Ed+5342+Week+4

Part 1:  **FIRST: Financial Integrity Rating System of Texas:**  Texas Administrative Code (TAC), Title 19 provides that the purpose of the financial accountability rating system is to ensure that school districts and open-enrollment charter schools are held accountable for the quality of their financial management practices and achieve improved performance in the management of their financial resources. The system is designed to encourage Texas public schools to manage their financial resources better in order to provide the maximum allocation possible for direct instructional purposes. The system will also disclose the quality of local management and decision-making processes that impact the allocation of financial resources in Texas public schools.  There are many critical components to the FIRST system and depending on which stakeholder group that is reviewing the information you will probably get three very different most important components. The perspective that our group will take will be that of an educator or an employee of the education system. Thus the three most critical components are reserve fund availability, transparency, and the consistent grading across other districts.  **Reserve funds** is critical to the operation of a school system; especially in the current times. A healthy reserve fund indicates fiscal responsibility of the district along with the fiscal responsibility of the board of trustees, who are voted into office. With a healthy reserve as part of the financial picture a district can address major capital outlay items that they may come across in a fiscal year that was not part of the original budget as well as maintain a healthy staffing in times of economic crisis like all Texas systems are going through currently.  **Transparency** is critical in that the system is responsible not only to manage the funds but to spend and delivery services to the student body. If transparency did not exist then the public would have no avenue or form of checks and balances to ensure that the spending is occurring in the manner intended. In turn, the reporting mechanisms ensures that policies and practices are put into place to ensure integrity of the system and to ensure the system is accountable to how money is spent.  **Consistency** is a major issue in any accountability framework. This ensures that how one district is graded and held accountable so too are other districts operating under the same umbrella. The state rates every district on the same criteria and therefore the public ratings released online are comparable.  In answering this question in the financial crisis we are currently in as a state the financial integrity of a system will have a profound impact on student programs and services, moral of employees and staff, and ultimately the productivity of the system which is education of students.   My reflections: FIRST is a great plan to approach school finance and in these hard times of school finance and knowing that so many are not pushing for funding that would help our schools, it is imperative that we are transparent and consistent to those we serve. There is so much being said about how school districts waste money and how we are willing to show what we have spent funding on and give explanations. There are also lots of legislators who want to access our funding and there ability to see what we have saved and what it is being spent on should also help our public see how conservative we have been to contradict those who feel we may not be. After meeting with the business manager from GPISD, he also agreed that these three components are crucial to FIRST. Part 2:  Based on a review of data contained in the “Snapshot District Detail for 2009,” District 1 and District 2 are quite different.   District 1 is a small district with only three campuses. The three campuses serve a total of 830 students. 43% of the student population is economically disadvantaged; however the average SAT score is 1043. The graduation rate is 94.2%. The district’s total revenue for 2009 was $8,823,250, with a per pupil revenue of $10,529. The operational expenditures were $7,216,335, with a per pupil expenditure of $8,611. Teachers in District 1 have an average salary of $39,771 and an average of 13.3 years of experience. The fund balance for District 1 in 2009 was $2,552,074.   District 2 is significantly larger than District 1 and has 45 campuses. In 2009, the district served 32,326 students. Of those, 53.9% of the students are economically disadvantaged. The district’s graduation rate was 84.2%, with a 10.2% drop out rate. The average SAT score for a student in District 2 is 1058. Considering the difference in size, District 2 has a much larger total revenue at $329,638,930, with a per pupil revenue of $10,316. The total operational expenditures for District 2 are $284,664,004, with a per pupil expenditure of $8,908. Teachers in District 2 also have a significantly higher average salary of $50,307. The average years of experience for District 2’s teachers is 11.6 years. In 2009, the fund balance for District 2 was $42,780,035.   