STATE OF NEW MEXICO CENTRAL CONSOLIDATED SCHOOL DISTRICT ... · PDF fileCENTRAL CONSOLIDATED...

STATE OF NEW MEXICO

CENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22

FINANCIAL STATEMENTS

June 30, 2004

With Independent Auditors’ Report Thereon

STATE OF NEW MEXICO CENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22

ANNUAL FINANCIAL REPORT

FOR THE YEAR ENDED JUNE 30, 2004

TABLE OF CONTENTS

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INTRODUCTION SECTION

Official Roster ................................................................................................................................................. 1 FINANCIAL SECTION

Independent Auditors’ Report ......................................................................................................................... 2 Management’s Discussion and Analysis (MD&A) (Required Supplementary Information)............................ 4 Basic Financial Statements

Government-Wide Financial Statements Statement of Net Assets ............................................................................................................... 22 Statement of Activities................................................................................................................... 23

Fund Financial Statements

Balance Sheet - Governmental Funds.......................................................................................... 24 Reconciliation of the Governmental Funds Balance Sheet with the Statement of Net Assets ..... 25

Statement of Revenues, Expenditures, and Changes in Fund Balances ..................................... 26 Reconciliation of the Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balances with the Statement of Activities................................................. 27 Statements of Revenues and Expenditures - Budget and Actual (Non-GAAP Basis)

Operational ............................................................................................................................ 28 ESEA Title I ........................................................................................................................... 29 IDEA-B – Entitlement ............................................................................................................ 30 PL 81-874 Impact Aid............................................................................................................ 31

Statement of Fiduciary Net Assets – Agency Funds..................................................................... 32

Notes to Financial Statements...................................................................................................................... 33 SUPPLEMENTARY INFORMATION

Major Capital Projects Funds

Statements of Revenues and Expenditures - Budget and Actual (Non-GAAP Basis) Bond Building ................................................................................................................................ 60 Debt Service.................................................................................................................................. 61

Non-Major Funds

Non-Major Special Revenue Funds Descriptions ................................................................................. 62 Non-Major Special Revenue Funds - Combining Balance Sheet......................................................... 70

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TABLE OF CONTENTS

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Non-Major Special Revenue Funds - Combining Statement of Revenues, Expenditures, and Changes in Fund Balances............................................................................. 78

Non-Major Special Revenue Funds - Statements of Revenues and Expenditures – Budget and Actual (Non-GAAP Basis) Teacherage ................................................................................................................................... 85 Transportation ............................................................................................................................... 86

Instructional Materials ................................................................................................................... 87 Food Services ............................................................................................................................... 88

Athletics......................................................................................................................................... 89 Non-Instructional Support ............................................................................................................. 90 ESEA Title I Program Improvement .............................................................................................. 91 IDEA-B – Discretionary Competitive ............................................................................................. 92 IDEA-B – Preschool ...................................................................................................................... 93 Evenstart ....................................................................................................................................... 94 Learn and Serve............................................................................................................................ 95 Technology Literacy Challenge..................................................................................................... 96 Comprehensive School Reform Demonstration............................................................................ 97 Preschool Environments ............................................................................................................... 98 Vocational Education..................................................................................................................... 99 Reading Excellence..................................................................................................................... 100 Title V Innovation Strategies ....................................................................................................... 101 English Language Acquisition ..................................................................................................... 102 Title II-A ....................................................................................................................................... 103 Title IV ......................................................................................................................................... 104 Rural/Low Income ....................................................................................................................... 105 Title I Program Improvement....................................................................................................... 106 IDEA and Technology ................................................................................................................. 107

Title VII Indian Education ............................................................................................................ 108 IHS/Northern Navajo Medical Center.......................................................................................... 109 Johnson O’Malley........................................................................................................................ 110 Advanced Placement Incentives ................................................................................................. 111 Star Schools ................................................................................................................................ 112 PL 81-874 Impact Aid – Special Education................................................................................. 113 NM Grads .................................................................................................................................... 114 Medical Assistance Payments (Medicaid)................................................................................... 115 Navajo Nation Grants .................................................................................................................. 116 ETIP Project ................................................................................................................................ 117 Smaller Learning Communities ................................................................................................... 118 Projects with Industry .................................................................................................................. 119 Literacy through Libraries............................................................................................................ 120 Jordan Fundamentals Grant ....................................................................................................... 121 PNM Foundation, Inc................................................................................................................... 122 Toyota Time Grant ...................................................................................................................... 123 Burlington Grant .......................................................................................................................... 124

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TABLE OF CONTENTS

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CYFD – Preschool....................................................................................................................... 125 TANIF – After School Child Care ................................................................................................ 126 Technology for Education ........................................................................................................... 127 Computerized Learning Systems ................................................................................................ 128 Incentives for School Improvements ........................................................................................... 129 Bridging of the Arts...................................................................................................................... 130 Gear Up....................................................................................................................................... 131 Teacher Mentoring ...................................................................................................................... 132 Private Direct Grants ................................................................................................................... 133

Non-Major Capital Projects Funds Descriptions ................................................................................. 134 Non-Major Capital Projects Funds - Combining Balance Sheet......................................................... 135 Non-Major Capital Projects Funds - Combining Statement of Revenues, Expenditures, and

Changes in Fund Balances ......................................................................................................... 136

Non-Major Capital Projects Funds - Statements of Revenues and Expenditures – Budget and Actual (Non-GAAP Basis)

Public School Capital Outlay....................................................................................................... 137 Special Capital Outlay – State .................................................................................................... 138

Special Capital Outlay – Federal................................................................................................. 139 Capital Improvements SB-9 ........................................................................................................ 140

Energy Efficiency Act .................................................................................................................. 141 Public School Capital Outlay – 20%............................................................................................ 142

Fiduciary Funds Description ............................................................................................................... 143

Statement of Changes in Assets and Liabilities – All Agency Funds.......................................... 144 Schedule of Changes in Deposits Held for Others – All Agency Funds ..................................... 145

Schedule of Expenditures of Federal Awards..................................................................................... 146 Schedules: Pledged Collateral ....................................................................................................................... 148 Cash Reconciliation..................................................................................................................... 149 Joint Powers Agreements ........................................................................................................... 152 Bank Depositories ....................................................................................................................... 155

Independent Auditors’ Report on Compliance and on Internal Control Over Financial Reporting Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards ..................................................................... 156

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TABLE OF CONTENTS

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Independent Auditors’ Report on Compliance with Requirements Applicable to Each Major Program and Internal Control over Compliance in Accordance with OMB Circular A-133 .................................................................................................................... 158

Schedule of Findings and Questioned Costs.............................................................................. 160 Findings and Questioned Costs .................................................................................................. 161 Exit Conference........................................................................................................................... 166

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INTRODUCTION SECTION

STATE OF NEW MEXICO CENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22 OFFICIAL ROSTER June 30, 2004

BOARD OF EDUCATION

Randy J. Manning President

Bernadette A. Todacheene Vice-President Stanley R. King Secretary Glenn L. Duncan Member

Gary D. Ray Member

SCHOOL OFFICIALS Dr. Linda Besett Superintendent Dennis Nicholson Assistant Superintendent of Secondary Education

Jay Mortensen Assistant Superintendent of Elementary Education

Byron Manning Executive Director of Finance and Business Operations

Marlene Frazier Executive Director of Curriculum and Instruction

Sheri Price Director of Human Resources

Angela Haney Director of Student Nutrition Jeff Hunt Director of Transportation Karen Rodberg Director of School Improvement Herbert Frazier Director of Bilingual Education Patricia Emrick Director of Exceptional Programs

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CENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22 MANAGEMENT’S DISCUSSION AND ANALYSIS (MD&A)

FOR THE FISCAL YEAR ENDED JUNE 30, 2004 The Management’s Discussion and Analysis (MD&A) of the fiscal performance of Central Consolidated School District No. 22 (District) for the fiscal year ended June 30, 2004 represents the District’s second year implementation of the Governmental Accounting Standards Board Statement No. 34 (GASB 34). This written analysis is now a required part of the District’s financial reporting and is intended to give the reader an easy-to-understand overview of the District’s financial position and the results of its operations for the year. Please read it in conjunction with the District’s financial statements, which immediately follow this section. FINANCIAL HIGHLIGHTS

• The District’s total net assets of governmental activities increased by $10.1 million. This represents an 8.4% increase from fiscal year 2003, resulting from the use of current year funding for capital additions and previously unidentified capital assets.

• General revenues accounted for $62.5 million, or 72.3% of all 2004 fiscal year

revenues. Program specific revenues in the form of charges for services and grants and contributions accounted for $23.9 million, or 27.7% of total fiscal year 2004 revenues.

• The District had approximately $76.4 million in expenses related to governmental

activities of which $23.9 million of these expenses were offset by program specific charges for services or grants and contributions. General revenues of $62.5 million were adequate to provide for the remaining costs of these programs.

• Capital outlay expenditures decreased by $1.0 million from last fiscal year, 2003,

to the current fiscal year. However, the District is still involved in major renovation and addition projects going on at three elementary schools in the Shiprock area and construction on two performing arts centers in Kirtland and Shiprock during the current year.

• The overall Fund Balance increased by $1.1 million in the current fiscal year.

The sale of general obligation bonds resulted in $3.8 million to be available for the construction of two new performing arts centers in the Kirtland and Shiprock communities.

• Total revenues, exclusive of revenues from general obligation bond proceeds,

increased by $2.7 million when compared to the previous fiscal year. This represents a 3.5% increase in revenue growth for the year. The increase in revenue can be attributed to an increase in special revenue and capital projects sources.

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• Total expenditures, including capital expenditures and debt service, increased $5.0 million in the current fiscal year when compared to the previous fiscal year. The increase in capital expenditures accounts for this increase.

• The District’s total long-term debt has increased $0.61 million in the current fiscal

year. This was due to the sale of $3.8 million in general obligation bonds and the retirement of $2.875 million in bonds $0.315 in capital leases.

OVERVIEW OF THE FINANCIAL STATEMENTS

This annual report consists of three parts: management’s discussion and analysis (this section), the basic financial statements, and required supplementary information. The basic financial statements include two kinds of statements—district-wide and fund—that present different views of the District:

• The first two statements are district-wide financial statements that provide both short-term and long-term information about the District’s overall financial status.

• The remaining statements are fund financial statements that focus on individual parts of the District, reporting on the District’s operation in more detail than the district-wide statements.

• The governmental funds statements report on how basic services such as regular and special education were financed in the short term as well as what remains for future spending.

• Fiduciary funds statements provide information about the financial relationships in which the district acts solely as a trustee or agent for the benefit of others.

In addition to the new reporting requirements, this annual report consists of a series of detailed, audited financial statements, and the notes to those statements. The annual report also includes the Independent Auditor’s Report on Compliance and on Internal Control Over Financial Reporting Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards, the Independent Auditor’s Report on Compliance with Requirements Applicable to Each Major Program and Internal Control Over Compliance in Accordance with OMB Circular A-133, and the Schedule of Findings and Questioned Costs. These statements were included in past reporting by the District. District-Wide Financial Statements This being the second year of implementation of GASB 34 for the District, two years of data will be provided—current year data will be compared with prior-year data. The reader will see two new statements with the implementation of GASB 34—Statement of Net Assets and Statement of Activities. These two new statements are presented on a district-wide basis and encompass all assets and liabilities of the District. This section will look at the financial performance of the District as a whole rather than looking at individual components or areas of the District.

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Fund Financial Statements The District uses fund accounting to ensure and demonstrate compliance with financial and legal requirements. Fund financial statements are based on a modified accrual basis of accounting. The Balance Sheet and the Statement of Revenues, Expenditures, and Changes in Fund Balances are not new to the District’s annual financial reports, though the presentation has changed somewhat. The reports guide the reader to a meaningful overall view for the District’s assets, liabilities, revenues, expenditures, fund balances, and changes to those fund balances.

FINANCIAL ANALYSIS OF THE DISTRICT AS A WHOLE Statement of Net Assets Due to GASB 34 requirements, the Statement of Net Assets is new to the financial statements of the District and is prepared using the accrual method of accounting. The District’s financial position is the product of several financial transactions, including the net results of activities, the acquisition and payment of debt, the acquisition and disposal of capital assets, and the depreciation of capital assets. The following table presents a summary of the District’s net assets for the fiscal years ended June 30, 2003 and June 30, 2004.

AssetsCash and Investments $ 26,458,250 $ 29,483,693Other Current Assets 3,164,308 1,865,884Capital Assets, Net 130,359,466 139,894,137 Total Assets 159,982,024 171,243,714

LiabilitiesAccounts Payable 1,278,061 1,127,015Other Current Liabilities 5,254,349 5,970,465Long-Term Liabilities 32,968,153 33,594,813 Total Liabilities 39,500,563 40,692,293

Net AssetsInvestment in Capital Assets, Net 100,023,755 111,074,271Restricted 16,644,900 9,658,361Unrestricted 3,812,806 9,818,789 Total Net Assets $ 120,481,461 $ 130,551,421

June 30, 2003 June 30, 2004

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The following are significant current year transactions that have had an impact on the Statement of Net Assets:

• The addition of $9.9 million in capital assets through additions, remodeling, and equipment purchases and $6.7 million in previously unidentified assets.

• The retirement of $3.2 million in long-term debt.

• The addition of $3.8 million in long-term debt.

The District has total net assets of $130,551,421 as of June 30, 2004 as compared to $120,481,461 as of June 30, 2003. Changes in Net Assets The District’s total revenues for the fiscal year ended June 30, 2004 were $86.4 million and total revenues for the fiscal year ended June 30, 2003 were $77.6 million. The total costs of all programs and services were $76.4 million in 2004 and $70.7 million in 2003. The following table presents a summary of the changes in net assets for the fiscal year ended June 30, 2003.

Revenues:Program Revenues:

Charges for Services $ 949,752 $ 957,452Operating Grants and Contributions 6,683,988 18,275,457Capital Grants and Contributions 6,275,073 4,694,440

General Revenues:Property Taxes 6,333,676 7,324,467Federal and State Aid 56,006,196 54,634,788Investment Income 618,157 550,975Miscellaneous 700,861 - Total Revenues 77,567,703 86,437,579

Expenses:Direct Instruction 37,954,477 41,641,911Instructional Support 11,501,067 12,314,620Administration 1,772,190 2,068,119Business and Support Services 1,519,519 1,213,857Operation and Maintenance of Plant 7,266,990 8,302,508Food Services 2,550,562 2,727,632Athletics 1,100,954 1,126,386Non-Instructional Support 266,740 655,911Community Services 1,375,917 1,845,504Student Transportation 3,002,532 2,749,366Interest on Long-Term Obligations 2,410,903 1,721,805

Total Expenses 70,721,851 76,367,619 Increase in Net Assets $ 6,845,852 $ 10,069,960

June 30, 2003 June 30, 2004

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Statement of Activities The Statement Activities is also a new statement required by GASB 34 and is prepared using the accrual method of accounting. This report compliments the Statement of Net Assets by showing the overall change in the District’s net assets for the fiscal years ended June 30, 2004 and June 30, 2003. The following table shows the cost of the 11 major District functional activities: direct instruction, instructional support, administration, business and support services, operation and maintenance of plant, food services, athletics, non-instructional support, community services, student transportation, and interest on long-term obligations. This table also shows each function’s net cost (the total cost less charges for the services generated by the activities and intergovernmental aid provided for the specific programs). The net cost shows the financial burden that was placed on Federal, State, and District taxpayers by each of these functions.

Direct Instruction $ 37,954,477 $ (30,950,712) $ 41,641,911 $ (26,059,444)Instructional Support 11,501,067 (11,501,067) 12,314,620 (10,996,426)Administration 1,772,190 (1,406,415) 2,068,119 (1,552,558)Business and Support Services 1,519,519 (1,519,519) 1,213,857 (1,213,857)Operation and Maintenance of Plant 7,266,990 (6,748,459) 8,302,508 (7,902,643)Food Services 2,550,562 246,064 2,727,632 177,025Athletics 1,100,954 (917,654) 1,126,386 (974,539)Non-Instructional Support 266,740 (117,081) 655,911 (493,779)Community Services 1,375,917 (1,375,917) 1,845,504 (1,621,134)Student Transportation 3,002,532 (111,375) 2,749,366 (81,110)Interest on Long-Term Obligations 2,410,903 (2,410,903) 1,721,805 (1,721,805) Total Expenses $ 70,721,851 $ (56,813,038) $ 76,367,619 $ (52,440,270)

Expenses Revenue

June 30, 2003 June 30, 2004Total Net (Expense)Total

ExpensesNet (Expense)

Revenue

• The cost of all governmental activities this year was $76.4 million and $70.7 million

last year. • The Federal and State governments, along with charging for services, subsidized

certain specific programs with grants and contributions in the amount of $23.9 million in 2004 and $13.9 million in 2003.

• The net cost of governmental activities ($52.4 million in 2004 and$56.8 million in

2003) was financed by general revenues, which were primarily funded with Federal and State aid ($54.6 million this year and $56.0 million last year).

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FINANCIAL ANALYSIS OF THE DISTRICT’S FUNDS Balance Sheet The focus of the District’s governmental funds is to provide information on near-term inflows, outflows, and balances of spendable resources. Such information is useful in assessing the District’s financing requirements. In particular, unreserved fund balance may serve as a useful measure of the District’s net resources available for spending at the end of the fiscal year. The financial performance of the District as a whole is reflected in the Balance Sheet as of June 30, 2004. As the District completed the year, it reported a combined fund balance of $27.8 million, an increase of $1.1 million. This increase was primarily due to the sale of general obligation bonds in the amount of $3.8 million. Approximately $5.2 million, or 18.6% of the fund balance constitutes unreserved fund balance. The remaining fund balance of $22.6 million, or 81.4%, is reserved for inventory, debt service, or subsequent year’s expenditures. Statement of Revenues, Expenditures, and Changes in Fund Balances Total revenues from State, local, and Federal sources were $80.1 million, an increase of $2.7 million from the prior year. Including all other financing sources and uses, which include $3.8 million in general obligation bond proceeds (Other Financing Sources), total revenues increased to $83.9 million. The total expenditures for the District were $82.8 million, including lease purchase payments, an increase of $5.0 million from the prior year. The General Fund is the principal operating fund of the District. The decrease in fund balance of $1,371,245 in the General Fund for the fiscal year was a result of the District beginning to spend down its cash balance. The State has passed legislation establishing limits on allowable cash balances in the General Fund. As a result of this, the District is required to spend its cash balance down to the established guidelines or risk losing the money back to the State. Multi-Year Comparison of District Revenues and Expenditures A view of the District’s revenues and expenditures over the past eight years indicates that, while attendance figures are declining, total revenues, excluding bond revenues, are increasing annually. This is related to the increase in the dollar value of student unit allocations by the State for the State Equalization Guarantee, an increase in capital projects revenues, and an increase in the dollar value of Federal and State grants received by the District.

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1995-1996 $ 68,050,818 $ 50,804,257 $ 21,000,000 1996-1997 57,609,722 -15.3% 1.2% 67,666,590 24.9% 10,000,000 1997-1998 58,520,172 1.6% 9.9% 60,357,673 -12.1% 6,200,000 1998-1999 55,907,215 -4.5% 6.9% 58,442,084 -3.3% - 1999-2000 61,679,611 10.3% 10.3% 63,798,288 8.4% - 2000-2001 71,979,810 16.7% 10.2% 73,595,743 13.3% 4,000,000 2001-2002 72,797,502 1.1% 7.1% 73,819,830 0.3% - 2002-2003 83,110,746 14.2% 6.3% 77,887,271 5.2% 5,700,000 2003-2004 83,943,908 1.0% 3.5% 82,849,578 6.0% 3,800,000

% ChangeBond

RevenuesYear Total Revenues* % Change

% Change w/o Bond Revenues

Total Expenditures*

* Note: Revenues include proceeds from General Obligation Bonds and exclude cash carryovers. Expenditures include capital outlays. Equity transfers are included in both revenues and expenditures. Budgetary Highlights The District has experienced the same growth in its budget as it has in its revenues and expenditures. The budgeting process for the State of New Mexico is defined under New Mexico State Statues (Section 22) and the New Mexico Administrative Code (Section 6). Additionally, the District develops its budget through input at site budget meetings from parents and staff members at each of its three main attendance areas—Kirtland, Newcomb/Naschitti, and Shiprock; the District Budget Committee, made up of community members, certified and non-certified staff, administrators, and finance department personnel; and input from the local School Board and Superintendent. The District also has a facilities master plan for major construction and renovation that is constantly updated for major capital expenditures. GASB 34 does not require a statement presenting the overall result of the budget for each year; however, all major budgetary funds are required to be reported as a separate statement. Major budgetary funds in these reports are the General Operational Fund (Operational), ESEA Title I, IDEA-B Entitlement, PL 81-874 Impact Aid, Bond Building, and Debt Service. In addition, fifty-five (55) non-major Special Revenue Funds and six (6) non-major Capital Projects funds are also reported for their budgetary performance. Examples of non-major Special Revenue funds are Transportation, Food Services, Title VII, and Impact Aid-Special Education. Examples of non-major Capital Project funds include SB-9 Capital Improvements (Two Mill Levy) and Public School Capital Outlay-20%. The following shows the fiscal relationship of the major funds and the combined non-major funds.

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DISTRICT BUDGET DISTRIBUTION

43.0%

4.5%

4.1%

6.7%

1.8%

9.1%

17.8%

13.1%

Operational

ESEA Title I

IDEA-B Entitlement

PL 81-874 Impact Aid

Bond Building

Debt Service

Special Revenue

Capital Projects

The Operational Fund accounts for 43.0% of the total District budget. This fund provides the salary and benefits for the significant majority of the instructional, instructional support, school support, maintenance, custodial, administrative, and business staffs as well as classroom materials, special education ancillary staff, insurance, and utility costs. Revenue from this fund is substantially derived from the State Equalization Guarantee (61.4%) and PL-874 Federal Funds (Impact Aid) (34.4%). The State Equalization Guarantee is based upon a funding formula developed by the State. This formula includes taking a credit for the PL-874 funds received by the District. The net effect on the District’s Operational Fund is retaining 5% of the total Impact Aid dollars in the fund for operational expenditures. The Operational Fund will be discussed in further detail later in the Management Discussion and Analysis. The following table examines the summary budget performance of the major and combined non-major funds for the fiscal year ended June 30, 2004. Detail budget performance is examined through the Statements of Revenues and Expenditures—Budget and Actual.

