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					SAN JACINTO UNIFIED SCHOOL DISTRICT

TABLE OF CONTENTS
JUNE 30, 2010

FINANCIAL SECTION
   Independent Auditors' Report                                                                   2
   Management's Discussion and Analysis                                                           4
   Basic Financial Statements
      Government-Wide Financial Statements
         Statement of Net Assets                                                                 13
         Statement of Activities                                                                 14
      Fund Financial Statements
         Governmental Funds - Balance Sheet                                                      15
         Reconciliation of the Governmental Funds Balance Sheet to the Statement of Net Assets   16
         Governmental Funds - Statement of Revenues, Expenditures, and Changes in Fund Balance   17
         Reconciliation of the Governmental Funds Statement of Revenues, Expenditures, and
         Changes in Fund Balances to the Statement of Activities                                 18
         Fiduciary Funds - Statement of Net Assets                                               20
      Notes to Financial Statements                                                              21

REQUIRED SUPPLEMENTARY INFORMATION
  General Fund - Budgetary Comparison Schedule                                                   49
  Schedule of Other Postemployment Benefits (OPEB) Funding Progress                              50

SUPPLEMENTARY INFORMATION
   Schedule of Expenditures of Federal Awards                                                    52
   Local Education Agency Organization Structure                                                 54
   Schedule of Average Daily Attendance                                                          55
   Schedule of Instructional Time                                                                56
   Reconciliation of Annual Financial and Budget Report with Audited Financial Statements        57
   Schedule of Financial Trends and Analysis                                                     58
   Schedule of Charter Schools                                                                   59
   Combining Statements - Non-Major Governmental Funds
      Combining Balance Sheet                                                                    60
      Combining Statement of Revenues, Expenditures, and Changes in Fund Balance                 62
   Note to Supplementary Information                                                             64

INDEPENDENT AUDITORS' REPORTS
   Report on Internal Control Over Financial Reporting and on Compliance and Other Matters
   Based on an Audit of Financial Statements Performed in Accordance with Government
   Auditing Standards                                                                            67
   Report on Compliance With Requirements That Could Have a Direct and Material Effect
   on Each Major Program and on Internal Control Over Compliance in Accordance With
   OMB Circular A-133                                                                            69
   Report on State Compliance                                                                    71
SAN JACINTO UNIFIED SCHOOL DISTRICT

TABLE OF CONTENTS
JUNE 30, 2010

SCHEDULE OF FINDINGS AND QUESTIONED COSTS
   Summary of Auditors' Results                   74
   Financial Statement Findings                   75
   Federal Awards Findings and Questioned Costs   76
   State Awards Findings and Questioned Costs     77
   Summary Schedule of Prior Audit Findings       78
   Management Letter                              80
FINANCIAL SECTION




     1
SAN JACINTO UNIFIED SCHOOL DISTRICT

MANAGEMENT'S DISCUSSION AND ANALYSIS
JUNE 30, 2010

REPORTING THE DISTRICT AS A WHOLE

The Statement of Net Assets and the Statement of Activities

The Statement of Net Assets and the Statement of Activities report information about the District as a whole and
about its activities. These statements include all assets and liabilities of the District using the accrual basis of
accounting, which is similar to the accounting used by most private-sector companies. All of the current year's
revenues and expenses are taken into account regardless of when cash is received or paid.

These two statements report the District's net assets and changes in them. Net assets are the difference between
assets and liabilities, which is one way to measure the District's financial health, or financial position. Over time,
increases or decreases in the District's net assets are one indicator of whether its financial health is improving or
deteriorating. Other factors to consider are changes in the District's property tax base and the condition of the
District's facilities.

The relationship between revenues and expenses is the District's operating results. Since the governing board's
responsibility is to provide services to our students and not to generate profit as commercial entities do, one must
consider other factors when evaluating the overall health of the District. The quality of the education and the
safety of our schools will likely be an important component in this evaluation.

In the Statement of Net Assets and the Statement of Activities, we report the District activities as follows:

Governmental Activities - Most of the District's services are reported in this category. This includes the
education of kindergarten through grade twelve students, adult education students, the operation of child
development activities, and the on-going effort to improve and maintain buildings and sites. Property taxes, State
income taxes, user fees, interest income, Federal, State, and local grants, as well as general obligation bonds,
finance these activities.




                                                        5
SAN JACINTO UNIFIED SCHOOL DISTRICT

MANAGEMENT'S DISCUSSION AND ANALYSIS
JUNE 30, 2010

REPORTING THE DISTRICT'S MOST SIGNIFICANT FUNDS

Fund Financial Statements

The Fund Financial Statements provide detailed information about the most significant funds - not the District as
a whole. Some funds are required to be established by State law. However, management establishes many other
funds to help it control and manage money for particular purposes or to show that it is meeting legal
responsibilities for using certain taxes, grants, and other money that it receives from the U.S. Department of
Education.

Governmental Funds - Most of the District's basic services are reported in governmental funds, which focus on
how money flows into and out of those funds and the balances left at year-end that are available for spending.
These funds are reported using an accounting method called modified accrual accounting, which measures cash
and all other financial assets that can readily be converted to cash. The governmental fund statements provide a
detailed short-term view of the District's general government operations and the basic services it provides.
Governmental fund information helps determine whether there are more or fewer financial resources that can be
spent in the near future to finance the District's programs. The differences of results in the governmental fund
financial statements to those in the government-wide financial statements are explained in a reconciliation
following each governmental fund financial statement.



