On the Dec. 18, school board meeting, Gustine Unified School District (GUSD) provided an annual update on the district’s latest financial report on certificates of participation (COPs) activity.
COPs are financial contracts that raise funds for capital project construction. GUSD Superintendent Bryan Ballenger said the district is currently paying off a loan that was used to build a school site at Gustine Elementary.
“The district had to have matching funds,” Ballenger said. “In order to get those funds, the district took out COPs to build the school sites.”
According to the meeting’s agenda, the district made two loan payments in January and July of this year. In January, GUSD paid $240,775, and in July, $240,132.50. Last year, GUSD paid a total of $484,372.50 in loan payments. They currently have more than $6 million to pay off with a loan payment of $236,445 in January 2025.
“Without these funds taken out, we wouldn’t have a new school site,” Ballenger said.
Ballenger also stated that the payments have not negatively impacted the school’s budget. According to a June 2023 GUSD audit report, the district’s net position was $13.1 million, a $6.6 million increase from the year prior. Additionally, the district generated revenue of more than $41 million, with expenses of $34.4 million, a difference of $6.6 million. The biggest contributors to the $34.4 million expense were Instruction and Plant Services, at $14.6 million and $6.9 million, respectively.
The audit report also mentioned $27.3 million toward Capital Assets. The initial amount for the various projects under the Capital Assets was $50.2 million but with the Accumulated Depreciation at $23.8 million, the district ended up with $27.3 million. Building & Improvements and Construction made up more than $43.7 million.
Ballenger said the district does multiple interim reports throughout the calendar year. The Merced County Office of Education evaluates the district’s budget. GUSD was issued a positive certification, meaning the district can pay any of its financial obligations in the current school year and the following two school years. If a negative certification was issued to the district, it would mean that the district would not meet and pay any of its financial obligations within the current school year and the following two school years.
According to the first interim report mentioned in a Dec. 11 agenda, the district met the requirements of having a positive general fund and cash balance and minimum available reserves in the event of economic uncertainty. Additionally, there was no indication of GUSD having a projected negative cash flow, fiscal distress and contributions going from an unrestricted to a restricted resource.
Some notable differences compared to the first interim report from last year included an indication that the district was not projected to have a positive general fund cash balance and negative cash flow.
“Our budgets are in a healthy situation, which means that we can pay our obligations this year, plus the two years out,” Ballenger said.
Navtej Hundal is a freelance journalist within Stanislaus County.
