001Okay, good afternoon everybody. I call this meeting to order on this Tuesday, July the 22nd, 2025 at 5:00 PM in the Santa Cruz Valley Unified School uh district number 35 governing board room district office 570 Camino Galito Galindo, Rio Rico, Arizona. Can we please stand for the pledge? >> Mr. Beach, please will you help? >> Yes. I pledge allegiance >> to the flag of the United States of America and to the republic for which it stands. One nation under God, indivisible, with liberty and justice for all. >> Thank you. >> Okay. Roll call. Uh, Miss Alma de Laiva. >> Uh, Mr. Ben Guerrero. >> Mr. Rene Ramirez absent. Mr. Brad Beach >> and I'm Lur Vasquez. We have a quorum. Thank you. Moving on. Adoption of the agenda. Uh Mr. Verdugo, >> I'd just like
002to request that we remove uh item two, executive session. There is no need for that tonight. >> All righty. Okay. Uh recommended action motion to approve the agenda as presented, removing section number two. Second. >> Okay. All those in favor say I. I. >> All those opposed? Nay. Okay, eyes have it. Motion passes. Uh, next subject is called to the public. >> No call to the public. Righty. Moving on. Presentation. Uh, subject Santa Cruz Valley Unified School District number 35, aquatic center lifeguard recognition. Mr. Verdu, >> thank you. Uh, this year was the first year that we actually had our pool open. And so I would like to and we're coming to the end of the the summer season wanted to recognize all of our lifeguards for all of their work uh that they put
003in receiving positive uh information from parents. Uh really happy about the swim lessons and the the pool itself. So we had turn over to Audrey who will just kind of give a I think a brief introduction about the lifeguards and then >> Okay. you. Um, good afternoon, Madam President, governing board members, Mr. Berdogo, Dr. Lenderville, and Mrs. Brown, and guests, most importantly, our parents here, right? Um, I'm here today to recognize a truly outstanding group of individuals, a group of employees who have gone above and beyond in their roles over the past two months. Um, as many as you know, um, as well mentioned, this summer marked a major milestone for SCB35, um, the full-time opening of our aquatic center to the public for the very first time. Um, with that came great responsibility and
004our incredible team of 25 lifeguards rose to the occasion. Throughout the summer, these dedicated individuals have done far more than just watch over the help ensure that our patrons had a safe and enjoyable experience, taught essential swimming skills to children, all while making them feel confident and comfortable in the water, and provided vigilant supervision during private pool rentals as well. Thanks to the unwavering support of our governing board members and district administration, we were able to reach remarkable milestones. This summer alone, over 515 children registered for swimming lessons, and more than 1,700 individuals visited the aquatic center in just the last two months. To our lifeguards, your professionalism, your patience, and commitment to safety have made this program a success. Your work has created lasting memories for our community and laid the foundation of many
005more summers to come. Thank you all for your exceptional service. Um, I truly appreciate it and it was an honor to work with all of you and I hope many of you come back for next summer as well. Thank you. Um, so all of our lifeguards will be getting some goodies and some certificates later on, but we are going to recognize the ones that are present here today in person. Um, so I'm actually going to have each of them just stand up, say their name, wave, um, and then you >> Hi guys. >> So just say hi to your parents, say hi to the governing board members. you guys are the ones that have been, you know, protecting the community and so we all just really want to say thank you for everything that you
006guys have done. Okay. Um and then I'll just have you guys come over and you can grab some goodies. Okay. We'll start with Anna, please. >> Hi everyone, I'm Anna and I was really happy to be able to have this opportunity and work with Audra most importantly who's been a wonderful boss. Thank you. Hi guys, I'm Francisco PCO and it was really good working with all these guys. >> Hi everyone, I'm Vanessa and I especially like teaching all the little kids to see how much they grew over the lights. >> Say something. Can they give us your last name? Mr. Bacho told us his last name, but the young ladies did not. >> Antones Pino. >> Canunes. >> Antones. Okay. And your >> Vanessa Nicholas. >> Nicholas. Okay. I just want to know your last
007names. Okay. Because family name is very important. Okay. To me anyway. But thank you. Continue. >> Hi guys. My name is Frank Nades. Um I really like working here. It was the first my first job and it was a very good experience. Hi, I'm Campio and I also really enjoyed working with the little kids and teaching them how to swim. Hopefully they remember and don't drown. >> Hi everyone, I'm Hunt and I just like to say I loved gardening this summer and can't wait for next year. >> Hi, I'm Jonathan Canua. I like being a lifeguard is my second year and I'll do it again. >> Hi, I'm and I really like this being my first job. I met a lot of people since I live in Ngalis and but yeah, >> hi has been
008a pleasure watching you guys and seeing your growth following the summer. It was great. Hi, I'm Maria Papia. I really enjoyed this job as my first job and thank you AA and thank you to this team. >> Hi, I'm Roberto Kota and I just really enjoy making new friends, the co-workers, teaching students, lifeguarding, everything has just been really special for me and I can't ask for more. Hi, I'm Santaria. I'm very glad I had this job. And in true lifeguard fashion, I can't keep water off. >> So, thank you to all of you guys. Thank you families for attending. Many of you guys are employees of the district, so you guys got to see, you know, the beginning of the pool up until what it's become today. So, thank you so much for your support.
