FCMAT flags Apple Valley Unified for fiscal risk as teachers’ and classified leaders demand transparency

Apple Valley Unified School District hosted a board workshop on Oct. 30, 2025, during which the state’s Fiscal Crisis and Management Assistance Team (FCMAT) presented a fiscal health risk analysis that highlighted persistent deficit spending, weak internal controls and gaps in budget transparency.

FCMAT representatives Charlene Hart and Jennifer Noga told trustees the district’s FHRA score was 31.2 percent — in the moderate‑risk range overall — but that a single material weakness pushed certain measures into a higher risk category: the absence of a board‑approved and implemented plan to reduce or eliminate ongoing deficit spending after multiple years of negative results. "If a district is deficit spending in the current or two subsequent fiscal years, has the board approved and implemented a plan to reduce or eliminate deficit spending?" the presenters asked, noting that answer carried extra weight in the FHRA.

Why it matters: FCMAT said the district has run consecutive deficits and is drawing on reserves. The presenters cited the district’s unaudited actuals and adopted projections showing year‑end net decreases to the general fund: a deficit of about $1.7 million in 2023–24, $6.4 million in 2024–25, and a projected deficit in the adopted 2025–26 budget. FCMAT warned that relying on one‑time federal or state dollars to pay ongoing salaries — a practice districts statewide used following COVID relief — can create a structural deficit once those funds expire.

Public comments and union concerns came before and during the presentation. JC Scott, chapter president of the California School Employees Association (CSEA), said the FHRA confirmed long‑standing staff concerns and called for "real accountability with transparency," including full disclosure of how one‑time funds were used and immediate fraud‑prevention systems such as anonymous reporting hotlines and internal audits. "Apple Valley Unified School District is at high risk for fiscal insolvency," Scott told trustees.

The president of the Apple Valley Unified Teachers Association disputed specific wording in the FHRA about past salary schedule increases and restated union demands for clearer explanations of the district’s use of one‑time funds. She and another bargaining‑unit representative asserted that some recent settlements included management longevity payouts and said those outcomes worsened staff confidence in the board’s process.

FCMAT’s answers and recommendations: Presenters emphasized practical steps the district can take, including: - Improve communication and provide readable budget summaries and presentation materials in advance of board meetings so trustees and the public can review assumptions before votes; - Establish an inclusive budget advisory committee representing certificated, classified, management and parents to evaluate priorities and recommend reductions where needed; - Identify and publish program‑level contributions from the unrestricted general fund to restricted programs (for example, special education) so the community understands what is being subsidized; - Require regular budget monitoring updates and consider preparing a two‑year cash flow (current year plus one) to avoid mid‑year surprises; - Adopt and implement a board‑approved plan to reduce deficit spending and prioritize tackling material weaknesses identified in the FHRA.

On fraud prevention, FCMAT said it found no evidence of fraud in its fieldwork but flagged a gap in anonymous reporting and internal procedures that could deter employees from reporting concerns; they recommended making reporting channels visible to staff.

Board reaction and next steps: Trustees asked detailed questions about SACS forms, the mechanics of interfund transfers (indirect costs), fund‑specific balances — including the cafeteria fund and the special reserve for capital outlay (fund 40) — and how federal and state timing affects reported revenues. FCMAT encouraged the board to avoid masking out‑year deficits with speculative savings in the multi‑year projection (box B1D) unless reductions are board‑approved and actionable.

FCMAT offered follow‑up assistance: an independent multi‑year projection and a follow‑up FHRA review if the district requests one within the timeframe allowed by the study agreement (the presenters said follow‑up reviews are possible within roughly six to 18 months to check progress on items marked "no" in the FHRA).

The meeting concluded with trustees moving to adjourn. The board took a roll‑call vote and adjourned the workshop.

What remains unresolved: FCMAT’s report and public commenters call for a concrete, board‑approved plan to halt and reverse deficit spending, clearer disclosure of how one‑time funds were spent, and public documentation of contributions to restricted programs. Union leaders urged correction of specific report language about salary schedule increases and demanded accelerated transparency about contracts and bargaining settlements. The district and FCMAT agreed on the need for improved communication and prioritized action on the FHRA’s material weaknesses as the next step.