Ajo Unified District presents adopted FY2027 budget, plans one-time ASRS repayment

Ajo Unified District officials presented the district's adopted fiscal year 2027 budget at a public hearing and described a plan to cover a one-time approximately $100,000 payment the district owes the Arizona State Retirement System (ASRS), finance consultant Tyler Moore said. The district will use a partial transfer from capital and operating savings to make the payment while maintaining healthy carryforward reserves.

Moore told the board the adopted budget is essentially unchanged from the previously proposed budget because no late legislative changes required adjustments. He said the state provided a 2% inflation adjustment to base K-12 funding and that one-time appropriations retained in the K-12 budget will provide roughly $80,000 to $100,000 for the district, depending on final enrollment. "That provides about 80 to $100,000 to Ajo, depending on enrollment," Moore said.

Moore reported the M & L (maintenance and operations) per‑pupil base amount, including weights for special education and English-language learners, as $55,250.53. He cautioned that enrollment is the main driver of formula funding and that the district's enrollment has remained relatively flat compared with larger declines elsewhere.

The board also reviewed a previously undisclosed ASRS charge that district staff traced to funding decisions made by a prior administration dating back to about 2010'11. Moore and other staff described the charge as a roughly $100,000 fee the district needs to repay. "This was a decision made by prior administration ... and ultimately that led to a fee of approximately a $100,000," Moore said. Staff explained that a credit the district had been receiving from ASRS had been used for medical-premium costs rather than applied only for retired individuals, and ASRS has asked for repayment of the unused credit.

Moore recommended funding the one-time ASRS payment with a transfer from the capital budget (about $65,000 as discussed in the presentation) plus identified operating savings. He characterized the transfer as absorbable and temporary: the district would use carryforward reserves to manage the payment and rebuild capital in subsequent years. "We have been notified of a Arizona State Retirement fee that Ajo owes ... this is a one-time transfer because this fee is a one time fee," Moore said. He said the district's post-transfer carryforward balance would remain roughly $758,000 and that interest earnings from Pima County were on the order of $5,000.

On capital spending Moore reported the capital budget total for FY2027 as stated in the presentation (transcript phrasing: "900,666 thousand dollars"); staff did not clarify whether the phrasing in the presentation included an extra word (see clarifying details). Moore said the district will manage a modest transfer while preserving reserve levels.

District staff also described progress on a comprehensive action plan (CAP) intended to remove the district from the state board of education's deficiency list and said they are awaiting an Auditor General's Office visit to verify implemented changes. The presentation closed with no additional questions from board members.

Action and next steps: the board voted earlier on the agenda on a procedural motion (the transcript records a motion, a second and a recorded "Motion carries 4 to 0" on that item). District staff said they will proceed with the proposed one-time transfer and complete follow-up steps with the Auditor General's Office to clear the CAP-related deficiency.

The presentation and public hearing concluded with a brief thank-you to the finance consultant and a motion to adjourn.