009Um, thank you for letting me work these guys until they were super tired and they they came home and they couldn't do anymore. So, thank you guys so much. Governing board members, do you guys have any questions that you want to >> Anybody have any anything to say to them? >> Uh, yes. Thank you and congratulations on your recognition uh today. As a parent and as a person who never learned how to swim, I ju I know just how important and how confident it made me feel whenever I took my my ch my own children uh swimming to see a lifeguard there and to know that you if anything, you know, god forbid happened you they would be out there, you know, helping and doing everything possible to save my child. It just made me
010feel very comfortable. So, thank you and yes, we wish to see you all back next summer. Good, >> Mr. Guerrero. Yeah, know it's it's it's great to see this program. Uh, as a paramedic of 23 years, I understand the responsibility that comes with something like this. So, it's greatly appreciated. You guys had two of the most important things, you know, uh, somebody's life safety and teaching somebody life safety skills. So, I commend you guys for that. Great job. And glad you guys all enjoyed it. You guys all look a little tan, too. So, >> thank you, Mr. Beach. >> The good news, so far, no one has drowned. >> Thank God. Good to all you and your training and I know Audra is very hard to work work for. She she does push you hard
011but uh thank you Audra for all you do for the lifeguards. I remember uh back when we passed the bond uh under the direction of Mr. Verdugo in our community when we spent I don't know millions of dollars on this pool. Uh one of it was to bring the community together and uh what was the number? 1,700 of our youth used it this year. >> Yes. So, it's definitely doing what the our taxpayers wanted. So, >> uh uh thank you for giving our community something to do over the summer. Uh thank you for allowing our kids to be safe in your hands. Uh and that's a testament of of what your job is. Like Mr. Guerrero said, the importance of it. Uh I think someone I think it was Vanessa, you mentioned the swim lessons.
012My granddaughter uh uh Ava I got five of them. I had A was so excited. Uh she said, "I want to be a lifeguard when I grow up." So, you know, you guys are her was her role models and uh the importance that those swim lessons did for our community. So, just uh appreciative of all your hard work and I don't think the pool is closing anytime soon or >> um >> we open on the weekends. >> We're going to be open weekends hopefully. We have some We'll talk it over and see when we'll be open to the public. It'll be announced publicly so we'll know. >> So, thank all of you guys for doing what you do. Absolutely. Hey, thank you, Mr. Beach. I mean, for me, everything that everybody said, okay, because they
013always beat me to it. So, but anyway, but congratulations to each and every one of you. Thank you so much. And I really like the fact that there are people from our neighboring community that came, you know, and that that took advantage of our facilities, you know. So, more power to you. You know, the more people that that can come to our community, the much better it it is, you know. And um uh I heard nothing but good things about the you know with everybody that oh my god the pool is this the pool is that you know all the lifeguards are helping us. So you guys are these little kids you know like you're their heroes you're their mentors they're you know so you guys really made you have no idea what impact you
014made in so many of the little kids. Okay. So congratulations to all of you for a great great summer and we hope to see you guys next year exactly again. Okay. Thank you. >> Yeah. We'll do a group picture with Mr. Red. >> Everyone wants to stand up. >> Say how you are. We'll face this way so the light is hitting you guys. Mr. Right. >> to blind you. >> Shorter people. I mean, you guys need to to get together. >> There's shorter people than girls. >> You get in it. >> I'll get one with just >> parents. Parents, parents, take advantage. >> Parents, I'll get one group picture. I'll get a couple of them and then I'll move out of the way and you guys can >> All right. Ready? One, two. >> I'm
015sorry. parents go first. >> Go ahead. >> Good job. Good job. >> Guys, come on over here. Grab a red thing. Thanks. >> The two things and then whichever >> candy and where was the other twin the library? No. Thank you very much. Vanessa >> was the winner. You guys get your >> I know. I know. >> Before you guys leave, before you guys leave, thank you parents. Thank you so much. Thank you very much. much. Gracias. [Music] Thank you so much. >> Thank you. Thank you. >> Thank you very much. >> All righty. Are we ready? Moving on. Uh, uh, subject B, uh, superintendence report. Mr. Verdugo, >> thank you. Just wanted to, uh, mention a few items. Um, as we get back to, um, our school year, uh, all new teachers reported yesterday.