THE DISTRICT AS A TRUSTEE

Reporting the District's Fiduciary Responsibilities

The District is the trustee, or fiduciary, for funds held on behalf of others, like our funds for associated student
body activities. The District's fiduciary activities are reported in the Statement of Fiduciary Net Asset. We
exclude these activities from the District's other financial statements because the District cannot use these assets
to finance its operations. The District is responsible for ensuring that the assets reported in these funds are used
for their intended purposes.




                                                        6
SAN JACINTO UNIFIED SCHOOL DISTRICT

MANAGEMENT'S DISCUSSION AND ANALYSIS
JUNE 30, 2010

THE DISTRICT AS A WHOLE

Net Assets

The District's net assets were $156.9 million for the fiscal year ended June 30, 2010. Of this amount, $10.0
million was unrestricted. Restricted net assets are reported separately to show legal constraints from debt
covenants and enabling legislation that limit the governing board's ability to use those net assets for day-to-day
operations. Our analysis below, in summary form, focuses on the net assets (Table 1) and change in net assets
(Table 2) of the District's governmental activities.

                                                       Table 1

(Amounts in millions)                                                                 Governmental Activities
                                                                                      2010             2009
Assets
 Current and other assets                                                        $         58.6      $          86.7
 Capital assets                                                                           193.5                172.0
                    Total Assets                                                          252.1                258.7
Liabilities
 Current liabilities                                                                        5.9                  6.2
 Long-term obligations                                                                     89.3                 93.0
                    Total Liabilities                                                      95.2                 99.2
Net Assets
 Invested in capital assets,
  net of related debt                                                                     114.3                104.0
 Restricted                                                                                32.6                 41.8
 Unrestricted                                                                              10.0                 13.7
                   Total Net Assets                                              $        156.9      $         159.5

The $10.0 million in unrestricted net assets of governmental activities represents the accumulated results of all
past years' operations. It means that if we had to pay off all of our bills today, including all of our non-capital
liabilities (compensated absences as an example); we would have $10.0 million left.




                                                        7
SAN JACINTO UNIFIED SCHOOL DISTRICT

MANAGEMENT'S DISCUSSION AND ANALYSIS
JUNE 30, 2010

Changes in Net Assets

The results of this year's operations for the District as a whole are reported in the Statement of Activities on
page 14. Table 2 takes the information from the Statement, rounds off the numbers, and rearranges them slightly
so you can see our total revenues for the year.

                                                     Table 2

(Amounts in millions)                                                              Governmental Activities
                                                                                   2010             2009
Revenues
 Program revenues:
     Charges for services                                                     $           0.7     $           0.7
     Operating grants and contributions                                                  18.2                15.7
     Capital grants and contributions                                                     0.4                15.8
 General revenues:
     Federal and State aid not restricted                                                39.7                45.6
     Property taxes                                                                      10.8                13.4
     Other general revenues                                                               9.0                 7.7
                   Total Revenues                                                        78.8                98.9
Expenses
 Instruction-related                                                                     56.0                58.8
 Student support services                                                                 8.3                 8.3
 Administration                                                                           3.7                 4.5
 Maintenance and operations                                                               8.1                 8.7
 Other                                                                                    5.3                 3.1
                   Total Expenses                                                        81.4                83.4
                   Change in Net Assets                                       $          (2.6)    $          15.5

Governmental Activities

As reported in the Statement of Activities on page 14, the cost of all of our governmental activities this year was
$81.4 million. However, the amount that our taxpayers ultimately financed for these activities through local taxes
was only $10.8 million because the cost was paid by those who benefited from the programs ($.7 million) or by
other governments and organizations who subsidized certain programs with grants and contributions ($18.6
million). We paid for the remaining "public benefit" portion of our governmental activities with $48.7 million in
State funds, and with other revenues, like interest and general entitlements.




                                                       8
SAN JACINTO UNIFIED SCHOOL DISTRICT

MANAGEMENT'S DISCUSSION AND ANALYSIS
JUNE 30, 2010

In Table 3, we have presented the cost of each of the District's largest functions: instruction, instruction-related
activities, home-to-school transportation, other pupil services, general administration and maintenance, and
operation, as well as each program's net cost (total cost less revenues generated by the activities). As discussed
above, net cost shows the financial burden that was placed on the District's taxpayers by each of these functions.
Providing this information allows our citizens to consider the cost of each function in comparison to the benefits
they believe are provided by that function.

                                                      Table 3

(Dollar amounts in millions)                          Total Cost of Services            Net Cost of Services
                                                      2010             2009             2010            2009
Instruction                                         $     46.9     $       49.0       $    34.9     $      23.6
Instruction-related activities                             9.1              9.8              7.3             8.2
Home-to-school transportation                              2.1              2.0              1.9             1.7
All other pupil services                                   6.2              6.3              2.5             3.0
General administration                                     3.7              4.5              2.9             3.8
Maintenance and operations                                 8.1              8.7              7.7             8.1
Other                                                      5.3              3.1              4.9             2.8
            Total                                   $     81.4     $       83.4       $    62.1     $      51.2




                                                        9
SAN JACINTO UNIFIED SCHOOL DISTRICT

MANAGEMENT'S DISCUSSION AND ANALYSIS
JUNE 30, 2010

THE DISTRICT'S FUNDS

As the District completed this year, our governmental funds reported a combined fund balance of $52.0 million,
which is a decrease of $26.4 million from last year (Table 4).

