Chino Valley Unified staff warn of budget strain after Auditor General flags district as ‘approaching high risk’

Mister Livingston, the district’s finance presenter, told the Chino Valley Unified board that the Auditor General’s office emailed the district saying it was “approaching the high risk category” on its annual school financial risk analysis and provided a nine-item corrective framework the district will use to guide remediation.

Livingston summarized the December 31 financial snapshot: the capital fund budget is roughly $19.2 million with year-to-date capital expenses near $9.8 million, and a budget balance line showing a $662,873 shortfall. He cautioned that timing of state pass-through receipts affects month-to-month cash: pending cash dropped from about $7.4 million to $6.3 million due to timing of a roughly $979,000 School Facilities Board payment.

“[The Auditor General] says it is approaching the high risk category,” Livingston said, adding that the designation is a warning status the office uses to prompt conversation with districts and the legislature. He cited a four‑percent four‑year decline in weighted student count as a core revenue pressure and explained that last year’s increases in certified stipends, new hires and staff housing contributed materially to higher instructional expenses even as enrollment fell.

Superintendent (speaker 4) and staff described an array of proposed spending reductions and operational changes to improve reserve positions ahead of FY2027. Recommendations presented to the board include a hiring freeze already in effect, a set of department-level savings (transportation outsourcing for major repairs, shifts in district office staffing, curtailing district contributions to employee health-savings accounts), and targeted school-level adjustments. Staff aggregated proposals that total about $2.1 million if taken in full, or roughly $1.9 million when excluding items marked as cuts of last resort.

Among the largest single-school proposals was a grade reconfiguration that would move sixth grade into Del Rio (making Del Rio a 3–6 campus) and reduce administrative overhead at the middle school; staff estimated Del Rio could yield about $124,647 in recurring savings while the middle school (HMS) could yield roughly $294,922 primarily via administrative and support-position reductions. Administration emphasized these are recommendations for February action and that any formal reduction-in-force or grade reconfiguration would come back to the board for a vote.

Staff also flagged opportunities to capture additional revenue or savings: a recently awarded $46,000 early-childhood grant, about $30,000 in savings from ending vendor-fee payments for foreign-worker sourcing, and the potential to apply for an Arizona rural school nurses grant to fund an RN and reduce local payroll. Administration said final contract and staffing decisions will be presented in March with any RIF votes in February.

Next steps: staff will refine the projection and bring formal action(s) to the board in February; the board did not take binding action on the package during this meeting.