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FUND

Operational $ 45,121,000 $ 42,729,261 $ 2,391,739 ESEA Title I 4,275,172 3,377,231 897,941 IDEA-B Entitlement 1,933,311 1,584,030 349,281 PL 81-874 Impact Aid 7,000,000 5,130,198 1,869,802 Bond Building 9,551,725 1,183,429 8,368,296 Debt Service 4,676,400 4,588,295 88,105

MAJOR FUNDS EXPENDITURE TO BUDGET PERFORMANCE

FINAL BUDGET ACTUAL

EXPENDITURES VARIANCE

FUNDSpecial Revenue $ 18,684,188 $ 14,882,391 $ 3,801,797 Capital Projects 13,737,637 7,686,950 6,050,687

COMBINED MINOR FUNDS EXPENDITURE TO BUDGET PERFORMANCE FINAL COMBINED ACTUAL VARIANCE

All expenditures within the major and non-major funds fell within the approved budget limits. No budgets had expenditures in excess of budget authority. Operational Fund The Operational Fund is the primary fund for the District. Operational revenues totaled $41,418,618, which represents 49.3% of total District revenues of $83,937,516 (inclusive of bond proceeds and operating transfers in). The Operational Fund had an initial approved budget of $44,725,479 and a final budget of $45,121,000. The increased budget of $395,521, a .09% increase, was due to the budgeting of additional cash carryover from the previous year’s budget. While the District has seen a decline in student enrollment over the past five years, the operational fund has, on whole, experienced an increase in total revenues over that same period of time due to higher unit value allocations from the State, as can be seen from the following table.

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Y ear Inc rease1995 -1996 $ 30 ,541 ,503 1996 -1997 31 ,379 ,370 2 .7%1997 -1998 34 ,652 ,567 9 .4%1998 -1999 36 ,796 ,306 5 .8%1999 -2000 39 ,746 ,474 7 .4%2000 -2001 38 ,620 ,493 -2 .9%2001 -2002 40 ,980 ,570 5 .8%2002 -2003 40 ,279 ,814 -1 .7%2003 -2004 41 ,418 ,618 2 .7%

O p era tio n a l F u n d R even u esR ev enues

The Operational Fund represents the major expenditures for the education of the students within the District. During the year ended June 30, 2004, the Operational Fund expended $42,783,471 of which $24,429,285 was expended on Direct Instruction. This represents 57.10% of all Operational Fund expenditures. Direct Instruction expenditures include salaries for regular, bilingual, and special education teachers and educational assistants, payroll taxes, benefit costs, classroom supplies and equipment, training, student and teacher travel, and instructional related contract services. Employee salaries, payroll taxes, and benefit costs account for 83.7% of all Operational Fund expenditures.

O PER AT IO N AL EXPEN D IT U R ES B Y FU N C T IO N

0.51%15.50%

1.91%

2.58%19.12%57.10%

0.07% 2.03%

0.46%0.73%

Direct Instruction

Instructional Support

Adm inistration

Business and SupportServ ices

O peration and M aintenanceof P lant

A thletics

Non-Instructional Support

Com m unity Serv ices

Non-O perating

Capita l O utlay

Instructional Support expenditures include salaries, payroll taxes, and benefits for principals, counselors, nurses, librarians, program coordinators, school secretaries and receptionists, special education ancillary staff, and contracted ancillary support personnel for special education. Ancillary personnel provide specialized services for special education students and include speech or occupational therapists, psychologists, diagnosticians, etc. It also includes the necessary supplies, equipment, training, and travel for these individuals. Instructional Support expenditures totaled $8,178,705, or 19.12% of Operational expenditures.

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The next largest area of expenditures for the District is for Operation and Maintenance of Plant. These expenditures totaled $6,630,335, 15.50% of the Operational expenditures. This includes salaries, payroll taxes, and benefits for maintenance staff and supervisors, school custodians, and maintenance and custodial clerical staff. It also includes costs for maintenance and custodial supplies and equipment, maintenance and repairs of buildings, grounds, and equipment, utilities, internet access, travel and training for maintenance and custodial personnel, outside contract services, and property and liability insurance. The District also receives funding for maintenance costs from the voter approved Two Mill Levy Fund (Fund 31700). Administration expenditures totaled $1,105,483, or 2.58% of Operational Fund expenditures. Included in this area are salaries, payroll taxes, and benefits for the superintendent, assistant superintendents, administrative secretaries and receptionist, and human resource personnel. Additionally, supplies, equipment, travel, training, and outside contract services for the above individuals and the School Board are included in this function. Administrative costs like legal and auditing fees and costs related to board and bond elections are also included here. Expenditures for Athletics totaled $868,441, 2.03% of Operational expenditures, and include salaries and payroll taxes for coaches and athletic directors, as well as expenditures for travel, supplies, and equipment. Athletics is also funded from the Athletic Fund (Fund 22000). This fund is where gate receipts are maintained and spent. Total expenditures from the Athletic Fund were $113,855. The District expended 1.91%, $815,263, of the Operational Fund for Business and Support Services. This includes salaries, payroll taxes, and benefits for employees of the business office, warehouse and delivery, computer technicians and programmers, and statistical and student count departments. It also includes supplies, equipment, outside contract services, training, and travel for the above individuals, and postage and shipping for the District. Community Services, which include day-care services at Career Prep High School and Newcomb High School and the Parents as Teachers Program (PAT) in the Kirtland/Ojo and Shiprock areas, accounted for $314,198, 0.73% of Operational expenditures. This includes salaries, payroll taxes, and benefits for day-care providers and PAT personnel as well as supplies, equipment, travel, and training for these individuals. The District spent $216,831, 0.51%, was spent from Capital Outlay for the purchase of two activity buses and a car. The District spent $194,842, 0.46% of Operational expenditures, for Non-Instructional Support. This includes salaries and payroll taxes for activity directors and club sponsors and supplies and travel costs for the student organizations. Finally, $30,088 was spent on litigation fees in fiscal year 2003-2004, less than 0.07% of Operational Expenditures.

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CAPITAL ASSETS AND DEBT ADMINISTRATION

Capital Assets As of June 30, 2004, the district had invested $187.9 million in capital assets, including land, school buildings, athletic facilities, administrative offices, buses and other vehicles, computer and audio-visual equipment, and other equipment. This amount represents a net increase of $16.6 million from last year. Because of GASB 34 requirements, the District added $19.9 million of assets to the books in fiscal year 2002-2003 that had not been previously capitalized. The District also identified an additional $8.9 million of assets in the current year that had not yet been capitalized. This is for capital expenditures on parking lots, fences, sewer systems, and other items of infrastructure. The District also had $7.7 million in new additions in the current fiscal year. For financial reporting purposes, the District will only capitalize and depreciate equipment with a value of $5,000 or more. The District will continue to inventory and track all equipment additions in excess of $1,000, however, in accordance with State law. GASB 34 rules now require public entities to depreciate capital assets as private-sector companies do. The accumulated depreciation for the District’s capital assets amounts to $48.0 million. Total depreciation expense for the year was $4.3 million with an adjustment of an additional $2.8 million for the newly identified assets that had not been booked in the previous year. The District utilizes a “straight line” depreciation method in all cases and has established standardized lifetime tables in calculating depreciation. . The following schedule presents capital asset balances, net of depreciation, for the fiscal year ended June 30, 2004.

Land $ 1,698,547 Land Improvements 5,562,050 Buildings and Improvements 118,290,813 Equipment and Vehicles 3,554,214 Construction in Progress 10,788,513 Total $ 139,894,137

Amount

Major additions to capital assets this year, additions in excess of $100,000, included additional construction and remodeling at Eva B. Stokely Elementary, Nataani Nez Elementary, Nizhoni Elementary, and Mesa Elementary. The State funded the addition of two new kindergarten classrooms at Newcomb Elementary and one kindergarten classroom at Naschitti Elementary. The State also funded new roofs for Newcomb Elementary School and Career Prep High School. The District also began construction on the two new performing arts centers in Kirtland and Shiprock. Two new portables were purchased to add science labs to Shiprock High School.

15

The District has also completed exterior painting projects at Kirtland Middle School and Nataani Nez Elementary School. Additionally, the District has been painting hallways and replacing carpet and floor tile throughout the District. In the District’s fiscal year 2005 budget, final payments will be made on the Eva B. Stokely Elementary, Nizhoni Elementary, and Mesa Elementary projects as well as the two performing arts centers. The State is funding the addition of one new kindergarten classroom at Nizhoni Elementary, a major remodel of the kitchen and mechanical and electrical systems at Tse Bit Ai Middle School, and a new roof for Kirtland Middle School. The state is also funding intercom and fire alarm upgrades as well as mechanical and electrical upgrades at various schools. The District is remodeling the kindergarten area at Ruth N. Bond in order to add two new classrooms and it will be re-roofing the Kirtland natatorium. In addition, the Shiprock administrative offices, Career Prep High School, and Newcomb Elementary School are scheduled for complete exterior paint jobs. The District will continue painting interiors and installing new carpeting and tile at many schools in the District. The painting and carpeting projects are expected to take several years to complete. Finally, the District received a construction award from the State for the construction of a new Career Prep High School. The District will receive $2.94 million dollars towards the construction of the new school. The District will be responsible for funding the remaining cost of the project, estimated at $2.26 million. The District is considering issuing additional bonds to fund this project. Additional information on the District’s capital assets can be found in Note 4 on page 46 of this report. Long-Term Debt At year-end, the District has $36,150,000 in general obligation bonds and $339,113 in other long-term debt outstanding, $3,189,113 due within one year. State statutes currently limit the amount of general obligation debt a district may issue to 6.0% of its total assessed valuation. At June 30, 2004, the District’s general obligation debt limit was $37,695,048. At year-end, the District was bonded to 95.9% of the legal limit. The District issued $3.8 million in new bonds during the fiscal year ended June 30, 2004. The District has never defaulted on any of its debt or other obligations. Listed below is the District’s total general obligation debt and yearly payment schedule as of June 30, 2004.

16

YEAR ENDED JUNE 30 PRINCIPAL INTEREST TOTAL

2005 2,850,000 1,674,419 4,524,419 2006 2,875,000 1,517,491 4,392,491 2007 2,900,000 1,378,440 4,278,440 2008 2,925,000 1,237,535 4,162,535 2009 2,850,000 1,094,193 3,944,193 2010 2,825,000 951,883 3,776,883 2011 2,900,000 808,203 3,708,203 2012 2,925,000 659,838 3,584,838 2013 2,900,000 510,536 3,410,536 2014 2,600,000 373,821 2,973,821 2015 2,600,000 256,796 2,856,796 2016 2,000,000 160,774 2,160,774 2017 2,000,000 81,431 2,081,431 2018 1,000,000 21,750 1,021,750 Total $36,150,000 $10,727,110 $46,877,110

Additional information on the District’s long-term debt can be found in Note 5 on page 47 of this report.

FACTORS BEARING ON THE DISTRICT’S FUTURE At the time these financial statements were prepared and audited, the district was aware of the following circumstances that could significantly affect its financial health in the future.

• The District is experiencing a decline in student enrollment. Over the previous five year period, the District’s average enrollment, as measured by the 40th, 80th, and 120th day counts, has decreased by 473 students with a decline in membership occurring in each of those five years. The 40th day count for fiscal year 2005, however, reverses that trend with an increase of an additional 52 students over the 40th day count from fiscal year 2004.

The overall decline in enrollment is principally attributable to the elementary age groups as the secondary schools have seen a decline of only 53 students during that five year period while the elementary schools have seen a decline of 420 students. This would indicate that smaller family sizes and/or fewer families with school age children are residing within the District. The surrounding school districts in the area are also experiencing declining enrollments. The following charts detail the change in enrollment for elementary and secondary schools and enrollment by major attendance areas.

17

FIVE YEAR ENROLLMENT HISTORY

3,100

3,200

3,300

3,400

3,500

3,600

3,700

3,800

2000 2001 2002 2003 2004

FISCAL YEAR

STU

DEN

T C

OU

NT

ELEMENTARY SECONDARY

ENROLLMENT BY ATTENDANCE AREAS

3,0833,0493,0823,0473,128

3,106 3,058 2,954 2,893 2,778

1,163 1,177 1,192 1,110 1,063

-

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

2000 2001 2002 2003 2004

FISCAL YEAR

STU

DEN

T C

OU

NT

KIRTLAND AREA SHIPROCK AREA NEWCOMB AREA

18

These trends indicate that the District would experience lower funding levels in the coming fiscal years if State unit value amounts remained the same. The District will need to continue monitoring teacher/student ratios with these trends in mind.

• On September 23, 2003, the voters of New Mexico passed a new constitutional

amendment that increases the amount of funding to be provided to educational institutions in the State of New Mexico from the Permanent Fund. Additional funding has been promised to school districts from this funding source, which may help to offset the reduction in funding from declining enrollments in the District. However, at this time, the District does not know how much, if any, additional funding it will receive because of this constitutional amendment. The next session of the legislature will deal with these issues. The changes will affect the fiscal year 2004-2005 budget.

• During the 2003 legislative session, the legislature passed House Bill 212 that

included various measures that will affect public schools in the State of New Mexico.

Cash carryover amounts from the Operational Funds will be limited at the

end of fiscal year 2003-2004. Cash balances cannot exceed a predetermined rate of “program cost” (4.5% for the District—$1.85 million for fiscal year 2004-2005), or the State will take back the excess carryover funds. Districts with Impact Aid funds, like Central Consolidated, will be given an additional allowance for carryover, approximately $400,000 - $600,000 for the District. The District will be below the allowable amount and will therefore not lose additional cash balances to the State.

The State is initiating a three-tiered licensing structure for certified

personnel with minimum salary requirements. All teachers hired after the first day of the 2002-2003 school year must be established as “Highly Qualified” if they are teaching in the core academic area. By June 30, 2006, all teachers hired before the first day of the 2002-2003 school year must be “Highly Qualified” if they are teaching in the core academic area.

Level I Provisional Teacher is to make a minimum of $30,000 in

the 2003-2004 School year. Before advancing to Level II, the following must be completed:

Three years at Level I Mentoring Program Professional Development Dossier

Dossier should include successful annual evaluations and demonstration/evidence of meeting

19

the nine teaching competencies. The nine competencies are divided into five strands

Level II Professional Teacher is to make a minimum of $40,000,

phased in by the 2005-2006 school year. The Level II license is renewable every nine years. Before advancing to Level III, the following must be completed:

Minimum of three years at Level II Masters degree or National Board Certification Professional Development Dossier

Dossier should include successful annual evaluations and demonstration/evidence of meeting the nine teaching competencies. The nine competencies are divided into five strands

Level III-A Professional Teacher is to make a minimum of

$50,000, phased in by the 2007-2008 school year. The level III-A license is renewable every nine years with the following criteria:

Verify leadership role

• The Federal No Child Left Behind Act (NCLB) is changing the way schools are rated within New Mexico. The changes in the rating system are expected to cause additional schools within the State to be rated as “probationary” or to be put in “corrective action” status. The major highlights for NCLB are as follow.

All students are to be proficient by 2013-2014. Accordingly, the State’s

adequate yearly progress (AYP) measure will not only look at all public school students but will also evaluate the performance of four categories of students:

Economically disadvantaged students Students from major racial and ethnic groups Students with disabilities Students with limited English proficiency

If any of these groups do not make AYP, that school will be rated probationary.

Schools that are identified for improvement or corrective action must offer

all students the choice option to transfer to another public school within the District that has not been identified for improvement at the expense of the Title I program.

If a school fails to make AYP by the end of the first full school year after

being identified for school improvement, then the District must arrange for supplemental educational services for eligible students who attend that school. These services can include tutoring and other supplemental

20

academic enrichment services, recognized by the State, that are in addition to the instruction provided during the school day.

All core subject teachers must become “Highly Qualified” by the end of

2005-2006. All paraprofessionals (aides) in Title I schools (all District schools are Title I schools) must have a high school diploma and have two years of college or an associate’s degree, or meet a rigorous standard of quality and demonstrate skill on a State or local test. Five percent of the Title I budget must be used to ensure that all teachers and paraprofessionals meet these high quality standards.

These changes will govern set-aside dollars before allocating funds to

individual schools. District Operational and Title I budgets may be affected in the future by these changes as additional dollars are moved into supplemental services or to salaries as increased requirements are put on teachers and paraprofessionals.

CONTACTING THE DISTRICT’S FINANCIAL MANAGEMENT

This financial report is designed to provide the District’s citizens, taxpayers, customers, investors, and creditors with a general overview of the District’s finances and to demonstrate the District’s accountability for the money it receives. If you have questions about this report or need additional financial information, contact the Executive Director of Finance, Central Consolidated School District, 583 CR 6100, Kirtland, NM 87417.

21

STATE OF NEW MEXICO CENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22 STATEMENT OF NET ASSETS As of June 30, 2004

GovernmentalActivities

ASSETS Current Assets:

Cash and Investments $ 29,483,693Taxes Receivable (Net) 317,362Due from Other Governmental Units 1,395,249Inventory 153,273

Total Current Assets 31,349,577

Noncurrent Assets:Land 1,698,547Construction in Progress 10,788,513Depreciable Noncurrent Assets:

Buildings, Equipment, and Improvements 175,380,600Less: Accumulated Depreciation (47,973,523) Total Noncurrent Assets 139,894,137

Total Assets 171,243,714

LIABILITIES Current Liabilities:

Accounts Payable and Other Current Liabilities 1,425,683Accrued Interest 663,974Deferred Revenue 1,818,710Current Portion of Long-Term Obligations 3,189,113

Total Current Liabilities 7,097,480

Long-Term Liabilities:Compensated Absences Payable 294,813Noncurrent Portion of Long-Term Obligations 33,300,000

Total Long-Term Liabilities 33,594,813

Total Liabilities 40,692,293

NET ASSETSInvestment in Capital Assets, Net of Related Debt 111,074,271Restricted For :

Debt Service 3,731,507Capital Projects 4,183,146Other Restrictions 1,743,708

Unrestricted 9,818,789

Total Net Assets $ 130,551,421

SEE INDEPENDENT AUDITORS' REPORTS The accompanying notes are an integral part of these financial statements 22

STATE OF NEW MEXICO CENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22 STATEMENT OF ACTIVITIES For the Year Ended June 30, 2004

Program Revenues Net (Expenses)Operating Capital Revenue and

Charges for Grants and Grants and Changes in Functions/Programs Expenses Services Contributions Contributions Net Assets

Governmental Activities:Direct Instruction $ 41,641,911 10,888,027 4,694,440 $ (26,059,444)Instructional Support 12,314,620 1,318,194 (10,996,426)Administration 2,068,119 515,561 (1,552,558)Business and Support Services 1,213,857 (1,213,857)Operation and Maintenance of Plant 8,302,508 399,865 (7,902,643)Food Services 2,727,632 243,608 2,661,049 177,025Athletics 1,126,386 151,847 (974,539)Non-Instructional Support 655,911 162,132 (493,779)Community Services 1,845,504 224,370 (1,621,134)Student Transportation 2,749,366 2,668,256 (81,110)Interest on Long-Term Obligations 1,721,805 (1,721,805)

Total Governmental Activities $ 76,367,619 957,452 18,275,457 4,694,440 (52,440,270)

General Revenues: Taxes Property Taxes, Levied for General Purposes 1,013,407 Property Taxes, Levied for Debt Service 4,852,494 Property Taxes, Levied for Capital Projects 1,458,566 Federal and State Aid Not Restricted to Specific Purpose General 50,105,168 Capital 4,529,620 Interest and Investment Earnings 550,975 Subtotal, General Revenues 62,510,230

Change in Net Assets 10,069,960

Net Asets - Beginning 120,481,461

Net Assets - Ending $ 130,551,421


STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22BALANCE SHEET - GOVERNMENTAL FUNDSAs of June 30, 2004

Fund Fund Fund Fund Fund Fund11000 24101 24106 24247 31100 41000

GENERAL OtherOPERATIONAL ESEA IDEA-B PL 81-874 BOND DEBT Governmental

FUND TITLE I ENTITLEMENT IMPACT AID BUILDING SERVICE Funds TOTALS

ASSETS

Assets:Cash and Investments $ 2,492,441 760,127 497,089 6,412,010 8,415,773 4,154,208 8,248,878 30,980,526Taxes Receivable 12,439 241,273 63,650 317,362Due from Grantor 1,395,249 1,395,249Inventory 153,273 153,273

Total Assets $ 2,504,880 760,127 497,089 6,412,010 8,415,773 4,395,481 9,861,050 32,846,410

LIABILITIES AND FUND BALANCE

Liabilities:Bank Overdraft $ 1,496,833 1,496,833Accounts Payable 26,594 103,956 5,240 746,526 244,699 1,127,015Accrued Salaries and Benefits 69,476 19,035 744 70,367 65,347 224,969Accrued Compensated Absences 53,185 3,220 1,227 5,153 10,914 73,699Deferred Revenue 11,807 633,916 495,118 224,343 748,713 2,113,897

Total Liabilities 161,062 760,127 497,089 80,760 746,526 224,343 2,566,506 5,036,413

Fund Balance:Reserved for Inventory 153,273 153,273Reserved for Subsequent

Year's Expenditures 2,343,818 1,863,620 7,669,247 6,443,269 18,319,954Reserved for Debt Service 4,171,138 4,171,138Undesignated, Reported In Special Revenue Fund 4,467,630 966,733 5,434,363

Capital Projects Fund (268,731) (268,731)

Total Fund Balance 2,343,818 6,331,250 7,669,247 4,171,138 7,294,544 27,809,997

Total Liabilities and Fund Balance $ 2,504,880 760,127 497,089 6,412,010 8,415,773 4,395,481 9,861,050 32,846,410

SEE INDEPENDENT AUDITORS' REPORTSThe accompanying notes are an integral part of these financial statements 24

STATE OF NEW MEXICO CENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22 RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET WITH THE STATEMENT OF NET ASSETS June 30, 2004

Amounts reported for governmental activities in the Statement of Net Assetsare different because:

Total fund balances - governmental funds $ 27,809,997

Capital assets used in governmental activities are not financial resourcesand therefore are not reported as assets in governmental funds.

