001Hello and welcome to the St. Mary Valley Schools Board of Education study session of April 21st, 22nd, and 2026. Chris, Sarah, will you please call the roll? Sure. Mrs. Babs? Present. Mr. Brueffold? Present. Mrs. Gilligan? Present. Mrs. Horanek? Here. Mr. LeChuga? Absent. Mrs. Solomon? Excused. Mrs. Weiss? Excused. Thank you. On the agenda, we have the fiscal year 2026, March district financial statements. Tony, take it away. Great. Thank you. Good evening, member of the board. Pleased to present to you the periodic financial statements for the month ending March 31st to 2026, which is the ninth month of our fiscal year. So we're three quarters of the way through. And so basically is the end of our third fiscal quarter. Appreciate all the work of our accounting and reporting team for putting these together. And I wanted
002to go through, talk about a few highlights regarding some reports in the general fund, maybe the touch on the grants fund briefly, and then spend a little bit of time following up on our nutrition services fund. And then I'll just give you also a really brief update on our work with Carbon Valley. So first, I just want to make sure you can see what's on your screen when I'm pointing at. Great. I'll be working from the dashboard that I left a copy of that on your desk. And I'd use that to guide our conversation today. So first, I'm going to start at the general fund's balance sheet. These are balances as of March 31st, 2026 compared to March 31st, 2025. We just like to look at any large differences between the two years and point
003out what that might be. Christy, I presume we're working on lights. It just helps be able to read that. Awesome. Thank you. So first of all, we see a decrease in our cash and investment balance. Welcome, Brian. We're in the dark. So I didn't touch anything. Thank you. So we have a decrease in our cash and investment balances year over year. And that is as expected. That's due to a couple of reasons. Number one, it is because last year we had some artificially inflated cash balances as a result of some one time items, namely the reimbursement for the land purchase, as well as the iPad sale. And then finally, the other reason why we would have a decrease in cash and investment balances this point this year over last year is because we're actually spending
004down our reserves a little bit more this year than we were last year. So with a larger budgeted spend down compared to last year, especially with those artificial one time items, this tracks with expectations. Another difference you can see is this due from other funds right here. You can see there's about a million dollars last year. That's $3.3 million this year. That difference directly relates to the amount that the Nutrition Services Fund is borrowing from the General Fund. The Nutrition Services Fund operates on a reimbursement basis from the federal and state governments to give them their reimbursements. They operate in arrears. So typically they are using their reserves in order to maintain their ongoing operations. But as you know, we talked about before, the Nutrition Services Fund doesn't have any reserves right now. They spent
005down their reserves. So in order to operate in arrears, they have to borrow money from somewhere and that's the General Fund because we have adequate reserves to do that. So that $3.3 million represents an amount owed to the General Fund from the Nutrition Services Fund for essentially capital purposes. Okay, this $459 right here that you can see wasn't last year, but is this year. This $459 is directly related to this $459 right here. It's basically an on and an off at the same time. It's an asset and a liability. And it just represents an amount owed regarding the best grant for Firestone Charter Academy. We're the fiscal agent for that. And so as Firestone, they were granted this best grant award. So we recognize it as a receivable from the state as well as a
006payable to Firestone. And as they actually do the work, they request the funds from the best grant. We'll get that money and this will go down and we'll pay that money and this will go down. So when that best grant doesn't exist anymore for when our charter schools, you won't see any activity in either of those amounts anymore. Another thing here you can see is taxes receivable. This is the amount of taxes that we have levied less the amount of taxes that we've received thus far. And so the whole amount, if you recall last month, this number was higher. The whole amount is sort of hits all at once in January because January is when essentially the amounts are levied to the community and those are recognized as owed to the district. And so we