016And so, which is very exciting, as well as, uh, our long-term substitutes, which is our first time that we've done that. Um, so it was very exciting to to have those individuals come in early so they can start their training and get some of the things done, started getting in the classrooms um early because the school year coming fast. >> Yes. >> So wanted to thank them and all Miss F and her team for all that they're doing to prepare those uh teachers to to get ready for the school year. Also want to thank um Angie and and her team, Audra um with the back to school blitz and all of the the principles and teams that participated in in the back to school blitz. We had close to 600 families um that received uh
017supplies. It was great being there um and haven't been able to be there in in a while. And so it was great to be there and see all of the students um dragging their backpacks across the floor because they were so full of uh supplies. Um, I saw one little girl. She kept rocking back and falling down and then back up, trying to get back up. >> Yeah, it was it was it was great to see. They were so excited uh to receive all the supplies and I want to thank all the community members for all their support because it it is truly a community effort uh for those students to receive all those supplies. So, that's it. Thank you. >> All righty. Thank you very much. Uh, subject C, governing board report. Miss uh
018Deariva. Yes, I um I attended the ASPO conference this past week. Um I'm going to say that I really enjoyed it. It was very informative. It was very instructive. I learned and I especially enjoyed the speaker that we had on one of the days. I believe it was Thursday um during during lunch. He spoke about pers perseverance and not giving up and not listening to the negative thoughts in your brain but having you know uh and wait and wait for those positive uh uh messages that you always listen you know unfortunately you know we tend to listen to the negative side or we listen to the negative comments of other people um but um it was a good he was a good speaker I learned from him and I look forward to attending this aspel
019conference again next here. >> Yes. Yep. Thank you very much, Mr. Guerrero. >> Nothing to report. Thank you. >> Squishy, Mr. Beach. >> Yeah, I'll talk a little bit about the the conference we just went to. I always pick up one or two things when I attend these conferences. So, this is what I picked up. Uh mental health still affecting our uh students. Anxiety, depression, suicide still uh on the rise. Uh some of the reasons they listed, bullying was one. uh screen time four four to six hours a day screen time uh increases it food insecurities uh health care etc and this is why I think uh schools are so important because uh in our rural communities we don't have a lot of resources out there so our schools are sort of as Mr. Verdu
020has mentioned many of times this is the hub of of the community where we do offer health care. We do offer after school programs, sporting programs, our swimming pools. Uh and all those help decrease uh depression and anxiety. Uh they said those programs if they get into a program after school, it dramatically decreases. So I'm a big proponent not only of the regular sports, football, wrestling, track field, volleyball, etc. But I'm a big supporter of clubs. Reading club, a walking club, uh any type of club out there. So, get the word out to your uh teachers. I'm sure we can find funding for them. Uh but definitely uh push those clubs. Okay. Uh what else? Uh 1 million people have moved into Arizona, but 18year-old and unders have declined, and they're not looking for that
021number to increase till 2030. And I know we're dealing with it. Uh m Miss Brown has uh mentioned that our our combined of 200 something students >> we're projecting 155 >> 155 at $4,000 roughly a student that the state gives us in funding. So this is having an impact on schools across uh our our uh our state. Uh and what else is causing this? Housing shortages, charter and private schools. We're all compete competing for these students. I always like coming out of Kino Park and I see our Santa Cruz Valley uh recruitment uh billboard down there. Our bus going all the way into the Ngalas territory up and bringing schools uh students north. But they did talk about branding and it's so important. Audrey, you do an amazing job with our uh social media out
022there >> and we have to have our brand, you know, our swimming pool, our swim team. That's something other districts don't have. Uh so we have to create a brand a market almost like we're marketing our school >> in uh recruiting these uh students. So I thought that was really interesting. Teaching certificates man back in the day there's only one. >> Now there's I think I saw 20 on the piece of paper they gave me. Uh if you want to be a teacher there there's a way they're going to get you in there. Uh, one uh of the certificates that stood out to me was we can recruit out of the U of ASU during their student teaching year. So that'd be that last semester. And I thought that was really interesting. You just call
023it university professor. Uh you get a student to come down, they student teach, they get paid as a teacher or similar uh and then they transition right into uh becoming a teacher. So, some of the challenges there, they don't have a well, they probably have a mentor, uh, but not a student teacher in the classroom with them, so they're sort of flying. So, so I thought that was interesting. I'm not sure if we're tapping into that resource. Uh, but I do know a student, Ramito Lopez, from uh, Rio Rico. He's on his student teaching and he graduates in December. So, maybe we can recruit him down. >> Oh, what else? Last thing I thought was pretty cool, I know we have a exit interviews for uh teachers, but they uh also mentioned having exit interviews
024uh for families to address uh concerns and practices that why why are they leaving our district? You know, is it because the parents have to move to get a job or was it our school? You know, they're just looking for something different. So, that's something uh our administrators out there if we don't do uh family exit interviews, maybe give it a shot, okay? find out uh some of the reasons why and maybe we can address those. But uh overall great conference and uh looking forward to one in September I think. >> Yep. Well, that one's a law one. >> Yeah. >> Law conferences. >> That's all I got. Thank you. >> That's all you got? Yeah. Everything he said. Yeah, I know. And yeah, also the the I also attended the the Asbo conference and
025again the guest speaker was amazing. I mean and all of the the the the points that you touched on, okay, you know, were very very very interesting. You know, like how our kids are still suffering because of the pandemic, because they have a mindset that's now different. You know, the parents think that, oh well, my son cannot doesn't have to go to school because he's got a computer. They don't realize, you know, that one- on-one that we're doing, you know, with the teacher and stuff, how important it is for them. Okay. And another thing is that you know the kids sometimes the parents you know they they the kids have their their you know their laptop and all that stuff but the time that they spend on their form on their phones is I mean