                                                    Table 4

(Dollar amounts in millions)                                                           Fund Balance
                                                                             June 30, 2010     June 30, 2009
General Fund                                                                 $         18.4    $         19.9
Adult Education Fund                                                                    0.1               0.1
Child Development Fund                                                                  0.1               0.1
Cafeteria Fund                                                                          2.0               2.0
Deferred Maintenance Fund                                                               1.4               1.9
Building Fund                                                                           9.5              15.3
Capital Facilities Fund                                                                 0.9               1.1
County School Facilities Fund                                                           6.6              20.3
CFD Capital Fund                                                                        0.7               0.6
COP Capital Fund                                                                         -                9.3
Bond Interest and Redemption Fund                                                       1.5               1.8
COP Debt Service Fund                                                                  10.8               6.0
                    Total                                                    $         52.0    $         78.4

General Fund Budgetary Highlights

Over the course of the year, the District revises its budget as it attempts to deal with unexpected changes in
revenues and expenditures. The final amendment to the budget was adopted in June 2010 (a schedule showing
the District's original and final budget amounts compared with amounts actually paid and received is provided in
our annual report on page 49).




                                                     10
SAN JACINTO UNIFIED SCHOOL DISTRICT

MANAGEMENT'S DISCUSSION AND ANALYSIS
JUNE 30, 2010

CAPITAL ASSET AND DEBT ADMINISTRATION

Capital Assets

At June 30, 2010, the District had $193.5 million in a broad range of capital assets (net of depreciation), including
land, buildings, and furniture and equipment. This amount represents a net increase (including additions,
deductions, and depreciation) of $21.5 million, or 13 percent, from last year (Table 5).

                                                      Table 5

(Amounts in millions)                                                                Governmental Activities
                                                                                     2010             2009
Land and construction in progress                                               $         44.4    $          69.7
Buildings and improvements                                                              146.6              100.2
Equipment                                                                                  2.5                2.1
                 Total                                                          $       193.5     $        172.0

This year's construction expenditures were primarily related to the Megan Cope Elementary School Project.

Long-Term Obligations

At the end of this year, the District had $89.3 million in long-term obligations outstanding versus $93.0 million
last year, a decrease of four percent. Long-term obligations consisted of:

                                                      Table 6

(Amounts in millions)                                                                Governmental Activities
                                                                                     2010             2009
General obligation bonds                                                        $         46.0    $          46.3
Certificates of participation                                                             42.6               45.7
Capitalized lease obligations                                                              0.1                0.2
Other                                                                                      0.6                0.8
                    Total                                                       $         89.3    $          93.0

Other obligations include compensated absences and other postemployment benefits obligation. We present more
detailed information regarding our long-term obligations in Note 8 of the financial statements.




                                                       11
SAN JACINTO UNIFIED SCHOOL DISTRICT

MANAGEMENT'S DISCUSSION AND ANALYSIS
JUNE 30, 2010

SIGNIFICANT ACCOMPLISHMENTS OF FISCAL YEAR 2009-2010 ARE NOTED BELOW:

Facility Highlights

In late 2010, the District completed the construction of Megan Cope Elementary School. The work included the
construction of 38 new permanent classrooms, library, multipurpose building with cooking facilities,
administration building, two basketball courts, three handball walls, six tetherball courts, a jungle gymnasium,
and a separate playground for the kindergartners. The project cost approximately $20 million and was funded
with State and local bond funds.


ECONOMIC FACTORS AND NEXT YEAR'S BUDGETS AND RATES

In considering the District Budget for the 2010-2011 year, the governing board and management used the
following criteria:

The key assumptions in our revenue forecast are:

        1. Revenue limit and unfunded COLA resulted in a deficit of 17.963%.

        2. No growth in response to the effects of the State fiscal crisis and housing slowdown.

Expenditures are based on the following enrollment forecasts:

                                                 Staffing Ratio             Enrollment
       Kindergarten                                   30:1                      683
       Grades first through second                  Up to 25                  1,384
       Grade three                                    30:1                      668
       Grades four through eight                      33:1                    3,479
       Grades nine through twelve                     33:1                    2,810
                      TOTAL                                                   9,024



CONTACTING THE DISTRICT'S FINANCIAL MANAGEMENT

This financial report is designed to provide our citizens, taxpayers, students, and investors and creditors with a
general overview of the District's finances and to show the District's accountability for the money it receives. If
you have questions about this report or need any additional financial information, contact the Director, Fiscal
Services, at San Jacinto Unified School District, 2045 South San Jacinto Avenue, San Jacinto, California, 92583,
or e-mail at heeren@sanjacinto.k12.ca.us.