The cost of capital assets is 187,867,660Accumulated depreciation is (47,973,523) 139,894,137

Delinquent property taxes not collected within thirty days after year-endare considered "available" revenues and are shown as deferred revenueson the balance sheet. 295,187

Long-term and certain other liabilities, including bonds payable, arenot due and payable in the current period and therefore are not reported asliabilities in governmental funds. Long-term and other liabilities at year-endconsist of:

Bonds payable (36,150,000)Compensated absences (294,813)Lease purchase payable (339,113)Accrued interest payable (663,974) (37,447,900)

Total net assets - governmental activities $ 130,551,421


STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES - GOVERNMENTAL FUNDSFor the Year Ended June 30, 2004


PL 81-874 Other ESEA IDEA-B IMPACT BOND DEBT Governmental

OPERATIONAL TITLE I ENTITLEMENT AID BUILDING SERVICE Funds TOTALSRevenues:

Federal Sources $ 14,982,029 3,490,275 1,586,001 4,466,430 13,957,878 38,482,613State Sources 25,491,386 7,916,092 33,407,478Local Sources 945,203 115,887 4,852,494 2,333,841 8,247,425

Total Revenues 41,418,618 3,490,275 1,586,001 4,466,430 115,887 4,852,494 24,207,811 80,137,516

Expenditures:Education, Current:

Direct Instruction 24,429,285 2,195,910 1,050,047 2,302,986 5,547,585 35,525,813Instructional Support 8,178,705 352,788 486,627 1,918,007 1,397,368 12,333,495Administration 1,105,483 270,244 49,266 159,558 50,082 214,858 1,849,491Business and Support Services 815,263 293,023 73,423 1,181,709Operation and Maintenance of Plant 6,630,335 5,852 20,508 452,560 7,109,255Food Services 2,757,262 2,757,262Athletics 868,441 113,855 982,296Non-Instructional Support 194,842 47,652 242,494Community Services 314,198 579,272 61 377,118 576,927 1,847,576Student Transportation 86,209 3,063,119 3,149,328

Education, Non-Current: Non Operating 30,088 30,088Debt Principal 2,875,000 2,875,000Debt Interest 1,663,213 1,663,213Capital Outlay 216,831 96,179 1,789,901 8,838,120 10,941,031

Total Expenditures 42,783,471 3,490,275 1,586,001 5,167,379 1,789,901 4,588,295 23,082,729 82,488,051

Revenues Over (Under) Expenditures (1,364,853) (700,949) (1,674,014) 264,199 1,125,082 (2,350,535)

Other Financing Sources (Uses):Bond Proceeds 3,800,000 3,800,000Operating Transfers In 6,392 6,392Operating Transfers Out (6,392) (6,392)Lease Purchase Payments (355,135) (355,135)

Net Other Financing Sources (Uses) (6,392) 3,800,000 (348,743) 3,444,865

Revenues and Other Financing Sources Over (Under) Expenditures and Other Financing Sources (1,371,245) (700,949) 2,125,986 264,199 776,339 1,094,330

Fund Balance - Beginning of Year, as Previously Reported 3,715,063 6,859,771 5,543,261 3,906,939 6,690,633 26,715,667

Adjustments and Residual Equity Transfers 172,428 (172,428)

Fund Balance - Beginning of Year, as Restated 3,715,063 7,032,199 5,543,261 3,906,939 6,518,205 26,715,667

Fund Balance - End of Year $ 2,343,818 6,331,250 7,669,247 4,171,138 7,294,544 27,809,997


STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES WITH THE STATEMENT OF ACTIVITIESFor the Year Ended June 30, 2004

Total net change in fund balances - governmental funds $ 1,094,330

Amounts reported for governmental activities in the Statement of Activities aredifferent because:

Capital outlays to purchase or build capital assets are reported in governmentalfunds as expenditures. However, for governmental activities, those assets areshown in the Statement of Net Assets and allocated over their estimated useful lives as annual depreciation expenses in the Statement of Activities. This is the amount by which capital outlays exceeds depreciation for the year.

Depreciation expense (7,086,529) Capital outlays 16,621,200 Excess of capital outlays over depreciation expense 9,534,671

In the Statement of Activities, certain operating expenses - compensated absencesand interest expense - are measured by the amounts incurred during the year. In the fund financial statements, however, expenditures are measured by the amountof financial resources used (essentially the amounts actually paid). The (increases)decreases in the liabilities for the year were:

Compensated absences payable (15,773) Accrued interest payable (18,316) (34,089)

Repayment of debt principal is an expenditure in the governmental funds, but itreduces long-term liabilities in the Statement of Net Assets and does not affectthe Statement of Activities.

Bond principal payments 2,875,000 Lease purchase principal payments 314,859 3,189,859

Because some property taxes will not be collected for several months after thefiscal year-end, they are not considered available revenues in the governmentalfunds. They are considered revenue in the Statement of Activities. The increase(decrease) in property taxes for the year were: 85,189

Bond proceeds provide current financial resources to governmental funds, butissuing debt increases long-term liabilities in the Statement of Net Assets. Bondproceeds for the year totaled: (3,800,000)

Change in net assets of governmental activities $ 10,069,960


STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22GENERAL FUNDFUND 11000 - OPERATIONALSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Original FinalRevenues:

Federal SourcesPL874 - Impact Aid $ 17,256,566 17,256,566 17,865,493 - 608,927Federal Direct Grants Indirect Costs 148,446 148,446 278,331 - 129,885Federal Flowthrough Grants Indirect Costs 167,323 167,323 237,230 - 69,907Access Board (E-rate) 145,000 145,000 174,073 - 29,07320% Restricted (3,510,673) (3,510,673) (3,573,098) - (62,425)

14,206,662 14,206,662 14,982,029 - 775,367State Sources:

State Equalization Guarantee 26,141,814 26,141,814 25,491,386 - (650,428)

Local Sources:School District Tax Levy 293,873 293,873 256,595 - (37,278)Oil and Gas Taxes 2,926 2,926 5,344 - 2,418Fees - Activities 10,000 10,000 24,167 - 14,167Rents and Leases 300,000 300,000 309,996 - 9,996Sale of District Assets - - 33,326 - 33,326Prior Year Checks Voided - - 1,464 - 1,464Royalties - - 2,500 - 2,500Gifts/Donations Non-Category - - - - - Insurance Recoveries 10,000 10,000 42,187 - 32,187Refunds - - - - - Earnings from Investments 550,000 550,000 355,144 - (194,856)

1,166,799 1,166,799 1,030,723 - (136,076)Total Revenues 41,515,275 41,515,275 41,504,138 - (11,137)


Direct Instruction 25,150,298 25,250,161 24,441,467 (99,863) 808,694Instructional Support 8,878,542 8,907,212 8,154,927 (28,670) 752,285Administration 1,112,446 1,187,812 1,092,312 (75,366) 95,500Business and Support Services 886,007 896,007 819,308 (10,000) 76,699Operations and Maintenance of Plant 6,518,083 6,685,724 6,609,754 (167,641) 75,970Athletics 904,664 917,428 867,070 (12,764) 50,358Non-Instructional Support 229,475 229,475 195,042 - 34,433Community Services 475,964 407,081 302,462 68,883 104,619Non-Operating 350,000 420,100 30,088 (70,100) 390,012

Education, Non-Current:Capital Outlay 220,000 220,000 216,831 - 3,169

Total Expenditures 44,725,479 45,121,000 42,729,261 (395,521) 2,391,739

Revenues Over (Under) Expenditures (3,210,204) (3,605,725) (1,225,123) (395,521) 2,380,602

Operating Transfers Out (6,392)

Revenues and Other FinancingSources Over (Under) Expendituresand Other Financing Uses (3,210,204) (3,605,725) (1,231,515) (395,521) 2,380,602

Budgetary Notation-Cash Appropriatedfrom Prior Year $ 3,210,204 3,605,725

Actual(Budgetary

Basis)

VariancesBudgeted Amounts Original

to FinalFinal

to Actual


STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 24101 - ESEA TITLE ISTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004


Federal Sources $ 3,201,312 4,275,172 3,853,175 1,073,860 (421,997)


Direct Instruction 2,042,111 2,716,711 2,195,565 (674,600) 521,146Instructional Support 361,917 432,177 352,488 (70,260) 79,689Administration 264,011 296,645 268,145 (32,634) 28,500Operation and Maintenance of Plant 7,500 16,341 5,837 (8,841) 10,504Community Services 374,458 711,856 468,987 (337,398) 242,869Student Transportation 151,315 101,442 86,209 49,873 15,233 Total Expenditures 3,201,312 4,275,172 3,377,231 (1,073,860) 897,941

Revenues Over (Under) Expenditures $ - - 475,944 - 475,944

Actual(Budgetary

Basis)


to FinalFinal

to Actual


STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 24106 - IDEA-B ENTITLEMENTSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004


Federal Sources $ 1,549,859 1,933,311 1,637,215 383,452 (296,096)


Direct Instruction 1,445,859 1,338,748 1,050,047 107,111 288,701Instructional Support 55,797 534,433 484,717 (478,636) 49,716Administration 48,203 60,130 49,266 (11,927) 10,864

Total Expenditures 1,549,859 1,933,311 1,584,030 (383,452) 349,281


Actual(Budgetary

Basis)


to FinalFinal

to Actual


STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 24247 - PL 81-874 IMPACT AIDSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004


Federal Sources $ 7,000,000 7,000,000 4,466,430 - (2,533,570)

Expenditures: Education, Current:

Direct Instruction 2,741,101 2,741,101 2,300,501 - 440,600Instructional Support 2,373,356 2,373,356 1,915,531 - 457,825Administration 200,000 200,000 159,558 - 40,442Business and Support Services 497,812 497,812 291,617 - 206,195Operation and Maintenance of Plant 300,326 300,326 19,010 - 281,316Community Services 787,405 787,405 347,802 - 439,603

Education, Non-Current: Capital Outlay 100,000 100,000 96,179 - 3,821

Total Expenditures 7,000,000 7,000,000 5,130,198 - 1,869,802

Revenues Over (Under) Expenditures $ - - (663,768) - (663,768)

Actual(Budgetary

Basis)


to FinalFinal

to Actual


STATE OF NEW MEXICO CENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22 STATEMENT OF FIDUCIARY NET ASSETS - AGENCY FUNDS As of June 30, 2004

Agency FundsAssets

Cash and Investments $ 419,016

Liabilities

Deposits Held for Others $ 419,016


33

STATE OF NEW MEXICO CENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22 NOTES TO FINANCIAL STATEMENTS June 30, 2004 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The financial statements of Central Consolidated School District No. 22 (District) have been prepared in conformity with Generally Accepted Accounting Principles (GAAP) as applied to government units. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting principles.

The District’s more significant accounting policies are described in the sections below.

A. Reporting Entity

The District is considered a primary government, since it is a special-purpose government that has a separately elected governing body, is legally separate, and is fiscally independent of other state or local governments. The District has no component units as there are no other legally separate organizations for which the elected School Board members are financially accountable. The Central Consolidated District No. 22 School Board (School Board) was created under the provisions of Chapter 22, Article 5, Paragraph 4, NMSA 1978. The School Board is comprised of five members who are elected for terms of four years.

B. Function of Entity

The District provides kindergarten, elementary, and secondary high school educational services to school age residents of the District. The District operates under the direction of a local school board, under the provision of Chapter 22, Article 5, Paragraph 4, NMSA 1978, Comp. The local school board is charged with the following powers and duties:

(1) Subject to the rules of the department, develop educational policies for the

District; (2) Employ a local superintendent for the District and fix his/her salary;

(3) Review and approve the District budget; (4) Acquire, lease, and dispose of property; (5) Have capacity to sue and be sued;

(6) Acquire real estate by eminent domain as pursuant to the procedures in the Eminent Domain Code;

(7) Issue general obligation bonds of the District; (8) Provide for the repair and maintain all property belonging to the District; (9) For good cause and upon order of the district court, subpoena witnesses

and documents in connection with a hearing concerning any powers or duties of the local school boards;

(10) Except for expenditures for salaries, contract for the expenditures of

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money according to the provisions of the Procurement Code; (11) Adopt rules pertaining to the administration of all powers or duties of the

local school board; (12) Accept or reject any charitable gift, grant, devise, or bequest. The

particular gift, grant, devise, or bequest accepted shall be considered an asset of the District or the public school to which it is given;

(13) Offer and, upon compliance with the conditions of such offer, pay awards for the information leading to the arrest and conviction or other appropriate disciplinary disposition by the courts or juvenile authorities of offenders in cases of theft, defacement, or destruction of local District property. All such rewards shall be paid from District funds in accordance with rules promulgated by the department; and.

(14) Give prior approval for any educational program in a public school in the

District that is to be conducted, sponsored, carried on or caused to carried on by a private organization or agency.

The District operates under the auspices of the New Mexico Public Education Department and adheres to budgetary accounting principles and procedures promulgated by the New Mexico Public Education Department as approved by the State Board of Education and the Legislative Finance Committee in accordance with State statute (section 22-8-5 NMSA 1978, Comp.).

C. Basis of Financial Presentation

The District’s accounts are organized on the basis of funds. Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain government functions or activities. A fund is a separate entity with a self-balancing set of accounts established as needed to demonstrate compliance with finance-related legal and contractual provisions.

The District’s funds are classified into two categories—governmental and fiduciary. Each category, in turn, is divided into separate "fund types.”

Governmental Funds Governmental funds are used to account for the District’s general governmental activities, including the collection and disbursement of legally restricted monies, the acquisition or construction of general fixed assets, and the servicing of general long-term debt. Governmental funds include the following fund types:

General Fund – the District’s primary operating fund accounts for all financial resources of the District that are not accounted for in other funds. Special revenue funds – reflect the revenues and expenditures that are legally restricted for specific purposes. Capital projects funds – account for the acquisition of fixed assets or

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construction of major capital projects. Debt service funds – account for revenues and expenditures associated with the servicing of long-term debt.

The District is required to present certain of its governmental funds as major funds based upon certain specific criteria. In addition to the General Fund described above, the District has designated the following funds as major funds:

ESEA Title I (24101) –To account for a program funded by a Federal grant to supplement the regular instructional program for educationally deprived students. Funding authorized by the Elementary and Secondary Education Act of 1965, Chapter 1 of Title 1, as amended, Public Laws 100-297, 20 U.S.C. 2701. IDEA-B Entitlement (24106) – The IDEA-B Competitive program is to provide grants to states that flow through to schools to assist them in providing a free appropriate public education to all children with disabilities. Funding authorized by the Individuals with Disabilities Education Act, Part B, Sections 611-617, and part D, Section 674, as amended, 20 U.S.C. 1411-1417 and 1420.

Impact Aid (PL-81-874) (24247) – to account for a portion of the Federal assistance authorized by Public Law 81-874 and the Elementary and Secondary Education Act, Title VIII, as amended, allowing Federal assistance to be provided to local educational agencies adversely affected by Federal activities. The District is composed largely of non-taxable Indian lands held in trust by the Federal government limiting the property tax base required to adequately fund District schools serving children living on Indian lands. Bond Building (31100) – to account for bond proceeds and the interest earned thereon. The proceeds are restricted for the purposes of making additions to and furnishing of school buildings, or purchasing or improving school grounds, or any combination thereof, as approved by the voters of the District. Debt Service (41000) – to account for monies designated for the payment of interest and principal due on general obligation bonds. Financing is provided by special tax levies approved by the voters of the District and assessed by the County Assessor and collected and remitted to the District by the County Treasurer.

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Fiduciary Funds

Fiduciary funds account for assets held by the government in a trustee capacity. The District only had agency funds during the year ended June 30, 2004. The agency funds are as follow:

Agency funds are used to account for assets that the government holds for others in an agency capacity.

Central Activity Fund – accounts for assets held by the District as an agent for the individual schools and school organizations.

D. Measurement Focus and Basis of Accounting

Government-Wide Financial Statements (GWFS) The Statement of Net Assets and the Statement of Activities display information about the reporting government as a whole. Fiduciary funds are not included in the GWFS. Fiduciary funds are reported only in the Statement of Fiduciary Net Assets at the fund financial statement level. The Statement of Net Assets and the Statement of Activities were prepared using the economic resources measurement focus and the accrual basis of accounting. Revenues, expenses, gains, losses, assets, and liabilities resulting from exchange-like transactions are recognized when the exchange takes place. Revenues, expenses, gains, losses, assets, and liabilities resulting from non-exchange transactions are recognized in accordance with the requirements of GASB Statement No. 33, Accounting and Financial Reporting for Non-exchange Transactions. Program Revenues Program revenues included in the Statement of Activities derive directly from the program itself or from parties outside the District’s taxpayer or citizenry, as a whole; program revenues reduce the cost of the function to be financed from the District’s general revenues. Allocation of Indirect Expenses In the government-wide financial statements, expenses are classified by function. The District reports all direct expenses by function in the Statement of Activities. Direct expenses are those that are clearly identifiable with a function. The District does not currently employ indirect cost allocation systems. Depreciation expense is specifically identified by function and is included in the direct expense of each function, except for that portion of depreciation that is identified as unallocated on the Statement of Activities. Interest on general long-term debt is considered an indirect expense and is reported separately on the Statement of Activities.

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Inter-fund Transfers For the purposes of the Statement of Activities, all inter-fund transfers between individual governmental funds have been eliminated. Fund Financial Statements (FFS) Governmental Funds The accounting and financial reporting treatment applied to a fund is determined by its measurement focus. Governmental fund types use the flow of current financial resources measurement focus and the modified accrual basis of accounting. Under the modified accrual basis of accounting revenues are recognized when susceptible to accrual (i.e., when they are “measurable and available”). “Measurable” means the amount of the transaction can be determined and “available” means collectible within the current period or soon enough thereafter to pay liabilities of the current period. The government considers all revenues available if they are collected within 60 days after year-end. Expenditures are recorded when the related fund liability is incurred, except for unmatured principal and interest on general long-term debt which is recognized when due, and certain compensated absences and claims and judgments which are recognized when the obligations are expected to be liquidated with expendable available financial resources. Any effect of inter-fund activity has been eliminated from the district-wide financial statements. With this measurement focus, only current assets and current liabilities are generally included on the balance sheet. Operating statements of these funds present increases and decreases in net current assets. The governmental funds use the following practices in recording revenues and expenditures:

Revenues Ad valorem taxes (property taxes) are susceptible to accrual.

Entitlements and shared revenues (which include state equalization and state revenue sharing) are recorded as unrestricted grants-in-aid at the time of receipt or earlier if the susceptible to accrual criteria are met. Expenditure-driven grants are recognized as revenue when the qualifying expenditures have been incurred and all other grant requirements have been met and the susceptible to accrual criteria have been met. Other receipts become measurable and available when cash is received by the District and are recognized as revenue at that time. Expenditures In the fund financial statements expenditures are classified by character and function, as follows:

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Current (further classified by function)

Debt Service Capital Outlay Salaries earned prior to year-end are accrued. Other Financing Sources (Uses) Permanent reallocations of resources between funds of the reporting entity are classified as inter-fund transfers. Inter-fund transfers are accounted for as other financing sources (uses). These other financing sources (uses) are recognized at the time the underlying events occur. Fiduciary Funds The agency funds are custodial in nature (assets equal liabilities) and do not present results of operations or have a measurement focus. Agency funds are accounted for using the modified accrual basis of accounting. These funds are used to account for assets that the District holds for others in an agency capacity.

E. Budgets and Budgetary Accounting

Formal budgetary integration is employed as a management control device during the year. The budget is classified as a non-appropriated budget under governmental accounting standards. A non-appropriated budget is a financial plan for an organization approved in a manner consistent with a constitution, charter, statute, or ordinance that is not subject to appropriation.

Budgets for the General, Special Revenue, Debt Service and Capital Projects

Funds are adopted on a basis inconsistent with Generally Accepted Accounting Principles (GAAP). These budgets are prepared using the cash basis of accounting. Budgetary comparisons for the various funds in this report are on this non-GAAP budgetary basis. The District follows these procedures in establishing the budgetary data reflected in the financial statements:

(1) Prior to April 15, (unless a later date is fixed by the Superintendent of

Public Instruction) the local school board submits to the School Budget Planning Unit (SBPU) of the New Mexico Public Education Department an estimated budget for the school district for the ensuing fiscal year beginning July 1. The operating budget includes proposed expenditures and the means of financing them. All budgets submitted to the State Department of Public Education (SDPE) by the school district shall contain headings and details as prescribed by law.

(2) Prior to June 20 of each year, the proposed "tentative" budget will be

reviewed and approved by the SBPU and certified and approved by the local school board at a public hearing of which notice has been published

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by the local school board which fixes the estimated budget for the school district for the ensuing fiscal year.

(3) The "tentative" budget will be used by the District until a "final" budget

has been approved by SBPU and the local school board. The budget shall be integrated formally into the accounting system. Encumbrances shall be used as an element of control and shall be integrated into the budget system.

(4) The SBPU shall make corrections, revisions and amendments to the

estimated budgets fixed by the local school board to recognize actual cash balances and carryover funds, if any.

(5) Prior to the first Monday of September of each year, SBPU shall approve

and certify to each local school board a final budget for use by the local school board.

(6) No school board or officer or employee of a school district shall make any

expenditures or incur any obligation for the expenditure of public funds unless such expenditure or contractual obligation is made in accordance with an operating budget approved by the division, but this does not prohibit the transfer of funds between line items within a series of a budget.

(7) Budget change requests are processed in accordance with Supplement 1

(Budget Preparation and Maintenance) of the Manual of Procedures Public School Accounting and Budgeting. Such changes are initiated by the school district and approved by the SBPU.

(8) Legal budget control for expenditures is by function.

(9) Appropriations lapse at fiscal year end. Funds unused during the fiscal

year may be carried over into the next fiscal year by budgeting those in the subsequent fiscal year's budget. The budget of Central Consolidated School District No. 22 has been amended during the current fiscal year in accordance with these procedures. The budget statements included in the accompanying financial statements reflects the approved budget and amendments thereto.

Encumbrances represent commitments related to unperformed contracts for goods

or services. Encumbrance accounting - under which purchase orders, contracts and other commitments for the expenditure of resources are recorded to reserve that portion of the applicable appropriation - is utilized in the governmental funds. Encumbrances lapse at the fiscal year end.

F. Cash and Cash Equivalents

Cash and cash equivalents include amounts on hand and in demand deposits as well as short-term investments with a maturity date within three months of the

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date acquired by the District.

G. Short-Term Inter-fund Receivables/Payables

During the course of operations, some transactions may occur between individual funds for goods provided or services rendered. These receivables and payables, as well as any short-term inter-fund loans, are classified as "due from other funds" or "due to other funds" on the balance sheet.

