Financial Integrity Rating System of Texas (FIRST)...Financial Integrity Rating System of Texas (FIRST) Adopted 2020–2021 School FIRST Indicators Presenter: Rita Bunton ESC Region

Financial Integrity Rating System of Texas (FIRST)

Adopted 2020–2021 School FIRST Indicators

Presenter: Rita BuntonESC Region 1: May 24, 2019

Copyright

Copyright © Notice The materials are copyrighted © and trademarked ™ as the property of the Texas Education Agency (TEA) and may not be reproduced without the express written permission of TEA, except under the following conditions:

Texas public school districts, charter schools, and education service centers may reproduce and use copies of the materials and related materials for the districts’ and schools’ educational use without obtaining permission from TEA. Residents of the state of Texas may reproduce and use copies of the material and related material for individual personal use only without obtaining written permission of TEA.

Any portion reproduced must be reproduced in its entirety and remain unedited, unaltered, and unchanged in any way.

No monetary charge can be made for the reproduced materials or any document containing them; however, a reasonable charge to cover only the cost of reproduction and distribution may be charged.

Private entities or persons located in Texas that are not Texas public school districts, Texas education service centers, or Texas charter schools or any entity, whether public or private, educational or non-educational, located outside the state of Texas MUST obtain written approval from TEA and will be required to enter into a license agreement that may involve the payment of a licensing fee or a royalty.

For information contact: Office of Intellectual Property, Texas Education Agency, 1701 N. Congress Ave., Austin, TX 78701-1494; phone 512-463-9270 or 512-463-9713; email: [email protected].

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The applicable data for each rating year will be extracted from the data feed, Public Education Information Management System (PEIMS), and other required collection systems to produce your school district’s final School FIRST rating.

The terms “school district” and “district” are used interchangeably throughout this presentation to refer to a school district.

The term Public Education Information Management System (PEIMS) is used throughout this presentation to refer to PEIMS Edit+ and the Texas Student Data System PEIMS (TSDS PEIMS).

Notes on this Presentation

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Agenda

School Financial Integrity Rating System of Texas (FIRST)

Adopted School FIRST Indicators for the 2020-2021 School FIRST Rating Year, based on FY 2020 data

Senate Bill 622

Useful Links

Contact Information

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What’s New

2020-2021

School FIRST

Ratings

(Based on FY 2020 data)

Indicators for 2020–2021 ratings are NOTthe same as the 2016–2017 ratingsIndicators for 2020–2021 ratings are NOTthe same as the 2016–2017 ratings

Point scales and ratings are different Point scales and ratings are different

There are 20 adopted indicatorsThere are 20 adopted indicators

An introduction of a new type of indicator, designated as a “Ceiling Indicator”, is included with the adopted indicators.

An introduction of a new type of indicator, designated as a “Ceiling Indicator”, is included with the adopted indicators.

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2020–2021 Ratings Year (Based on FY 2020 Data)

Must pass critical indicators (indicators 1-5) to receive a passing rating (Superior, Above Standard, or Meets Standard rating)

F = Substandard Achievement

‣ Fail a critical indicator (indicators 1 through 5) or points less than Meets Standard Achievement rating

‣ Substandard data quality because the AFR and/or the Data Feed was not submitted on time and/or not complete for FIRST analysis

Rating 2019-2020 Ratings 2020-2021 Ratings

A = Superior Achievement 90 – 100 points 90 – 100 points

B = Above Standard Achievement 80 – 89 points 80 – 89 points

C = Meets Standard Achievement 60 – 79 points 70 – 79 points

F = Substandard Achievement 0 – 59 points 0 – 69 points

6

7

Ceiling IndicatorsA Ceiling Indicator

adds additional criteria to designated indicators. If the additional ceiling criteria is not met by the school district, a predetermined maximum number of points and

highest applicable School FIRST rating that may be earned are assigned to the school district.