                                                      12
SAN JACINTO UNIFIED SCHOOL DISTRICT

STATEMENT OF NET ASSETS
JUNE 30, 2010

                                                                             Governmental
                                                                               Activities
ASSETS
 Deposits and investments                                                    $    43,194,427
 Receivables                                                                      13,205,931
 Stores inventories                                                                  107,255
 Deferred cost on issuance                                                         2,129,613
 Capital assets
   Land and construction in process                                               44,420,311
   Other capital assets                                                          178,133,909
 Less: Accumulated depreciation                                                  (29,063,045)
                Total Capital Assets                                             193,491,175
                Total Assets                                                     252,128,401

LIABILITIES
 Accounts payable                                                                  4,142,657
 Interest payable                                                                  1,323,992
 Deferred revenue                                                                    413,711
 Current portion of long-term obligations                                            358,692
 Noncurrent portion of long-term obligations                                      88,969,127
                Total Liabilities                                                 95,208,179
NET ASSETS
 Invested in capital assets, net of related debt                                 114,275,682
 Restricted for:
   Debt service                                                                 10,932,156
   Capital projects                                                              8,151,225
   Educational programs                                                          9,942,958
   Other activities                                                              3,623,506
 Unrestricted                                                                    9,994,695
                 Total Net Assets                                            $ 156,920,222




The accompanying notes are an integral part of these financial statements.

                                                     13
SAN JACINTO UNIFIED SCHOOL DISTRICT

STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED JUNE 30, 2010




                                                                               Program Revenues
                                                                Charges for       Operating      Capital
                                                                Services and      Grants and    Grants and
            Functions/Programs                  Expenses           Sales        Contributions Contributions
Governmental Activities:
Instruction                                   $ 46,928,159      $    353,208    $   11,330,757      $     376,075
Instruction-related activities:
  Supervision of instruction                      1,920,906           14,272          1,169,758                 -
  Instructional library, media, and
   technology                                       678,952                -             10,063                 -
  School site administration                      6,460,200           43,089            539,438                 -
Pupil services:
  Home-to-school transportation                   2,064,691                -            214,764                 -
  Food services                                   3,348,216          221,163          2,932,254                 -
  All other pupil services                        2,893,669                -            561,062                 -
General administration:
  Data processing                                   708,448                -             21,798                 -
  All other general administration                2,994,770           45,875            726,108                 -
Plant services                                    8,086,833           39,992            309,385                 -
Interest on long-term obligations                 3,969,221                -                  -                 -
Other outgo                                       1,333,591           41,873            363,631                 -

    Total Governmental Activities             $ 81,387,656      $    759,472    $   18,179,018      $     376,075

                                             General Revenues and Subventions:
                                              Property taxes, levied for general purposes
                                              Property taxes, levied for debt service
                                              Taxes levied for other specific purposes
                                              Federal and State aid not restricted to specific purposes
                                              Interest and investment earnings
                                              Miscellaneous
                                                        Subtotal, General Revenues
                                             Change in Net Assets
                                              Net assets - Beginning
                                              Net assets - Ending




The accompanying notes are an integral part of these financial statements.

                                                     14
Net (Expenses)
Revenues and
 Changes in
  Net Assets

Governmental
  Activities

$   (34,868,119)

       (736,876)

       (668,889)
     (5,877,673)

     (1,849,927)
       (194,799)
     (2,332,607)

       (686,650)
     (2,222,787)
     (7,737,456)
     (3,969,221)
       (928,087)

    (62,073,091)


      7,682,275
      2,351,967
        731,952
     39,726,989
        367,333
      8,649,935
     59,510,451
     (2,562,640)
    159,482,862
$   156,920,222




                   14
SAN JACINTO UNIFIED SCHOOL DISTRICT

GOVERNMENTAL FUNDS
BALANCE SHEET
JUNE 30, 2010

                                                                                                County School
                                                          General                Building         Facilities
                                                           Fund                   Fund             Fund
ASSETS
 Deposits and investments                             $      8,417,632       $    11,066,289    $    6,756,335
 Receivables                                                12,647,085                32,250            19,095
 Due from other funds                                           84,655               178,541                 -
 Stores inventories                                                  -                     -                 -
                  Total Assets                        $     21,149,372       $    11,277,080    $    6,775,430

LIABILITIES AND FUND BALANCES

Liabilities:
 Accounts payable                                     $      2,286,032       $     1,784,527    $      14,844
 Due to other funds                                             53,770                     -          178,541
 Deferred revenue                                              392,241                     -                -
                   Total Liabilities                         2,732,043             1,784,527          193,385
Fund Balances:
 Reserved for:
   Revolving cash                                               10,000                      -                -
   Stores inventories                                                -                      -                -
   Legally restricted balance                                9,942,958                      -                -
 Unreserved:
   Designated                                                8,464,371             9,492,553         6,582,045
   Undesignated, reported in:
     Debt service funds                                              -                     -                 -
     Capital projects funds                                          -                     -                 -
                   Total Fund Balances                      18,417,329             9,492,553         6,582,045
                   Total Liabilities and
                   Fund Balances                      $     21,149,372       $    11,277,080    $    6,775,430




The accompanying notes are an integral part of these financial statements.