H. Inventory

Purchased inventory is valued at the lower of cost (first-in, first-out) or market. Inventory in the Food Services Fund consists of purchased food and non-food items and United States Department of Agriculture (USDA) commodities. Commodities are shown at the USDA procurement cost. Costs are recorded as expenditures at the time individual inventory items are used (consumption method). Reported inventories are equally offset by a fund balance reserve that indicates that they do not constitute "available spendable resources" even though they are a component of net current assets.

I. Prepaid Items

Payments made to vendors for services that will benefit periods beyond June 30, 2004 are recorded as prepaid items.

J. Capital Assets

Capital assets have been defined as assets with an initial individual cost of $5,000 or more having an estimated useful life in excess of one year. Capital assets have been recorded at historical costs if available. If unavailable, historical values were estimated by determining current values and deflating these amounts to the year of acquisition using readily available deflation factors. The District does not develop “internal use” software. Capitalizable purchased software is depreciated over its expected useful life using the straight-line method of depreciation. Books comprising the District’s libraries are not capitalized as the net value were considered immaterial to the financial statements at June 30, 2004. General fixed assets are not capitalized in the funds used to acquire or construct them. Instead, capital acquisition and construction are reflected as expenditures in governmental funds, and the related assets are recorded at cost when purchased. All donated fixed assets are valued at their estimated fair market value on the date received. Infrastructure (roads, bridges, storm drainage projects, etc.), if any, are recorded and depreciated if appropriate. The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend asset lives are not capitalized. Interest costs during construction, if any, are not capitalized.

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Additions, improvements, and other capital outlays that extend the useful life of an asset are capitalized. The District does not capitalize interest in regards to its capital assets. Estimated useful life is management’s estimate of how long the asset is expected to meet service demands. Straight-line depreciation is used based on the following estimated useful lives: Land Improvements 40 years Buildings and Building Improvements 60 years Equipment and Vehicles 5 to 10 years

K. Compensated Absences

Vested or accumulated vacation leave that is expected to be liquidated with expendable available financial resources is reported as an expenditure and a fund liability of the governmental fund that will pay it. No liability has been recorded for non-vesting rights to receive sick pay benefits as the District's policies do not provide for payment or exchange in the future.

L. Long-Term Obligations

Long-term debt is recognized as a liability of a governmental fund when due or when resources have been accumulated in the Debt Service Fund for payment early in the following year. For other long-term obligations, only that portion expected to be financed from expendable available financial resources is reported as a fund liability of a governmental fund.

M. Fund Balances of Fund Financial Statements

Reserves represent those portions of fund equity not available for appropriation or expenditure or legally segregated for a specific future use. Designated fund balances represent tentative plans for future use of financial resources. Portions of the fund balances have been reserved for subsequent year's expenditures, debt service, and inventory. The reservation represents the amount of cash appropriated in the subsequent year's budget.

N. Bond Discounts/Issuance Costs

For fund financial reporting, bond premiums and discounts as well as issuance costs, are recognized in the period the bonds are issued. Bond proceeds are reported as another financing source net of the applicable premium or discount. Issuance costs, even if withheld from the actual net proceeds received, are reported as debt service expenditures.

O. Inter-Fund Transactions

Quasi-external transactions are accounted for as revenues, expenditures, or expenses. Transactions that constitute reimbursements to a fund from

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expenditures/expenses initially made from it that are properly applicable to another fund, are recorded as expenditures/expenses in the reimbursing fund and as reductions of expenditures/expenses in the fund that is reimbursed. All other inter-fund transactions, except quasi-external transactions and reimbursements, are reported as transfers. Nonrecurring or non-routine permanent transfers of equity are reported as residual equity transfers. All other inter-fund transfers are reported as operating transfers.

P. Estimates and Management Assumptions

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates.

Q. Restricted Net Assets

For the government-wide Statement of Net Assets, net assets are reported as restricted when constraints placed on net asset used are either:

Externally imposed by creditors (such as debt covenants), grantors, contributors, or laws or regulations of other governments;

Imposed by law through constitutional provisions or enabling legislation.

The District’s policy is to apply restricted resources first when an expense is incurred for purposes for which both restricted and unrestricted net assets are available.

2. DEPOSITS AND INVESTMENTS

Central Consolidated School District No. 22 is authorized under the provisions of Chapter 6, Article 10, paragraph 10 NMSA 1978, Comp. to deposit its money in banks, savings and loan associations, and/or credit unions whose accounts are insured by an agency of the United States.

All money not immediately necessary for the public uses of the District may be invested in:

(a) Bonds or negotiable securities of the United States, the State, or any county, municipality, or school district which has taxable valuation of real property for the last preceding year of at least one million dollars ($1,000,000) and has not defaulted in the payment of any interest or sinking fund obligation or failed to meet any bonds at maturity at any time within the preceding five years;

(b) Securities that are issued by the United States Government or by its agencies

or instrumentalities that are either direct obligations of the United States or are backed by the full faith and credit of the United States Government or agencies guaranteed by the United States Government;

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(c) Contracts with banks, savings and loan associations, or credit unions for the present purchase and resale at a specified time in the future of specific securities at specified prices at a price differential representing the interest income to be earned by the investor. The contract shall be on the books of the financial institution as being the property of the investor and the designation shall be contemporaneous with the investment. The contract shall be fully secured by obligations of the United States having a market value of at least one hundred two percent of the contract. The collateral required for investment in the contracts provided for in the subsection shall be shown on the books of the financial institution as being the property of the investor and the designation shall be contemporaneous with the investment.

Deposits and investments are classified into three categories of risk. The categories of risk relate only to custodial credit risk which is the risk that the school district will not be able either to recover deposits if the depository financial institution fails or to recover the value of investment or collateral securities that are in the possession of an outside party if the counter party to the investment or deposit transaction fails. Classification in category 1 indicates that the exposure of deposits or investments to potential custodial credit risk is low. The level of potential custodial credit risk is higher for deposits and investments classified in category 2 and highest for those in category 3.

Deposits with financial institutions are classified depending on whether they are insured or collateralized, as follows:

Category 1: Insured or collateralized with securities held by the entity or by its agent in the entity's name.

Category 2: Collateralized with securities held by the pledging financial institution's trust department or agent in the entity's name.

Category 3: Uncollateralized. (This includes any bank balance that is collateralized with securities held by the pledging financial institution or by its trust department or agent but not in the entity's name.)

Investments that are securities that are not either insured, registered, or in the hands of the District have to be classified in the three categories based on who the securities custodian is and how the custodian holds the securities. Utilizing this criteria result in the following classification:

Category 1: Insured or registered, or securities held by the entity or its agent in the entity's name.

Category 2: Uninsured and unregistered, with securities held by the counter-party's trust department or agent in the entity's name.

Category 3: Uninsured and unregistered, with securities held by the counter-party, or its trust department, or agent but not in the entity's name.

Demand deposits at June 30, 2004 that were insured by Federal Deposit Insurance Corporation have all been classified as Category 1.

If the District is unable to receive payment on public money at the rate of interest set forth by the State Board of Finance (which is no less than one hundred percent of the asked price on United States Treasury Bills of the same maturity on the day of the deposit) from financial institutions within the geographic boundaries of the governmental unit, the District may invest its money with banks, savings and loans, credit unions or the New Mexico State Treasurer's short-term investment pool. Money invested in the New Mexico State Treasurer's short-term investment pool shall not be invested for a period greater than one hundred eighty one days. The State Treasurer Local Governmental Investment Pool is not SEC registered. Section 6-10-10 I, NMSA 1978, empowers the State Treasurer, with the advice and consent of the State Board of Finance, to invest money held in the short-term investment fund in securities that are issued by the United States government or by its departments or agencies and are either direct obligations of the U.S. or are backed by the full faith and credit of the U.S. government or are sponsored by the U.S. government. The Local Government Investment Pool investments are monitored by the same investment committee and the same policies and procedures that apply to all other state investments. The Pool does not have unit shares. Per Section 6-10-10F, NMSA 1978, at the end of each month all interest earned is distributed by the State Treasurer to the contributing entities in the amounts directly proportionate to the respective amounts deposited in the fund and the length of time the amounts were invested. Central Consolidated School District voluntarily participates in the State Treasurer Local Government Investment Pool. The investments are valued at fair value based upon quoted market prices as of the valuation date.

At June 30, 2004, the carrying amount (book balance) of Central Consolidated School

District No. 22 was $29,483,693. The bank deposits are held at Wells Fargo Bank. An additional amount was placed with the New Mexico Treasurer's Local Government Investment Pool. Total cash and investments, as reflected on the balance sheet include the following:

Cash and Investments with Financial Institutions $ 4,444,932 Investments with New Mexico State Treasurer 25,038,761

$ 29,483,693

These balances are reflected as:

Cash and Investments $ 30,980,526 Bank Overdrafts (1,496,833)

$ 29,483,693

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The deposits in the banks are insured and pledged as follows:

Wells Fargo Bank: Insured $ 100,000 $ 100,000 Uninsured 4,344,932 7,673,617

Total Cash in Bank $ 4,444,932 $ 7,773,617

50% Collaterization Required- 50% of Uninsured $ 3,836,809

Pledged Collateral 12,960,836

Over Collteralization $ 9,124,027

State of New Mexico Short-Term Investment Pool: $ 25,038,761 $ 25,038,761

The following schedule summariezed the bank's deposits by risk categories (not presentedis the New Mexico State Treasurer's Investment Pool):

Wells Fargo Bank $ 100,000 $ - $ 7,673,617 $ 7,773,617

Carrying Amount

Bank Balance

Risk Category #1

Risk Category #2

Risk Category #3 Totals

3. RECEIVABLES

Accounts receivable are recorded in the various funds. They consist of amounts

receivable from governments and private agencies relating to various grant agreements and property taxes receivable.

Details of receivables as reflected on the Statement of Net Assets at June 30, 2004 are

detailed hereunder:

OtherGeneral Other Major Governmental Total

Property Taxes $ 12,439 $ 241,273 $ 63,650 $ 317,362 Due from Grantors - - 1,395,249 1,395,249 Total $ 12,439 $ 241,273 $ 1,458,899 $ 1,712,611

All amounts are considered collectible at June 30, 2004.

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4. CAPITAL ASSETS

Capital assets balances and activity for the year ended June 30, 2004 are as follows:

Capital Assets ClassBalance at July 1,

2003 Additions AdjustmentsBalance at June 30,

2004

Land 1,639,047$ - 59,500 1,698,547$ Land Improvements 8,824,975 35,965 - 8,860,940 Buildings and Improvements 147,903,257 3,205,557 8,960,784 160,069,598 Equipment and Vehicles 5,522,536 1,018,294 (90,768) 6,450,062 Construction in Progress 7,356,645 5,606,219 (2,174,351) 10,788,513 Total 171,246,460 9,866,035 6,755,165 187,867,660

Less Accumulated Depreciation: Land Improvements 3,059,666 239,224 - 3,298,890 Buildings and Improvements 35,576,295 3,270,221 2,932,269 41,778,785 Vehicles and Equipment 2,251,033 788,659 (143,844) 2,895,848 Total Depreciation 40,886,994 4,298,104 2,788,425 47,973,523

Governmental Activities Capital Assets, Net $ 130,359,466 5,567,931 3,966,740 $ 139,894,137

Depreciation Expense by Function Direct Instruction 3,053,205$ Instructional Support 5,397 Administration 171,946 Business and Support Services 55,062 Operation and Maintenance of Plant 448,311 Food Services 6,676 Athletics 144,090 Transportation 413,417

Total Depreciation Expense 4,298,104$

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The District’s construction in progress includes the following major projects:

Eva B. Stokely Elementary Addition 4,012,115$ 3,868,227$ 143,888$ FY05

Nizhoni Elementary Addition/Remodel 3,140,000 3,130,259 9,741 FY05

Kirtland Business Office 60,000 791 59,209 FY 05

Mesa Elementary Remodel 2,775,636 937,494 1,838,142 FY05

Newcomb Elem. - Kindergarten Classes 494,871 453,504 41,367 FY05

Kirtland Middle - Roofing 188,097 68,213 119,884 FY05

Naschitti Elem. - Kindergarten Class 250,045 229,887 20,158 FY05

Shiprock Performing Arts Center 6,178,310 1,207,905 4,970,405 FY05

Kirtland Performing Arts Center 6,021,690 892,233 5,129,457 FY05

23,120,764$ 10,788,513$ 12,332,251$

Project Budget

Construction in Progress

Project Balance

Estimated Completion

Date

5. LONG-TERM DEBT

A. Changes in Long-Term Liabilities

During the year ended June 30, 2004, the following changes occurred in the Long-Term liabilities.

General Obligation Bonds Payable $ 35,225,000 $ 3,800,000 $ 2,875,000 $ 36,150,000 Lease Purchase Contracts 653,972 - 314,859 339,113 Accrued Compensated Absences 334,848 309,500 275,836 368,512

$ 36,213,820 $ 4,109,500 $ 3,465,695 $ 36,857,625

Balance at July 1, 2003 Additions Deletions

Balance at June 30, 2004

B. General Obligation Bonds

The District’s general obligation bonds were issued for the purposes of creating, remodeling, making additions to and furnishing school buildings, and purchasing and improving school grounds, and are payable solely from general property taxes that are levied against all taxable property in the District. Interest rates on the outstanding bonds range from 1.00% to 5.88%. The bonds are payable out of the Debt Service Fund (Fund 41000). The following is a schedule of the debt service requirements for all general obligation bonds as of June 30, 2004.

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YEAR ENDED JUNE 30 PRINCIPAL INTEREST TOTAL

2005 2,850,000 1,674,419 4,524,419 2006 2,875,000 1,517,491 4,392,491 2007 2,900,000 1,378,440 4,278,440 2008 2,925,000 1,237,535 4,162,535 2009 2,850,000 1,094,193 3,944,193 2010 2,825,000 951,883 3,776,883 2011 2,900,000 808,203 3,708,203 2012 2,925,000 659,838 3,584,838 2013 2,900,000 510,536 3,410,536 2014 2,600,000 373,821 2,973,821 2015 2,600,000 256,796 2,856,796 2016 2,000,000 160,774 2,160,774 2017 2,000,000 81,431 2,081,431 2018 1,000,000 21,750 1,021,750 Total $36,150,000 $10,727,110 $46,877,110

C. Lease Purchase

In May of 1995 the District entered into a lease purchase agreement for the Honeywell Energy Management System. The lease payments are made out of the Energy Efficiency Act Fund (Fund 31800). The District has one year remaining on the contract. In fiscal year 2005, principal payments will total $339,113 and interest payments will total $16,022 for a total of $355,135. A description of the contract follows.

Contract Date Cost of Assets Purchased Interest Rate Payment Terms Maturity Date Balloon Payment

May 30, 1995 $2,468,801 7.49% $88,784/quarter 06/01/05 None

D. Compensated Absences

All District employees who have twelve-month contracts are granted eighteen days of annual leave per annum. The maximum that can be accrued is 36 days. Employees will be compensated for unused vacation leave upon termination. The board reserves the right to negotiate a separate annual leave agreement with the superintendent. The current portion of compensated absences (estimated amount due within one year) of $73,699 is included with the caption “Accounts Payable and Other Current Liabilities.” Total accrued compensated absences amounted to $368,512 at June 30, 2004, $294,813 which is considered long-term. Historically, the compensated absences have been paid out of the following funds in the percentages noted:

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General Operating Fund 11000 72.2% Transportation Fund 13000 7.5% PL81.874 Fund 24247 7.0% ESEA Title I Fund 24101 4.4% Other Special Revenue Funds (7) (less than 2.5% each) 8.9%

6. REVENUES

A. Property Tax Levies

Central Consolidated School District No. 22 receives property tax payments made by the property owners of the District from the San Juan County Treasurer for operational, public school capital improvements, and debt service purposes.

Property taxes are assessed on January 1st of each year, except on livestock, and are payable in two equal installments on November 10th of the year in which the tax bill is prepared and April 10th of the following year. Property taxes are considered delinquent if not paid within 30 days of their due date. Property taxes are collected by the County Treasurer and remitted to the District in the month following collection.

Although there are no restrictions placed on property taxes collected for operational purposes, restrictions do exist on the amounts collected under the Public School Capital Improvements Act (22-25-1 to 22-25-10 NMSA 1978) and the amounts collected as a result of issuing general obligation bonds.

Under the provisions of the Public School Capital Improvements Act, any local school board may adopt a resolution to submit to the qualified electors of the school district the question of whether or not a property tax should be imposed on the net taxable value of property allocated to the school district for the purpose of capital improvements. The resolution shall:

(1) Identify the capital improvements;

(2) Specify the rate of the proposed tax, which shall not exceed two dollars ($2.00) on each $1,000 of net taxable value of property;

(3) Specify the date an election will be held;

(4) Limit the imposition of the tax to no more than four property tax years.

If approved, any revenues produced by the tax and any state distribution resulting

to the District under the act shall be expended only for the capital improvements specified in the authorized resolution. During the year ended June 30, 2003 the District’s electorate approved the two-mill tax for an additional 4 years (2004, 2005, 2006, and 2007).

General obligation bonds may be issued for the purpose of erecting, remodeling,

making additions to, and the furnishing of school buildings, or purchasing or improving school grounds or any combination of these purposes. Such bonds shall be fully negotiable and constitute negotiable instruments.

The school board shall establish adequate budgetary provisions, approved by the

School Management Division, to promptly pay, as it becomes due, all principal and interest on general obligation bonds issued by the school district. The full faith and credit of a school district shall be pledged to the payment of the principal and interest on general obligation bonds issued by the school district.

The Board of County Commissioners shall levy and collect upon all taxable

property within a school district in the county such tax as is necessary to pay the interest and principal on general obligation bonds issued by the school district as the interest and principal become due, without limitation as to rate or amount. During the year ended June 30, 2004, property taxes were imposed upon the net taxable value of property allocated to the school district in the following amounts (rate per $1,000 of net taxable value):

Residential Non-ResidentialGenral Operational Purposes 0.329 0.500 Public School Capital Improvements 2.000 2.000 General Obligation Bonds-Debt Service 7.638 7.638

Property tax revenue recognized by the District during the year ended June 30,

2004 amounted to the following:

General Operational Purposes $ 243,224 $ 4,341 $ 247,565 Public School Capital Improvements 1,245,300 21,708 1,267,008 General Obligation Bonds-Debt Service 4,755,066 82,884 4,837,950 Public School Capital Outlay-20% 60,764 1,085 61,849 Totals $ 6,304,354 $ 110,018 $ 6,414,372

Real Property Taxes

Oil and Gas Taxes Total

B. State Equalization Guarantee

Each school district in the State of New Mexico receives a "state equalization guarantee distribution" which is defined as "that amount of money distributed to each school district to insure that the school district's operating revenue, including its local and federal revenues, is at least equal to the school district's program cost" (as defined in Chapter 22, Section 8-25, NMSA 1978).

A school district's program costs are determined through the use of various formulas using "program units" which take into consideration (1) early childhood education; (2) basic education; (3) special education; (4) bilingual-multi cultural education; (5) size, etc. Payment is made from the public school fund under the authority of the chief (director of public school finance). The District received $25,491,386 in state equalization guarantee distributions during the year ended June 30, 2004.

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C. Transportation Distribution

Money in the transportation distribution of the public school fund shall be used only for the purpose of making payments to each school district for the to-and-from school transportation costs of students in grades kindergarten through twelve attending public school within the school district, and of three- and four-year-old children who meet the state board approved criteria and definition of developmentally disabled, and for transportation of students to and from their regular attendance centers and the place where vocational education program are being offered.

The transportation distribution is allocated to each school district according to an objective formula developed by the State Transportation Director and the Director of Public School Finance. In the event the sum of the proposed transportation allocations to each school district exceeds the amounts in the transportation distribution, the allocation for each school district will be reduced in the proportion that the local school district allocation bears to the total statewide transportation distribution.

The Department shall make periodic installment payments to school districts

during the school year from the transportation distributions, based upon the allocations certified by the state transportation director.

The District received $2,665,887 in transportation distributions during the year

ended June 30, 2004. D. SB-9 State Match

The Director shall distribute to any school district that has imposed a tax under the Public School Capital Improvements Act (22-25-1 to 22-25-10 NMSA 1978) an amount from the public school capital improvements fund that is equal to the amount by which the revenue estimated to be received from the imposed tax as specified in Subsection B of Section 22-25-3 NMSA 1978, assuming a one hundred percent collection rate, is less than an amount calculated by multiplying the product obtained by the rate imposed in the District under the Public School Capital Improvements Act. The distribution shall be made by December 1, of each year that the tax is imposed in accordance with Section 22-25-3 NMSA 1978. However, in the event that sufficient funds are not available in the Public School Capital Improvements fund to make the state distribution provided for in this section, the dollar per program unit figure shall be reduced as necessary.

The District received $332,532 in SB-9 state match funds during the year ended June 30, 2004.

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E. Public School Capital Outlay

Under the provisions of Chapter 22, Article 24, a public school capital outlay fund was created. The money in the fund may be used only for capital expenditures deemed by the Public School Capital Outlay Council necessary for an adequate educational program.

The Council shall approve an application for grant assistance from the fund when the Council determines that:

(1) A critical capital outlay need exists;

(2) The residents of the school districts have provided all available

resources to the district to meet its capital outlay requirements;

(3) The school district has used its resources in a prudent manner; (4) The District is in a county or counties that have participated in the

reappraisal program and the reappraised values are on the tax rolls, or will be used for the tax year 1979 as certified by the property tax division;

(5) The school district has provided insurance for buildings of the school

district in accordance with the provisions of Section 13-5-3 NMSA 1978;

(6) The school district is indebted at not less than seventy-five percent of

the total debt authorized by law; (7) The school district has submitted a five-year facilities plan that includes

enrollment projections.

The Council shall consider all applications for assistance from the fund and after public hearing shall either approve or deny the application. Applications for grant assistance shall only be accepted by the Council after a district has complied with the provisions of this section. The Council shall list all applications in order of priority and all allocations shall be made on a priority basis; provided, however, except in the case of an emergency, that the order of priority shall first reflect those projects which have been previously funded but are not as yet completed, excluding expansion of those projects and contingent upon maintenance of the required local support.

Money in the fund shall be disbursed by warrant of the Department of Finance and Administration on vouchers signed by the Secretary of Finance and Administration following certification by the Council that the application has been approved.

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During the year ended June 30, 2004, the District did not receive any new critical capital outlay funds.