Ceiling Indicator Activation of Ceiling Indicator Maximum Points Rating

Indicator 4 – Timely Payments and Warrant Hold(s) Issued

A warrant hold was issued in connection with untimely payments to governmental entities

95 A = Superior Achievement

Indicator 5 – Unrestricted Net Position Balance

Passes indicator 5 solely on 7% or more increase in students in membership over 5-year period

79 C = Meets Standard Achievement

Indicator 6 – 3-Year Change in Assigned and Unassigned Fund Balances

3-year change in assigned and unassigned fund balances < 25%, or assigned and unassigned fund balance > 75 days of operational expenditures

89 B = Above Standard Achievement

Indicator 16 – Comparison of PEIMS to AFR data

PEIMS to AFR data exceeds 3% threshold 89 B = Above Standard Achievement

Indicator 17 – Material Weaknesses in Internal Controls over Financial Reporting and Compliance

AFR discloses one or more material weaknesses in internal controls over financial reporting and compliance


Indicator 20 – Property Values and Funding Lag Discussion with Board of Trustees

Property values and funding lag discussion did not occur


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Ceiling Indicators, Continued• Examples of the points and rating that a school district may earn when the criteria of a ceiling

indicator is not met.

Indicator Number Example Maximum

Points Rating

Indicator 4 Your school district fails ceiling indicator 4 and your school district's total points before failing indicator 4 is 90 points, the maximum points and rating that your school district may receive is 90 points, A = Superior Achievement.

90 A = Superior Achievement

(The maximum points that may be earned if the ceiling portion of indicator 4 is activated is 95 points. However, since the overall points/score is 90, the lower score supersedes the ceiling maximum.)

Indicator 5 Your school district fails Part 1 of indicator 5, but passes critical indicator 5 based on Part 2, the school district's 7% or more increase in growth in students in membership over 5 years, and your school district's total points before passing indicator 5 solely on Part 2 of the indicator is 100 points, the maximum points and rating that your district may receive is 79 points, C = Meets Standard Achievement.


Indicator 6 Your school district fails ceiling indicator 6 and your school district's total points before failing ceiling indicator 6 is 86 points, the maximum points and rating that your school district may receive is 86 points, B = Above Standard Achievement, not 89 points, B = Above Standard Achievement.


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Ceiling Indicators, Continued

Indicator Number Example Maximum

Points Rating

Indicator 16 Your school district’s PEIMS to AFR data comparison exceeds the 3% threshold and your school district’s total points before failing indicator 16 is 90 points, the maximum points and rating that your school district may receive is 89 points, B = Above Standard Achievement.


Indicator 17 Your school district fails ceiling indicator 17 and your school district's total points before failing ceiling indicator 17 is 98 points, the maximum points and rating that your school district may receive is 79 points, C = Meets Standard Achievement.


Indicator 20 The property values and funding lag discussion did not occur with the board of trustees of your school district and your school district’s total points before failing indicator 20 is 100 points, the maximum points and rating that your school district may receive is 89 points, B = Above Standard Achievement.


Indicators 4 and 16

Your district fails critical indicator 4 and ceiling indicator 16 and your district's total points before failing indicators 4 and 16 is 67 points, the maximum points and rating that your district may receive is 67 points, F = Substandard Achievement, not 89 points, B = Above Standard Achievement.

67 F = Substandard Achievement

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Ceiling Indicators, Continued

• If the school district's overall points earned is less than the maximum points allowed by the applicable ceiling indicator, the school district will receive a rating based on the lesser of, which is the lowest number of points earned.

• If the school district receives an F = Substandard Achievement rating based on the school district failing a critical indicator or the school district's total number of points is equal to or less than 69 points, the F = Substandard Achievement rating will supersede any rating that the school district may earn for a ceiling indicator.