                                                     15
       COP              Non-Major         Total
    Debt Service       Governmental    Governmental
       Fund               Funds           Funds

$      10,775,984      $   6,178,187   $   43,194,427
                -            507,501       13,205,931
                -             54,065          317,261
                -            107,255          107,255
$      10,775,984      $   6,847,008   $   56,824,874




$                  -   $      57,254   $    4,142,657
                   -          84,950          317,261
                   -          21,470          413,711
                   -         163,674        4,873,629


                   -             200           10,200
                   -         107,255          107,255
                   -               -        9,942,958

                   -       4,455,640       28,994,609

                -          1,480,164        1,480,164
       10,775,984            640,075       11,416,059
       10,775,984          6,683,334       51,951,245

$      10,775,984      $   6,847,008   $   56,824,874




                                               15
SAN JACINTO UNIFIED SCHOOL DISTRICT

RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET
 TO THE STATEMENT OF NET ASSETS
JUNE 30, 2010

Total Fund Balance - Governmental Funds                                                         $    51,951,245
Amounts Reported for Governmental Activities in the
Statement of Net Assets are Different Because:
Capital assets used in governmental activities are not financial
resources and, therefore, are not reported as assets in governmental
funds.
 The cost of capital assets is                                                 $ 222,554,220
 Accumulated depreciation is                                                     (29,063,045)
           Total Capital Assets                                                                     193,491,175
Expenditures relating to issuance of debt of next fiscal year were
recognized in modified accrual basis, but should not be recognized
in accrual basis.                                                                                     2,129,613
In governmental funds, unmatured interest on long-term obligations is
 recognized in the period when it is due. On the government-wide
 financial statements, unmatured interest on long-term obligations
 is recognized when it is incurred.                                                                  (1,323,992)
Long-term obligations, including bonds payable, are not due and payable
in the current period and, therefore, are not reported as liabilities in the
funds. Long-term obligations at year-end consist of:
    General Obligation Bonds                                                      46,004,383
    Certificates of Participation                                                 42,637,182
    Capital Leases Payable                                                            66,481
    Other Postemployment Benefits                                                    588,412
    Compensated Absences                                                              31,361
            Total Long-Term Obligations                                                           (89,327,819)
            Total Net Assets - Governmental Activities                                          $ 156,920,222




The accompanying notes are an integral part of these financial statements.

                                                       16
SAN JACINTO UNIFIED SCHOOL DISTRICT

GOVERNMENTAL FUNDS
STATEMENT OF REVENUES, EXPENDITURES, AND
CHANGES IN FUND BALANCE
FOR THE YEAR ENDED JUNE 30, 2010

                                                                                                County School
                                                              General            Building         Facilities
                                                               Fund               Fund             Fund
REVENUES
Revenue limit sources                                     $   42,350,226     $             -    $            -
Federal sources                                                8,020,930                   -                 -
Other State sources                                            9,401,790                   -           178,541
Other local sources                                            6,047,785             278,460           202,070
               Total Revenues                                 65,820,731             278,460           380,611
EXPENDITURES
 Current
   Instruction                                                44,313,931                    -                 -
   Instruction-related activities:
     Supervision of instruction                                1,869,727                    -                 -
     Instructional library, media, and technology                461,546                    -                 -
     School site administration                                6,245,584                    -                 -
   Pupil services:
     Home-to-school transportation                             1,971,517                    -                 -
     Food services                                                45,108                    -                 -
     All other pupil services                                  2,434,765                    -                 -
   General administration:
     Data processing                                             646,332                   -                 -
     All other general administration                          3,241,337                   -                 -
 Plant services                                                6,450,400                   -                 -
 Facility acquisition and construction                           155,562           6,056,502        14,130,137
 Other outgo                                                           -                   -                 -
 Debt service:
   Principal                                                     100,721                   -                  -
   Interest and other                                              8,734                   -                  -
               Total Expenditures                             67,945,264           6,056,502         14,130,137
Deficiency of Revenues Over Expenditures                      (2,124,533)         (5,778,042)       (13,749,526)
OTHER FINANCING SOURCES (USES)
 Transfers in                                                          -                   -                  -
 Other sources                                                   990,517                   -                  -
 Transfers out                                                  (412,910)                  -                  -
 Other uses                                                            -                   -                  -
               Net Financing Sources (Uses)                      577,607                   -                  -
NET CHANGE IN FUND BALANCES                                   (1,546,926)         (5,778,042)       (13,749,526)
Fund Balance - Beginning                                      19,964,255          15,270,595         20,331,571
Fund Balance - Ending                                     $   18,417,329     $     9,492,553    $     6,582,045




The accompanying notes are an integral part of these financial statements.

                                                     17
       COP              Non-Major            Total
    Debt Service       Governmental       Governmental
       Fund               Funds              Funds

$               -      $            -     $    42,350,226
                -           3,250,682          11,271,612
                -             514,128          10,094,459
        2,259,696           4,893,725          13,681,736
        2,259,696           8,658,535          77,398,033


                   -          533,343          44,847,274

                   -           20,121           1,889,848
                   -                -             461,546
                   -           59,326           6,304,910

                   -                -           1,971,517
                   -        3,147,818           3,192,926
                   -           40,969           2,475,734

                -                   -             646,332
                -             236,002           3,477,339
        4,457,486           1,084,996          11,992,882
                -               2,557          20,344,758
                -           1,350,034           1,350,034

          605,000             259,667             965,388
          258,386           2,424,483           2,691,603
        5,320,872           9,159,316         102,612,091
       (3,061,176)           (500,781)        (25,214,058)

       10,091,570               90,378         10,181,948
       43,816,466                    -         44,806,983
                -           (9,769,038)       (10,181,948)
      (46,037,595)                   -        (46,037,595)
        7,870,441           (9,678,660)        (1,230,612)
        4,809,265          (10,179,441)       (26,444,670)
        5,966,719           16,862,775         78,395,915
$      10,775,984      $     6,683,334    $    51,951,245




