1. T UBA C ITY F UND B ALANCE A NALYSIS & E XPENDITURE R EVIEW April 30, 2012 1

2. C URRENT B UDGET AND P RACTICES 2

3. F UND B ALANCE AND E XPENSE T REND WITHOUT S TATE C ASH F LOW C OVERAGE 3

4. 5 Y EAR F UND B ALANCE S UMMARY 4

5. A SSUMPTIONS INCLUDED IN PREVIOUS CHARTS All revenue received is expended Impact Aid funded at 85% No State Aid Reductions No enrollment decline No additional expenses added No additional capital expenses added ($2M continued) No reductions in expenses Successful Bond election in 2014 First sale of Bond proceeds and payment in 2015 5

6. FY 2012 F UND B ALANCE : $17,000,000 6

7. FY 2013 F UND B ALANCE : $9,014,576 7

8. F UND B ALANCE C HANGE 2008-09 THROUGH 2011-12 Increases in 2011-12 expenses include: Additional teachers Salary increases Additional maintenance support Teacherage capital improvements Includes capital and contingency expenses 8

9. 2011-12 M&O/ IMPACT A ID B UDGET BY F UNCTION M&O Fund Impact Aid Fund M&O Total: $10,563,000 Impact Aid Total: $11,200,000 9

10. 2011-12 C OMBINED B UDGET BY F UNCTION Grand Total: $21,763,000 10

11. 2011-12 C OMBINED B UDGET BY F UNCTION Grand Total: $21,763,000 11

12. 2011-12 M&O/ IMPACT A ID B UDGET BY O BJECT M&O Fund Impact Aid Fund M&O Total: $10,563,000 Impact Aid Total: $11,200,000 12

13. 2011-12 C OMBINED M&O AND I MPACT A ID B UDGET BY O BJECT Grand Total: $21,763,000 13

14. R EDUCTION S TRATEGY BASED ON F UNCTION 14

15. C OMPARISON D ISTRICT A NALYSIS 15

16. C OMPARISON D ISTRICTS – % OF D OLLARS IN THE C LASSROOM Auditor General Classroom Spending Report, 2012 16

17. C OMPARISON D ISTRICTS FunctionTuba CityWhite- river KayentaWindow Rock State Average Instruction41.1%48.3%41.6%47.4%54.7% Student Support 11.4%11.9%11.3%9.6%7.6% Instructional Support 4.6%7.5%6.4%8.2%5.8% Administration12.2%12.7%10.5%11.5%9.7% Plant Operations 19.2%10.9%17.4%15.2%12.4% Transportation6.9%4.5%8.6%3.9%4.7% Food Service4.7%4.2%4.1%4.3%5.0% Auditor General Classroom Spending Report, 2012 17

18. C OMPARISON D ISTRICTS Auditor General Classroom Spending Report, 2012 18

19. P LANT O PERATIONS AND A DMINISTRATION 19

20. T UBA C ITY S CHOOL D ATA 20

21. S TUDENT E NROLLMENT H ISTORY 23.7% Decline since 2006 Arizona Department of Education ADMS 46-1 Reports 21

22. S TUDENT E NROLLMENT G ROWTH G OAL Goal A – Grow Student Enrollment Goal B – Stabilize/Level Enrollment Goal C – Status Quo 22

23. H ISTORICAL R EVIEW OF E NROLLMENT, E XPENSES AND S TAFFING – 2007-08 THROUGH 2011-2012 23

24. B UDGET P ROCESS AND F UTURE P LANNING 24

25. A CCOUNTABILITY B UDGET P ROCESS A PPROACHES Incremental, Zero-Based, and Program Budgeting Incremental : compare previous year budget as a basis for incremental amounts to be added or reduced to the new year’s budget Zero-Based : each line item of the budget is built from zero and must be approved rather than only approving changes to the line items Program : review individual programs or functional activities independently of the overall budget to determine its fiscal needs 25

26. B UDGET G OALS Return on Investment – ROI Marketing Schools Student Achievement Teacher/Staff Retention Long Term vs. Short Term Funding Needs State Reductions Federal Reductions Building Needs Avoiding the Funding Cliff Maintaining Fund Balance 26

27. B UDGET A CCOUNTABILITY Student Achievement Increase student achievement Resources (financial, human and capital) Responsible budgeting Effectiveness and Efficiencies Improve productivity 27

28. 5 Y EAR F UND B ALANCE S UMMARY – M AINTAINING $4M F UND B ALANCE, B OND C ONTINGENCY 28

29. F UND B ALANCE AND E XPENSE T REND WITH S TATE C ASH F LOW C OVERAGE 29

30. 2012-13 B UDGET V ARIABLES Cost Increases Compensation Increases State Retirement Fuel Cost Enrollment Decline Federal Funding Decline Cost Decreases District Health Insurance Integrate Alternative School with High School Consolidate Primary, ENIS, JHS into K-8 One principal over Gap and Cameron 30

31. 2012-13 C OMPENSATION INCREASES 31

32. F UTURE I MPACT A ID S PENDING P OLICY M&O Transfer – determined by State Debt Service Payment Override authorization (conceptual) Reserves for future Bond – TBD Current year expenses – TBD 32

33. F UTURE I MPACT A ID S PENDING P OLICY 33