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Determination of Points – 2020-2021 School FIRST Rating Year Indicator Points Ceiling Indicator Maximum Points Highest Possible Rating

1-3 Pass/Fail (Critical)

4 Pass/Fail (Critical) Ceiling 95 A = Superior Achievement

5 Pass/Fail (Critical) Ceiling 79 C = Meets Standard Achievement

6 Pass/Fail Ceiling Indicator 89 B = Above Standard Achievement

7 10

8 10

9 10

10 10

11 10

12 10

13 10

14 10

15 5


17 Pass/Fail Ceiling Indicator 79 C = Meets Standard Achievement

18 10

19 5


Total 100

CRITICAL INDICATORS Indicator 1: Timely Filing of the AFR and Data Feed

Indicator 2: Unmodified Opinion in the AFR

Indicator 3: Monetary Default on Debt

Indicator 4: Timely Payments to Government Entities and Warrant Hold(s), it

is also a ceiling indicator

Indicator 5: Unrestricted Net Position Balance, it is also a ceiling indicator

FAILURE TO MEET THE REQUIREMENTS OF A CRITICAL INDICATOR WILL CAUSE A SCHOOL DISTRICT TO FAIL FIRST FOR THE APPLICABLE RATING YEAR

CI

CI

12

Was the complete annual financial and compliance report (AFR) and data submitted to TEA within 30 days of the November 27 or January 28 deadline depending on the school district’s fiscal year end date of June 30 or August 31, respectively?

Critical Indicator –Yes or No response

Aligns with Texas Education Code, § 44.008(d)

Data Source: AFR and Data Feed

TEC, §44.008(d)

o (d) A copy of the annual audit report, approved by the board of trustees, shall be filed by the district with the agency not later than the 150th day after the end of the fiscal year for which the audit was made. If the board of trustees declines or refuses to approve its auditor's report, it shall nevertheless file with the agency a copy of the audit report with its statement detailing reasons for failure to approve the report.

INDICATOR 1: TIMELY SUBMISSION OF THE ANNUAL FINANCIAL AND COMPLIACNE REPORT (AFR)

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Did the school district’s AFR contain an unmodified opinion on the financial statements as a whole? The American Institute of Certified Public Accountants (AICPA) defines unmodified opinion. The external independent auditor determines if there was an unmodified opinion.


Data Source: AFR, and Data Feed, Schedule L- 1

Adopted changes:

No longer a two-part indicator

Part B, material weakness in internal controls over financial reporting for local, state, or federal funds, is now Adopted indicator 17.

INDICATOR 2: AUDITOR OPINION

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Was the school district in compliance with the payment terms of all debt agreements at fiscal year end? (If the school district was in default in a prior fiscal year, an exemption applies in following years if the school district is current on its forbearance or payment plan with the lender and the payments are made on schedule for the fiscal year being rated. Also exempted are technical defaults that are not related to monetary defaults. A technical default is a failure to uphold the terms of a debt covenant, contract, or master promissory note even though payments to the lender, trust, or sinking fund are current. A debt agreement is a legal agreement between a debtor (person, company, etc. that owes money) and their creditors, which includes a plan for paying back the debt.)


Data Source: AFR, and Data Feed, Schedule L-1

INDICATOR 3: MONETARY DEFAULT ON DEBT

15

Did the school district make timely payments to the Teachers Retirement System (TRS), Texas Workforce Commission (TWC), Internal Revenue Service (IRS), and other government agencies? If the school district received a warrant hold and the warrant hold was not cleared within 30 days from the date the warrant hold was issued, the school district is considered to not have made timely payments and will fail this indicator.

If the school district was issued a warrant hold, the maximum points and highest rating that the school district may receive is 95 points, A = Superior Achievement (even if the issue surrounding the initial warrant hold was resolved and cleared within 30 days).


Ceiling Indicator –Yes

Data Source: Data Feed, Schedule L-1, and Information from governmental entities

CI

INDICATOR 4: TIMELY PAYMENTS TO GOVERNMENTAL ENTITIES AND WARRANT HOLDS

16

Was the total unrestricted net position balance (Net of the accretion of interest for capital appreciation bonds) in the governmental activities column in the Statement of Net Position greater than zero? (If the school district's change of students in membership over 5 years was 7 percent or more, then the school district passes this indicator.

If the school district passes indicator 5 based on the school district's 7 percent or more increase in students in membership, the maximum points and highest rating that the school district may receive is 79 points, C = Meets Standard Achievement.)