F. Instructional Materials

The New Mexico State Department of Education shall establish a separate instructional materials account for each school district, state institution, private school, or adult basic education center in the state having students in attendance entitled to the free use of instructional materials pursuant to the Instructional Material Law (22-15-1 through 22-15-14 NMSA 1978).

On or before July 1 of each year, the Department of Education shall allocate credit to the instructional materials account of each school district, state institution, or private school not less than ninety percent of its estimated entitlement as determined from the estimated forty-day membership for the next school year. A school district's, state institution's, or private school's entitlement is that portion of the total amount of the annual appropriation less a deduction for a reasonable reserve for transportation charges and emergency expenses that its forty-day membership bears to the forty-day membership of the entire state. The allocation of adult basic education shall be based on a full-time equivalency obtained by multiplying the total previous year's enrollment by .25. For the purpose of this allocation, additional pupils (increase in enrollment over prior year) shall be counted as four pupils. On or before January 15 of each year, the Department of Education shall re-compute each entitlement using the forty-day membership for that year, except for adult basic education, and shall allocate the balance of the annual appropriation compensating for any over- or under-estimation of credit made in the first allocation. In the event the funds remaining for this allocation are insufficient to compensate for an over- or under-estimation of credit made in the first allocation, the final re-compute over- or under-allocation of credit shall be carried forward by the Department of Education to be credited or debited to the allocation for the ensuing school year. An amount not to exceed thirty percent of total credit allocations attributed to each individual instructional materials account shall, at the request of the local school district or the appropriate governing body and institution, be distributed directly to each public school district, state institution, or adult basic education center for instructional materials not included on the multiple list provided for in Section 22-15-8 NMSA 1978. The districts are allowed to carry forward unused instructional materials credits from year to year.

During the year ended June 30, 2004 the District received $583,478 and expensed $585,031 for instructional materials under this program.

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G. Federal Grants

The District receives revenues under Federal programs that are legally restricted to expenditures for specific purposes. These programs are reported as Special Revenue Funds. Each program operates under its own budget, which has been approved by the New Mexico Department of Education. This department also administers these funds. The District also receives reimbursements under the National School Lunch and Breakfast Programs for its food service operations and distributions of commodities through the New Mexico Human Services Department.

H. Indirect Costs

The District received cost reimbursements from the various Federal agencies for Federal programs it administers. The indirect costs are shown as expenditures of the Special Revenue Funds and as revenues in the General Fund. Federal projects indirect cost reimbursements are budgeted as revenue in the general operating account. The accompanying statements of budgeted and actual revenues and expenditures for Federal projects are based on the Federal budgets of each project, which included the budgeted indirect costs.

7. RETIREMENT PLAN

Substantially all of the District’s full-time employees participate in a public employee retirement system authorized under the Educational Retirement Act (Chapter 22, Article 11 NMSA 1978). The Educational Retirement Board (ERB) is the administrator of the plan, which is a cost-sharing multiple-employer defined benefit retirement plan. The plan provides for retirement, disability benefits, and cost-of-living adjustments to plan members and beneficiaries. The ERB issues a separate, publicly available financial report that includes financial statements and required supplementary information. That report may be obtained by writing to ERB, P.O. Box 26129, Santa Fe, New Mexico 87502.

A. Retirement Eligibility

The benefit for retirement at age 60, or after 25 years of service before age 60, is an annual sum equal to the "final average salary" multiplied by the total number of years of service credit times 2.15%. A member is eligible to retire when:

(1) The member's age and earned service credit add up to the sum of 75 or

more, or (2) The member is age 65 or more with at least five years of earned service

credit, or (3) The member has earned service credit at allowed service credit totaling 25

or more years.

A further requirement to be eligible to retire is that one must be a "member" having at least one year of employment after July 1, 1957 and at least five years

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of contributory employment. Eligible members who have one year of employment after July 1, 1957, but less than the required five, may contribute to the fund for each year needed. The cost of such contributions is 15.2% of the average salary of the last five years for each year of contributory employment needed plus 3% compound interest from July 1, 1957 to the date of payment.

When a member has completed five or more years of "earned service credit" and has made contributions for at least five years, the member may terminate employment, leave his/her contributions in the retirement fund, and retire:

(1) When the member's age and years of "earned service credit" (covered

employment in New Mexico) add up to the sum of 75 or more, or (2) The member may retire at age 65, if he/she has at least five years of

"earned service credit.”

B. Funding Policy

Plan members are required to contribute 7.6% of their gross salary. The District is required to contribute 8.65% of the gross covered salary. The contribution requirements of plan members and the District are established in Chapter 22, Article 11 NMSA 1978. The requirements may be amended by acts of the legislature. The District’s contributions to ERB for the years ending June 30, 2004, 2003, and 2002 were $3,490,834, $3,233,553, and $3,289,699 respectively, equal to the amount of the required contributions for each year.

8. RETIREE HEALTH CARE ACT CONTRIBUTIONS

The Retiree Health Care Act (Chapter 10, Article 7C NMSA 1978) provides comprehensive core group health insurance for persons who have retired from certain public service in New Mexico. The Retiree Health Care Authority is the administrator of the plan. The purpose is to provide eligible retirees, their spouses, dependents, and surviving spouses and dependents with health insurance consisting of a plan, or optional plans, of benefits that can be purchased by funds flowing into the Retiree Health Care Fund and by co-payments or out-of-pocket payments of eligible retirees.

Monies flow to the Retiree Health Care Fund on a pay-as-you-go basis from eligible employers and eligible retirees. Eligible employers are institutions of higher education, school districts, or other entities participating in the Public School Insurance Authority and state agencies, state courts, magistrate courts, municipalities, or counties, which are affiliated to or covered by the Educational Retirement Act, Magistrate Retirement Act, Public Employees Retirement Act, Volunteer Firefighters Retirement Act, or Judicial Retirement Act. Eligible retirees are: A. Retirees who make contributions to the fund for at least five years prior to

retirement and whose eligible employer during that period of time made contributions as a participant in the Retiree Health Care Act on that person’s

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behalf, unless that person retires on or before July 1, 1995, in which event the time period for contributions becomes the time between July 1, 1990, and the date of retirement; or

B. Retirees defined by the Act who retired prior to July 1, 1990.

Each participating employer makes contributions to the fund in the amount of one and three-tenths percent (1.3%) of each participating employee's salary. Each participating employee contributes to the fund an employee contribution equal to sixty-five hundredths of one percent (.65%) of the employee's annual salary. The contribution amounts increase periodically.

Contributions from participating employers and participating employees become the property of the Retiree Health Care Fund and are not refundable under any circumstances, including termination of employment or termination of the participating employer's operation or participation in the Retiree Health Care Act.

The employer, employee, and retiree contributions are required to be remitted to the Retiree Health Care Authority on a monthly basis.

The Retiree Health Care Authority issues a separate, publicly available audited financial report that includes post employment benefit expenditures of premiums and claims paid, participant contributions (employer, employee, and retiree), and net expenditures for the fiscal year. The report also includes the approximate number of retirees participating in the plan. That report may be obtained by writing to the Retiree Health Care Authority, 810 W. San Mateo Rd., Santa Fe, New Mexico 87505.

For the fiscal year ended June 30, 2004, the District remitted $524,706 in employer contributions and $262,356 in employee contributions to the Retiree Health Care Authority.

9. DEFICIT FUND BALANCE

The District is supported by various Federal and State grant subsidies received under the authority of grant and/or statute. All deficit fund balances at June 30, 2004, as listed below, are expected to be recovered during the fiscal year ended June 30, 2005.

Special Revenue Funds:

Transportation - Fund 13000 $ 3,206 Title I - Program Improvement - Fund 24105 5,307 Teacher Mentoring - Fund 25433 19,664

Capital Projects Funds:

Public School Capital Outlay - Fund 31200 $ 21,3 Special Capital Outlay - State - Fund 31400 247,3

9041

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10. ADJUSTMENTS AND RESIDUAL EQUITY TRANSFERS

Residual equity transfers were made to PL 81-874 Impact Aid from Navajo Nation Grants in the amount of $172,428. In previous years, expenditures were made from Impact Aid for expenses relating to a grant in the Navajo Nation Grants fund, which was a reimbursement fund. However, when the reimbursement came in, the expenditures had not been moved out of Impact Aid.

11. RISK MANAGEMENT The District is exposed to various risks of loss related to torts; theft of, damage to, and

destruction of assets; errors and omissions; injuries to employees and others; and natural disasters. The District has joined other local districts in a multi-line pool and a worker’s compensation pool. These public entity risk pools operate as a common risk management and insurance program for worker’s compensation and property and casualty coverage.

These pools are funded entirely by member contributions and are administered by the New Mexico Public Schools Insurance Authority (NMPSIA). The pools are authorized by joint powers agreements entered into by each district as a separate and independent government and legal entity pursuant to the provisions of NMSA 1978 Sections 11-1-1. Annual premiums are paid by the District to NMPSIA for coverage provided in the following areas:

1. Worker’s Compensation; 2. Property and automobile liability and physical damage; 3. Liability and civil rights and personal injury; 4. Contract school bus coverage; and 5. Crime

The District has not filed any claims for which the settlement amount exceeded the insurance coverage during the past three years. However, should a claim be filed against the District that exceeds the insurance coverage described above and should that claim be allowable under New Mexico State Statutes, the District would be responsible for a loss in excess of the coverage amounts. As claims are filed, the New Mexico Public Schools Insurance Authority assesses and estimates the potential for loss. To the best of management's knowledge and belief, all known and unknown claims will be covered by insurance. However, information regarding incurred but not reported claims is not available on a school district-by school district basis.

New Mexico Public Schools Insurance Authority has not provided information that would allow for a reconciliation of changes in the aggregate liabilities for claims for the current fiscal year and the prior fiscal year for a single school district within the pool.

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12. RECONCILIATION OF BUDGETARY BASIS TO GAAP BASIS STATEMENTS

GENERAL

OPERATIONAL ESEA IDEA-B PL 81-874FUND TITLE I ENTITLEMENT IMPACT AID

Revenues over expenditures - Budgetary Comparison Statements-Budgetary Basis $ (1,225,123) 475,944 53,185 (663,768)

Adjustments:Increase (Decrease) in:

Investment income/Deposits (71,146) 1,500Taxes Receivable (2,567)Due from GrantorInventory

(Increase) Decrease in:Accounts payable 17,468 (92,626) 36,461Accrued expenses (60,703) (18,759) (744) (68,489)Compensated absences (10,975) (3,159) (1,227) (5,153)Deferred revenue (11,807) (362,900) (51,214)

Operating Transfers In (Out) (6,392)

Revenues over expenditures Statement of revenues,expenditures and changesin fund balance $ (1,371,245) (700,949)

TOTAL OTHER

BOND DEBT MAJOR GOVERNMENTALBUILDING SERVICE FUNDS FUNDS TOTALS

Revenues over expenditures - Budgetary Comparison Statements-Budgetary Basis $ 2,726,541 545,833 1,912,612 1,203,517 3,116,129

Adjustments:Increase (Decrease) in:

Investment income/Deposits 5,917 (9,303) (73,032) (17,653) (90,685)Taxes Receivable (47,988) (50,555) (15,932) (66,487)Due from Grantor (1,054,317) (1,054,317)Inventory 32,379 32,379

(Increase) Decrease in:Accounts payable (606,472) (645,169) 796,213 151,044Accrued expenses (148,695) 72,846 (75,849)Compensated absences (20,514) 2,623 (17,891)Deferred revenue (224,343) (650,264) (249,729) (899,993)

Operating Transfers In (Out) (6,392) 6,392

Revenues over expenditures Statement of revenues,expenditures and changesin fund balance $ 2,125,986 264,199 317,991 776,339 1,094,330

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13. CONTINGENT LIABILITIES

Compliance – Amounts received or receivable from grantor agencies are subject to audit and adjustment by grantor agencies, principally the Federal government. Any disallowed claims, including amounts already collected, may constitute a liability of the applicable funds. The amount, if any, of expenditures/expenses that may be disallowed by the grantor cannot be determined at this time, although the District expects such amounts, if any, to be immaterial. Lawsuits – The District is a defendant in various lawsuits. Although the outcome of these lawsuits is not presently determinable, in the opinion of the District’s counsel, the resolution of these matters will not have a material effect on the financial condition of the District. Arbitrage – Under the Tax Reform Act of 1986, interest earned on the debt proceeds in excess of interest expense or expenditure prior to the disbursement of the proceeds must be rebated to the Internal Revenue Service (IRS). Management believes there is no significant tax arbitrage rebate liability at year-end.

14. FINANCIAL STATEMENT PREPARATION These financial statements were prepared by the staff of Central Consolidated School District No. 22.

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SUPPLEMENTARY INFORMATION

MAJOR CAPITAL PROJECTS FUNDS

STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 31100 - BOND BUILDINGSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal

to ActualOriginal FinalRevenues:

Local Sources $ 75,000 75,000 109,970 - 34,970

Expenditures:Education, Non Current

Capital Outlay 5,833,407 9,551,725 1,183,429 (3,718,318) 8,368,296

Revenues Over (Under) Expenditures (5,758,407) (9,476,725) (1,073,459) (3,718,318) 8,403,266

Other Financing Sources (Uses):Sale of Bonds - 3,800,000 3,800,000 3,800,000 -

Revenues and Other FinancingSources Over (Under) Expendituresand Other Financing Uses (5,758,407) (5,676,725) 2,726,541 81,682 8,403,266



STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 41000 - DEBT SERVICESTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Local Sources $ 4,651,537 4,651,537 5,134,128 - 482,591


Administration 60,000 60,000 50,082 - 9,918Education, Non-Current:

Debt Service:Principal Payment 2,875,000 2,875,000 2,875,000 - - Interest Payment 1,741,400 1,741,400 1,663,213 - 78,187

Total Expenditures 4,676,400 4,676,400 4,588,295 - 88,105

Revenues Over (Under) Expenditures (24,863) (24,863) 545,833 - 570,696

Budgetary Notation-Cash Appropriatedfrom Prior Year $ 24,863 24,863


NON-MAJOR FUNDS

NON-MAJOR SPECIAL REVENUE FUNDS

Special revenue funds are used to account for specific revenues that are legally restricted to expenditures for particular purposes. Teacherage (12000) – To account for revenues and expenditures associated with district owned multi-bedroom housing units rented to District employed teachers. Transportation (13000) – To account for State Equalization – Transportation funds authorized by Section 22-8-26, NMSA, 1978 designated for the costs of transporting school-age children who are students within the District. Instructional Materials (14000) – To account for Funding designated for instructional materials purchases as authorized by Sections 22-15-1 through 22-15-14, NMSA, 1978. Food Services (21000) – To account for funding provided pursuant to the Code of Federal Regulations, Title VII, Subtitle B, Sections 210, 215, and 220 designated for a school breakfast, lunch, and summer lunch program(s). Athletics (22000) – To account for revenues and expenditures associated with the District's athletic programs. Funding authorized by NMAC 6.20.2 of the New Mexico Department of Education. Non-Instructional Support (23000) – To account for revenues and expenditures associated with District non-instructional, non-athletic programs. ESEA Title I Migrant (24103) – To account for Federal money to assist States to ensure that migratory children have the opportunity to meet the same challenging State content and performance standards that all children are expected to meet. Funding is authorized by the Elementary and Secondary Education Act of 1965, Title I, Part C, 20 U.S.C. 6391 et seq. ESEA Title I Program Improvement (24105) – To account for a program funded by a Federal grant to help break the cycle of poverty and illiteracy and improve the educational opportunities of low-income families by integrating early childhood education, adult literacy or adult basic education, and parenting education into a unified family literacy program. Funding is authorized by the Elementary and Secondary Education Act of 1965; Title I, Part B, 20 U.S.C. 6362. IDEA-B Discretionary Competitive (24108) – The IDEA-B Competitive program is to provide grants to states that flow through to schools to assist them in providing a free appropriate public education to all children with disabilities. Funding authorized by the Individuals with Disabilities Education Act, Part B, Sections 611-617, and part D, Section 674, as amended, 20 U.S.C. 1411-1417 and 1420.

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SPECIAL REVENUE FUNDS, Continued

IDEA-B Preschool (24109) – To account for a program funded by a Federal grant to assist the District in providing a free appropriate public education to preschool disabled children aged three through five years and, at the State's discretion, to two year old children with disabilities who will reach age three during the school year. Funding authorized by the Individuals with Disabilities Education Act, Part B, Section 619, as amended. ESEA Title VI (24112) – To account for a program funded by a Federal grant to assist the District to reform elementary and secondary education. Funding authorized by the Elementary and Secondary Education Act of 1965, Title VI, as amended, 20 U.S.C. 7301-7373. Education for Homeless Children and Youth (24113) – To account for a program funded by a Federal grant to ensure that homeless children and youth have equal access to the same free, appropriate public education as other children. Funding is authorized by the McKinney-Vento Homeless Assistance Act, Title VII, Subtitle B. Carl Perkins (24119) – To account for a program funded by a Federal grant which provides funds for planning and demonstration grants to a consortia of local educational agencies and postsecondary educational agencies for the development and operation of 4-year programs designed to provide a tech-prep education program leading to a 2-year associate degree or a 2-year certificate and to provide, in a systematic manner, strong, comprehensive links between secondary schools and postsecondary educational institutions. Funding authorized by the Carl D. Perkins Vocational and Applied Technology Education Amendments of 1998, Title II, Public Law 105-332, 20 U.S.C. 2394. Evenstart (24125) – To account for a Federal grant to provide technical assistance and training services to school districts to cope with educational problems occasioned by race, gender, and national origin desegregation. Learn and Serve America (24126) – To account for a Federal grant which provides financial support to Service-Learning projects focused on meeting the needs of a community and fosters civic responsibility. These projects must be integrated with academic curriculum and provide structured time for participants to reflect on the service experience. Safe and Drug Free Schools (24128) – To account for a Federal grant which provides funds to support programs to meet the National Education Goal that, by the year 2000, every school in the United States will be free of drugs, violence, and the unauthorized presence of firearms and alcohol. To offer a disciplined environment conducive to learning by preventing violence in and around schools and strengthen programs that prevent the illegal use of alcohol, tobacco, and drugs, involve parents, and coordinate with related Federal, State, and community efforts and resources. Funding is authorized by the Elementary and Secondary Education Act, Title IV, Part

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A, Subpart 1, sections 4011-4118, as amended, Public Law 103-382, 20 U.S.C. 7111-7118. Technology Literacy Challenge (24133) – To account for a Federal grant which provides funding to State Education Agencies (SEAs) on a formula basis to support the development and implementation of systemic technology plans at the State, local, and school levels to improve the teaching and learning of all children. States are asked to address four goals: (1) All teachers will have the training and support they need to help all students learn through computers and through the information superhighway; (2) all teachers and students will have modern computers in their classrooms; (3) every classroom will be connected to the information superhighway; and (4) effective and engaging software and online resources will be an integral part of every school curriculum. To provide discretionary grants to LEAs in states which choose not to participate in the program. Funding is authorized by the Elementary and Secondary Education Act, Title III, Part A, Subpart 2, Public Law 103-382. Comprehensive School Reform Demonstration (24135) – To account for a program funded by a Federal grant to provide financial incentives for schools that need to substantially improve student achievement, particularly Title I schools, to implement comprehensive school reform programs that are based on reliable research and effective practices, and include an emphasis on basic academics and parental involvement. Funding authorized by the Elementary and Secondary Education Act of 1965, Title I, Part A, 20 U.S.C. 6301 et seq. Preschool Environments (24136) – To account for a Federal grant targeting at building capacity to improve services to preschool students with disabilities. Funds are used to improve inclusive services at Headstart and district classrooms by conducting parent focus groups to develop needs assessments for parent training and support. Vocational Education (24144) – To account for a program funded by a Federal grant which provides funds for planning and demonstration grants to a consortia of local educational agencies and postsecondary educational agencies for the development and operation of 4-year programs designed to provide a tech-prep education program leading to a 2-year associate degree or a 2-year certificate and to provide, in a systematic manner, strong, comprehensive links between secondary schools and postsecondary educational institutions. Funding authorized by the Carl D. Perkins Vocational and Applied Technology Education Amendments of 1998, Title II, Public Law 105-332, 20 U.S.C. 2394. Title V Innovation Strategies (24150) – To account for Federal flow-through funds under the Elementary and Secondary Education Act as amended by the No Child Left Behind Act of 2001, Title V Part A designated for Innovative Education Program Strategies. Activities funded under this program include expansion and improvement of school-based mental health services, early identification of drug use and violence,

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and individual or group counseling services provided to students, parents, and school personnel. English Language Acquisition (24153) – To account for a Federal grant which provides funds to support various activities relating to English language acquisition. Funding will be used to implement a District resource library of bilingual and English as-a-second language materials. Training regarding dual language, bilingual education, and indigenous language revitalization will be supported. Title II-A (24154) – To account for a program funded by a Federal grant to provide sustained and intensive high-quality professional development activities to teachers, staff, and administrators so that they may teach challenging State content and performance standards in the core academic subjects. Title IV (24157) – To account for a Federal grant which provides funds to support programs to meet the National Education Goal that, by the year 2000, every school in the United States will be free of drugs, violence, and the unauthorized presence of firearms and alcohol and to offer a disciplined environment conducive to learning. Rural / Low Income (24160) – To account for a Federal grant that provides funding for performance goals. All students will reach high standards or improve in reading/language arts and math. All students will be taught by qualified teachers in a safe environment conducive to learning. All students will graduate from high school. Title I Program Improvement (24162) – To be used for allowable Title I purposes in order to assist with the implementation of approved school improvement or corrective action plans. IDEA and Technology (24166) – To account for a Federal grant supporting the acquisition of interactive classroom equipment under the auspices of the Special Education Office. This grant also supports the renovation and repair of schools on a competitive basis excluding new construction. Title VII Indian Education (24215) – To account for a Federal program designed to support local educational agencies in their efforts to reform elementary and secondary school programs that serve Indian students in order to ensure that programs are based on challenging State content standards and student performance standards that are used for all students and are designed to assist Indian students meet those standards in reaching the National Education Goals. Funding is authorized by the Elementary and Secondary Education Act of 1965, Title IX, Part A, Subpart 1, as amended, Public Law 103-382, 20 U.S.C. 7811-7818; 25 U.S.C. 2001. IHS/Northern Navajo Medical Center (24222) – To account for a Federal grant to fund programs that improve the quality of the health of American Indians and Alaska Natives by providing a full range of curative, preventive, and rehabilitative health

65


services; and to improve the management capability of American Indians and Alaska Natives to assume operation of all or part of an existing Indian Health Service direct-operated health care program. Funding is authorized by Public Law 83-568, 42 U.S.C. 2001-2004a; Indian Self-Determination and Education Assistance Act, Section 104 (b), Public Law 93-638, 25 U.S.C. 450; Section 9, Public Law 98-250; Public Law 100-472. Johnson O’Malley (24231) – To account for a Federal grant to fund programs that meet the unique and specialized needs of eligible Indian students. Funding is authorized by the Johnson-O’Malley Act of April 16, 1934; as amended, 25 U.S.C. 452; Indian Self-Determination and Education Assistance Act, Public Law 93-638; 25 U.S.C. 455-457. Advanced Placement Incentive (24235) – Funding is to be used to creatively present and engage students in history and related social subjects. Star Schools Grant (24237) – To account for Federal monies to encourage improved instruction in mathematics, science, and foreign languages as well as other subjects, such as literacy skills and vocational education. To serve underserved populations, including the disadvantaged, illiterate, limited-English proficient, and individuals with disabilities. Grants are made to telecommunication partnerships for telecommunications facilities and equipment, educational and instructional programming, and technical assistance in the use of such facilities and instructional programming. Funding is authorized by the Elementary and Secondary Education Act of 1965, as amended, Title III, Part B, Public Law 103-382, 20 U.S.C. 6891-6900. PL 81-874 Impact Aid-Special Education (24245) – To account for a program funded by a Federal grant to provide financial assistance to local educational agencies (LEAs) where enrollments or availability of revenue are adversely affected by Federal activities, i.e. where the tax base of a district is reduced through the Federal acquisition of real property (Section 8002, ESEA), where there are significant number of children who reside on Federal (including Indian) lands and/or children whose parents are employed on Federal property or in the Uniformed Services (Sections 8003 and 8007, ESEA), where there is a sudden increase in school enrollment as the result of Federal activities (Section 8006, ESEA). To provide disaster assistance for reduced or increased operating costs for replacing or repairing damaged or destroyed support equipment and books and for repairing minor damage to facilities. Funding authorized by Public Law 81-874. Funding is authorized by the Elementary and Secondary Education Act, Title VIII, as amended. NM Grads (Grads Child Care – CYFD) (24249) – To account for a Department of Education grant through Children, Youth, and Families Department to provide for the maintenance and expansion of the teen parent programs.