007recognize that as an asset as well as this item right here called unearned revenues. So again, that's kind of an in and out as well. As we get taxes paid to us, these amounts will work their way down to zero until the entirety of the tax amounts have been collected. And then finally, you'll see a little difference here. This $1.1 million last year and now there's only the $4.59 related to the charter best grant this year. This $1.1 million last year was related to that Broomfield URA issue that we were dealing with them. They had sent us that $1.1 million. If you recall, I was like, I think they sent us too much. We don't want to recognize it all right now. So we put it on a liability account till we figured out exactly
008how much we kept and first sent back to them. Of course, that's all been resolved. And so that was a liability last year that doesn't exist this year. Just wanted to show you that explain that difference. Okay, so that's all I've got in the balance sheet. I'm going to go on to actual versus actual. This is revenues and expenditure activity from the beginning of the year until March 31st for this year compared to last year. So again, if I want to see like, hey, what are our revenues this year compared to last year at this time? And why are there large variances? This is the schedule to be able to look at those. So again, we'd like to explain a little bit about the differences. So for instance, the first one you can see right
009here at the top is property taxes. We've collected about 61 versus 53. Same with the related MLO. It's 30.3 versus 25.9. Those increased amounts are related to an increase in the total assessed valuation or the overall market value of our community property taxes. We were able to actually collect a little more in property taxes year over year. And that's what you see reflected here compared to last year compared to this year. And if you recall, we talked about that there was about a 9% increase in AV, which, again, contributes to the total program portion as well as our MLO. All right. Investment income right here. You can see a decrease year over year of about $859,000. That $859,000 is expected. Remember, our investment income is the current market rate of return that we get in
010our investments on the total reserves that we have invested. Well, remember earlier you saw that we have lower cash investments. So that's going to account for a part of the decrease in our investment income. And then also the rates that we're getting are a little lower than they were last year. If you look at the very bottom of your dashboard, you can see it says investments. It says current year interest rate is 3.76% compared to last year's 4.4% at this time. So actually the interest earnings that we get, there's a lower rate in place right now. And that rate is directly proportional to the Fed funds rate. So every time you see on the news, the Feds are decreasing the rate by a quarter percent. All the Jerome Powell stuff that they're talking, that you
011hear about with the Feds, all of that influences our investment income. So whenever you see those decreases or increases, the Fed funds rate, we're also going to see a corresponding increase or decrease in our LGIP rate of return on our investments. So right now we're a little lower than we were last year, but we're still well above the almost zero percent that we were getting back I think in 2020, 2019. Okay. Let's keep going here. Make sure we're okay on time. The BABS. Oh, here. No, I want to talk about this revenue first of all, the career and technical education. So this difference right here that you're seeing is because of that audit adjustment that I spoke about a couple of times. So CTE came in and they did an audit to review the amount
012of CTE expenditures that we've submitted to them for reimbursement. And they found some items that needed correction. And so we actually had to send some money back. And that money that we sent back was sort of a net against this revenue number that you're seeing. And so this number is kind of artificially deflated. It would be about 610 without that audit adjustment. And as we get the remaining few payments for CTE, this will move back up, but it will still be decreased by about 270,000, which was that audit adjustment. And that'll stay there throughout the end of the year. Okay. Build America bond rebates. So this one right here, you can see zero last year, 717,000 this year. This was because last year's BABS rebate came in really late. We're having some issues with IRS.