Ceiling Indicator -Yes

Data Source: Data Feed, Schedule A-1, and Data Feed, Schedule L-1

CI

INDICATOR 5: TOTAL UNRESTRICTED NET POSITION BALANCE

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Indicator 6: 3 Year Change in Fund Balances - NEW

Indicator 7: Number of Days of Cash on Hand

Indicator 8: Current Assets to Current Liabilities Ratio

Indicator 9: General Fund Revenues Equal or Exceed Expenditures

Indicator 10: Budgeted to Actual Revenues 3 Year Comparison - NEW

Indicator 11: Long-Term Liabilities to Total Assets Ratio

Indicator 12: Debt Per $100 of Assessed Property Value - NEW

Indicator 13: Administrative Cost Ratio

Indicator 14: Student to Staff Ratio over 3 Year Period

CI

SOLVENCY INDICATORS

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Was the average change in (assigned and unassigned) fund balances over 3 years less than a 25 percent decrease or did the current year’s assigned and unassigned fund balances exceed 75 days of operational expenditures?

(If the school district fails indicator 6, the maximum points and highest rating that the school district may receive is89 points, B = Above Standard Achievement.)


Data Source:

o Data Feed – C-1 worksheet (AFR – Balance Sheet); and

o Data Feed – C-2 worksheet (AFR – Statement of Revenues, Expenditures And Changes in Fund Balance)

The following ceiling criteria must be met

o Assigned + unassigned fund balances change over three years must be

< 25 percent

or

o Current year under review assigned and unassigned fund balances must be > 75 days of operational expenditures

CIINDICATOR 6: 3 YEAR CHANGE IN FUND BALANCES

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Calculation:Part I:

Assigned + Unassigned Fund

Balances Two Years Prior to

Current Year Under Review

Assigned + Unassigned Fund Balances Three Years Prior to Current Year Under Review


Balances One Year Prior to Current

Year Under Review


Balances Two Years Prior to


Assigned + Unassigned Fund Balances Current

Year Under Review

Assigned + Unassigned

Fund Balances One Year Prior to Current Year Under Review

3 < 25%

or

Assigned + Unassigned Fund Balances Three Years Prior to Current Year Under Review

Assigned + Unassigned Fund Balances Two Years Prior to Current Year Under Review

Assigned + Unassigned Fund Balances One Year Prior to Current Year Under Review

CI

Part II:

Total Expenditures for


Capital Outlay (Function 81)

for Current Year Under Review

365 75

> 75 Days of Operational

Expenditures of the Current Year

Under Review Assigned and Unassigned

Fund Balances

INDICATOR 6: 3 YEAR CHANGE IN FUND BALANCES - CONTINUED

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Indicator 6: 3-Year Change in Fund Balances, Continued

Indicator 6

Ceiling Indicator

Points 10 0 Ceiling Indicator Activated Ceiling Indicator Activated

If the school district fails indicator 6, the maximum points and highest rating that the school district may receive is 89 points, B = Above Standard Achievement.

< 25% decrease or >75 days of operational

expenditures

> 25% decrease or < 75 days of operational

expenditures

No

If the school district receives a score greater than zero (0) on indicator 6, the ceiling portion of the indicator is not activated.

Yes

If the school district receives zero (0) points for indicator 6, the ceiling portion of the indicator is activated.

Scale:

21

Was the number of days of cash on hand and current investments in the general fund for the school district sufficient to cover operating expenses (excluding facilities acquisition and construction)?

Data Source: data feed C-1 and C-2 worksheets

Range of 0 to 10 points on a sliding scale

Calculation:

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Indicator 7: Number of Days of Cash on Hand

Points 10 8 6 4 2 0Days ≥90 <90 ≥75 <75 ≥60 <60 ≥45 <45 ≥30 <30

Was the measure of current assets to current liabilities ratio for the school district sufficient to cover short-term debt?