66


Medical Assistance Payments (Medicaid) (24252) – To account for Federal funds which are provided to provide financial assistance to states for payments of medical assistance on behalf of cash assistance recipients, children, pregnant women, and the aged who meet income and resource requirements and other categorically-eligible groups. In certain states that elect to provide such coverage, medically-needy persons who, except for income and resources, would be eligible for cash assistance, may be eligible for medical assistance payments under this program. Financial assistance is provided to states to pay for Medicare premiums, co-payments, and deductibles of qualified Medicare beneficiaries meeting certain income requirements. More limited financial assistance is available for certain Medicare beneficiaries with higher incomes. Funding is authorized by the Social Security Act, Title XIX, as amended; Public Laws 89-97, 90-248, and 91-56, 42 U.S.C. 1396 et seq., as amended; Public Laws 92-223, 92-603,93-66, 93-233, 96-499, 97-35, 97-248, 98-369, 99-272, 99-509, 100-93, 100-202, 100-203, 100-360, 100-436, 100-485, 100-647, 101-166, 101-239, 101-508, 101-517, 102-170, 102-394, 103-66, 103-112, 103-333, 104-91, 104-191, 104-193, 104-208, and 104-134; Balanced Budget Act of 1997, Public Law 105-33. Navajo Nation Grants (24301) – To account for Federal grants to assist each state to develop and implement a statewide, comprehensive, coordinated, multidisciplinary, interagency system to provide early intervention services for infants and toddlers with disabilities and their families. Funding is authorized by the Individuals with Disabilities Act (IDEA), Part C, as amended, 20 U.S.C. 1471-1785. ETIP Project (USDE Technology Challenge Grant) (24307) – To account for Federal grants that support the development, interconnection, implementation, improvement, and maintenance of an effective educational technology infrastructure, including activities to provide equipment, training for teachers, school library and media personnel, and technical support. Funding is authorized by the Elementary and Secondary Education Act of 1965, Title III, Part A, Section 3136, as amended, 20 U.S.C. 6846. Smaller Learning Communities (24317) – To conduct nationally significant programs to improve the quality of education, assist all students to meet challenging State content standards, and contribute to the achievement of the National Education Goals. Funding is authorized by the Elementary and Secondary Education Act of 1965; Title X, Part A, as amended 20 U.S.C. 8001-8007. Projects with Industry (24334) – Projects with a vocational rehabilitation grant supporting the transition of eligible students to work settings. Literacy Through Libraries (24335) – Funding source to allow for the increase of school library books. Staffing will also be enlarged to accommodate the additional needs of the libraries.

67


Jordan Fundamentals Grant (25117) – To account for private grant supporting the acquisition of resource materials, supplies and equipment for classroom use. PNM Foundation, Inc. (25123) – To account for a grant received from Public Service Company of New Mexico for an education project. Toyota Time (25137) – To account for a grant to be used to encourage and help prepare Native American students attend college. Burlington Grant (25162) – To account for various grants received from Burlington Resources Foundation which are to be used for various educational needs within the classroom. CYFD Preschool (25335) – To account for revenues and expenditures for a Children, Youth, and Family Development (CYFD) grant from the State of New Mexico to provide for the purpose of offering a pre-kindergarten educational program with a family literacy component. Center for Teaching Excellence (25338) – To account for funding provided by Eastern New Mexico University focused on encouraging parents and children reading activities through the audio and video recording of school books. TANIF - After School Child Care (25341) – To account for the revenues and expenditures of school age child care. The funds provided by the New Mexico Human Services Department (HSD) for the purpose of providing child care for Temporary Assistance to Needy Families (TANF PL 105-33) families. Also provides childcare during the summer as well. Technology for Education (25347) – To account for State funding which is to be used for the development of classroom technology, including furnishing classrooms with computer hardware and software. Authorizing legislation is found in the Technology for Education Act [22-15A-1 to 22-15A-10, NMSA 1978, Compilation]. Computerized Learning (25355) – To account for State funding provided to assist teachers in aligning curricula and standardized testing to the New Mexico Content Standards, Benchmarks, and Performance Standards in the core academic areas of reading, language arts, and mathematics. School Improvement (25374) – To account for the revenues and expenditures of District school location awards. The purpose is to improve results of the New Mexico Achievement Assessment or the New Mexico High School Competency Exam. The funds are provided in accordance with the Incentives for School Improvement Act (NMSA 22-13A-5).

68


Bridging of the Arts (25428) – To account for State funding supporting TANF eligible sites with summer arts programming. Funding supports staff training activities, supplies, and curriculum resources for arts programming. Gear Up (25429) – To account for the revenues and expenditures of certain District locations that provide academic enrichment programs and early college and career awareness activities to middle school students and their parents. Funding is authorized pursuant to the Federal grant Gaining Early Awareness Readiness for Undergraduate Programs, CFDA #84.334A. Teacher Mentoring (25433) – To account for funding authorized through the Joint Powers Agreement with the State Department of Public Education for a program to engage in activities to develop, implement, and evaluate a beginning teacher mentoring program to ensure that beginning teachers, especially those who seek educator licensure through alternative routes, have structured support from accomplished and experienced teachers to help them improve their skills and knowledge. Private Direct Grants (25502) – To account for local grants awarded to provide additional funding for specific projects.

69

STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22NON-MAJOR SPECIAL REVENUE FUNDSCOMBINING BALANCE SHEETAs of June 30, 2004

Fund Fund Fund Fund Fund Fund Fund12000 13000 14000 21000 22000 23000 24105

NON- ESEA TITLE I INSTRUCTIONAL FOOD INSTRUCTIONAL PROGRAM

TEACHERAGE TRANSPORTATION MATERIALS SERVICES ATHLETICS SUPPORT IMPROVEMENT

ASSETS

Assets:Cash and Investments $ 195,947 16,188 120,706 391,348 122,348 723,114Taxes ReceivableDue from Grantor 69,710Inventory 153,273

Total Assets $ 195,947 16,188 120,706 614,331 122,348 723,114


Liabilities:Bank Overdraft $ 5,307Accounts Payable 6,879 13,467 324 5,581Accrued Salaries and Benefits 142 13,854Accrued Compensated Absences 1,461 5,540 1,678Deferred Revenue

Total Liabilities 1,603 19,394 6,879 15,145 324 5,581 5,307

Fund Balance:Reserved for Inventory 153,273Reserved for Subsequent

Year's Expenditures 194,344 113,827 445,913 122,024 717,533Reserved for Debt ServiceUndesignated, Reported In Special Revenue Fund (3,206) (5,307)

Capital Projects Fund

Total Fund Balance 194,344 (3,206) 113,827 599,186 122,024 717,533 (5,307)

Total Liabilities and Fund Balance $ 195,947 16,188 120,706 614,331 122,348 723,114

SEE INDEPENDENT AUDITORS' REPORTSThe accompanying notes are an integral part of these finanical statements 70


ASSETS

Assets:Cash and Investments $Taxes ReceivableDue from GrantorInventory

Total Assets $


Liabilities:Bank Overdraft $Accounts PayableAccrued Salaries and BenefitsAccrued Compensated AbsencesDeferred Revenue

Total Liabilities

Fund Balance:Reserved for InventoryReserved for Subsequent

Year's ExpendituresReserved for Debt ServiceUndesignated, Reported In Special Revenue Fund


Total Fund Balance

Total Liabilities and Fund Balance $


IDEA-B EDUCATION FOR LEARNDISCRETIONARY IDEA-B ESEA HOMELESS CARL AND SERVE

COMPETITIVE PRESCHOOL TITLE VI CHILDREN & YOUTH PERKINS EVENSTART AMERICA

74,372 17,031 4,091 37,112 8,463

11,810 2,976

11,810 74,372 17,031 4,091 37,112 8,463 2,976

11,810 2,9762,676

74,372 17,031 4,091 37,112 5,787

11,810 74,372 17,031 4,091 37,112 8,463 2,976

11,810 74,372 17,031 4,091 37,112 8,463 2,976



ASSETS


Total Assets $



Total Liabilities




Total Fund Balance



SAFE AND COMPREHENSIVE TITLE VDRUG FREE EDUCATIONAL SCHOOL REFORM PRESCHOOL VOCATIONAL INNOVATIONSCHOOLS TECHNOLOGY DEMONSTRATION ENVIRONMENTS EDUCATION STRATEGIES

14,669 101,892 25,059 52

3,988 60,052 428

14,669 101,892 25,059 3,988 60,052 480

3,988 60,052

48014,669 101,892 25,059

14,669 101,892 25,059 3,988 60,052 480

14,669 101,892 25,059 3,988 60,052 480



ASSETS


Total Assets $



Total Liabilities




Total Fund Balance



ENGLISH TITLE I IDEA LANGUAGE RURAL/ PROGRAM AND

ACQUISITION TITLE II-A TITLE IV LOW INCOME IMPROVEMENT TECHNOLOGY

103,578 28,495

117,897 53,522 85,301 75,819

117,897 103,578 28,495 53,522 85,301 75,819

81,872 52,848 69,743 75,81926,550 6239,475 674 14,935

122 443103,456 28,052

117,897 103,578 28,495 53,522 85,301 75,819

117,897 103,578 28,495 53,522 85,301 75,819



ASSETS


Total Assets $



Total Liabilities




Total Fund Balance



TITLE VII IHS/ NORTHERN ADVANCED PL 81-874INDIAN NAVAJO JOHNSON PLACEMENT STAR IMPACT AID- NM

EDUCATION MEDICAL CENTER O'MALLEY INCENTIVE SCHOOLS SPECIAL EDUCATION GRADS

33,238 34,583 1,050 1,256,598

258,781 29,713 474

33,238 34,583 258,781 1,050 29,713 1,256,598 474

257,145 29,713 474989 2,729 1,636

10,587

32,249 31,854 1,050

33,238 34,583 258,781 1,050 29,713 10,587 474

456,788

789,223

1,246,011

33,238 34,583 258,781 1,050 29,713 1,256,598 474



ASSETS


Total Assets $



Total Liabilities




Total Fund Balance



MEDICAL ASSISTANCE NAVAJO SMALLER PROJECTS LITERACYPAYMENTS FIRST A/C NATION ETIP LEARNING WITH THROUGH(MEDICAID) NM GRADS GRANTS PROJECT COMMUNITIES INDUSTRY LIBRARIES

168,457 25,000 60,072 1,098 68,491 1,406

57,516

168,457 25,000 57,516 60,072 1,098 68,491 1,406

57,51620

15,324

25,000 36,098 1,098 53,147 1,406

25,000 57,516 36,098 1,098 68,491 1,406

168,457 23,974

168,457 23,974

168,457 25,000 57,516 60,072 1,098 68,491 1,406



ASSETS


Total Assets $



Total Liabilities




Total Fund Balance


Fund Fund Fund Fund Fund Fund Fund Fund25113 25117 25120 25123 25137 25162 25335 25338

JORDAN PNM TOYOTA CENTER FORLANL FUNDAMENTALS MERIDIAN FOUNDATION, TIME BURLINGTON CYFD TEACHING

FOUNDATION GRANT OIL INC. GRANT GRANT PRESCHOOL EXCELLENCE

813 30 1,351 352 140 5,056 3,871

56,497

813 30 1,351 352 140 5,056 56,497 3,871

55,163233 1,334

233 56,497

813 30 1,351 352 140 4,823 3,871

813 30 1,351 352 140 4,823 3,871

813 30 1,351 352 140 5,056 56,497 3,871



ASSETS


Total Assets $



Total Liabilities




Total Fund Balance



TANIF - AFTER TECHNOLOGY INCENTIVES BRIDGING PRIVATESCHOOL FOR FOR SCHOOL OF THE TEACHER DIRECT

CHILD CARE EDUCATION IMPROVEMENTS ARTS GEAR UP MENTORING GRANTS TOTALS

9,765 3,697 93,540 3,753,073

46,496 74,150 7,449 1,012,579153,273

46,496 9,765 74,150 3,697 93,540 7,449 4,918,925

46,496 58,789 19,664 7,396 896,77115,317 1,821 5,550 53 85,782

44 312 65,3471,190 10,9148,575 87,678 689,676

46,496 9,765 74,150 1,821 93,540 19,664 7,449 1,748,490

153,273

2,050,429

1,876 (19,664) 966,733

1,876 (19,664) 3,170,435

46,496 9,765 74,150 3,697 93,540 7,449 4,918,925


STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22NON-MAJOR SPECIAL REVENUE FUNDSCOMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCESFor the Year Ended June 30, 2004


NON- ESEA TITLE I IDEA-B Instructional Food INSTRUCTIONAL PROGRAM DISCRETIONARY

TEACHERAGE Transportation Materials Services ATHLETICS SUPPORT IMPROVEMENT COMPETITIVERevenues:

Federal Sources $ 2,661,049 40,888 11,810State Sources 2,665,886 583,478Local Sources 399,865 2,370 3,172 243,608 151,847 162,132

Total Revenues 399,865 2,668,256 586,650 2,904,657 151,847 162,132 40,888 11,810


Direct Instruction 585,031 17,061 215Instructional Support 2,176 11,595Administration Business and Support Services Operation and Maintenance of Plant 439,117 Food Services 2,757,262 Athletics 113,855 Non-Instructional Support 47,652 Community Services 26,958 Student Transportation 3,052,086

Education, Non-Current: Non OperatingDebt Principal Debt Interest Capital Outlay

Total Expenditures 439,117 3,052,086 585,031 2,757,262 113,855 47,652 46,195 11,810

Revenues Over (Under) Expenditures (39,252) (383,830) 1,619 147,395 37,992 114,480 (5,307)

Other Financing Sources (Uses):Bond ProceedsOperating Transfers InOperating Transfers OutLease Purchase Payments

Net Other Financing Sources (Uses)

Revenues and Other Financing Sources Over (Under) Expenditures and Other Financing Sources (39,252) (383,830) 1,619 147,395 37,992 114,480 (5,307)

Fund Balance - Beginning of Year, as Previously Reported 233,596 380,624 112,208 451,791 84,032 603,053

Adjustments and Residual Equity Transfers

Fund Balance - Beginning of Year, as Restated 233,596 380,624 112,208 451,791 84,032 603,053

Fund Balance - End of Year $ 194,344 (3,206) 113,827 599,186 122,024 717,533 (5,307)



Revenues:Federal Sources $State SourcesLocal Sources

Total Revenues


Direct InstructionInstructional SupportAdministrationBusiness and Support ServicesOperation and Maintenance of PlantFood ServicesAthleticsNon-Instructional SupportCommunity ServicesStudent Transportation

Education, Non-Current:Non OperatingDebt PrincipalDebt InterestCapital Outlay

Total Expenditures

Revenues Over (Under) Expenditures



Revenues and Other Financing Sources Over(Under) Expenditures and Other Financing Sources

Fund Balance - Beginning of Year, as Previously Reported


Fund Balance - Beginning of Year, as Restated

Fund Balance - End of Year $


TECHNOLOGY COMPREHENSIVE TITLE VIDEA-B LEARN AND LITERACY SCHOOL REFORM PRESCHOOL VOCATIONAL INNOVATION

PRESCHOOL EVENSTART SERVE CHALLENGE DEMONSTRATION ENVIRONMENTS EDUCATION STRATEGIES

66,216 224,370 7,776 121,621 42,733 3,988 154,673 39,073

66,216 224,370 7,776 121,621 42,733 3,988 154,673 39,073

63,856 193,112 7,534 113,267 41,399 149,883301 8,468 4,571 37,393

2,059 242 3,783 1,334 4,790 1,680 22,790 3,988

66,216 224,370 7,776 121,621 42,733 3,988 154,673 39,073




Total Revenues




Total Expenditures










TITLE III TITLE I IDEA TITLE VII IHS/ NORTHERNENGLISH RURAL/ SCHOOL AND INDIAN NAVAJO

ACQUISITION TITLE II-A TITLE IV LOW INCOME IMPROVEMENTS TECHNOLOGY EDUCATION MEDICAL CENTER

339,274 731,973 86,645 144,008 307,273 690,335 1,384,912 99,193

339,274 731,973 86,645 144,008 307,273 690,335 1,384,912 99,193

290,125 680,460 23,385 283 194,075 98,489 1,258,17839,717 14,742 55,238 80,830 97,8109,432 35,435 2,732 5,915 9,073 384 44,670

1,336 5,290 137,810 104,125 1,234 1,383

591,462

339,274 731,973 86,645 144,008 307,273 690,335 1,384,912 99,193




Total Revenues




Total Expenditures










ADVANCED PL 81-874 MEDICAL ASSISTANCE NAVAJOJOHNSON PLACEMENT STAR IMPACT AID- NM PAYMENTS NATIONO'MALLEY INCENTIVES SCHOOLS SPECIAL EDUCATION GRADS (MEDICAID) GRANTS

567,294 950 63,299 843,212 25,974 334,115 91,906

567,294 950 63,299 843,212 25,974 334,115 91,906

110,855 950 1,139,197 9,345 54,232406,207 64,045 173,298 48,950 32,30517,246 2,096 43,320 302

10,863 1,244

31,393 4,848 5,156 5,877

550,327 950 67,385 1,393,085 14,495 48,950 86,537

16,967 (4,086) (549,873) 11,479 285,165 5,369

16,967 (4,086) (549,873) 11,479 285,165 5,369

(16,967) 4,086 1,795,884 (11,479) (116,708) 167,059

(172,428)

(16,967) 4,086 1,795,884 (11,479) (116,708) (5,369)

1,246,011 168,457




Total Revenues




Total Expenditures









`


PROJECTS LITERACY JORDAN PNM TOYOTAETIP WITH THROUGH LANL FUNDAMENTALS MERIDIAN FOUNDATION, TIME

PROJECT INDUSTRY LIBRARIES FOUNDATION GRANT OIL INC. GRANT

60,793 239,925 58,096

2,50060,793 239,925 58,096 2,500

13,267 2,470 1,823 1,320219,673 56,289

721 6,985 1,807

721 239,925 58,096 2,470 1,823 1,320

60,072 30 (1,823) (1,320)

60,072 30 (1,823) (1,320)

(36,098) 813 1,351 2,175 1,460

(36,098) 813 1,351 2,175 1,460

23,974 813 30 1,351 352 140




Total Revenues




Total Expenditures










CENTER FOR TANIF - AFTER TECHNOLOGY INCENTIVES BRIDGINGBURLINGTON CYFD TEACHING SCHOOL FOR COMPUTERIZED FOR SCHOOL OF THE

GRANT PRESCHOOL EXCELLENCE CHILD CARE EDUCATION LEARNING IMPROVEMENTS ARTS

127,937 55,558 90,048 75,000 74,150 4,0007,7197,719 127,937 55,558 90,048 75,000 74,150 4,000

9,834 110,574 75,000 70,002 35,951 3,577 2,571 3,499 73,423 68,968 2,124

9,834 114,151 71,539 112,873 75,000 70,002 2,124

(2,115) 13,786 (15,981) (22,825) 4,148 1,876

(2,115) 13,786 (15,981) (22,825) 4,148 1,876

6,938 (13,786) 3,871 15,981 22,825 (4,148)

6,938 (13,786) 3,871 15,981 22,825 (4,148)

4,823 3,871 1,876




Total Revenues




Total Expenditures









Fund Fund Fund25429 25433 25502

PRIVATE NON-TEACHER DIRECT MAJOR

GEAR UP MENTORING GRANTS TOTALS

9,443,374202,690 18,124 3,896,871

17,949 991,162202,690 18,124 17,949 14,331,407

195,515 32,630 4,218 5,547,5857,809 1,397,368

10,074 1,131 214,858 73,423 452,560 2,757,262 113,855 47,652

145,220 20,796 576,927 3,063,119

591,462

358,618 33,761 25,014 14,836,071

(155,928) (15,637) (7,065) (504,664)

(155,928) (15,637) (7,065) (504,664)

155,928 (4,027) 7,065 3,847,527

(172,428)