026it it was an eye openener you know you really don't think that they spend that much time but if these people are doing all these studies and they're seeing what's going on our kids are really really addicted to the phone and stuff you know and and I know some adults are too okay but anyway but yeah you know And another thing that would piggyback on the school, you know, like we have so many programs that we offer that a lot of other schools don't, you know, like the dual enrollment, the, you know, the CTE, you know, all of this stuff. We have, you know, the afterchool program if our funds get, you know, released, you know, from the state. And hopefully that'll be something that like you say you know and the kids need to
027be uh you know um you know busy interested you know engaged not just on their phone you know on their you know on just life on just being a kid you know just being and I think that's one of the things like Mr. Mr. Beach was saying, you know, we really need to, you know, to really, you know, work on this and make sure that we've got a lot of things for our kids that are interesting to them that will get them, you know, away from their from their phone and stuff, but, you know, again, really great um um uh um conference. I mean, I wish that we could have, you know, more people could go, you know, especially, you know, teachers and stuff like that. And um but you know it is what it
028is you know and so anyways whatever we can do you know the absences and all that stuff okay we want to work on all of the things that that we need work on for the kids so you know we're all available okay abuse us okay please uh and um but anyway other than that you know almost uh time to start our school year you know again so time flies really it does so thank you very much I appreciate that um moving Moving on. Number four, information discussion action subject uh a 2025 2026 uh tax rates. Mr. Verdugo, >> thank you. Um it's at that time of year that we um recommend what our tax rate should should be for the upcoming tax season. Um I'm going to go ahead and turn over to Miss Brown.
029>> Thank you. Good evening, Madam President, members of the board. Um as Mr. Verdugo mentioned uh we our role as a school district is just to recommend the tax rate. The responsibility of setting the tax rate is with our board of supervisors. >> Um so just a little uh general information about the tax rates that you find in school districts. School districts have two tax rates or can have two tax rates, right? Um you have the primary tax rate that provides uh revenue for our levy funds that is our M and capital or major operating funds and then um it also contributes towards our budget limit. In previous board meeting you approved the budget limit. Then we determine well how much of that budget limit is going to local tax rate and how much is
030going to that's what the role of the primary tax rate is and then on the other hand you find a secondary rate and the secondary rate provides revenue to pay for district initiatives such as overrides and bonds. So when school districts identified the need and get the support of their community to go above and beyond their budgets, um it could be in the form of an M override like ours at 9% or it could be in the form of a bond like ours and $23 million and change. Um then you set a secondary tax rate to pay those initiatives back. One factor that we use annually to calculate our tax rate is the assessed valuation because the primary tax rate will will react to the assessed valuation. Um from last year to this year we
031saw 5% increase in the assessed valuation for um the properties within school district. just a little bit of um where the formula dollars come from. Like I said, the first step is to identify that budget limit, which we already approved, right? Um and then we determine how much are we going to collect from our local constituents versus how much we're going to receive from state aid. Um, in our district, to give you an idea, um, 74% comes from the state and 26% comes from our local constituents from that primary tax rate. >> Would that be the the the property taxes and stuff? >> Primary, right? >> Primary. Okay. Okay. Thank you. >> Is it the split for the primary? >> Okay. >> Right. Because the secondary is fully funded out of local, right? You do
032not see a a portion from the state that is 100% funded by your local taxpayers. >> Now, so what programs do we have linked and associated with the secondary tax rate? And here for our district, we won the 9% M override, which allows us to exceed our budget limit in the M by $2.4 million. So now, what's the cost of that? The cost of our to our taxpayers for this coming year is um 0.8811. Okay. And the recommendation here is to offset the the cost of that override by a little bit over $420,000 with cash on hand. Right. When we put together the voter information pamphlet, the projected um the full cost the full projected cost of the 9% override is 1.19. So we are way below that projection. >> Um on the other hand,
033we have our bond, right? It's time to pay back for all those constructions, the pool, all of those enhancements that we now have for our community. And our bond payment for next year is $1.4 million. And the cost associated to collect the revenue that we need in order to make that payment would be to impose a a tax rate of 0.5918. Okay. And again when we did the border information pamphlet the project the projection was that the tax rate was going to be 1.68. So we're way below. Um on the other hand as u members of puma uh seated we have to impose a levy uh for our participation in puma uh seated and that is actually defined by statute ars 15-395 tells us that we have to set it at 0.05 so no more
034no less that's what it is on that one. So if we compare the last year's tax rate to this year's tax rate, you can see that the primary rate last year was set at 3.5574. For next year, we're looking at a primary rate of 3.483. >> Okay, which is lower. >> So what why is that? Remember that if the assessed valuation increases, then the primary rate will decrease. So that's the reason why you see that fluctuation in the primary. >> And just just to clarify because this is a and we we will educate the public on this. >> Um so they're going to say, "Well, my the rate went down, but their assessed value went up." So most likely their taxes is going to increase. >> Yes. >> Because their valuation went up. >> Even
035though the rate went down, their value is higher. So there may see an increase in their tax rate. And so they're they're always like, "Well, how is how is it possible if the rate went down?" But it's because their valuation went up, so their value was worth more and so it will increase. So we have to educate the public on that every time we go out and which we we will just so that that's a because that's the question we always get. Well, how is it possible if the rate went down and I'm paying more? It's because the valuation went up. And as M. Brown said, it's it has that inverse effect. >> Yeah. >> And the county does that as far as evaluation or >> Yes. Assess value is >> you mean to define
036the assessment? Yes. >> Yes. That is the role of the county assessors. >> Mr. Fanning. >> Well, no. >> He will he will he will be the one voting on on whether they accept our recommendation >> or tax rate >> our tax rate >> of the the incessation for the county. that [Music] >> and we do have individuals in our community that um request to to have their valuation reduced. >> Um so and that happens. So that's something that may affect that as well. But for us, >> we we set it based on what the they report the value to us and then that's what we make that recommendation. >> Yeah. Yeah. So in other words, if a person wants to sell their house, they can sell it for more now. Is that the way?
