Changes in State Education Code for Financial Solvency Review has major impact for CFBISD

Changes in State Education Code for Financial Solvency Review has major impact for CFBISD

The State of Texas seeks to strike a balance between student achievement and financial accountability. Changes will have a major impact on the Carrollton Farmers Branch School District. The code change directly address unwise budgeting practices in the district.

Changes in the State education code requires the Comptroller to evaluate academic
and financial data of all Texas public schools and districts and rank them by their level of academic achievement and cost-effective operations. No longer will districts be held accountable solely on academic achievement, but also on cost-effectiveness. The Carrollton Farmers Branch School District will evaluated on the district's ability to achieve high student achievement while maintaining cost-effective operations.

The new Financial Solvency Review provisions require that the TEA implement a review process to analyze district revenues and expenditures for the preceding school year, and projected district revenues and expenditures for the current school year and the following two school years. Additionally , if a district a projects a deficit for a school district general fund within the following three school years, to provide TEA interim financial reports, supplemented by staff and student count data, as needed, to evaluate the district's current budget status. A deficit is projected, a district develop a financial plan and submit the plan to TEA for approval To discourage a rapid depletion of a district's general funds balance, TEA must established an alert in reporting system.

Although TEA commissioner has not issued final regulations to implement the Financial Solvency Review provisions, it is probably a safe bet that the district would had made dramatic changes in budgets if this provision of code existed in 2007. Every year since the 2007-2008 school year the district has projected deficits. Rather than developing a financial action plan to address deficits the Board of Trustees elected to deplete the the general funds balance. One does not have to be accountant or economist to realize, that when your revenues don't cover your expenses, that you can not continue to deplete your savings. It is time for the Board of Trustees and District administration make the same tough decisions that families and businesses in the district make everyday.