In comparing and contrasting the two districts, it is interesting to note that District 1 (the smaller district) is obtaining a much higher graduation rate with comparable SAT scores. Both districts are comparable when analyzing student populations, with nearly 50% of both districts serving economically disadvantaged students. In order to compare the two districts, it is critical to review their student demographics. District 2, the larger district, has students in every sub-population; however, District 1 is comprised of 76% white students, 22% Hispanic, and 2% African American. District 2 is much more diverse with 56% Hispanic, 31% White, 7% African American, and 7% Other. Even though District 2 is educating a more diverse student population, their percentage of students passing all tests is 78% compared to District 1’s 80%. The challenge of educating diverse student populations does not appear to create a performance gap between the two districts. This could be attributed to the fact that both districts are very similar when it comes to per pupil revenue and expenditures. District 1 brings in approximately two hundred dollars more per student, while District 2 spends approximately three hundred dollars more per student. Even though the numbers differ slightly, the amount of per pupil revenue and expenditures is not impacted by the size of the district. <span style="line-height: 19.0pt; mso-layout-grid-align: none; mso-pagination: none; text-autospace: none;"> <span style="line-height: 19.0pt; mso-layout-grid-align: none; mso-pagination: none; text-autospace: none;"> When analyzing the data for the two districts, we expected to see more differences than similarities due to teacher salary. District 2’s average teacher salary is approximately $11,000 more annually. This difference would lead one to assume that the smaller district would struggle to retain experienced teachers; however, that was not supported with the data. On average, teachers in District 1 have 13.3 years of experience, which is actually a bit more than District 2, which has teachers with an average of 11.6 years of experience. We also analyzed turnover rate, and we were surprised to see that both districts have an approximate turnover rate close to 15%. We expected to see a higher turnover in the smaller district with the lower teacher salary. <span style="line-height: 19.0pt; mso-layout-grid-align: none; mso-pagination: none; text-autospace: none;"> <span style="line-height: 19.0pt; mso-layout-grid-align: none; mso-pagination: none; text-autospace: none;"> According to information presented by Dr. Lu Stephens in this week’s lecture, “economy of scale” certainly plays a factor in student learning. Dr. Stephens defined this as a concept in which increased size results in lower per unit cost. Obviously, the “product” in the educational system is “student learning.” Larger districts have an advantage of creating greater efficiency in their “product” due to a decreased cost per student. Basically, the per pupil expenditure on paper is very similar for each district, but the larger district is definitely going to get more “bang for their buck.” Dr. Stephens specifically mentioned that the larger district would be able to use those efficiency savings to help attract and retain excellent teachers. This is a point that should receive significant attention. District 2 is able to offer a teacher salary that is much higher than District 1, which likely leads to higher quality teachers. The district is working to meet the needs of a diverse student population, and they will be able to use their high salary to attract the best certified educators. Perhaps we can conclude that this factor substantially supports why District 2 is comparable to District 1 in terms of student performance (SAT scores and passing rates.) <span style="line-height: 19.0pt; mso-layout-grid-align: none; mso-pagination: none; text-autospace: none;"> My reflections: <span style="line-height: 19.0pt; mso-layout-grid-align: none; mso-pagination: none; text-autospace: none;"> I have run a very large campus- over 1,200 students and now a small school of 530 students. The opportunities and options that I could offer the larger school were very significant. With more staff, funding and a larger facility, there are so many more things that I had access to, more people to spread the wealth in regards to leadership and curriculum offerings. In the smaller school, so many of my staff members have to wear a variety of hats and do many jobs in order to give students some of these same opportunities, though they are still limited. I truly believe it is the job of the campus leader to have a vision for each school no matter the funding. With both schools the drive was student achievement and excellence and this is what must come first. Though District 1 has a smaller student population, they are able to reach kids to be able to succeed and this is evident in their scores. District 2 has many other obstacles to face, which is evident in their student breakdown and the focus needs to stay on student success.