037Because their house costs more per se. >> The market the >> And I know the market right now. Uh-huh. >> Homes for for selling your home. >> It's totally different. >> Totally different. >> Value for tax reason >> for tax reasons. It's completely okay. It's always going to be by far less >> for sending the for the tax rate >> than when it comes to actually selling >> selling a house. Okay. All right. Okay. Thank you. >> Thank you. >> You want it that way. >> You don't want to be taxed probably at the market rate. >> No. Of the house. >> No, probably not. >> Most of the time you don't want that. >> Okay. Thank you. >> Um, now let's take a look at the secondary rate. And the secondary rate, this is
038where we see a slight increase. I'm going to walk you through why we see that increase. So last year the secondary rate was 1.297 and that was the sum of the override paying back the bond and or 5 cents for the date. Okay. Now this year the secondary rate is at 1.5229 when the override is at 0.8811 8811 and then the debt service went down because our bond payment went down last year and then the date remains constant right 005. So why is it that the override rate increase? Remember that I shared with you right there um look at the first bullet. our district has been buying down the cost or the rate of our override >> the cash that we have on hand. >> Um obviously that cash is is not going to be
039there forever, right? So we are going to gradually going to start to decrease how much we can offset or buy down that rate um because we eventually going to run out of that then. >> Okay. So that's why you see the amount the offset amount of 423,000 is less than what I used last year. So that's that's the reason why the override rate increased slightly >> and that money again is is being reduced. Um, and so we're trying to make it as last as long as possible to offset for as long as possible so that our tax rates can stay stable because what we don't want is to because we could continue to pay for it all >> and then it'll all of a sudden that cash will be gone and then then now you're
040paying the full 9%. >> And so we don't want to do that to our constituents. We want to try to keep it as as balanced as possible. >> Cool. sum of both rates, right? The combined tax rate for the district last year was 4.8544. For this year, it's 4.9312. So, it's a >> variance of 0.0768. It's not a significant increase, but it is an increase. >> It is a little >> not in the primary rate. >> Important to recognize that. Not in paying back the bond, not in the participation in the Jake debt. It's how we're managing um the cash flow >> there. >> And this is the part that we're going to be educating our >> that is the part that they need to understand because I understand it now the way you you
041broke it up, you know, now I I get it. Okay. Yeah. You know, and this is what a lot of people don't get, you know, they're like, "But like you said, but what?" >> Yeah. We we will share this information as all the the different positive things happening within the district, but we try to educate um about our fiscal responsibility and how we utilize our funds. I think it's very important for the community to know and one of the main ways that they question his tax rates because that's what they put. >> Yeah. >> That that's their money into the pot. And so we want to make sure we're educating them not only this is what why the rates are, but then we have a second part of this presentation is is how are we
042using those funds and uh like for the pool or for what educational reasons what we're doing with personalized learning all the different things that we're doing. So we educate them on that side of it as well. >> That makes it really confusing for the taxpayer is that we're just one of the entities >> in the tax bill. >> Yeah. We have our friendly friends from the fire districts that are also part of that. >> They're also part of that. >> Then we have the county and then we have So it's it's it's hard. It's important for for constituents to to really understand >> trying to impact the arrow got on top of I'm sorry um just trying to compare a homeowner >> right just only looking at the tax rate associated with the school district
043>> um in last fiscal year if their home value was and that is the average home value >> as it's listed in the assessor's >> okay roles >> of 180,556 and then you apply the formula of the >> and you take it all the way down their annual tax bill for the school district was 87651 >> we're going to take that same homeowner and we're going to increase the the the value of the property what did I say? By 5%. So that home value went up. And then I'm going to run it through the formula applying the tax rates that we're recommending for this new year. And now their tax bill for the school district went from 88 876 to 934.88. >> A lot of a lot of numbers in this graph. Yeah, >> I
044just want you to look at the line and the way we've been managing that tax rate for the district. Um, our goal is to level those that tax rate to not have peaks and um so that we can um try to be as level as possible as possible. >> And Miss Brown and I are very very proud when we go out to to do this presentation. Um, I started in 2014, see what the tax rate has has done. Our work together is trying to to really be fiscally responsible for our community and and keep the rates as low as possible uh while providing as quality of education as we possibly can. >> So, a lot of question that I get quite often is like you said, you mentioned dead cash, like how do you build
045dead cash, right? Give me that trick. It's like well um technically no one should have dead cash, right? But what happened here and this is and this is starts in '04 but if I were to expand this graph and take it back into the late 90s um this district's tax rate was approaching the 9 something imagine size of the operation back in those days >> just >> imagine assess valuation outside and just look around So what was helping me then was that the school de was at a very very high tax rate for the operation and remember that we can only spend up to our budget limit. So in essence it was building some cash reserves that when I came on board I decided to gradually start using them and then when we decided to
