School enrollment projections broadly accurate, not driving financial distress, State Auditor’s Office finds

School districts’ financial challenges are not the result of inaccurate student enrollment projections, according to a new report from the Office of the Washington State Auditor. 

Several public school districts are experiencing financial distress, and student enrollment has declined statewide. Legislators asked the State Auditor’s Office to determine whether districts’ financial challenges were linked to faulty projections of future student enrollment.  

Because state funding is tied to actual student head counts, a district that bases its budget on overly optimistic enrollment projections risks owing money back to the state once the real student count is known. 

Concerns about a direct link between projections and financial distress proved unwarranted, however.  A comparison of districts’ projections with subsequent actual enrollment showed that districts of all sizes were generally accurate in their forecasts.  

When predicting enrollment for the next school year, more than two-thirds of districts were within 5% of actual student enrollment. Of 308 districts reviewed, only 14 overestimated enrollment by more than 10%. 

Auditors also looked at longer-term, four-year projections for 306 districts. As expected, these were less accurate than short-term forecasts, but 141 districts’ projections were still within 5% of actual enrollment. 

Importantly, districts with indicators of financial distress in the Office’s publicly available Financial Intelligence Tool were no more likely to overpredict enrollment than those with more accurate projections. This also suggests that factors other than enrollment projections were driving school districts’ budget challenges. 

Auditors did note that more than 40 districts projected identical enrollment numbers for four years in a row. Unchanging enrollment numbers seem unlikely to be accurate and may warrant further review.  

Because enrollment projections were broadly accurate, the Office concluded that a full performance audit was unnecessary. Instead, the Office issued this data brief today. 

The report can be found on the State Auditor’s Office website: School District Enrollment Projections (PDF)

Media inquiries: Assistant Director of Communications Adam Wilson, Adam.Wilson@sao.wa.gov, 564-999-0799.