013We weren't able to get the payment. We had column. Justin Patrone, bless him. He spent so long on the phone waiting in queues for the IRS to try to figure out what was wrong, why they wouldn't send it to us, had to do with some filing issues that confused them. And anyway, nonetheless, we're more on track with those, the timing of those BABS rebates this year compared to last year. And that's why you're seeing a discrepancy here. This 717 still also represents only half of our anticipated receipts. We get those in two payments, one as a result of our December bond debt service payments and one as a result of our June debt service payments. So those two separate payments go to the IRS or excuse me, payment submissions go to the IRS and then
014get sent to us. This represents one of two. We expect that to be about $1.4 million when we're done with the end of the year. And I was just going to add it there, Tony, not to be confused with BABS the first thing. Yes, that's right. I appreciate that. Yes, not to be confused with that. BABS is the Build America bonds rebates issued by the federal government in 2010 in order to incentivize municipal governments to issue bonds. That's right. Someone's loud out there. I hope everything's okay. Okay. I hope it's a celebration and not a concern. All right. I want to move on down, make sure we have enough time. To our budget to actual. So this is the current year budget actual. Remember, we are budgeted to spend down our reserves by about $28.6
015million before outperformance. And so we would anticipate ending the year before outperformance at about $145. We talked about that before. Right now we're at $120. So we're below that. Don't be alarmed. That's expected because if you recall the high watermark is at the very end of our fiscal year. That's our fund balance. Our reserves, the high watermark is right at the end. So we actually dip down below before we start getting tax payments. The tax payments come in the spring at the end of the year. We get our final tax payment in June. And so that's finally going to bolster us back up. So you're going to see this $120 slowly increment back up till it's $145. And then as we get outperformance materialized, we expect if we outperform by $10 to $15 million, then
016we're going to go that $145 all the way up to maybe $160 or so if it's $15 million. So that's where we actually will probably expect to end this number right here by the end of the year. It'll be closer to $160. Maybe high $150s, $160. Okay. Passed the time. So again, we're three-quarters of the way through the year, 75%. So we would expect our two salaries and benefits to be at least below that 75%. And they are. And again, that's what actually helps materialize that outperformance that represents that better than budget number. Again, from our perspective, you can never hit budget exactly. With a large organization like that, you can't always be perfect on your budget. So if there's going to be a budget variance, we want it to be a favorable budget variance,
017right? We don't want to accidentally spend more money than we expected. We want to do better. And so when I talk about that outperformance and it being planned, it absolutely is planned because no matter what, we really want to make sure we estimate our revenues a little low because if we outperform that, we'll get more revenues than we expected. And we estimate our expenditures just a little high so that again, when the reality comes in, we do better on expenditures. Those two effects are going to result in a positive or beneficial budget variance. All right, let me jump down to grants fund, fund 22. So if you look at the, excuse me, I typed 22 instead of the page number. One second, that's page 31. So if you look at the actual actual, you just
018see a few little anomalies here in terms of our state and federal grants in our grants fund. One is a decrease of 666,000 year over year. And the other is an increase of 1.2 million. And what that is, and again, that's noted in your dashboard, but what it is, it's a decrease in state grant revenue because we had the Colorado High Impact Tutoring Grant in this fund last year that doesn't exist in this year. In addition, compounding that a little bit, the Opportunity Now grant funding shifted from state to federal and portions of it. And so they got reported here instead of here. So that also exacerbated. So in addition to one of the grants ending, there's also a geography change compared to last year. So that's why you see this large change. All right,
019let's talk about Nutrition Services Fund. So as we talked about, Nutrition Services Fund is, they're running pretty lean. They use most of their reserves. And for a while there, we were seeing that their projected actuals were going to burn through their entire reserves all the way past zero. That was untenable. They can't do that. And so we've been working with Brian and Katie on some plans to mitigate that. Katie's done a great amount of work to make sure that she did mitigate that. And really proud to come back to the board. We reported this at FAC on Monday as well, that they're now on track to hit just above zero. So they're not going to burn past zero at the end of the year. We're checking in on a monthly basis to make sure that
020that does indeed happen. But so far from what we're seeing, the changes that they made have happened. And so they're projected to end above zero. You can see here kind of the starkness of the problem. This due to other funds last year was about a million dollars. And this year it's 3.3 million dollars. That represents the payment, the payment of the amount owed in cash to the general fund. That exists because they don't have a reserve to use. They have to borrow. It's a general fund, like I was mentioning earlier. Well, Katie, again, what she did is she went through and adjusted some of the hours for some of her personnel just a little bit. She'd made some really incremental changes. But when you make them over a really big system, it has a compounding