046go for the first override then we really started to use some of that dead cash >> um because there's there's not a lot we can do. I cannot turn that dead cash into additional budget capacity. That is just not allowable. So the only way that you the only that you can use that that cash is to buy down your tax rates. In essence, you're giving it back to your community. And if you take it all the way back to where it started was 1984 when equalization came into where they um said that u there's only a few districts I think like valley and that actually fully fund based on their tax base because we need to be the have and have nots and tube was probably one of our abs in our community that had
047a very high tax base and was fully funding schools and then when we combined the districts three and five it gave us addition cash as well. So, I mean, it's it's a big history lesson, but it's but it's allowed us now again to be fiscally responsible and utilize that fund um for as long as we can and it won't last forever. I mean, it's it it goes down every year. Um, and at one point um I don't know if the board remembers, but when we first had our first override, we were actually fully funding the entire override at that point, which I know our constituents were very happy with. Uh but then we realized, oh, that's going to run out very fast and then we're going to see that big cliff. And so we decided
048to then pull back and and do 50% and we'll start to go to 40% and and look at how we can again stabilize the tax rate. this slide. I I I really want people to pay attention to this slide because I think a question that we will get as we release our tax rates and as they start to get their their tax bills and as they start to pay more for their tax bills, they'll say it's probably to pay back for what happened with the county treasur. I want you to if you're approached by a constituent, the loss from county treasur is not factored into the calculation of the tax rate now. We're not there just yet, right? We'll have to wait to see how much money we recover. And this is going to take
049a couple of years, if not more. And then maybe at one point me or my successor is gonna come to you and it's going to tell you it's not we're gonna have to, you know, levy for what we did in recuperate. Maybe not, you know, but it is important to know that as part of today's tax rate recommendation, the loss at the county treasury is not factored. But where is it? Let's take a look at where we have it right now. So, the last allocation for our district, those $14 million have been recorded in fund 565. Fund 565 is the litigation recovery fund. Okay. Um and we will we've made the the decision I've had discussions with um my auditor with um legal with my superintendent that we will keep the laws in fund 565
050um until we are done with recuperating the funds. At that point we will then move anything that we don't recuperate either to M. Okay. and then the levy will will take effect if it happens like that. Um and in the meantime we are going to park the loss to make it very very visible in 5565 right um so that's third bullet that's the second bullet that's where it is today now the third bullet is any unreovered funds will be transferred to the operating or capital fund maybe two three years down the road >> and then at that point the district will evaluate whether we have been approved to recover any So let's take a look at um the total reported loss allocation is 14 million. um the cash that we had in that fund, the
051litigation recovery. And just to give you an idea, it's like what what deposit in that fund, right? Remember when sometimes you impose um the clause in our contracts, if someone leaves their contract, then you assess liquidated damages, >> liquidated damages, that's where >> goes into the >> it goes into the litigate the litigation recovery fund. So, we were um very very happy with $82,000 in our favor until they gave us a loss allocation and that um brought the balance to a negative of 13,50 cash that we had in hand. Um and then we got the first rec dispersement of recovery funds. Yes. Of $1.8 8 million >> mean the negative down to $12.1 million. >> So we did get money from >> whatever they whatever they recovered after they sold and whatever >> they they
052they gave back $5 million and they distributed >> and our share of that was 1.8 and we put it into the 565 >> that >> keep it all in one >> because again we're not we're not accepting it in a sense that we're just we're putting it in that fund because we don't necessarily agree with >> exactly >> the amounts or until we >> yeah and it doesn't show anywhere else in our you know M and the capital and all that stuff. Okay. If I move negative to let's say Mbus >> to put our operating fund in red >> then what's gonna happen I might need to register warrants right so that I can continue to issue payments to vendors and employees and then the district would have to incur a cost for registering warrants
053which then turns into a levy the following fiscal year. It's very complicated. >> Exactly. >> It's very very complicated and um >> because this amount will be fluctuating. Um, it's not good practice right now to recognizeing in recognize it in any other. It was the I I have to tell you it was the auditor's recommendation to put it in the override or capital right now. And I I talked to them and I disagree with them and yes, they will give me another finding. We're keeping it in 565. Um, but gave me another finding last year for what happened at the treasures that I have them control. ultimately finding that is very under control in a separate contest. [Music] >> Uh, Miss Dear, >> can you go back a couple of slides? Maybe you can just
054explain how do you transfer um unreovered funds? Wait, that one unre I don't I'm having trouble understanding that. Unreovered funds will be transferred into the So let's say that in three years the final payback from the county >> and that leaves us with $4 million still in the red. >> Okay. >> And at that point from lawsuits to the receiverhip process, everything they have exhausted all the >> and at the end we didn't move in 14. We only reach number 10. I'm still going to have a negative $4 million in 565, >> which at that point I need to recognize in one of our operating funds. >> So, I'm going to do a transfer, >> right, with the journal entry or I'm going to move that negative cash of $4 million to more likely M.
