In final ratings from the Texas Education Agency, Dripping Springs ISD received the rating of “Meets Standard” and a letter grade “C” on the 2021-2022 Texas Financial Integrity Rating System of Texas report.
The rating is based on 20 base indicators with five critical indicators, nine indicators related to solvency and six indicators related to financial competence. For this rating year, three indicators were not scored by the TEA, according to a report published by DSISD. These indicators included results of the annual external audit, debt management, fund balance and administrative cost ratio, among other financial indicators.
The Schools FIRST accountability rating system uses ratings of “A-Superior,” 'B-Above Standard', “C-Meets Standard,” or “F-Substandard Achievement.” This recent designation is based on financial information from the 2020-2021 fiscal year.
The FIRST rating, which has been issued for the past 19 years, measures the quality of school districts’ financial management and reporting. The report ensures that Texas public schools are held accountable for the quality of their financial management practices and that they improve those practices. The system is designed to encourage Texas public schools to better manage their financial resources to provide the maximum allocation possible for direct instructional purposes.
DSISD has received a Superior Rating almost every year since the FIRST system’s inception, with an exception in 2014–2015 due to a temporary change in the rating system to a “pass or fail” scale. This is the first year that DSISD has not earned the highest possible rating, due to a failure to meet the requirements under Indicator 17, which asks, “Did the external independent auditor report that the AFR was free of any instance(s) of material weaknesses in internal controls over financial reporting and compliance for local, state, or federal funds?” Because the school district failed Indicator 17, the maximum points and highest rating that the school district could receive was 79 points.
For the 2020–2021 fiscal year, the auditor’s report noted a “Material Weakness in Internal Control over Financial Reporting: Financial Close Process.” The auditor’s report pointed out several misstatements in various general ledger account balances, including the failure to record retainage payable in the Capital Projects Fund.
DSISD filed an appeal of the finding and the rating with the Texas Education Agency, which was denied on Nov. 4. According to district documents, the district maintains the position that due to multiple staff vacancies and turnover, the district’s overall financial condition is strong. The district scored 98 points out of 100 on all other indicators.
The report was presented by DSISD Deputy Superintendent Elaine Cogburn at the DSISD Board of Trustees meeting on Monday, Dec. 12.