                                                   17
SAN JACINTO UNIFIED SCHOOL DISTRICT

RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT OF
REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES
TO THE STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED JUNE 30, 2010

Total Net Change in Fund Balances - Governmental Funds                                         $   (26,444,670)
Amounts Reported for Governmental Activities in the Statement
of Activities are Different Because:
Capital outlays to purchase or build capital assets are reported in
governmental funds as expenditures, however, for governmental
activities, those costs are shown in the Statement of Net Assets
and allocated over their estimated useful lives as annual depreciation
expenses in the Statement of Activities.
This is the amount by which capital outlays exceeds depreciation
in the period.
    Capital outlays                                                            $ 24,612,422
    Depreciation expense                                                         (3,105,799)
                                                                                                   21,506,623
In the Statement of Activities, certain operating expenses - compensated
 absences (vacations) and special termination benefits (early retirement)
 are measured by the amounts earned during the year. In the
 governmental funds, however, expenditures for these items are
 measured by the amount of financial resources used (essentially, the
 amounts actually paid). Compensated absences used were more than the
 amounts earned by $61,111. Termination benefits (CSEA/SJTA) used
 were more than the amounts earned by $217,821. Other terminated
 benefits (SERP) used were less than the amounts earned by $313,475.
                                                                                                       (34,543)
Contributions for postemployment benefits are recorded as an expense in
the governmental funds when paid. However, in the Statement of
Activities the expense is equal to the benefit earned. The actual amount
of the contribution was less than the annual required contribution.                                  (104,460)
Proceeds from COP additions are revenue in the governmental
funds, but it increases long-term liabilities in the Statement of Net Assets
and does not affect the Statement of Activities.                                                   (43,380,000)
Governmental funds report the effect of premiums, discounts, and issuance
costs when the debt is first issued, whereas the amounts are deferred and
amortize over the life of the debt in the Statement of Activities. This
amount is the net effect of the amortization of the related items:
    Discount on issuance for certificates of participation                                            526,704
    Cost of issuance for certificates of participation                                               (132,649)
    Cost of issuance for certificates of general obligation bonds                                     (42,618)
    Deferred amount on refunding                                                                     (731,903)
    Premium on issuance                                                                                85,520

The accompanying notes are an integral part of these financial statements.

                                                      18
SAN JACINTO UNIFIED SCHOOL DISTRICT

RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT OF
REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES
TO THE STATEMENT OF ACTIVITIES, CONTINUED
FOR THE YEAR ENDED JUNE 30, 2010

Repayment of principal is an expenditure in the governmental funds,
but it reduces long-term obligations in the Statement of Net Assets and
does not affect the Statement of Activities.
   General obligation bonds                                                  $      259,667
   Certificates of participation                                                 45,895,000
   Capital lease payments                                                           100,721
   Arbitrage rebate liability                                                       327,869
Interest on long-term obligations in the Statement of Activities differs
 from the amount reported in the governmental funds because interest
 is recorded as an expenditure in the funds when it is due, and thus
 requires the use of current financial resources. In the Statement of
 Activities, however, interest expense is recognized as the interest
 accrues, regardless of when it is due. The additional interest
 reported in the Statement of Activities is the net result of two factors.
                                                                                   (393,901)
                   Change in Net Assets of Governmental Activities           $   (2,562,640)




The accompanying notes are an integral part of these financial statements.

                                                        19
SAN JACINTO UNIFIED SCHOOL DISTRICT

FIDUCIARY FUNDS
STATEMENT OF NET ASSETS
JUNE 30, 2010

                                                                                 Agency
                                                                                 Funds
ASSETS
 Deposits and investments                                                    $ 2,784,588

LIABILITIES
 Due to student groups                                                       $   155,683
 Due to bondholders                                                            2,628,905
          Total Liabilities                                                  $ 2,784,588




The accompanying notes are an integral part of these financial statements.

                                                     20
SAN JACINTO UNIFIED SCHOOL DISTRICT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2010

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Financial Reporting Entity

The San Jacinto Unified School District (the District) was unified on March 29, 1944, under the laws of the State
of California. The District operates under a locally elected five member Board form of government and provides
educational services to grades K-12 as mandated by the State and/or Federal agencies. The District operates six
elementary schools, two middle schools, one high school, one continuation high school, one adult school, four
State preschools, and two head start preschools.

A reporting entity is comprised of the primary government, component units, and other organizations that are
included to ensure the financial statements are not misleading. The primary government of the District consists of
all funds, departments, boards, and agencies that are not legally separate from the District. For San Jacinto
Unified School District, this includes general operations, food service, and student related activities of the
District.

Component Units

Component units are legally separate organizations for which the District is financially accountable. Component
units may also include organizations that are fiscally dependent on the District, in that the District approves their
budget, the issuance of their debt or the levying of their taxes. In addition, component units are other legally
separate organizations for which the District is not financially accountable but the nature and significance of the
organization's relationship with the District is such that exclusion would cause the District's financial statements
to be misleading or incomplete. For financial reporting purposes, the component units have a financial and
operational relationship which meets the reporting entity definition criteria of the Governmental Accounting
Standards Board (GASB) Statement No. 14, The Financial Reporting Entity, and thus are included in the financial
statements of the District. The component units, although legally separate entities, are reported in the financial
statements using the blended presentation method as if they were part of the District's operations because the
governing board of the component units are essentially the same as the governing board of the District and
because its purpose is to finance the construction of facilities to be used for the direct benefit of the District.