055I mean, we would have to at that point to see where we are um with cash on hand in our operating funds, either an M or in capital and we'll redo that. And we take it as a loss. Of course. I mean, it's definitely definitely a loss. >> In other words, if we could have bought something, okay, if we needed to buy something, well, guess what? Now we can't because we're at a deficit right there. >> I mean, >> that point, Miss Vasquez, is the district is going to have to make a decision whether to absorb >> the the the loss. We might have cash in hand. We do not. >> Um or to assess a levy. >> Levy. Okay. >> Yeah. To recuperate those $4 million or I've been talking to the county where
056they could potentially assess the levy of anything that we recover on our behalf. >> That's a possibility. >> That's an option. >> An option. >> It's up in the air, but it's an option. Okay. Okay. And and that that's important of why we have all the tolling agreements in case we want to pursue any litigation at that time or um figure out again that's why we're in the wait and see. We want to sit back, let this run its course. >> Um see what happens with the the lawsuit, see how much we end up recovering. And then at that point then we'll have to with the board come together and then make a decision of what our next steps will be what and how we absorb that loss if there is any remaining loss >>
057um >> or how are we going to approach that. >> Yeah. >> How are we going to move forward? >> Yeah. >> With that. >> Okay. >> So the other thing is that there's there's there's much I wouldn't say confusion but I guess confusion or or different ways to approach >> how you're dealing with this loss. Our district is like I said identified recogniz 565 and it there >> um it's not impacting our operation as it is this is a cash situation >> it's not a budget limit >> please follow me because that's very important >> you the last four meaning the budget limit is a budget limit care less if we have the cash or not. >> Yeah, >> got >> we are we have the legal authority to spend up to that money.
058>> Very different for other >> end for fire to help >> different district some districts can only spend up to and and it's it's different school finance is very unique. So we we we can spend up to that budget limit. And even when the time comes to recognize this loss in one of our levy funds, the district will not have to reduce a budget limit to recognize the loss. >> Unless the board at that time decides that's what they want to >> have. They do not have to. >> Yeah. >> Okay. Questions? Uh, Mr. uh, Guerrero, >> no questions, >> Mr. Beach. >> Good. Thank you. Yeah. >> So, if I'm understanding you, uh, when we approve the budget, the budget, uh, runs all our all our facilities, everything in our school district. So, that
059that's set year after year. >> When this uh, what is it, the 565, say we get negative six million or whatever goes into our account, uh, who accounts for the accounting error? the the the county or do we >> we it's our books. >> So now we account for the accounting error. But isn't that gonna affect our our bond ratings or have triple >> the bond rating because we just survived a a bond rate. Um, as we were going through all of this, um, I don't want to have a word to this. >> I know. >> Um, we received that, um, S&P standard force was going to reviewer rating. >> It was like, >> yeah, that we were up for review or rating. I was like, oh great, we're the best timing of. So, I
060started to working with her bond council. I started to prepare. I gather information. And I went through interviews after interviews, meetings after meetings, and actually our bond remain the same. >> It did not go down. >> So we were still A-rated. You're >> still A-rated. >> Oh, what is that prior to? >> They knew. We fully disclosed. >> Okay. >> We fully disclosed. And they and they do have a footnote in in our >> that this happened to us at no fault of our own but that we are still because of our fiscal responsibility a very viable investable uh school district. >> Why wouldn't the county take responsibility and say it was their budgeting error and uh figure out what the state you know to put something in place that the districts, the fire districts,
061etc. were at no fault. >> Don't know that. >> Well, I I but that would mean that then they would admit fault >> and they won't >> and at this point no one is admitting >> nobody admit is admitting >> and that's I mean just I mean I think that's the to be honest Mr. Beach I think that's the the reason that they have not accepted that. I mean they're they're hoping again that these litigation things happen and and are able to recoup. >> But at some point somebody's going to have to say that they're responsible. responsible >> and and I don't think the county wants to do that yet. >> It would change the legal landscape for >> and again that's why we have the tolling agreements so that as as this runs its