155,928 (4,027) 7,065 3,675,099

(19,664) 3,170,435


STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 12000 - TEACHERAGESTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Local Sources:Rents $ 375,000 375,000 396,869 - 21,869Investment Income 5,000 5,000 4,551 - (449)

Total Revenues 380,000 380,000 401,420 - 21,420


Operation and Maintenance of Plant 532,002 614,814 440,065 (82,812) 174,749

Revenues Over (Under) Expenditures (152,002) (234,814) (38,645) (82,812) 196,169

Budgetary Notation-Cash Appropriated from Prior Year $ 152,002 234,814


STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 13000 - TRANSPORTATIONSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


State Sources:Transportation Distribution $ 2,642,187 3,052,437 2,665,886 410,250 (386,551)

Local Sources:Sale of District Assets - - 2,370 - 2,370Insurance Recoveries - - - - -

Total Revenues 2,642,187 3,052,437 2,668,256 410,250 (384,181)


Student Transportation 2,642,187 3,052,437 3,038,617 (410,250) 13,820

Revenues Over (Under) Expenditures - - (370,361) - (370,361)

Budgetary Notation-Cash Appropriatedfrom Prior Year $ - 386,549


STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 14000 - INSTRUCTIONAL MATERIALSSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


State Sources:Instructional Materials-Credit $ 362,077 408,435 408,434 46,358 (1)Instructional Materials-Cash 155,176 175,043 175,044 19,867 1

Local Sources:Insurance/Individual Recoveries - - 3,172 - 3,172

Total Revenues 517,253 583,478 586,650 66,225 3,172


Direct Instruction 517,253 695,686 578,152 (178,433) 117,534

Revenues Over (Under) Expenditures $ - (112,208) 8,498 (112,208) 120,706

Budgetary Notation-Cash Appropriatedfrom Prior Year $ - 112,208


STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 21000 - FOOD SERVICESSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Federal Sources:Direct Federal Grants $ 2,365,500 2,365,500 2,480,052 - 114,552Donated Commodities - 450,000 182,265 450,000 (267,735)Other Grants 1,000 1,000 - - (1,000)Inter Governmental Contract 29,500 29,500 - - (29,500)

Local Sources:Fees - Adults 230,000 230,000 243,608 - 13,608

Total Revenues 2,626,000 3,076,000 2,905,925 450,000 (170,075)


Food Services 2,801,283 3,389,900 2,828,477 (588,617) 561,423

Revenues Over (Under) Expenditures (175,283) (313,900) 77,448 (138,617) 391,348



STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 22000 - ATHLETICSSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Local Sources:Fees - Activities $ 161,894 161,894 150,877 - (11,017)Insurance/Individual Recoveries - - - - - Interest 1,500 1,500 1,428 - (72)

Total Revenues 163,394 163,394 152,305 - (11,089)


Athletics 243,998 251,062 117,559 (7,064) 133,503




STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 23000 - NON-INSTRUCTIONAL SUPPORTSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Local Sources:Fees - Activities $ 55,000 55,000 54,012 - (988)Fees - Users 70,000 70,000 101,425 - 31,425Interest 12,500 12,500 10,386 - (2,114)

Total Revenues 137,500 137,500 165,823 - 28,323


Non-Instructional Support 692,584 737,326 42,071 (44,742) 695,255




STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 24105 - ESEA TITLE I PROGRAM IMPROVEMENTSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Federal Sources $ 50,000 54,752 - 4,752 (54,752)


Direct Instruction 15,000 25,202 25,202 (10,202) - Instructional Support 3,000 2,176 2,176 824 - Community Services 32,000 27,374 27,374 4,626 -

Total Expenditures 50,000 54,752 54,752 (4,752) -



STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 24108 - IDEA-B DISCRETIONARY COMPETITIVESTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Federal Sources $ - 12,944 - 12,944 (12,944)


Direct Instruction - 375 215 (375) 160Instructional Support - 12,569 11,595 (12,569) 974

Total Expenditures - 12,944 11,810 (12,944) 1,134



STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 24109 - IDEA-B PRESCHOOLSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Federal Sources $ 59,432 124,526 85,950 65,094 (38,576)


Direct Instruction 56,384 116,573 63,856 (60,189) 52,717Instructional Support 1,200 4,080 301 (2,880) 3,779Administration 1,848 3,873 2,059 (2,025) 1,814

Total Expenditures 59,432 124,526 66,216 (65,094) 58,310



STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 24125 - EVENSTARTSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Federal Sources $ 20,000 224,766 192,179 204,766 (32,587)


Direct Instruction 13,424 193,407 192,512 (179,983) 895Instructional Support - 8,546 8,468 (8,546) 78Community Services 6,576 22,813 20,714 (16,237) 2,099




STATE OF NEW MEXICOFUND 24126 - LEARN AND SERVESTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Federal Sources $ - 10,000 - 10,000 (10,000)


Direct Instruction - 9,688 7,534 (9,688) 2,154Administration - 312 242 (312) 70

- 10,000 7,776 (10,000) 2,224



STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 24133 - TECHNOLOGY LITERACY CHALLENGESTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Federal Sources $ 140,262 218,928 246,286 78,666 27,358


Direct Instruction 135,000 161,024 113,267 (26,024) 47,757Instructional Support - 51,094 4,571 (51,094) 46,523Administration 5,262 6,810 3,783 (1,548) 3,027




STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 24135 - COMPREHENSIVE SCHOOL REFORM DEMONSTRATIONSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Federal Sources $ - 53,000 53,000 53,000 -


Direct Instruction - 51,352 41,399 (51,352) 9,953Administration - 1,648 1,334 1,334 314

- 53,000 42,733 (50,018) 10,267

Revenues Over (Under) Expenditures $ - - 10,267 103,018 (10,267)


STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 24136 - PRESCHOOL ENVIRONMENTSSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Federal Sources $ - 5,000 - 5,000 (5,000)


Direct Instruction - 5,000 3,988 (5,000) 1,012



STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 24144 - VOCATIONAL EDUCATIONSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Federal Sources $ 15,000 161,637 165,201 146,637 3,564


Direct Instruction 15,000 156,847 149,883 (141,847) 6,964Administration - 4,790 4,790 (4,790) -

15,000 161,637 154,673 (146,637) 6,964



STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 24147 - READING EXCELLENCESTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Federal Sources $ 150,000 150,000 - - (150,000)


Direct Instruction 6,936 6,936 6,936 - - Instructional Support 28,970 28,970 11,437 - 17,533Administration 221 221 - - 221Community Services 113,873 113,873 11,020 - 102,853

Total Expenditures 150,000 150,000 29,393 - 120,607

Revenues Over (Under) Expenditures - - (29,393) - (29,393)


STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 24150 - TITLE V INNOVATION STRATEGIESSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Federal Sources $ 37,870 38,593 38,565 723 (28)


Instructional Support 36,692 37,393 37,393 (701) - Administration 1,178 1,200 1,200 (22) -

Total Expenditures 37,870 38,593 38,593 (723) -

Revenues Over (Under) Expenditures $ - - (28) - (28)


STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 24153 - ENGLISH LANGUAGE ACQUISITIONSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Federal Sources $ 128,184 399,319 221,377 271,135 (177,942)


Direct Instruction 106,184 294,898 254,100 (188,714) 40,798Instructional Support 18,000 86,500 39,717 (68,500) 46,783Administration 4,000 12,421 9,432 (8,421) 2,989Transportation Services - 5,500 - (5,500) 5,500




STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 24154 - TITLE II-ASTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Federal Sources $ 754,769 835,078 748,695 80,309 (86,383)


Direct Instruction 694,392 734,068 680,460 (39,676) 53,608Instructional Support - 22,135 14,742 (22,135) 7,393Administration 54,875 57,373 35,313 (2,498) 22,060Operations and Maintenance of Plant 4,502 5,502 1,336 (1,000) 4,166Transportation 1,000 16,000 - (15,000) 16,000




STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 24157 - TITLE IVSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Federal Sources $ 81,952 112,761 102,111 30,809 (10,650)


Direct Instruction 14,222 39,663 24,710 (25,441) 14,953Instructional Support 58,426 62,836 55,075 (4,410) 7,761Administration 2,549 3,507 2,732 (958) 775Community Services 6,755 6,755 5,290 - 1,465




STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 24160 - RURAL/LOW INCOMESTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Federal Sources $ - 190,190 90,486 190,190 (99,704)


Direct Instruction - 26,272 283 (26,272) 25,989Administration - 5,915 5,915 (5,915) - Community Services - 158,003 137,136 (158,003) 20,867




STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 24162 - TITLE I PROGRAM IMPROVEMENTSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Federal Sources $ 180,000 400,000 150,972 220,000 (249,028)


Direct Instruction 118,487 258,137 193,749 (139,650) 64,388Administration 5,130 10,480 9,073 (5,350) 1,407Community Services 56,383 131,383 88,893 (75,000) 42,490




STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 24166 - IDEA AND TECHNOLOGYSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Federal Sources $ - 796,510 614,516 796,510 (181,994)


Direct Instruction - 99,040 98,489 (99,040) 551Administration - 384 384 (384) -

Education, Non CurrentCommunity Services - 697,086 591,462 (697,086) 105,624




STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 24215 - TITLE VII INDIAN EDUCATION STATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Federal Sources $ 736,511 1,541,899 1,744,250 805,388 202,351


Direct Instruction 495,378 1,305,518 1,262,012 (810,140) 43,506Instructional Support 189,114 120,642 81,125 68,472 39,517Administration 28,863 44,670 44,670 (15,807) - Operation and Maintenance of Plant 4,400 4,400 - - 4,400Community Services 16,506 64,419 7,882 (47,913) 56,537Student Transportation 2,250 2,250 - - 2,250

Total Expenditures 736,511 1,541,899 1,395,689 (805,388) 146,210



STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 24222 - IHS/NORTHERN NAVAJO MEDICAL CENTERSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Federal Sources $ 25,984 133,040 98,000 107,056 (35,040)


Instructional Support 24,596 131,654 97,707 (107,058) 33,947Community Services 1,388 1,386 1,383 2 3




STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 24231 - JOHNSON O'MALLEYSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Federal Sources $ 150,000 620,679 370,674 470,679 (250,005)


Direct Instruction - 147,184 110,163 (147,184) 37,021Instructional Support 147,129 434,268 409,596 (287,139) 24,672Administration 604 17,740 17,246 (17,136) 494Operation and Maintenance of Plant 2,267 10,864 10,863 (8,597) 1Community Services - 1,625 - (1,625) 1,625Student Transportation - 8,998 5,156 (8,998) 3,842




STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 24235 - ADVANCED PLACEMENT INCENTIVESSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Federal Sources $ 2,000 2,000 - - (2,000)


Direct Instruction 2,000 2,000 950 - 1,050

Revenues Over (Under) Expenditures $ - - (950) - (950)


STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 24237 - STAR SCHOOLSSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Federal Sources $ 40,000 69,432 69,641 29,432 209


Instructional Support 36,353 65,772 64,044 (29,419) 1,728Administration 2,147 2,160 2,096 (13) 64Operation and Maintenance of Plant 1,500 1,500 1,244 - 256




STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 24245 - PL 81-874 IMPACT AID - SPECIAL EDUCATIONSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Federal Sources $ 1,750,000 1,750,000 843,212 - (906,788)


Direct Instruction 1,173,153 1,173,153 1,139,629 - 33,524Instructional Support 488,199 488,199 175,263 - 312,936Administration 53,122 53,122 43,320 - 9,802Community Services 29,059 29,059 28,459 - 600Student Transportation 6,467 6,467 6,178 - 289

Total Expenditures 1,750,000 1,750,000 1,392,849 - 357,151



STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 24249 - NM GRADSSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Federal Sources 4,324 22,021 25,500 17,697 3,479


Direct Instruction 1,324 15,719 9,345 (14,395) 6,374Administration - 302 302 (302) - Community Services 3,000 6,000 4,848 (3,000) 1,152




STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 24252 - MEDICAL ASSISTANCE PAYMENTS (MEDICAID)STATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Federal Sources $ 250,000 250,000 363,987 - 113,987


Instructional Support 250,000 250,000 48,950 - 201,050



STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 24301 - NAVAJO NATION GRANTSSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Federal Sources $ 89,000 91,806 123,449 2,806 31,643


Direct Instruction 52,664 59,501 59,501 (6,837) - Instructional Support 33,636 32,305 32,305 1,331 - Administration 2,700 - - 2,700 -




STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 24307 - ETIP PROJECTSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Federal Sources $ 10,000 50,357 41,173 40,357 (9,184)


Instructional Support 9,608 47,210 20,370 (37,602) 26,840Administration 392 1,647 721 (1,255) 926Operation and Maintenance of Plant - 1,500 - (1,500) 1,500




STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 24317 - SMALLER LEARNING COMMUNITIESSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Federal Sources $ 10,000 26,098 - 16,098 (26,098)


Instructional Support 9,679 25,276 - (15,597) 25,276Administration 321 822 - (501) 822

Total Expenditures 10,000 26,098 - (16,098) 26,098

Revenues Over (Under) Expenditures $ - - - - -


STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 24334 - PROJECTS WITH INDUSTRYSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Federal Sources $ 337,351 386,089 286,685 48,738 (99,404)


Direct Instruction - 47,222 13,247 (47,222) 33,975Instructional Support 324,381 324,381 204,349 - 120,032Administration 12,970 14,486 6,985 (1,516) 7,501




STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 24335 - LITERACY THROUGH LIBRARIESSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Federal Sources $ 60,000 59,505 84,672 (495) 25,167


Instructional Support 58,090 57,609 56,292 481 1,317Administration 1,910 1,896 1,807 14 89

Total Expenditures 60,000 59,505 58,099 495 1,406



STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 25117 - JORDAN FUNDAMENTALS GRANTSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Local Sources $ - 2,500 2,500 2,500 -


Direct Instruction - 2,500 2,470 (2,500) 30

Revenues Over (Under) Expenditures $ - - 30 - 30


STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 25123 - PNM FOUNDATION, INC.STATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Local Sources $ 1,100 2,175 - 1,075 (2,175)


Direct Instruction 1,100 2,175 1,822 (1,075) 353



STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 25137 - TOYOTA TIME GRANTSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Local Sources $ - 1,461 - 1,461 (1,461)


Direct Instruction - 1,461 1,320 (1,461) 141



STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 25162 - BURLINGTON GRANTSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Local Sources $ 4,444 14,657 7,719 10,213 (6,938)


Direct Instruction 4,444 14,657 9,601 (10,213) 5,056



STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 25335 - CYFD - PRESCHOOLSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


State Sources $ 115,000 115,000 96,687 - (18,313)


Direct Instruction 111,423 111,423 109,240 - 2,183Administration 3,577 3,577 3,577 - -

115,000 115,000 112,817 - 2,183



STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 25341 - TANIF - AFTER SCHOOL CHILD CARESTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


State Sources $ 20,000 80,400 9,062 60,400 (71,338)


Administration - 2,571 2,571 (2,571) - Community Services 20,000 77,829 77,829 (57,829) -




STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 25347 - TECHNOLOGY FOR EDUCATIONSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


State Sources $ 111,153 140,345 98,623 29,192 (41,722)


Instructional Support 33,984 55,912 35,951 (21,928) 19,961Administration 4,000 4,433 3,499 (433) 934Business and Support Services 73,169 80,000 73,057 (6,831) 6,943




STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 25355 - COMPUTERIZED LEARNING SYSTEMSSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


State Sources $ - 75,000 75,000 75,000 -


Direct Instruction - 75,000 75,000 (75,000) -

Revenues Over (Under) Expenditures $ - - - - -


STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 25374 - INCENTIVES FOR SCHOOL IMPROVEMENTSSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


State Sources $ 95,771 95,771 - - (95,771)


Direct Instruction 95,771 95,771 54,641 - 41,130



STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 25428 - BRIDGING OF THE ARTSSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


State Sources $ - 4,000 4,000 4,000 -


Community Services - 4,000 303 (4,000) 3,697



STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 25429 - GEAR UPSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


State Sources $ 184,400 552,721 290,368 368,321 (262,353)


Direct Instruction 9,496 298,348 190,453 (288,852) 107,895Instructional Support 1,597 20,597 7,809 (19,000) 12,788Administration 5,362 32,204 10,074 (26,842) 22,130Community Services 167,945 201,572 149,963 (33,627) 51,609




STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 25433 - TEACHER MENTORINGSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


State Sources $ 12,243 36,340 18,124 24,097 (18,216)


Direct Instruction 12,243 35,209 32,630 (22,966) 2,579Administration - 1,131 1,131 (1,131) -

Total Expenditures 12,243 36,340 33,761 (24,097) 2,579-



STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 25502 - PRIVATE DIRECT GRANTSSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


State Sources $ 6,000 31,663 10,500 25,663 (21,163)


Direct Instruction 5,188 9,188 4,165 (4,000) 5,023Instructional Support - 1,500 - (1,500) 1,500Community Services 812 20,975 20,796 (20,163) 179




NON-MAJOR CAPITAL PROJECTS FUNDS Capital projects funds are used to account for the acquisition and construction of major capital facilities other than those financed by proprietary funds and trust funds. Public School Capital Outlay – State (31200) – To account for funding provided to the District by the State of New Mexico for capital improvement projects approved by the Public School Capital Outlay Council. Special Capital Outlay – State (31400) – To account for District-wide building improvement projects funded by the State. Special Capital Outlay – Federal (31500) – To account for funding provided by Federal sources designated for capital projects. Capital Improvements SB-9 (31700) - To account for erecting, remodeling, making additions to, and furnishing of school buildings, or purchasing or improving school grounds or any combination thereof as identified by the local school board. Financing is provided by the State of New Mexico's State Equalization Matching and a special tax levy as authorized by the Public School District Capital Improvements Act (22-25-1 to 22-25-10 NMSA 1978). Energy Efficiency Act (31800) – To account for State funding that permits New Mexico governmental agencies to enter into contracts with providers to reduce energy costs. Funding is authorized by NMSA 1987 6-23-1. Public School Capital Outlay – 20% (32100) - To account for the cost of improvement to land, buildings, and the purchase of buildings and equipment. Funding is provided by 20% credit for Impact Aid and locally assessed property taxes.

134

STATE OF NEW MEXICO CENTRAL CONSOLIDATED SCHOOL DISTRICT NO.22NON-MAJOR CAPITAL PROJECTS FUNDSCOMBINING BALANCE SHEETAs of June 30, 2004

Fund Fund Fund Fund Fund31200 31400 31500 31700 32100

PUBLIC SCHOOL STATE FEDERAL CAPITAL 20%CAPITAL SPEC CAP SPEC CAP IMPROVEMENTS CAPITALOUTLAY OUTLAY OUTLAY SB-9 OUTLAY TOTALS

ASSETS

Assets:Cash and Investments $ 1,017,102 1,083,137 2,395,566 4,495,805Taxes Receivable 63,490 160 63,650Due from Grantor 278,051 104,619 382,670Inventory

Total Assets $ 278,051 104,619 1,017,102 1,146,627 2,395,726 4,942,125


Liabilities:Bank Overdraft $ 253,939 346,123 600,062Accounts Payable 45,502 5,837 38,534 69,044 158,917Accrued Salaries and BenefitsAccrued Compensated AbsencesDeferred Revenue 59,037 59,037

Total Liabilities 299,441 351,960 97,571 69,044 818,016


Year's Expenditures 1,017,102 1,049,056 2,326,682 4,392,840Reserved for Debt ServiceUndesignated, Reported In Special Revenue Fund

Capital Projects Fund (21,390) (247,341) (268,731)

Total Fund Balance (21,390) (247,341) 1,017,102 1,049,056 2,326,682 4,124,109

Total Liabilities and Fund Balance $ 278,051 104,619 1,017,102 1,146,627 2,395,726 4,942,125


STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22NON-MAJOR CAPITAL PROJECTS FUNDSCOMBINING STATEMENT OF REVENUES, EXPENDITURES,AND CHANGES IN FUND BALANCESFor the Year Ended June 30, 2004 Fund Fund Fund Fund Fund Fund

31200 31400 31500 31700 31800 32100PUBLIC SCHOOL SPECIAL SPECIAL CAPITAL ENERGY PUBLIC SCHOOL NON-

CAPITAL CAP. OUTLAY CAP. OUTLAY IMPROVEMENTS EFFICIENCY CAPITAL MAJOROUTLAY STATE FEDERAL SB-9 ACT OUTLAY - 20% TOTALS

Revenues:Federal Sources $ 595,200 3,919,304 4,514,504State Sources 1,654,223 1,354,880 332,532 399,802 277,784 4,019,221Local Sources 1,275,493 67,186 1,342,679

Total Revenues 1,654,223 1,354,880 595,200 1,608,025 399,802 4,264,274 9,876,404


Direct Instruction Instructional Support Administration Business and Support Services Operation and Maintenance of Plant Food Services Athletics Non-Instructional Support Community Services Student Transportation

Education, Non-Current: Non OperatingDebt Principal Debt Interest Capital Outlay 1,535,984 1,257,634 641,349 1,164,880 47,904 3,598,907 8,246,658

Total Expenditures 1,535,984 1,257,634 641,349 1,164,880 47,904 3,598,907 8,246,658

Revenues Over (Under) Expenditures 118,239 97,246 (46,149) 443,145 351,898 665,367 1,629,746

Other Financing Sources (Uses):Bond ProceedsOperating Transfers In 6,392 6,392Operating Transfers OutLease Purchase Payments (355,135) (355,135)

Net Other Financing Sources (Uses) (348,743) (348,743)

Revenues and Other Financing Sources Over (Under) Expenditures and Other Financing Sources 118,239 97,246 (46,149) 443,145 3,155 665,367 1,281,003

Fund Balance - Beginning of Year, as Previously Reported (139,629) (344,587) 1,063,251 605,911 (3,155) 1,661,315 2,843,106


Fund Balance - Beginning of Year, as Restated (139,629) (344,587) 1,063,251 605,911 (3,155) 1,661,315 2,843,106

Fund Balance - End of Year $ (21,390) (247,341) 1,017,102 1,049,056 2,326,682 4,124,109


STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 31200 - PUBLIC SCHOOL CAPITAL OUTLAYSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


State Sources $ - - 995,105 - 995,105

Expenditures:Education, Non-Current:

Capital Outlay 2,821,955 2,587,219 956,141 234,736 1,631,078

Revenues Over (Under) Expenditures (2,821,955) (2,587,219) 38,964 234,736 2,626,183



STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 31400 - SPECIAL CAPITAL OUTLAY - STATESTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


State Sources $ - 182,455 1,119,979 182,455 937,524


Capital Outlay 1,352,004 1,392,752 1,015,201 (40,748) 377,551




STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 31500 - SPECIAL CAPITAL OUTLAY - FEDERALSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Federal Sources $ 112,510 1,556,690 1,669,200 1,444,180 112,510


Capital Outlay 942,800 2,273,069 1,255,967 (1,330,269) 1,017,102

Revenues Over (Under) Expenditures (830,290) (716,379) 413,233 113,911 1,129,612



STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 31700 - CAPITAL IMPROVEMENTS SB-9STATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


State Sources - 132,856 332,532 132,856 199,676Local Sources $ 1,217,957 1,217,957 1,349,300 - 131,343

Total Revenues 1,217,957 1,350,813 1,681,832 132,856 331,019


Capital Outlay 1,827,937 1,888,953 1,136,355 (61,016) 752,598

Revenues Over (Under) Expenditures (609,980) (538,140) 545,477 71,840 1,083,617



STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 31800 - ENERGY EFFICIENCY ACTSTATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


State Sources $ 399,802 403,039 399,802 3,237 (3,237)


Capital Outlay 44,667 47,904 47,904 (3,237) -

Revenues Over (Under) Expenditures 355,135 355,135 351,898 - (3,237)

Other Financing Sources (Uses):Operating Transfer In - - 6,392 - 6,392Lease Purchase Payments:

Principal 314,859 314,859 (314,859) - - Interest 40,276 40,276 (40,276) - -

355,135 355,135 (348,743) - 6,392

Revenues and Other FinancingSources Over (Under) Expendituresand Other Financing Uses $ - - 3,155 - 3,155


STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22FUND 32100 - PUBLIC SCHOOL CAPITAL OUTLAY - 20%STATEMENT OF REVENUES AND EXPENDITURESBUDGET AND ACTUAL (NON-GAAP BASIS)For the Year Ended June 30, 2004

Actual(Budgetary

Basis)


to FinalFinal


Federal Sources $ 3,451,313 3,451,313 3,573,099 - 121,786Local Sources 76,359 76,359 78,347 - 1,988

Total Revenues 3,527,672 3,527,672 3,651,446 - 123,774


Capital Outlay 5,513,701 5,192,605 2,920,247 321,096 2,272,358




STATE OF NEW MEXICO CENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22 FIDUCIARY FUNDS For the Year Ended June 30, 2004 Agency Funds - Agency Funds are used to account for assets held by the District as an agent for individuals, private organizations, or other governments. Agency Funds are custodial in nature (assets equal liabilities) and do not involve measurement of results of operations. These funds relate primarily to the various activities of the individual schools.