On August 20, 1990, certain members of the District's board of education and district employees formed a
nonprofit benefit corporation, known as the San Jacinto Unified School District School Facilities Corporation
(the Corporation), which is organized under Nonprofit Benefit Corporation Law of the State of California. The
purpose of the Facilities Corporation is to provide financing assistance to the District for construction and
acquisition of major capital facilities. The Corporation issued Certificates of Participation (COPs), a form of
long-term obligations, which the District used to finance construction and acquisition of some of its facilities.

The Facilities Corporation's financial activity is presented in the financial statements as the COP Debt Service
Fund and COP Capital Projects Fund. Certificates of participation issued by the Corporation are included as long-
term obligations in the government-wide financial statements. Individually prepared financial statements of the
Facilities Corporation may be obtained through the business office of the District.




                                                       21
SAN JACINTO UNIFIED SCHOOL DISTRICT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2010

Pursuant to the Mello-Roos Community Facilities Act of 1982, the District established the Community Facilities
Districts No. 2003-2, 2004-3, 2004-5, 2005-1, 2005-4, and 2006-1, legally constituted government entities, for the
purpose of financing special capital projects. The Community Facilities District were authorized, at special
elections, to incur indebtedness and subsequently sold bonds for the purpose of providing educational facilities
within the District boundaries. The repayment of the bonds are not a general or special obligation of the
Community Facilities District and the District, but rather are limited obligations payable solely from the proceeds
of special taxes levied on property within the Community Facilities District.

The Community Facilities Districts' financial activity is presented in the financial statements in the capital project
funds and in an agency fund.

The following are those aspects of the relationship between the District and the Community Facilities Districts,
which satisfy Statement Three criteria.

    1. Manifestations of Oversight

        a. The Community Facilities Districts and the District have common boards.

        b. The Community Facilities Districts have no employees. The District's Superintendent functions as an
           agent of the Community Facilities District.

        c. The District exercises significant influence over operations of the Community Facilities Districts as
           all projects of the Community Facilities Districts involve the San Jacinto Unified School District.

    2. Accountability for Fiscal Matters

        The District is responsible for preparation of the annual budgets for the Community Facilities Districts.

    3. Scope of Public Service

        The Community Facilities Districts were created specifically to finance capital improvements for the San
        Jacinto Unified School District.

Other Related Entities

Charter School The District has approved a charter for San Jacinto Valley Academy pursuant to Education Code
Section 47605. The San Jacinto Valley Academy was granted and approved on June 9, 1997, for a term of three
years commencing July 1, 1997. The charter was renewed an additional five year extension on August 18, 2009;
extending the term through August 31, 2014.

The San Jacinto Valley Academy Charter School (the Charter School) is not operated by the District. The Charter
School operates and provides school services as in independent entity and is not considered a component unit of
the District. The District's general fund includes property taxes received for the charter school and a
corresponding expense in other outgo.

The Charter School is required in its individual charter agreement to have an annual financial audit performed.
Additionally, the Charter School is to provide the District with an annual performance report.



                                                        22
SAN JACINTO UNIFIED SCHOOL DISTRICT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2010

Basis of Presentation - Fund Accounting

The accounting system is organized and operated on a fund basis. A fund is defined as a fiscal and accounting
entity with a self-balancing set of accounts, which are segregated for the purpose of carrying on specific activities
or attaining certain objectives in accordance with special regulations, restrictions, or limitations. The District's
funds are grouped into two broad fund categories: governmental and fiduciary.

Governmental Funds Governmental funds are those through which most governmental functions typically are
financed. Governmental fund reporting focuses on the sources, uses, and balances of current financial resources.
Expendable assets are assigned to the various governmental funds according to the purposes for which they may
or must be used. Current liabilities are assigned to the fund from which they will be paid. The difference
between governmental fund assets and liabilities is reported as fund balance. The following are the District's
major and non-major governmental funds:

Major Governmental Funds

General Fund The General Fund is the chief operating fund for the District. It is used to account for the ordinary
operations of a District. All transactions except those required or permitted by law to be in another fund are
accounted for in this fund.

Building Fund The Building Fund exists primarily to account separately for proceeds from the sale of bonds
(Education Code Section 15146) and may not be used for any purposes other than those for which the bonds were
issued.

County School Facilities Fund The County School Facilities Fund is established pursuant to Education Code
Section 17070.43 to receive apportionments from the 1998 State School Facilities Fund (Proposition lA), the 2002
State School Facilities Fund (Proposition 47), or the 2004 State School Facilities Fund (Proposition 55)
authorized by the State Allocation Board for new school facility construction, modernization projects, and facility
hardship grants, as provided in the Leroy F. Greene School Facilities Act of 1998 (Education Code Section 17070
et seq.).

Certificates of Participation (COP) Debt Service Fund The COP Debt Service Fund is used to account for the
accumulation of resources for the payment of principal and interest on certificates of participation and are
considered blended component units of the District under generally accepted accounting principles (GAAP).

