Isaac School District to receive $25M loan from Tolleson Union High School District

The Tolleson Union High School District is helping out the Isaac School District in a major way.

It's loaning the distressed school district $25 million as Maricopa County says it's more than $28 million in debt.

The Isaac School District is home to eleven schools and an online school. On Wednesday, teachers worked without pay after a vote.

The backstory:

A Dec. 31, 2024 letter sent to Superintendent of Public Instruction Tom Horne by Maricopa County School Superintendent Steve Watson said the district has a total overexpenditure of approximately $12.6 million.

The county says the debt is actually more than $28 million.

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Dig deeper:

Now, the dark clouds appear to be clearing for this district.

On the night of Jan. 29, the district reached an agreement with Tolleson to cut down most of the debt. Arizona Superintendent of Public Instruction said a few days earlier the feds would also give Isaac $6 million.

The loan agreement aims to get payroll settled for educators by Friday – two days after they were supposed to receive their paychecks.

Under the agreement, the Isaac Middle School property will be leased to Tolleson Union as the state receiver continues working toward a long-term solution to this financial fiasco.

For Isaac School District educators, this week has come with a lot of questions, including from students.

"I teach kindergarten, so having to explain when they ask me, 'Oh, why are you with the sign? Why are you standing outside?' And having to have them understand when this conversation should not be happening in the classroom," Andrea Valencia said. "It's devastating."

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By the numbers:

The conversation is stemming from the district's inability to make payroll due to the massive budget shortfall.

The Tolleson Union board voted to adopt a 12-year, $25 million lease-lease back agreement with 6% interest.

"We are taking this initiative for our community because it's a win-win situation," said Tolleson Union Board President, Leezah Sun.

The other side:

Before the board's vote, some Tolleson residents spoke out against the agreement.

"We shouldn't be using our funds. Our funds should be spent in our schools, in our district. I empathize with the teachers, but their leadership is the one that's at fault."

"Our Tolleson students need to be protected, and the funds need to stay in Tolleson where they belong, where we made them and where they should continue to stay."

Some state legislators who say they are working on their own solutions to the budget crisis at Isaac spoke in favor of the agreement, and the idea of neighbors helping neighbors.

"We grocery shop together. We drive down the street together, down the I-10 on our way to work. This is a community, and so I just want to commend you for helping us," Rep. Quantá Crews said.

What's next:

Meanwhile, Isaac educators plan to return to work on Thursday, saying this agreement leaves them hopeful, but not satisfied.

"Everything is in this receiver's hands and even now, although this is promising what we heard tonight, we also don't want to put everything, all of our eggs in one basket, because we've been blindsided so many times," Valencia said.

At the same time as the Tolleson meeting on Jan. 29, Isaac School District also met.

It approved the same agreement, and also approved the resignation of superintendent Mario Ventura effective Thursday, Jan. 30.

'We can't provide our job if we're not being paid to do that'

There are some concerned Tolleson residents who say they want to keep these funds in the Tolleson community, but the administration says this is an investment and the money will come back. 

"We are not changing any of the numbers that are proposed and adopted, but we are moving some funds over from (maintenance and operations) over to capital," said Ken Hicks, CFO for the Tolleson Union High School District.

Residents in opposition to the agreement voiced concerns about staff salaries and benefits being slashed, but Hicks says that isn't the case.

"That is our reserves, so that is where we put our reserves, and so this is using our reserves, and it will not affect employees at this point," he said.

Superintendent Jeremy Calles is offering a clarification as to why the more than $70 million in reserves is listed under instruction.

"If you were to look at our budget for last year, it has an extra $73 million in instruction that we did not actually spend. That was money that was carried forward in maintenance and operations. If you do not take that $73 million and put it somewhere in your budget, that $73 million is cut, so you have to put the money somewhere when you have reserves and contingencies," Calles explained.

During the meeting, Littleton Elementary School District board member Markus Ceniceros brought the conversation back to the people the agreement benefits in the immediacy.

"Students in the Isaac School District will be able to go to school. Families there will be able to have reassurance that they will be able to go to school and teachers will get paid," Ceniceros said.

Despite this agreement, teachers at Isaac School District are still awaiting paychecks.

"I don't think anybody would want to go to work if they aren't getting paid," Valencia said. "You know, we are here for the students, but at the same time, we have to put our livelihood, you know, we can't provide our job if we're not being paid to do that."

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