In fiscal year 2015, Arizona districts spent 53.6 percent of available operating dollars on instruction—the lowest percentage in the 15 years our Office has been monitoring district spending. This percentage has declined both during years of increased and decreased overall spending. Since its peak in fiscal year 2004, the State’s classroom dollar percentage has declined 5 percentage points, while the percentages spent on all other operational areas has increased. Although the impact of a declining classroom dollar percentage varies by district, it can be seen state-wide in lower teacher pay and larger class sizes.
Although factors outside a district’s control—such as district size, type, and location—can affect its efficiency, some districts operate efficiently and have lower costs despite these factors, while others do not. As a result, there are wide ranges of costs within peer groups of similar districts. Our performance audits of school districts have identified practices efficient districts use, as well as practices that make other districts less efficient. Additionally, analysis of six measures found 60 of 207 districts had a moderate to high financial stress level. District decision makers can use the details of this assessment in conjunction with other information, such as operating efficiency, to determine possible actions to reduce financial stress.
In fiscal year 2015, Arizona districts spent approximately $3,100 less per pupil than the national average and allocated their resources differently, spending lower percentages of available operating dollars on instruction and administration, and a greater percentage on all other operational areas. Arizona districts’ nonoperational spending was similar to the national average, and they received a greater percentage of their revenues from federal sources and a smaller percentage from state and local sources when compared to national averages.