Understanding District Finances

Almost all of the district's operating money arrives through the Local Control Funding Formula (LCFF). LCFF pays the district a base amount for each student, based on Average Daily Attendance (ADA) — how many students are actually in class, not how many are enrolled. That is why attendance matters financially as well as educationally.

On top of the base, LCFF adds supplemental and concentration funding for English learners, low-income students, and foster youth. The Unduplicated Pupil Percentage (UPP) measures what share of our students fall into those groups; a district above 55% receives additional concentration funding. That extra money has to be spent on services that increase or improve outcomes for those students, and the Local Control and Accountability Plan (LCAP) is where the district explains how.

The rest of the budget is federal money (Title programs, special education, child nutrition), other state categorical programs, and local revenue such as interest and facility leases.

Every California school district reports using the Standardized Account Code Structure (SACS), a state-mandated chart of accounts. It is what lets the state and county compare any district to any other, and it is why our documents look like everyone else's — dense, coded, and organized by fund, resource, object, and function rather than by anything a general reader would recognize.

SACS is a reporting format, not a spending decision. The PDFs labelled "SACS Documents" are the raw statutory forms. The documents labelled "Presentation to the Board" are the same information written for people — start there.

The district does not simply adopt a budget in June and wait until the year ends. Twice a year it formally re-forecasts and reports to the Board and to the Riverside County Office of Education (RCOE). First Interim uses data through October 31; Second Interim uses data through January 31.

With each report the Board certifies the district's financial position, using one of three words. Positive means the district can meet its obligations this year and the next two. Qualified means it may not be able to. Negative means it will not be able to. Each report includes a Multi-Year Projection (MYP) showing the current year plus two more, because a budget that balances this year but collapses the year after is not a balanced budget.

Most of it is restricted. Restricted funds arrive with legal strings attached: special education money must be spent on special education, child nutrition money on meals, bond money on the specific projects voters approved. A surplus in a restricted fund cannot be moved to cover something else, no matter how worthwhile.

Unrestricted funds are the money the Board genuinely has discretion over — and most of it is already committed to salaries and benefits for staff who are under contract. Roughly four out of every five dollars in a typical district's operating budget goes to people.

There is also a timing effect. Money set aside for a multi-year construction project or an obligation not yet invoiced still shows as a balance, even though it is already spoken for.

State law requires it. A district of our size must keep a minimum Reserve for Economic Uncertainties (REU) of 3% of general fund expenditures. It exists because the district's costs are largely fixed and its revenue is not: attendance can drop, the state can revise funding mid-year, and a single bad year can otherwise mean mid-year layoffs.

A reserve near the legal floor is a warning sign, not a sign of discipline — it means one poor year could force cuts to classrooms. County offices and the Fiscal Crisis and Management Assistance Team (FCMAT) generally consider a reserve well above the minimum to be prudent, not excessive.

They are bonds — money voters approved the district to borrow for construction and facility improvements, repaid over time through property taxes. Bond money is legally separate from the operating budget and can only be spent on the capital projects listed in the ballot measure.

Bond funds cannot pay salaries, buy classroom supplies, or close an operating shortfall. That is why the district can be building a new facility and tightening its operating budget in the same year: the two pots of money are not interchangeable. Each bond is audited separately every year, which is why you will see Measure H and Measure J audit reports listed alongside the district audit.

For what the district plans to spend this year, use the Adopted Budget for the current year. For what it actually spent in a completed year, use that year's Unaudited Actuals, or the Final Audit Report once the outside auditors have signed off — the audit is the authoritative version.

For a mid-year picture, use the most recent First or Second Interim. For bond spending, use the Measure H or Measure J audit report.

If you cannot find it, call Fiscal Services at (951) 509-5080. Public financial records are public, and we would rather help you find the right number than have you work from the wrong one.