Data Source: Data Feed, A-1 worksheet

Calculation: Current AssetsCurrent Liabilities


Points 10 8 6 4 2 0Ratio ≥3.00 <3.00 ≥2.50 <2.50 ≥2.00 <2.00 ≥1.50 <1.50 ≥1.00 <1.00

INDICATOR 8: CURRENT ASSETS TO CURRENT LIABILITIES

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Did the school district’s general fund revenues equal or exceed expenditures (excluding facilities acquisition and construction)?

If not, was the school district’s number of days of cash on hand greater than or equal to 60 days?

Data Source: Data Feed, C-1 and C-2 worksheets

Calculation:

Worth 0 or 10 points

o 10 points if revenues ≥ expenditures (excl. facilities acquisition and construction) or ≥60 days of cash on hand

INDICATOR 9: GENERAL FUND REVENUES EQUAL OR EXCEED EXPENDITURES

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Did the school district average less than a 10 percent variance (90%-110%) when comparing budgeted revenues to actual revenues for the last 3 fiscal years?

Data Source: PEIMS, General Fund (199) Revenue Object Codes 57XX through 58XX, Fall Snapshot (Budgeted Revenues) and Mid-year (Actual Revenues) collections submissions


Calculation: Budget versus Actual

Actual Revenues Two Years Prior to Current Year

Under Review

-

Budgeted Revenues Two Years Prior to Current Year

Under Review+

Actual Revenues One Year Prior to Current Year

Under Review

-

Budgeted Revenues One Year Prior to Current Year

Under Review+

Actual Revenues


-Budgeted Revenues

Current Year Under Review / 3

Budgeted Revenues Two Years Prior to Current Year Under Review

Budgeted Revenues One Year Prior to Current Year Under Review

Budgeted Revenues Current Year Under Review

INDICATOR 10: BUDGETED TO ACTUAL REVENUES – 3 YEAR COMPARISON

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INDICATOR 10: BUDGETED TO ACTUAL REVENUES 3 YEAR COMPARISON - CONTINUED

FY 2018 FY 2019 FY 2020

Actual Budget Actual Budget Actual Budget

199‐57XX 4,000,000 3,390,000 4,100,000 4,150,000 4,250,000 4,200,000

1%199‐58XX 5,970,000 5,990,000 5,800,000 6,000,000 5,650,000 5,750,000 =

6% ‐2% ‐1%

Was the ratio of long-term liabilities to total assets for the school district sufficient to support long-term solvency?

If the school district's change of students in membership over 5 years was 7 percent or more, then the school district passes this indicator.

Data Source: Data Feed, A-1 worksheet, and PEIMS Fall Collection Student Data Review reports

Calculation: Long-term Liabilities Total Assets

or


Students in Membership (Year under review) – Students in Membership 5 years from year under review = 7% or more

Indicator 11 Points 10 8 6 4 2 0

Ratio ≤ 0.60 > 0.60 ≤ 0.70 > 0.70 ≤ 0.80 > 0.80 ≤ 0.90 > 0.90 ≤ 1.00 > 1.00

INDICATOR 11: LONG-TERM LIABILITIES TO TOTAL ASSETS RATIO

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Was the debt per $100 of assessed property value ratio sufficient to support future debt payments?

Data Source:

o Data Feed – A-1 worksheet (AFR Statement of Net Position);

o Data Feed – J-1 worksheet (AFR – Exhibit J, Schedule of Delinquent Taxes Receivable), Current Year Net Assessed Value; and

o PEIMS Mid-Year Collection Report PDM2-100-004, Fund 599, Debt Service Fund, Total Revenues, Object Code 5020


Indicator 12 Points 10 8 6 4 2 0

Ratio ≤ 4 > 4 ≤ 7 > 7 ≤ 10 > 10 ≤ 11.5 > 11.5 ≤ 13.5 > 13.5

INDICATOR 12 : DEBT PER $100 OF ASSESSED PROPERTY VALUE

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Calculation:

Fund 599 Total

RevenuesLong-term Liabilities 100

Total Assessed Property Values

Fund 599, Object Code 5700, Local and Intermediate Resources

INDICATOR 12: DEBT PER $100 OF ASSESSED PROPERTY VALUE - CONTINUED

29

Was the school district’s administrative cost ratio equal to or less than the threshold ratio?If a school district’s administrative cost ratio is high that may reflect:

Financial inefficiency

“Top-heavy” organization

Data Source: PEIMS and the Data Feed

Calculation: Sum of amounts for function codes 21 and 41 Sum of amounts for function codes 11, 12, 13, and 31

Includes object codes 61XX-64XX in fund code 199, except 6144


INDICATOR 13 : ADMINISTRATIVE COST RATIO

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Points 10 8 6 4 2 0ADA

10,000 and Above

≤0.0855 >0.0855≤0.1105

>0.1105≤0.1355

>0.1355≤0.1605

>0.1605≤0.1855

>0.1855

ADA5,000-9,999

≤0.1000 >0.1000≤0.1250

>0.1250≤0.1500

>0.1500≤0.1750

>0.1750≤0.2000

>0.2000

ADA1,000-4,999

≤0.1151 >0.1151≤0.1401

>0.1401≤0.1651

>0.1651≤0.1901

>0.1901≤0.2151

>0.2151

ADA500-999

≤0.1311 >0.1311≤0.1561

>0.1561≤0.1811

>0.1811≤0.2061

>0.2061≤0.2311

>0.2311

ADA Less than500-999

≤0.2404 >0.2404≤0.2654

>0.2654≤0.2904

>0.2904≤0.3154

>0.3154≤0.3404

>0.3404

Sparse ≤0.3364 >0.3364≤0.3614

>0.3614≤0.3864

>0.3864≤0.4114

>0.4114≤0.4364

>0.4364

INDICATOR 13: ADMINISTRATIVE COST RATIO - CONTINUED

31

Did the school district not have a 15 percent decline in the students to staff ratio over 3 years (total enrollment to total staff)?

If the student enrollment did not decrease, the school district will automatically pass this indicator.

Data Source: PEIMS Fall Collection, Student Data Review reports, and PEIMS Fall Collection, Staff FTE by Role reports

Calculation:

or

POINTS: 0 or 10 points

INDICATOR 14: STUDENT TO STAFF RATIO

32

Indicator 15: Enrollment Variance Ratio - NEW

Indicator 16: PEIMS to AFR (Data Feed) Data Quality

Indicator 17: Material Weakness in Internal Controls Over Financial

Reporting - NEW

Indicator 18: Material Noncompliance Disclosed on AFR

Indicator 19: Transparency – Required Financial Postings - NEW

Indicator 20: Property Values and Funding Lag Discussion with the Board of

Trustees - NEW CI

CI

CI

FINANCIAL COMPETENCY INDICATORS

33

Was the school district's actual average daily attendance (ADA) within the allotted range of the district's biennial pupil projection submitted to TEA?

If the school district did not certify the school district’s biennial pupil projections, even if the school district failed to submit its biennial pupil projections to the TEA, the school district will automatically fail this indicator.

Data Source:

o Summary of Finances; and

o State Funding division data reports

Worth 0 or 5 points

Calculation:Average Daily Attendance - Projected Average Daily Attendance = Enrollment Variance Ratio

Projected Average Daily Attendance

ADA Size ≥ 10,000 ≥ 5,000 to < 10,000

≥ 1,000 to < 5,000

≥ 500 to < 1,000

< 500 Sparse

Range 7% 10% 20% 25% 30% 35%

INDICATOR 15: ENROLLMENT VARIANCE

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INDICATOR 15: ENROLLMENT VARIANCE – CONTINUED

96% of the districts submitted pupil projections on time!! Up from 70% last biennium

35

Did the comparison of Public Education Information Management System (PEIMS) data to like information in the school district’s AFR result in a total variance of less than 3 percent of all expenditures by function?

If the school district fails indicator 16, the maximum points and highest rating that the school district may receive is 89 points, B = Above Standard Achievement.


Data Source: PEIMS, and Data Feed, C-2 worksheet

Calculation: Sum of the absolute values of all differences in expenditures between the Data Feed (Statement of Revenues, Expenditures, and Changes in Fund Balance (C-2 worksheet)) and PEIMS, by function in Fund Code 199.