143

STATE OF NEW MEXICO CENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22 STATEMENT OF CHANGES IN ASSETS AND LIABILITIES - ALL AGENCY FUNDS For the Year Ended June 30, 2004

Balance BalanceJuly 1, 2003 Additions Deletions June 30, 2004

Assets

Cash and Investments $ 378,446 802,125 761,555 419,016

Liabilities

Deposits Held for Others $ 378,446 802,125 761,555 419,016


STATE OF NEW MEXICO CENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22 SCHEDULE OF CHANGES IN DEPOSITS HELD FOR OTHERS - ALL AGENCY FUNDS For the Year Ended June 30, 2004

Balance BalanceJuly 1, 2003 Additions Deletions June 30, 2004

Central Activity - District $ 20,897 36,123 29,068 27,952Kirtland Central High School 99,121 216,559 178,970 136,710Kirtland Middle School 38,324 92,908 90,632 40,600Kirtland Elementary School 9,075 29,868 30,406 8,537Grace B. Wilson Elementary School 34,124 37,996 31,067 41,053Ruth N. Bond Elementary School 12,015 14,376 18,115 8,276Ojo Amarillo Elementary School 2,670 7,718 8,088 2,300Shiprock High School 85,150 125,959 128,353 82,756Career Prep High School 4,956 9,011 8,389 5,578Tse Bit Ai Middle School 12,690 75,405 72,648 15,447Mesa Elementary School 811 11,987 9,632 3,166Nataani Nez Elementary School 9,706 25,940 24,812 10,834Nizhoni Elementary School 5,573 5,527 5,779 5,321Eva B. Stokely Elementary School 8,451 17,131 17,000 8,582Newcomb High School 3,221 47,361 65,103 (14,521)Newcomb Middle School 13,429 28,705 22,839 19,295Newcomb Elementary School 16,029 9,977 10,326 15,680Naschitti Elementary School 2,204 9,574 10,328 1,450

$ 378,446 802,125 761,555 419,016


STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22SCHEDULE OF EXPENDITURES OF FEDERAL AWARDSFor the Year Ended June 30, 2004

FederalFederal Grantor/Pass-Through CFDA Fund FederalGrantor/Program or Cluster Title Number Number Expenditures

Major Programs:U. S. Department of Education Direct Grants:

Impact Aid:P L 874 General 84.041 11000 $ 14,292,394P L 874 Special Education 84.041 24245 1,392,849P L 874 Indian Add-on 84.041 24247 5,130,198P L 874 Capital Outlay 84.041 32100 3,324,583

Indian Education Formula Grant 84.060 24215 1,395,689

25,535,713US Department of Education Passed Through NM State Dept. Of Education:

Title I ClusterESEA Title I 84.010 24101 3,377,231Teacher Principal Training and Recruiting 87.367A 24154 731,851Safe and Drug Free Schools and Communities 84.186A 24157 87,807

4,196,889U.S. Department of Agriculture

Passed through New Mexico State Department of Education:National School Lunch 10.553 21000 1,853,097National School Breakfast 10.533 21000 626,955

Passed Through New Mexico Department of Human Services: 10.550 21000 182,265

2,662,317

Total Department of Education Major Programs 32,394,919

Non-Major Programs:U. S. Department of Education

Passed through New Mexico State Department of Education:Title I Improv. 84.218A 24162 291,715ESEA Title I Program Improvement 84.218A 24105 54,752Comp School Reform 84.332A 24135 42,733Evenstart 84.213 24125 221,694ESEA Title VA 84.298 24150 38,593Pre-School Enviorn. 84.173 24136 3,988English Language Acquisition 84.365A 24153 303,249Star Schools 84.203F 24237 67,385 Carl Perkins Vo Ed 84.048 24144 154,673Technology Literacy Challenge 84.318X 24133 121,621School Renovation 84.352A 24166 690,335Learn & Serve 94.004 24126 7,776Rural and Low Income Schools 84.358B 24160 143,334Advanced Placement Incentives 84.330 24235 950Projects with Industry 84.234Q 24334 224,581Literacy through Libraries 84.364A 24335 58,099


STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22SCHEDULE OF EXPENDITURES OF FEDERAL AWARDSFor the Year Ended June 30, 2004

FederalCFDA Federal

Number Expenditures

IDEA-B Entitlement 84.027 24106 1,584,030IDEA-B Discretionary Competitive 84.027 24108 11,810IDEA-B Pre School 84.173 24109 66,216Reading Excellence 84.338A 24147 29,393Navajo Nation Grants 84.xxx 24301 91,806Technology Innovation Challenge Grants 84.303A 24307 21,091Native American School Repair and Renovation Grants 84.352B 31500 773,284

Total Department of Education Non-Major Programs 5,003,108

Non-Major Programs:U. S. Department of Health & Human Services Indirect Grants

Passed through Navajo Nation: 93.228 24222 99,089IHS/Navajo Nation Medical Center

Passed though NM Dept. of Health & Human ServicesMedical Assistance Payments (Medicaid) 93.778 24252 48,950

Passed though NM Department of EducationNM Grads 93.590 24249 14,495

Total Department of Health & Human Services Indirect Grants 162,534

U.S. Department of Interior - Bureau of Indian Affairs Direct GrantJohnson O' Malley 15.130 24231 553,023

0Total Expenditures of Federal Awards $ 38,113,584

Notes to Schedule of Expenditures of Federal Awards:1 Basis of Presentation

The accompanying Schedule of Expenditures of Federal Awards includes the Federal grantactivity of Central Consolidated Schools for the fiscal year ended June 30, 2004 and ispresented on the cash basis of accounting. The information in this schedule is presentedin accordance with the requirements of OMB Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations.

2 Non-Cash AssistanceIncluded above -U.S. Department of Agriculture - Food Distribution 182,265

3 Federal InsuranceNone

4 Federal Loans and/or Loan GuaranteesNone


STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22SCHEDULE OF PLEDGED COLLATERALFor the Year Ended June 30, 2004

Security CUSIP Market MaturitySecurity Description Number Number Value Date

Wells Fargo Bank:Fannie Mae Mortgage Backed Security 323605 31374TNW5 $ 2,150,997 03-01-2029Ginnie Mae Mortgage Backed Security 781259 36225BMGO 221,920 03-15-2031Ginnie Mae Mortgage Backed Security 781278 36225BM39 2,895,657 04-15-2031Ginnie Mae Mortgage Backed Security 781316 36225BN95 7,692,262 07-15-2031

$ 12,960,836


STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22CASH RECONCILIATION

Instructional FoodOperational Teacherage Transportation Materials Services Athletics

$ 3,791,947 236,147 386,549 112,208 313,900 88,060Adjustment to Beginning Cash Balance

3,791,947 236,147 386,549 112,208 313,900 88,060Add:

2003-2004 Revenues 41,431,528 399,865 2,668,256 586,650 2,905,925 151,847Prior Year Checks Voided 1,464Loans from Other Funds 3,155Deposits HeldOperating Transfer In

Total Cash and Investments Available 45,228,094 636,012 3,054,805 698,858 3,219,825 239,907

Less:2003-2004 Expenditures 42,729,261 440,065 3,038,617 578,152 2,828,477 117,559Loans to Other FundsOperating Transfer Out 6,392

Cash and Investments, June 30, 2004 $ 2,492,441 195,947 16,188 120,706 391,348 122,348

,

For the Year Ended June 30, 2004

Audited Cash and Investments, June 30, 2003

Adjusted, Audited Cash Balance June 30, 2003


STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22CASH RECONCILIATION, continued

Public SpecialFederal Local Bond School Capital

Non-Instructional Projects and State Building Capital Outlay Outlay-Local

$ 603,053 9,366,874 186,428 5,683,315 (292,903) (450,901)Adjustment to Beginning Cash Balance

603,053 9,366,874 186,428 5,683,315 (292,903) (450,901)Add:

2003-2004 Revenues 162,132 16,710,465 612,583 3,915,887 995,105 1,119,979Prior Year Checks Voided 6,936 Loans from Other FundsDeposits Held 1,500Operating Transfer In

Total Cash and Investments Available 765,185 26,085,775 799,011 9,599,202 702,202 669,078

Less:2003-2004 Expenditures 42,071 17,061,007 867,902 1,183,429 956,141 1,015,201Loans to Other FundsOperating Transfer Out

Cash and Investments, June 30, 2004 $ 723,114 9,024,768 (68,891) 8,415,773 (253,939) (346,123)





STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22CASH RECONCILIATION, continued

Special CapitalCapital Improvements Energy Debt

Outlay-Federal SB-9 Efficiency PSOC 20% Service Total

$ 603,869 540,134 1,671,892 3,617,678 26,458,250Adjustment to Beginning Cash Balance

603,869 540,134 1,671,892 3,617,678 26,458,250Add:

2003-2004 Revenues 1,669,200 1,679,358 399,802 3,643,921 5,124,825 84,177,328Prior Year Checks Voided 8,400Loans from Other Funds 3,155Deposits Held 1,500Operating Transfer In 6,392 6,392

Total Cash and Investments Available 2,273,069 2,219,492 406,194 5,315,813 8,742,503 110,655,025

Less: 2003-2004 Expenditures 1,255,967 1,136,355 403,039 2,920,247 4,588,295 81,161,785Loans to Other Funds 3,155 3,155Operating Transfer Out 6,392

Cash and Investments, June 30, 2004 $ 1,017,102 1,083,137 2,395,566 4,154,208 29,483,693





STATE OF NEW MEXICO CENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22 JOINT POWERS AGREEMENTS June 30, 2004 EDUCATION TECHNOLOGY IMPROVEMENT PLAN (ETIP) SUBCONTRACT AGREEMENT Participants: Gallup-McKinley County Schools (GMCS) on behalf of Navajo Education Technology Consortium (NETC) collectively referred to as (NETC-GMCS) and Central Consolidated School District No. 22 (CCSD). Responsible Parties: CCSD and GMCS Description: CCSD shall provide the necessary personnel, services, equipment, and facilities to ensure all appropriate participating teams attend summer training as scheduled. ETIP teams provide 30-40 hours training related to technology integration in the classroom. Provide a training facility that is equipped with at least 20 workstations and internet access. Period: 7/1/2003 thru 6/14/2004 Project Cost: NETC-GMCS shall reimburse CCSD for direct and indirect costs not to exceed $61,864.56 District Contribution: Personnel and facilities to be reimbursed. Audit responsibility: CCSD

SEE INDEPENDENT AUDITORS’ REPORTS 152 The accompanying notes are an integral part of these financial statements

STATE OF NEW MEXICO CENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22 JOINT POWERS AGREEMENTS June 30, 2004 MEDICAID PROGRAM AS A PROVIDER OF SCHOOL-BASED HEALTH SERVICES Participants: Central Consolidated School District No. 22 and New Mexico Human Services Department Responsible Parties: Central Consolidated School District No. 22 and New Mexico Human Services Department Description: To participate in the Medicaid program as a provider of school-based health services. Period: 4/24/03 until indefinite Project Cost: 100% reimbursement of cost to Medicaid-eligible children. District Contribution: Undetermined Audit Responsibility: Central Consolidated School District No. 22


STATE OF NEW MEXICO CENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22 JOINT POWERS AGREEMENTS June 30, 2004 JOINT POWERS AGREEMENT FOR OPERATION OF GOLF COURSE Participants: Central Consolidated School District No. 22 and San Juan College Responsible parties: Central Consolidated School District No. 22 and San Juan College Description: Acceptance of a gift of land from El Paso Natural Gas for use as a golf course, classes, etc. and operation of public golf course. Period: From 11/1/1990 until terminated by either of the members herein. Project Cost: Undetermined District Contribution: Undetermined Audit Responsibility: San Juan College


STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22BANK DEPOSITORIESJune 30, 2004

The following information is presented to comply with Section 12-6-5 NMSA 1978.

The following is a list of individual deposit accounts and investments held by CentralConsolidated School District No. 22 as of June 30, 2004. Accounts were held at WellsFargo Bank.

Act. Balance Deposits Outstanding BalanceAccount Name Type Per Bank In Transit Checks Adjustments Per Books

Wells Fargo Bank: Fiduciary Accounts: Central Activity 1 $ 22,680 (1,129) (7,443) $ 14,108 Investment 2 404,908 404,908 Total 427,588 (1,129) (7,443) 419,016

District Accounts: Operational 1 1,000,824 1,342 (3,342,178) 12,500 (2,327,512) Athletic 1 349 12,729 (578) (12,500) - Investment 2 6,772,444 6,772,444 Total 7,773,617 14,071 (3,342,756) 4,444,932

Total Wells Fargo Bank $ 8,201,205 12,942 (3,350,199) $ 4,863,948

New Mexico State Treasurer 3 $ 25,038,761 $ 25,038,761

Account Type

1-Checking 2-Money Market Account 3-State Pool Investment


STATE OF NEW MEXICO CENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22 SCHEDULE OF FINDINGS AND QUESTIONED COSTS For the Year Ended June 30, 2004

SECTION I - SUMMARY OF AUDITORS' RESULTS Financial Statements: 1. Type of auditors' report issued Internal control over financial reporting: 1. Material weaknesses identified? 2. Reportable condition (s) identified that are not considered to be material weaknesses? 3. Noncompliance material to financial statements noted? Federal Awards: Internal control over major programs: 1. Material weakness (es) identified? 2. Reportable condition(s) identified that are not considered to be material weaknesses Type of auditor's report issued on compliance for major programs Any audit findings disclosed that are required to be reported in accordance with section 510(a) of Circular A-133? Identification of major programs:

CFDA Number84.041 84.010 84.060

84.352A 10.553

Dollar threshold used to distinguish between Type A and Type B programs

Auditee qualified as low-risk Auditee

Unqualified

No

Yes

No

Yes

No

Qualified

Yes

Name of Federal Program or ClusterImpact Aid

Title I Cluster Title VII – Indian Education

Idea and Technology School Breakfast and Lunch

$ 300,000

No

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STATE OF NEW MEXICO CENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22 FINDINGS AND QUESTIONED COSTS For the Year Ended June 30, 2004 PRIOR YEAR FINDINGS STATUS 03-01 Classification of Bus Drivers’ Salaries Resolved 03-02 Medicaid Billing Procedures Resolved 03-03 Special Education Expenditures Resolved 03-04 Storage of Commodities Resolved 03-05 Timeliness of Audit Report Resolved CURRENT YEAR FINDINGS FINANCIAL REPORT – INTERNAL CONTROL 2004-01 Fraud Policy FEDERAL AWARDS – COMPLIANCE 2004-02 Monitoring Wages of Laborers

161

STATE OF NEW MEXICO CENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22 FINDINGS AND QUESTIONED COSTS, continued For the Year Ended June 30, 2004 04-01 FRAUD POLICY Statement of Condition: The District does not have a policy that dictates how employees are required to respond as they become aware of actual or suspected instances of fraud occurring in the District. Criteria: Good internal control procedures should include a policy that assures District Management that as instances of fraud are reported and that they are dealt with appropriately. Effect: Not only may fraud be occurring in the District, but employees may be aware of its occurrence and not informing the appropriate individuals. Cause: The need of a policy dealing with fraud occurrences may not have been adequately considered by District Management. Recommendation: A policy of how District Management would like employees to respond to actual or suspected reported instances of fraud should be designed and approved by the School Board. Response: The District will work with the company which provides its policy manual updates to obtain a fraud policy. This company works with the New Mexico School Boards Association to provide all necessary policy updates. The policy will be reviewed by the School Board, modified as needed, and then incorporated into the School Board Policy Manual. This policy will also be distributed so that employees know of their requirements under the policy and the method by which they may report fraud or suspected fraud to the appropriate personnel.

162

STATE OF NEW MEXICO CENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22 FINDINGS AND QUESTIONED COSTS, continued For the Year Ended June 30, 2004 2004-02 MONITORING WAGES OF LABORERS

CFDA#: 84.041 and 84.352A Questioned Costs: $2,317,703

Statement of Condition: The District received grants from the Federal Government for various purposes, including construction of District facilities. The District did not monitor the amounts paid to laborers by construction contractors financed by Federal funding. Criteria: Federally financed construction projects are subject to the Davis Bacon Act. That law requires that grantors monitor the amounts paid to laborers of projects funded by Federal money. Effect: The District apparently did not comply with the Davis Bacon Act. Cause: The District believed the New Mexico Department of Labor was monitoring the wages paid to the laborers and that was sufficient to comply with the Federal requirement. Recommendation: The District monitor the wages paid to laborers paid under Federally funded construction projects. Response: The District takes issue with this finding on two separate grounds. First, the District receives PL 81-874 Impact Aid dollars for operational purposes. These are payments in-lieu of property taxes for the impacted lands of the Navajo Nation which encompass a majority of the District’s boundaries. The State then takes credit against these dollars in its equalization process. These payments are intended to replace the property taxes that the District would receive if the lands within the boundaries of the District were not Federally impacted. To now say that this portion of our “property taxes” is now subject to the Davis Bacon Act is ridiculous. This would prevent the District from taking advantage of State and Federal contracts developed to save school districts monies. For example, the District could not take advantage of any Cooperative Educational Services (CES) contracts under this finding. The District would be required to pay Davis Bacon wages for projects as small as painting a school’s hallways or putting new carpeting down in a small wing of a single school.

163

The auditors also agree that if the funds were not moved into Fund 32100 – Public School Capital Outlay – 20% – as required by the State, the Davis Bacon Act would not apply to the expenditures from the General Fund – Fund 11000 – as expenditures are allowed for all operational purposes and are mixed with state and local monies so no differentiation could be made as to what funds apply. So if the District spent these funds from function 11 within Fund 11000, Davis Bacon would not apply. However, according to the auditors, since the District spends these funds from function 11 within Fund 32100, Davis Bacon does apply. A simple accounting requirement of the State should not affect the application of Davis Bacon, especially since these funds are payments in-lieu of property taxes, and property tax monies are not affected by Davis Bacon. So the District holds that no Impact Aid dollars received by the District are subject to the Davis Bacon Act. Second, the State has done Davis Bacon Act compliance work on all Federal construction monies received by the District through State flowthrough. The major construction projects in the District funded with Federal dollars, Eva B. Stokely Elementary addition, Nizhoni Elementary addition, and roofing projects at Newcomb Elementary, Career Prep High School, and Kirtland Middle School, have been audited by the State to ensure compliance with Davis Bacon. The District should not be required to duplicate the work of the State for compliance.

164

STATE OF NEW MEXICOCENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22SCHEDULE OF FINDINGS AND QUESTIONED COSTSJune 30, 2004

Items not inPopulation Size* Items Tested Compliance

CFDA Dollar Dollar Dollar QuestionedProgram Number Number Amount Number Amount Number Amount Finding/Noncompliance Costs

ImpactAid 84.040 NA $ 4,097,868 NA $ 4,097,868 NA $ 1,733,391 See Findings and Questioned Costs -

2004-02 Monitoring Wages of Laborers $ 1,733,391

IDEA andTechnology 84.352A NA $ 584,312 NA $ 584,312 NA $ 584,312 See Findings and Questioned Costs - 584,312

2004-02 Monitoring Wages of Laborers


STATE OF NEW MEXICO CENTRAL CONSOLIDATED SCHOOL DISTRICT NO. 22 EXIT CONFERENCE For the Year Ended June 30, 2004 An exit conference was held on November 5, 2004. In attendance were the following:

Representing Central Consolidated School District No. 22:

Linda Besett Superintendent Byron Manning Executive Director of Finance and

Business Operations Kathy Hamilton Accounting Supervisor Gary Ray Board Member

Representing Gary E. Gaylord, Ltd.: Gary E. Gaylord, CPA Auditor in charge

Wm. Larry Lanphere, CPA Auditor

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