Presidio ISD receives positive audit report for 2022-23

PRESIDIO — At Wednesday night’s meeting, CPA Kacey Gast — with commentary from Arrow Consultant’s Doug Karr — presented the Presidio ISD Board of Trustees with the results of the district’s 2022-23 financial audit. The team was happy to present positive findings, but also cautioned about potential future budget shortfalls as the district prepares for the upcoming fiscal year. 

The meeting kicked off with a short presentation by the district’s Chief Financial Officer Raquel Baeza about the district’s latest Financial Accountability Rating, a score given by the Texas Education Agency. Presidio ISD received an A rating this year with an overall score of 96. 

That score put Presidio in good company region wide — Marfa, Alpine and Fort Davis ISDs and Terlingua CSD also received As on a scale of A through D. Marathon and San Vicente ISDs received B ratings and Valentine ISD received a C. 

Next, Gast gave board members a detailed rundown of the district’s prior-year finances, explaining that she and Karr wanted to give a detailed explanation of each component of the audit because a large percentage of the board were sworn into office this school year. 

Gast said that compiling material for the audit was smooth sailing — thanks to some prep work by district administration, she was able to finish the full audit in about two days. “If you’re going to have a successful audit, the biggest key is the open flow of information,” she told the board. 

She offered a quick summary of the district’s cash flow: revenues and expenditures were up. Property tax revenue was relatively stable, despite higher values — the district’s tax rate had been lowered to adjust for the change. Interest rates had rebounded, bulking up returns on investments. 

Over the 2022-23 school year, the district’s general fund dipped slightly. While Gast said that wasn’t anything to panic about, she cautioned that the TEA advises a general fund balance of at least three or four months of operational expenses. “This is something to watch, because it’s something a lot of my districts are getting dinged on right now,” she said. 

While Gast presented her findings, Karr — who has served the district in multiple consulting roles — offered a more somber outlook for the future. While the school district had budgeted in the last year for the completion of a practice gym and a new bus, those projects had not yet been fully completed and paid for. “The chickens are about to come home to roost,” he cautioned. 

The district has also been enjoying an infusion of ESSER — Elementary and Secondary School Emergency Relief — funding from the state, which apportioned three waves of funding in response to the COVID-19 pandemic. The last was approved by the Legislature in 2021, and the funds will expire in 2024. 

Karr projected a $3.5 million deficit for next year’s budget. “I wish it wasn’t so, but it is,” he said. 

Because so many Presidio ISD students live below the poverty line, deciding where to cut corners as a district can be complicated. Karr gave the example of food service: the district spends around $200,000 a year providing students with free meals, all of which comes out of the district’s general fund. 

Charging more fortunate students for lunch wasn’t the full solution — inflation had driven up food costs so much that the program would continue to lose money at an exponential rate. “We’re being hit in the cafeteria the way you’re being hit at the grocery store,” Karr said. “Even if we did charge the kids for food we couldn’t bail ourselves out of the hole.” 

In uncertain economic times, Karr cautioned about relying too literally on projections for property taxes and tax collection — he’d seen local bankruptcies threaten the district’s funding source. He also knew that the district was spending around $16,000 per student while taking in around $13,000. “You can’t get blood out of a turnip,” he said.