absences to be excused, a child who is under 16 years of age must be accompanied by a parent, guardian, or authorized person.

• In order for absences relating to illness, doctor appointment, bereavement, family emergencies, or district approved family vacation to be counted as excused absences, the school must be notified of the absence prior to the absence or when the absence occurs by the parent or legal guardian who has custody of the student. Upon returning to school from an excused absence, the student shall submit to the school signed written consent and specific reason for the absence signed by the parent or guardian. The school shall then retain written consent of absence in the students file for a period of four (4) years. If there are ten (10) or more consecutive absences due to illness, the school shall require the student to furnish a doctors note allocating the student’s illness, which shall remain in the student’s file for four (4) years.

• If an absence occurs relating to any other term or condition that is not specifically designated herein, the absence shall be counted as unexcused.



Reporting Attendance: Minutes and Daily Absences For an approved group of schools, minutes of attendance may also be forwarded electronically for the purposes of determining daily membership. In these cases, daily absences should also be submitted. The school is still required to document daily absences and keep such records on file for determining compliance. This reporting method is allowed for the following alternative educational programs:

• Alternative schools operating in a school district: This approval applies only to district schools that appear on the list of alternative schools as identified by the Arizona State Board.

• Charter schools operating on approved alternative calendars: This approval applies only to charter schools that have been approved by the Arizona State Charter Board as operating alternative calendars.

• Technology Assisted Project-Based Instruction Program (TAPBI) (A.R.S. 15-808)

Determining Daily Absences These programs may count pupils as having attended full time in any week for which the pupil was enrolled in and physically attended at least twenty hours of instruction during that week (A.R.S. §§ 15-796 through 797). For the purposes of determining an excessive absence adjustment, SAIS will calculate an absence based on attendance less than 20 hours a week. When reporting absences schools shall follow the procedures outlined in this document under Reporting Attendance: Daily Absences.

Reporting Attendance: Instructional Minutes This reporting method is required for the reporting of attendance for homebound students and disabled preschool students.

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