This indicator is no longer a point driven indicator, it is a ceiling indicator only.

CI

INDICATOR 16: PEIMS TO AFR COMPARISON

36

Did the external independent auditor report that the AFR was free of any instance(s) of material weaknesses in internal controls over financial reporting and compliance for local, state, or federal funds? (The AICPA defines material weakness.)

If the school district fails indicator 17, the maximum points and highest rating that the school district may receive is 79 points, C = Meets Standard Achievement.


Data Source: Data Feed, Schedule L-1 and AFR

This indicator is a ceiling indicator only.

CIINDICATOR 17: MATERIAL WEAKNESSES IN INTERNAL

CONTROLS OVER FINANCIAL REPORTING AND COMPLIANCE

37

Did the external independent auditor indicate the AFR was free of any instance(s) of material noncompliance for grants, contracts, and laws related to local, state, or federal funds? (The AICPA defines material noncompliance.)

Covers local, state, and federal funds

Data Source: Data Feed, Schedule L-1


INDICATOR 18: MATERIAL NONCOMPLIANCE

38

Did the school district post the required financial information on its website in accordance with Government Code, Local Government Code, Texas Education Code, Texas Administrative Code and other statutes, laws and rules?

For example: adopted budget, budget for two prior years, the superintendent’s contract, annual financial reports, and other required postings?

Data Source: Schedule L-1 in the data feed

Worth 0 or 5 points

Some, but not all, of the posting requirements are disclosed on the next slide.

INDICATOR 19: REQUIRED FINANCIAL PUBLICATIONS

39

TEC, §44.0041. PUBLICATION OF SUMMARY OF PROPOSED BUDGET. (a) Concurrently with the publication of notice of the budget under TEC, §44.004, a school district shall post a summary of the proposed budget: (1) on the school district's Internet website; or (2) if the district has no Internet website, in the district's central administrative office.

(b) The budget summary must include:

o (1) information relating to per student and aggregate spending on: (A) instruction; (B) instructional support; (C) central administration; (D) district operations; (E) debt service; and (F) any other category designated by the commissioner; and

o (2) a comparison to the previous year's actual spending.

TEC, §44.0051. POSTING OF ADOPTED BUDGET. (a) On final approval of the budget by the board of trustees, the school district shall post on the district's Internet website a copy of the budget adopted by the board of trustees. The district's Internet website must prominently display the electronic link to the adopted budget.

(b) The district shall maintain the adopted budget on the district's Internet website until the third anniversary of the date the budget was adopted.

Reminder Local Government Code §140.0045 (Senate Bill 622) budgeting for items published in the newspaper

INDICATOR 19: REQUIRED FINANCIAL PUBLICATIONS - CONTINUED

40

The table below contains some, but not all, of the required financial postings that the school district must publish on the school district’s website and or in the local newspaper.

INDICATOR 19: REQUIRED FINANCIAL PUBLICATIONS - CONTINUED

Texas Government CodeTexas Local Government

Code Texas Tax Code Texas Election CodeTexas Property

CodeTexas Education

Code (TEC)Texas Administrative

Code (TAC)Tex. Gov't Code

§551.056(a)(b)(3)(c)(3)Tex. Local Gov't Code

§140.005Tex. Tax Code §26.05(b)(2)

Tex. Election Code §85.007(d)(1)

Tex. Property Code §21.0112(b)(2)

TEC §11.1512(d) 19 TAC §97.1055(f)(1)(2)(3)(A)

Tex. Gov't Code §551.128(b‐1)(1)(2) Tex. Local Gov't Code

§140.006(c)

Tex. Tax Code §26.065(b)

Tex. Election Code §254.04011(a)(1)(2)(b)(c)(

e)

TEC §12A.0071(a)(b) 19 TAC §97.1061(d)(3)(A)(ii)

Tex. Gov't Code §1201.0245(b)(4)(A‐G)

Tex. Local Gov't Code §140.008

Tex. Tax Code §26.16

TEC §29.006(f)(1)(2)(3)(4)