021effect. And so she was able to, I think, make things run a little bit more efficient and decrease the hours. And that made an impact. She also, I was going to recognize some savings this year compared to her budget because of a change in the needs for summer nutrition service programming. She made some changes to her menuing. So instead of a more varied menu, she was able to streamline and make some more consistent menuing. And that allowed her to do some savings as well. And then also, as we talked about before, she's working on doing more direct purchasing from suppliers rather than the distributor model where she goes to one distributor and they have that markup, right? Because they're going through all the partners and they create sort of a big batch order. And then
022she orders from one place. It does more work for her. It's more administrative work because you have way more vendors to work with, but you're getting an increase in savings. So she's doing that work in order to save some money for her program. And all of that's having a pretty good cumulative effect. And we think that we're going to be able to land the plane above zero. So I'm really happy to report that the hard work has been done and that at least we see a correction in the trajectory. So quick question on that and congratulations to Earth for thinking systematically with regard to the budget for nutrition services. I'm just a little curious when you said there was a decrease in some of the hours across the system, particularly in nutrition services. How is
023that impacting the employees? I would imagine that they were expecting whatever number hours they initially had. What's kind of the impact at a top level for those employees? Yeah, it certainly does impact. I actually have the note here. I wrote it down. Sorry, I didn't have it with me at the podium. And the reason I'm asking more specifically because just curious because if those numbers change for a person and they see that they're not possibly going to make what they could make somewhere else and they find something else, then we lose bodies. So just want to understand how that impacts. Certainly. How it's impacting them. And it's a little early to be able to see the aggregate impact, but the actual change was a six-hour-a-day employee I think was decreased to 5.75 hours a day.
024So it's like a quarter of an hour and 15 minutes. I think four hours was down to 3.75 hours, but only for the remaining few months. And so that aggregate impact was a pretty small impact. She tried to make sure it was sort of a broad thing instead of a depth thing. She wasn't laying off individuals, but she did neglect to fill vacancies. So where someone did depart, she made sure that she would hold that line and not refill that vacancy and try and reshuffle personnel to make sure that services weren't impacted or that they were minimally impacted in order to recognize those savings. I don't foresee future decreases in individual hourly schedules. From what I'm hearing from Katie for next year in order to make sure that the budget is balanced and that they're
025able to do the same thing where they're not burning through reserves is, number one, there's going to be some additional revenues next year as a result of the LL and then that was passed. In addition, they are working on ensuring that their allocation of positions to individual schools are as efficient as possible. So rather than decreasing schedules, they may have someone share between two locations or something like that. So it would be an aggregate reshuffling of positions rather than a decrease for everyone. Okay, got about nine more minutes. I wanted to make sure that I was able to address any questions you may have regarding our work with Carbon Valley. As you know, Carbon Valley Academy is winding down operations this year and so we've been trying to work with them to make sure that
026we as the authorizer could cooperate jointly as best as possible to make sure that all the employees were appropriately paid out, that they had all their reporting available to them, their W-2s, they had all the treated with respect. Of course, a lot of them are now trying to find jobs fairly late in the school year and so we're trying to make sure that that's done. In addition, Carrie and Jackie and all their team has done a great job to make sure that those students have a smooth transition to a new educational institution to make sure that they have a great opportunity to move without too much turmoil. As you know, our open enrollment window closed but we actually did a special open enrollment window just for the Carbon Valley students to help make sure that
027they were able to transition to a different school. Community meetings as well were had but the funny thing is I've never done this before. It's closed down a charter school or helped close down a charter school and so there's a litany of things that we knew that we needed to happen and also a bunch of stuff that we didn't and so I actually was able to go through and reach out to the Colorado Charter School Institute that the state runs and they have some checklists that they do because they have to occasionally close a charter school so they had some templates that I was able to use to adapt and there's a lot of work. It's not just closing down a school. For instance, we did some consolidation with Sanborn. We're actually closing down an
