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SUMMARY
The Office of the Auditor General has conducted a performance audit of the Madison Elementary School District pursuant to A.R.S. §41-1279.03(A)(9). This performance audit examines five aspects of the District’s operations: administration, student transportation, plant operation and maintenance, expenditures of sales taxes received under Proposition 301, and the accuracy of district records used to calculate the percentage of dollars spent in the classroom.
Administration (see pages 5 through 8)
Madison ESD’s fiscal year 2008 per-pupil administrative costs of $819 were 20 percent higher than comparable districts’ average per-pupil costs of $685. The higher costs were primarily due to employing more administrative staff. According to district officials, the higher administrative staffing levels helped support the District’s high student achievement. However, the additional administrative positions were primarily in the District’s central office, and their link to higher student achievement is not clear. Further, the District did not establish proper controls to safeguard its accounting system, and inadequate controls over the rental of district facilities resulted in a loss of at least $42,000 in revenues.
Student transportation (see pages 9 through 13)
Although Madison ESD maintained efficient bus routes, it spent 32 percent more per rider and 10 percent more per mile on its student transportation program than the comparable districts. The higher costs were primarily due to paying drivers and bus aides for 2¼ to 2½ hours per day of nonproductive time and also because it employed more bus aides. Additionally, the District did not accurately report route mileage for state funding purposes and did not ensure driver certification requirements were met. Also, under the current state funding formula for student transportation, Madison ESD received $397,000 more in transportation funding in fiscal year 2008 than its mileage would have generated, primarily because funding is increased from year to year based on increases in mileage, but it is not decreased for subsequent decreases in mileage.
Plant operation and maintenance (see pages 15 through 18)
Madison ESD’s plant costs per square foot were similar to comparable districts’, but its plant costs per pupil were significantly higher because its schools operated at only 73 percent of capacity. This resulted in the District’s maintaining more square footage per pupil than all of the comparable districts. Madison ESD’s plant costs were $847 per student while comparable districts averaged $633. Further, the District’s future plant costs will increase as it began leasing building space for an additional school in fiscal year 2009.
Proposition 301 monies (see pages 19 through 21)
In November 2000, voters passed Proposition 301, which increased the state-wide sales tax to provide additional resources for education programs. The District spent its Proposition 301 monies for purposes authorized by statute. However, the District paid 48 employees $380 each for a performance goal that was not met.
Classroom dollars (see pages 23 through 25)
Although Madison ESD’s 54.6 classroom dollar percentage was lower than the comparable districts’, state, and national averages, the District’s $4,075 per-pupil spending in the classroom was $142 more than the average amount spent by comparable districts. The District’s additional monies were primarily from higher funding for its special education students, funding for excess utilities, a budget override passed by district voters, tax credits, and gifts and donations. The District could have spent more in the classroom if not for high spending in noninstructional areas such as administration, student transportation, and plant operations. The District’s higher spending levels and inefficiencies identified in this report indicate that possible savings could be achieved in these areas.
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