Page 7 - School Finance Manual 2025-26

Budget Formula Construction cont. 7

Maintenance and Operations Budget Equalization Formula

The Maintenance & Operations (M&O) Fund budget The Equalization Formula consists of the following:
is where most of the day-to-day expenditures take • Revenue Control Limit (TRCL) which is made up of
place. Typical budgeted expenditures include: salaries, Base Support Level (BSL) (A.R.S. §15-943) (CY
employee benefits, supplies, utilities, maintenance and ADM) and Transportation Revenue Control Limit
repair, and miscellaneous expenditures not of a capital (TRCL).
nature. • District Additional Assistance; (DAA) (PY ADM),
(A.R.S. §15-961)
Although the format and formula computation of the • Tuition
M&O Fund is very structured, the process of deter- • Consolidation/Unification Assistance
mining how the monies will be spent varies among
school districts. Typically, the budgeting process starts These budget limit components may be allocated to
months before the fiscal year begins. M&O or Capital.

The M&O budget limit is referred to as the General
Budget Limit and is based on a number of formulas
which are heavily dependent upon the Average Daily
Membership (ADM) (A.R.S. §15-901). The M&O budget
is funded on current year (CY) ADM. ADM means the
average membership of fractional students and full-
time students through the first 100 school days of the
school year calendar. Student withdrawals (A.R.S.
§15-901) are incorporated in this total. Addition-
ally, A.R.S. §15-902.04 provides an option to offer a
200-day calendar and receive additional 5% of base
level funding. The modified calendar requires approxi-
mately a 10% increase in instructional time.

Arizona Association of School Business Officials | School Finance Summary Manual