Acton-Boxborough Regional School District Management’s Discussion and Analysis June 30, 2024
Entity-wide Financial Analysis
As noted earlier, net position may serve over time as a useful indicator of a government’s financial position. Assets and deferred outflows of resources exceeded liabilities and deferred inflows or resources by $18.2 million at the close of 2024. One component of net position, $91.6 million, reflects the District’s investment in capital assets (e.g., land, buildings, vehicles, and equipment); less any related debt used to acquire those assets that are still outstanding. The District uses these capital assets to provide services to pupils; consequently, these assets are not available for future spending. Although the investment in its capital assets is reported net of its related debt, it should be noted that the resources needed to repay this debt must be provided from other sources, since the capital assets themselves cannot be used to liquidate these liabilities. Restricted net position of $1.2 million represents resources that are subject to external restrictions on how they may be used. The remaining balance of unrestricted net position has a year-end deficit balance of $74.6 million. The deficit balance is primarily due to the impact of reporting a $49.3 million net other postemployment benefit liability and a $32.3 million net pension liability on the Districts Statement of Net Position. The governmental activities net position decreased by $4.1 million in 2024. This decrease is primarily due to a $1.8 million decrease from the net change in the net OPEB liability and the related deferred inflows/outflows of resources and a $3.4 million decrease from the excess of depreciation expense, which is unbudgeted, over debt principal payments. These decreases were offset by the recognition of $1.1 million of capital grants for school construction assistance. Effective July 1, 2024, the District withdrew from a group health insurance risk pool administered by the Acton Health Insurance Trust (Trust) and subsequently enrolled in the Massachusetts Interlocal Insurance Association (MIIA) for its health insurance coverage. During fiscal year 2024, health insurance claims paid by the Trust significantly exceeded expectations, necessitating additional funding from the District to cover these claims. Consequently, a total of $2,053,241 in benefit payments were paid from the OPEB trust fund. Of this amount, $504,241 was allocated to cover a 22.8% increase in premiums for the period from January 2024 to June 2024, while $1,549,000 was directly contributed to the Trust to address the excess claims.
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