028organization. It's the closure of a legal entity and so there's a lot of work that's involved in doing that and so we're working with them. I know Tim's working with their team. Tim O'Neill's worked with their team and working with them to make sure that we're able to address those jointly and getting over some hurdles to make sure that there's a clear understanding and if you can imagine us being a separate entity, we would need essentially the equivalent of a power of attorney to be able to act on their behalf and do work with their vendors and issue their W-2s and things like that so we have to work through the legalese of establishing that and making sure that we have transparency into their finances and bank accounts and utility accounts and making sure they're
029doing the final reports and their report to the Secretary of State and the IRS that they're closing down shop. Lots and lots of work to do and so I just want to give you an update on that. We've got that on our radar. We're working on it and trying to work with the Carbon Valley Academy staff to help do that as cooperatively as possible at this point. Any questions on it? Yeah, please. I have a lot of questions on it so I'm happy to answer as best I can. No, no problem. So you laid out some things that we're having to do to close the organization down if you will. What responsibilities do they have because they are their own organization if you will. What responsibilities do they have to ensure, and I know we
030probably have to oversee a lot of that, but what responsibilities do they have and that they're responsible for and if we have responsibilities that we have as their authorizer, then are those resources, are we having to pay for those resources? So again, we're kind of talking to the budget. You are a great question. You've echoed exactly many of the conversations that we've had already and so I'm happy to speak to that. So under state law, when a charter school wraps up, the remaining assets of the organization actually revert back to the authorizer. That makes sense because those funds that are going through the authorizer's fiscal agent would have otherwise come to the district except they were redirected to the charter as a sub-entity so to speak, a component unit. And so when the organization is
031working, if they have any remaining assets in a wrap-up shop, those revert back to us. And so there is going to be a little bit of remaining assets reserves, I think, that will probably revert back to us. So from a resources perspective, I don't think that this is going to sort of cost us money to wrap things up. We're not going to have to pay off the remaining debts or pay off some creditors or things like that. I think there'll be a net positive, even just a small amount, because again, we knew they were running on fumes and they were having some financial troubles, but in the end, they still did have a small amount of reserves and they have enough in terms of the remaining allocation from us, their normal PPR and MLO that
032we would allocate them, plus their reserves to get them through the end of the year. So that's the budgetary impact. I think we're okay from that standpoint. From a who does what perspective, this is a really great question because it's very theoretical, most of those responsibilities would lie on them. But the reality of the situation is, running on a skeleton crew, they've had a lot of departures and some various people have moved on and we, as the entity that will continue to exist beyond their closure, are sort of left with the situation. And so anything that they are unable to do, despite it perhaps being their responsibility, we would probably just need to do as a matter of fact anyway, as a matter of yeah, exactly. So it's not that we are taking upon the
033burden from an expectation because that's the law or that we would expect that would be our responsibility, it would probably be theirs, but it's more of one of practicality. We are equipped to be able to handle that. And again, as the remaining entity that continues on after they wrap up, we're equipped to be able to handle not just this year's audit, but they're going to have another audit next year, like in the fall of 2027. That's going to be a year after they wrap up their final school year. There's no one going to be around to be able to do that audit. It's going to be us that's going to do that. So the term I think in the private sector is receivership. There's usually another entity that maintains the final assets and helps all
034the creditors pay all the debts and maintain all the records and stuff. And essentially, we are that charter school's receivership. So that's kind of where we're approaching this from a practical perspective. But in terms of who actually does what, we're trying to defer to them as much as we can, while also making sure that, hey, we recognize that we're here. We're going to be the ones that have everything kind of coming back to us. All the student records we're going to have to archive and make sure that we can provide transcripts for those students and things like that. That's all us. And so there's a lot of work to be done, like I said, and we're working with them to make sure that all gets accomplished. Be back. Thanks. I think that's mostly my time
035here. Any other questions I can answer? I will give an abbreviated report at the regular board meeting in 15 minutes on what we talked about tonight. Okay. Thanks, Tony. Okay. Any other questions? I will ask for a motion to adjourn. And Sarah, all in favor? Aye.