The Arizona Auditor General conducted an audit of the Scottsdale Unified School District and has found that in fiscal year 2012, the District did not always properly classify its expenditures in accordance with the Uniform Chart of Accounts for school districts. As a result, the District’s Annual Financial Report did not accurately reflect its costs, and its reported instructional expenditures were falsely increased by over $5 million, or 3 percentage points.
Auditors found that the District “has not accurately reported its costs for many years. For example, between fiscal years 2004 and 2009, the District annually reported millions of dollars of electricity costs as instructional spending rather than plant operations spending as required by the Uniform Chart of Accounts. Additionally, in fiscal years 2012 and 2013, the District reported its costs for speech and physical therapy, guidance counseling, and psychology services for students as instructional spending although the Uniform Chart of Accounts defines these costs as student support services. Further, in fiscal year 2014, the District began misreporting its costs for property liability insurance as instructional spending rather than plant operations spending, as required by the Uniform Chart of Accounts.”
The audit also found that the District’s fiscal year 2012 transportation costs per mile and per rider were much higher than the peer districts’ averages, in part, because many of the District’s bus routes were inefficient. In fiscal year 2012, district routes filled buses to only 63 percent of bus capacity, on average, and many routes filled buses to less than 50 percent of bus capacity. Districts with efficient bus routes will typically operate routes that fill buses to 75 percent or more of bus capacity.
“Our observations of bus routes at a sample of five schools also confirmed the low bus capacity usage. For example, 4 of the 31 routes observed transported 7 or fewer students indicating the routes could possibly pick up additional students or be combined with other routes,” wrote auditors.
In fiscal year 2012, Scottsdale USD’s plant operations cost per square foot was lower than the peer districts’ average, but its cost per pupil was 8 percent higher. As a result, the District spent more of its available operating dollars for plant operations, leaving it less money to spend in the classroom. The higher cost was primarily caused by the District maintaining a large amount of excess school building space, which was likely not needed because many of the District’s schools operated far below their designed capacities. In fiscal year 2012, Scottsdale USD had total school building capacity of about 38,000 students but only had about 25,000 students enrolled, or in other terms, the District was using about 66 percent of its building capacity.
Student achievement similar to peer districts’—In fiscal year 2012, Scottsdale USD’s student AIMS scores were within 5 percentage points of the peer districts’ averages in the four tested areas. Additionally, under the Arizona Department of Education’s A-F Letter Grade Accountability System, the District received an overall letter grade of A. Four of the eight peer districts also received a letter grade of A, while four received Bs or Cs. Further, the District’s 90 percent graduation rate was similar to the peer districts’ 89 percent average and higher than the State’s 77 percent average.
In fiscal year 2012, Scottsdale USD’s food service program operated efficiently with a lower cost per meal than peer districts averaged, but its administration, plant operations, and transportation program were less than efficient. The District’s administrative cost per pupil was higher than the peer districts’, on average, primarily because of higher staffing levels, and its plant operations cost per pupil was higher because the District maintained excess building space. The District’s transportation cost per mile was much higher than the peer districts’ average, in part, because of inefficient bus routes.