062course >> at the very end then we can decide with the board hey do we want to go >> some litigation if we're not satisfied with where we're at at that point. So, thank you, Miss Brown. Yep. >> Interesting. >> Anything else? >> No. >> All right. Yeah. I mean, just thank you so much, okay, for being so on top of everything. You and your, you know, your group and whoever it is that you know that um that helps you out and what I know it's mostly you, but you know, you've really saved us. I mean, really, really, we're at a place right now where we are good, right? We're at a place where we're good besides what this happened. But this, like we say, this is no fault of our own, no fault of
063yours. Nobody else had anything to do with it. >> And again, somebody does have to take responsibility, but we know how, you know, how, you know, politics work and whatever. And probably nobody's ever going to say, well, it was my fault for not doing this or for not doing that. Okay. But, you know, I'm just really happy that our district, our schools are in a good place and that our students and our teachers and everybody that's working here, okay, isn't affected because of somebody's bad dishes decisions or whatever, you know? It's just it's just crazy. But thank you. Thank you so much, Miss B. Thank you very very much. Appreciate it. >> And just just to any follow up, I know there's always, you know, as Mr. Beach was talking about school districts um with
064enrollment and things. Um Miss Brown on top of our tax rates has always made sure budgetarily that we are fiscally responsible and that we are um in very good standing. We have uh like I said I always commend the board that you know the things that we were able to do this year with the 5% raise that that many districts will not be able to to do. Um not cutting positions you know just uh looking at efficiencies. How can we adjust positions and make sure that we're we're moving efficiently as a district? Um absorbing the insurance cost. I mean, there's just been a lot of things that we're able to do financially this year that other districts are not. And that's because we're always looking a year ahead um if not three to five years
065ahead of how we're uh preparing. And so I think Miss Brown for that. And again, our constituents see that through our tax rates. >> Exactly. Thank you. Thank you very very much. So, do we have action? Do we have an action? Recommended action. >> Is that right? >> Okay. Motion to approve the 2025 2026 tax uh taxes as presented. >> Second. >> Yes. >> All those in favor say I. >> I. >> All those opposed? Nay. Eyes have it. Motion passes. Thank you very much. Next one. Subject B. ASBA 2026 proposed political agenda. Mr. Gradu. >> Oh, yes. you received uh an email from uh Angie regarding the proposed ASBA agenda and so the the recommendation is to just uh approve that if unless there are recommended changes that you would like to add to
066the political agenda for recommendations and also just noted in there that the delegate is Miss Vosquez and the alternative is Mr. Beach. >> Mr. Beach. >> Okay. All righty. Okay. Um any um any questions? Miss Alma de la >> Mr. Mr. Guerrero, >> no questions. >> Mr. Beach, >> I don't have any either. So, the recommendation recommended action is motion to approve in whole or in part the draft of 2026 political agenda of the Arizon Arizona school board association, which is ASBA, and direct the district's delegate to the ASBA delegate assembly to represent the board's determined position. >> And I would say that the whole versus the board. >> The whole. >> Yes. >> As whole. as a whole. Okay. No. Okay. As a whole. >> Second. >> Okay. >> All those in favor? I.
067>> I. >> All those opposed? Nay. >> Okay. >> Eyes have it. Motion passes. Okay. Mr. Beach, you're with me. Okay. Remember that. Okay. >> All right. Moving on. Subject Santa Cruz Valley Unified School District policies. Mr. Verdugo. >> No updates at this time. Thank you. >> Okay. So then there's no recommendation on that one. Moving on. Subject D. uh proposed and priorit prioritize topics and possible dates and times for future board meetings. Mr. Verdugo. >> Yes. Um I'd like to request um for a special board meeting on uh Thursday, July 31st at 8 a.m. telephonically for hiring purposes. It's the the day or the Thursday before school starts just because that would be >> a final hiring that needs to >> that would be Thursday, July 31st, >> 8 a.m. we could get three
068and again it's telephonic. So if we can get three >> board members, okay, >> to participate telephonically, that appreciate it. >> All righty. Not a problem. July 31st at 8 a.m. >> 8 a.m. >> Okay. At 8 a.m. I will be there. I'm sure. Okay. And then what else? Uh moving on, consent agenda. Uh approve of the approval of the consent agenda. Um says any matter on the consent agenda will be removed from the from the consent agenda and discussed as regular agenda item or items upon the request of any board member. Miss Deariva, you have any questions on that? Mr. Guerrero, >> no questions. >> No. Mr. Beach, I have none either. So recommended action is to motion to approve and accept and ratify the consent agenda as presented. >> Second. >> Okay. All
069those in favor say I. All those opposed? Nay. Eyes have it. Motion passes. And we are ajourned. Right. All right. I adjourn this meeting at 5:59. I'm getting better, guys. Okay.