Examining Individual School Districts District Wealth
School districts operate in an environment where a variety of economic pressures, some in conflict with others, are operating simultaneously.
- School districts, supported by public funds, are expected to operate efficiently and collect only the local tax revenue they really need.
- They are expected to anticipate the future and establish reserve funds to protect against hard times.
- They are expected to expend the necessary funds to maintain an educational program that meets academic standards.
- They are expected to expend the necessary amounts to maintain a multi-million dollar investment in buildings and grounds.
- They are expected to accomplish all this despite uncertain economic conditions, changes in the student population and higher standards.
Under any circumstances, determining the overall fiscal health of a school district is a complex task. At this time no single, generally accepted financial indicator exists. Indeed, examining financial information alone is probably an inadequate approach. Factors such as changing property values, student demographics, plans for major capital expenditures and other non-fiscal circumstances may affect a district's financial health. However, an analysis can begin with an examination of trends over time.
This section contains calculated data over a five-year period for two items: Pupil Wealth Ratio Index and the Alternate Pupil Wealth Ratio Index. The Pupil Wealth Ratio and the Alternate Pupil Wealth Ratio are the components of the Combined Wealth Ratio (CWR) used in many aid formulas. The CWR and the baseline data for these items can be found in the Masterfiles. The data presented here show these items as a percentage of the statewide average for each year. These two items are only two of the many factors which need to be considered when assessing a school district's financial condition.
Pupil Wealth Ratio (PWR) Index
Calculation: (Actual Valuation of taxable real property / Total Wealth Pupil Units) / State Average
This is the Property wealth component of the Combined Wealth Ratio used in State Aid formulas. The property tax is the dominant source of local funding for most districts. The higher the pupil wealth ratio, the greater the property wealth behind each pupil, thus the greater the potential to generate funds locally.
Alternate Pupil Wealth Ratio Index
Calculation: (Adjusted Gross Income / Total Wealth Pupil Units) / State Average
This is the Personal Income component of the Combined Wealth Ratio used in State Aid formulas. In standard economic theory, the greater the income behind each pupil, the greater the marginal ability to pay school taxes.
DATA TABLE (1.80 MB)