19 TAC §109.1001(q)(4)(A)(B)

Tex. Gov't Code §2265.001(b) Tex. Local Gov't Code §176.009(a)

TEC §29.011(a‐2)

Tex. Gov't Code §2267.066(a)(1)(2)(A)

TEC §29.916(c)

Tex. Gov't Code Chapter 552 TEC §39.083TEC §39.083(d)(1)(2)

TEC §39.362TEC §44.0041(a)(1)TEC §44.0051(a)(b)

41

Did the school board members discuss the district's property values and the funding lag at a board meeting that takes place within 120 days of the district adopting its budget?

If the school district fails indicator 20 the maximum points and highest rating that the school district may receive is 89 points, B = Above Standard Achievement.


Data Source: Data Feed, Schedule L-1The agency uses prior year property values in calculating each school district’s local share of Foundation School Program (FSP) funding. Using school districts prior year property values does not fully reflect the property values decline that may be experienced by some school districts. When the agency calculates FSP payments during the fiscal year the agency is required to assume the same estimated property value increase in property values for all school districts. School districts with declining property values may experience significant underpayments creating what is called a funding lag. This funding lag may negatively impact cash flow and overall funding levels for some school districts.

CIINDICATOR 20: BOARD DISCUSSION OF PROPERTY VALUES

42

INDICATOR 20: BOARD DISCUSSION OF PROPERTY VALUES

TEA examples:Historical CY BudgetFY18 FY19 FY20

Property values used for local collections (LCPV) 47,547,519,229 49,715,686,106 52,600,000,000

Rate 1.04 1.04 1.04

Local Collections 447,552,428 496,195,540 512,323,908 Property Values used for state calculations (SCPV) 43,401,546,250 47,413,420,284 51,200,000,000

WADA 137,043 138,573 143,753 Wealth per WADA

316,700 342,155 356,166

State Aid FSP 374,535,443 329,730,598 318,509,108 RecaptureSettle up Addition (Deducted)

(7,443,602)Notes:

FY2018 FY2019

Total M&O Collections $ 1,175,794,620 $ 1,250,389,748

Local Share of Tier 1 $ (986,193,307) $ (1,103,028,081)

Local Share of Tier 2, Level 1 $ (65,384,616) $ (69,490,769)

Local Share of Tier 2, Level 2 $ (20,710,059) $ (22,060,562)

M&O Lag Revenue (if applicable) $ 103,506,638 $ 55,810,336

Chapter 41 Recapture $ (1,000,000) $ (2,000,000)

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Annual Financial and Compliance Report Submission

Electronic Submission for Districts

School FIRST Ratings on the TEA Website

Texas Administrative Code for FIRST Rules (19 TAC §109.1001)

Financial Accountability System Resource Guide (FASRG)

To the Administrator Addressed Letters

Useful Links

44

Useful Links Annual financial and Compliance Report

o Annual Financial and Compliance Report Submission

Annual Financial and Compliance Report

o Electronic Submissions for School Districts

Electronic Submissions

School FIRST

o Ratings on TEA’s Website

Financial Integrity Rating System of Texas

o Texas Administrative Code (TAC) for FIRST Rules

19 TAC §109.100145

Useful Links

Financial Accountability System Resource Guide (FASRG)

FASRG

TEA Correspondence

To the Administrator Addressed Correspondence

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Contact Information

47

David Marx Director, Financial Compliance Division(512) 463-2945 or [email protected]

Financial Accountability Section [email protected]

Yolanda Walker Manager, Financial Accountability Section

(512) 463-0947 or [email protected]

Robin Aldridge (512) 463-3940 or [email protected]

Rita Bunton (512) 936-3712 or [email protected]

Padmaja Sathyanarayan (512) 475-2012 or [email protected]

Contact Information

48

[email protected]

49

Documents

Financial Integrity Rating System of Texas (FIRST)...Financial Integrity Rating System of Texas (FIRST) Adopted 2020–2021 School FIRST Indicators Presenter: Rita Bunton ESC Region