Part 3: Due to our current financial status in the state of Texas, looking at different ways to save money, cut costs and still provide the same quality instruction to our students will be a very large task, but like always we will find the way to do it, while still being successful. One way to achieve this goal would be to differentiate our staff. “ Differentiated staffing is a concept that proposes specialized use of personnel,” (Week 4, Page 1, Lecture). As explained this week in our lecture this is where we teach our current employees how to do some of the smaller tasks, which may be splitting up the workload of one employee over numerous other professionals, thus eliminating a position and allowing us to save money. An example at a secondary campus could be the in school suspension (ISS) position. Currently, it is a position held by paraprofessional making approximately $22,000 a year with benefits. A way we could eliminate this position is by approaching ISS in a different manner. At the present teachers receive more time for planning than is defined by the law, therefore we could creating a rotating schedule to have each teacher be responsible for ISS one of their conference periods every two weeks. At the same time when they are in ISS, they could check on their own students progress, give help in the content area they teach, or even do a lesson on making better choices, on self esteem, or even on goal setting for them to make goals to help keep them out of trouble. The idea sounds like a good one, but there will be weak teachers that will not be able to control this type of environment, conflicting personalities, as well as teachers with negative attitudes who will openly complain about this extra duty, report it to their professional organization, or affect the moral of the campus. The success of this new program will again be based on numerous factors: the presentation of the program, the reasoning behind the change and their buy in/ support. In the lecture we heard during week 4, Dr. Lu explains “Differentiated staffing could create greater efficiency in a school district by assigning teachers and other educators different responsibilities based on carefully prepared definitions of many teaching functions.”(Week 4 Lecture, pg1). Taking this into consideration, during financial times like those we are currently facing it would be wise for a small school district to consider doing this with nonessential personnel. The reason we agreed that this would be best with non essential has a lot to do with all of the demands being place don public schools at this time. For instance, if we begin to cutback on teaching units, this will most definitely impact instruction, quality of instruction, ability to offer more manageable classrooms where all students could receive the best of their highly qualified teacher and this will impact not only our scores, but mastery, the ability to impact those most disadvantaged as there will no longer be as many options to service their needs. Therefore as a group we believe that we should consider non- essential personnel first. Positions to consider would be those secretarial positions, where certain personnel could share a secretary. We would also look at combining maintenance positions, possibly working different hours and different days. On campuses we could look at all aides and specialist teaching part time. Combining librarians with neighboring campuses could also be an option. All of these options would allow campuses to still have the same programs they currently serve, while also meeting their goals as outlined in the campus improvement plans. In conclusion, differentiating staffing is something that can be seen as a positive or a negative depending on how the message is conveyed. There is no one who wants to lose staff, but when the option is losing programs, losing academic gains with all groups, and not being able to get kids learn due to budget cuts, all leaders must seriously look at all of the options and as district leaders come together for the good of the children they serve. There can be no finger pointing when it comes to cutbacks, and as the superintendent it is our job to present the facts, get those we lead to understand this is not an easy task, but if all of us come together to make decisions, this is what will be necessary to make this a win-win situation. Stephens, Dr. Lu. (2010) Week 4 Lecture for Lamar Superintendent Certification. Lamar University, Beaumont, TX. Reflection: Those who want to look at it can see differentiating staffing differently, but it is an option we need to consider to save money. It can be perceived as taking away from teacher’s professionalism or seen as something to keep more teachers in the classroom. We are going to have to look at our profession with different glasses if we want to reach the same goals. Budget cuts are hard, but we must be creative and willing to try something different, if not the students of our communities will lose out and this will ultimately impact our future workforce. Part 4: This week I interviewed VIkas Chaphker, the business office manager also the right hand to our CFO. He had very good information to share with me regarding our district, the budget and expenses. Eighty five percent of our district budget is dedicated to personnel. He explains this is the case for most school district and that personnel is the first place we look to cut when we want to save money as each professional employee accounts for $40,000. Ever other part of our district budget is just odds and ends when compared to personnel. Some things we do not take into consideration is that their salary is not the only thing taken into consideration when we look at salaries, but also compensation packages, benefits, leave in any form, and anything else that can impact their ability to be at work. For the past 25 years Galena Park ISD has always given a pay raise each year. The pay raise each year has ranged from an even $1000 to a specific percentage based on their position. AS we are approaching the end of this school year and working towards building our budget for the upcoming the district must keep with tradition and will be giving another raise this year. The question I ask is at what expense? For us to give any type of raise when we are eliminating positions, how will we cover this raise? Therefore, I asked Vikas, as the budget manager, how does he see pay rises. Vikas states that as a district we must ask ourselves: Can you afford it? If so where will it come from? Our local budget or fund