Ticktock: Scottsdale Schools M&O override question is on the clock

The Scottsdale Unified School District Governing Board, from left, is Jann-Michael Greenburg, Sandy Kravetz, Allyson Beckham, Barbara Perleberg and Patty Beckman. (Independent Newsmedia/Arianna Grainey)

The potential of calling for an election this November to renew Scottsdale Schools’ M&O override is tentatively planned for discussion Tuesday, May 14, district officials say.

The discussion is set to be a part of the Scottsdale Unified School District Governing Board’s regular meeting agenda, which begins at 5 p.m. at Coronado High School, 7501 E. Virginia Ave.

Governing Board President Patty Beckman says passage of the maintenance and operations override ensures continuation of existing programs and services for students, schools and the community.

An override affords the school district to ask voters for an increase of their budget; there are three types of overrides: Maintenance and operations, special and capital.

The M&O override allows SUSD to ask voters for an increase of up to 15% of its state-imposed budgetary limit.

Scottsdale voters approved an $8.5 million capital override in 2016 — which was earmarked to provide curriculum materials and school technology; furniture, fixtures and equipment; fine arts, athletics and library programs; and playground equipment.

Overrides are approved for a term of seven years. SUSD’s current M&O override, renewed in November 2014, will begin sunsetting if the Governing Board decides not to call for an election on the issue, or if the override makes it to the ballot but fails to receive voter approval.

If the M&O override is not renewed, the school district would start to see a decrease in years 2020-21 and 2021-22.

Prior to the 2014 M&O override, the call for a budget extension had not been met with voter approval, as two elections failed.

Maricopa County Records Office records show the override failed in 2012 and 2013:

  • 2012: 52.66% of ballots cast voted “no” to a budget increase; while 47.34% voted “yes”; and
  • 2013: 50.28% of ballots cast voted “no” to a budget increase; while 49.72% voted “yes.”

In 2014, the override passed with 55.46% of ballots cast.

Ms. Beckman is supportive of calling for the override renewal, stating how her own children were affected years ago when programs were cut due to an unsuccessful override election.

When the override failed, the school district cut special programs and every child only attended a half-day of classes every Wednesday.

“Passage of the M&O override ensures continuity of existing programs and services for students, schools and community,” she said.

“These funds are primarily used for teacher salaries, programs and supplies. Some of these funds are specifically used to: reduce class sizes at every grade level; support elementary school art, music and P.E. programs; Continue full-day kindergarten; attract and retain quality teachers and staff.”

In an April Governing Board meeting, district staff began setting the stage for the discussion on the maintenance and operations budget by identifying cash reserves and developing regulation around them.

Ms. Beckman says the goal is to maintain enough cash on-hand to support the annual expenses that come out of each fund, as well as maintain budget reserve in case of unexpected expenses.

According to numbers presented by interim Chief Financial Officer Jeff Gadd on April 16, there is $21,182,805 unencumbered funds. These funds are comprised of medical insurance, worker’s compensation insurance and property/casualty insurance.

Ms. Beckman says it is important to note these unencumbered funds have accrued over the course of 10 years.

“With any operation, be it a school district or a business, it is important to have a certain amount of cash on-hand for unexpected expenses,” the school board president said.

“The SUSD Governing Board asked our CFO to identify our cash reserves, define how much reserve should be held and why, and ultimately provide a plan for moving any excess to our classrooms, over time. The formula will potentially become a cash reserve regulation for our district.”

Ms. Beckman says as she understands it, SUSD is one of the only school districts working toward a potential regulation like this.

“As a district, we would like the taxpayers to have as much information as possible when voting on any education related matters such as the M&O override,” she said.

There is a fine balance, Ms. Beckman explains, of providing ethical financial stewardship of tax dollars while maintain a prudent level of cash reserves at the same time. An experienced CFO, she says, will have a plan for scenarios that could negatively affect a school district with reserves to safeguard students and programs.

“No one wants to be in the position we were just a few years ago, when SUSD cut elementary school specials and went to half day on Wednesdays,” she said.

“If we did not have the M&O override and were to keep providing the same beneficial programs, our reserves could be gone quickly.”

Northeast Valley News Editor Melissa Rosequist can be e-mailed at mrosequist@newszap.com or can be followed on Twitter at twitter.com/mrosequist_.

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