balance? He agrees that yes, everyone will be happy, who wouldn’t with a little more money. A pay raise would improve teacher/staff morale, but such a large pay raise could negatively impact us as a district. With this in mind, he cautions that we should look at the fund balance as a savings account. You should only go to your savings for emergencies and a pay raise does not constitute that. A pay raise is also something that would be permanent. Taking money from this balance to pay for a raise would have a negative impact on our district and would ensure we lose our balance rather quickly. All pay raises require board approval and according to Vikas, our district board has never voted against a raise, though they do have intense discussions about the implications of doing this, while also considering what our kids will lose out if we pay for this instead of supplies or travel, for example. Has our board ever said no to what the CFO and his staff present? No says Vikas. He states that the key to their relationship is communication. There are no surprises and they work hard to always keep them educated on the decisions that need to be made and give options when they are available. Part 5: How does GPISD select their auditor? Again they refer to the guide which states the main qualification to be: “TEC 44.008(a) requires a financial audit to be performed annually by a certified public accountant holding a permit from the Texas State Board of Public Accountancy” (TEA FAS guide, pg 4). They would request an external auditor to submit a Request for Qualifications (RSQ) though some small school district may not be able to afford this process and may not require a formal RSQ. Here the school district would make sure they have the appropriate qualifications to carry out this task. The also look at letters of recommendations and references to show their experience. How is the audit conducted? TEA outlines three standards that must be adhered to which are: <span style="mso-layout-grid-align: none; mso-pagination: none; tab-stops: 28.0pt 56.0pt 84.0pt 112.0pt 140.0pt 168.0pt 196.0pt 224.0pt 3.5in 280.0pt 308.0pt 336.0pt; text-autospace: none;"> 1.A person or persons having adequate technical training and proficiency as an auditor must perform the audit. <span style="mso-layout-grid-align: none; mso-pagination: none; tab-stops: 28.0pt 56.0pt 84.0pt 112.0pt 140.0pt 168.0pt 196.0pt 224.0pt 3.5in 280.0pt 308.0pt 336.0pt; text-autospace: none;"> 2. In all matters relating to the assignment, an independence in mental attitude is to be maintained by the auditor or auditors 3. Due professional care must be exercised in the performance of the audit and the preparation of the report (TEA FAS guide, pg 17-18) They must follow the Government Auditing Standards (GAS), the generally accepted government auditing standards (GAGAS), and GAAP or General Accepted Accounting Principals. Ultimately the audit is used to find what is going right and wrong with the district in regards to our finances at all levels and throughout the district. It should show appropriate use of federal, state and local funding. Part of their responsibility is to give us a qualified opinion, one that is reasonable explaining what we are doing right and what needs to be fixed. I asked if in the past they have found things that were not done correctly and if things are being done incorrectly. He states they have and they are to give us advice on how to fix and dates need to be outlined to get these items fixed. It is the responsibility of the district to address these irregularities, respond according to the timeline and continue to keep doing things in accordance with TEA requirements. The main point he wants me to remember is that this is all a work in progress and not done at one sitting, but throughout the year. Results are always communicated through an audit report. This audit report explains the procedures used, the items reviewed and the findings. They put their qualified opinion and they also put any recommendations for the district to consider for the future. As a principal, whenever I have changed schools or budget clerks, we have had to worked with the same group of auditors. They come over a period of a few days and analyze all of our student organizations, receipts, collection of money, and our general budget. The area we always get the most questions on are with student organizations and their fund raising activities. After they spend numerous days at our campus, they then go to the administration building and continue to investigate, ask questions to get a clearer picture of how the campus worked to collect money and if it is all on the same page. After all of this has been done, they write a report and the district budget manager goes over the finding with my current budget clerk, the exiting clerk and me. This way we are all clear on the findings and understand any irregularities to ensure they do not reoccur. In our district, campuses, department and the district as a whole are audited either internally or by independent auditors each year. The process of being audited may be nerve wracking, but it does help us keep our focus on the right way to do things and we are lucky to have these audits done internally. Our business office is always available to help us keep our finances in order, whenever we have a question they are their to serve us and keep us financially sound. Texas Education Agency (January 2010) //Auditing, A module of the TEA Financial Accountability System Resource Guide.// Austin, TX. ||
 * I interviewed our school district business manager, Vikas Chaphker regarding the audit and all aspects of conducting the district audit. From the very beginning her shared numerous documents that are given to school districts from the state that outline the procedures and is to be used as a resource guide to this entire process. The guide also states what has been adopted and approved by the Texas Education Agency in Title 19, Texas Administrative Code, Section 109.41. When selecting an auditor, they must meet the qualifications outlined by the state on the first page of the resource guide issued by TEA. On this page the standards they must follow and be aware of are outlined. The resource guide states: “These rules facilitate preparation of financial statements that conform to generally accepted accounting principles (GAAP) established by the Governmental Accounting Standards Board (GASB). The school district auditor should have an understanding of these publications”(TEA Financial Accountability System Guide, pg 1).