Non-Major Governmental Funds

Special Revenue Funds The Special Revenue Funds are established to account for the proceeds from specific
revenue sources (other than trusts or for major capital projects) that are restricted to the financing of particular
activities:

    Adult Education Fund The Adult Education Fund is used to account separately for Federal, State, and
    local revenues for adult education programs and is to be expended for adult education purposes only, except
    for State revenues which, as a result of Senate Bill 4 of the 2009-10 Third Extraordinary Session (SBX3 4),
    may be used for any educational purpose.




                                                        23
SAN JACINTO UNIFIED SCHOOL DISTRICT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2010

    Child Development Fund The Child Development Fund is used to account separately for Federal, State,
    and local revenues to operate child development programs and is to be used only for expenditures for the
    operation of child development programs.

    Cafeteria Fund The Cafeteria Fund is used to account separately for Federal, State, and local resources to
    operate the food service program (Education Code Sections 38090-38093) and is used only for those
    expenditures authorized by the governing board as necessary for the operation of the District's food service
    program (Education Code Sections 38091 and 38100).

    Deferred Maintenance Fund The Deferred Maintenance Fund is used to account separately for
    State apportionments and the District's contributions for deferred maintenance purposes (Education
    Code Sections 17582-17587) and for items of maintenance approved by the State Allocation Board,
    except for State apportionments which, as a result of Senate Bill 4 of the 2009-10 Third Extraordinary
    Session (SBX3 4), may be used for any educational purpose.

    Special Reserve Fund for Other Than Capital Outlay Projects The Special Reserve Non-Capital Fund
    is used primarily to provide for the accumulation of General Fund monies for general operating purposes
    other than for capital outlay (Education Code Section 42840).

Debt Service Funds The Debt Service Funds are established to account for the accumulation of resources for
and the payment of principal and interest on general long-term obligations.

    Bond Interest and Redemption Fund The Bond Interest and Redemption Fund is used for the repayment of
    bonds issued for a District (Education Code Sections 15125-15262).

Capital Project Funds The Capital Project Funds are established to account for financial resources to be used
for the acquisition or construction of major capital facilities (other than those financed by proprietary funds and
trust funds).

    Capital Facilities Fund The Capital Facilities Fund is used primarily to account separately for monies
    received from fees levied on developers or other agencies as a condition of approving a development
    (Education Code Sections 17620-17626). Expenditures are restricted to the purposes specified in Government
    Code Sections 65970-65981 or to the items specified in agreements with the developer (Government Code
    Section 66006).

    Certificate of Participation (COP) Capital Projects Fund The COP Capital Projects Fund exists primarily
    to account for the acquisition of capital facilities from the sale of proceeds of Certificates of Participation.

    Special Reserve Fund for Capital Outlay Projects The Special Reserve Fund for Capital Outlay Projects
    exists primarily to provide for the accumulation of General Fund monies for capital outlay purposes
    (Education Code Section 42840).




                                                       24
SAN JACINTO UNIFIED SCHOOL DISTRICT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2010

    Community Facilities District (CFD) Capital Project Fund The CFD Capital Project Fund is used to
    account for capital projects financed by Mello-Roos Community Facilities Districts and similar entities that
    are considered blended component units of the District under generally accepted accounting principles
    (GAAP).

    Fiduciary Funds Fiduciary fund reporting focuses on net assets and changes in net assets. The fiduciary
    fund category is split into four classifications: pension trust funds, investment trust funds, private-purpose
    trust funds, and agency funds.

    Agency funds are custodial in nature (assets equal liabilities) and do not involve measurement of results of
    operations. The District's agency funds include:

           Debt Service Special Tax Bonds - this is an Agency fund used to account for the resources
           accumulated for the repayment of special assessment debt of the component unit described under
           financial reporting entity.
           Student Funds - are Agency funds used to account for student fund activities.

Basis of Accounting - Measurement Focus

Government-Wide Financial Statements The government-wide financial statements are prepared using the
economic resources measurement focus and the accrual basis of accounting. This is the same approach used in
the preparation of the proprietary fund financial statements, but differs from the manner in which governmental
fund financial statements are prepared.

The government-wide Statement of Activities presents a comparison between expenses, both direct and indirect,
and program revenues for each governmental function, and excludes fiduciary activity. Direct expenses are those
that are specifically associated with a service, program, or department and are therefore, clearly identifiable to a
particular function. The District does not allocate indirect expenses to functions in the Statement of Activities,
except for depreciation. Program revenues include charges paid by the recipients of the goods or services offered
by the programs and grants and contributions that are restricted to meeting the operational or capital requirements
of a particular program. Revenues that are not classified as program revenues are presented as general revenues.
The comparison of program revenues and expenses identifies the extent to which each program or business
segment is self-financing or draws from the general revenues of the District. Eliminations have been made to
minimize the double counting of internal activities.

Net assets should be reported as restricted when constraints placed on net asset use are either externally imposed
by creditors (such as through debt covenants), grantors, contributors, or laws or regulations of other governments
or imposed by law through constitutional provisions or enabling legislation. The net assets restricted for other
activities result from special revenue funds and the restrictions on their net asset use.




                                                       25
SAN JACINTO UNIFIED SCHOOL DISTRICT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2010

Fund Financial Statements Fund financial statements report detailed information about the District. The focus
of governmental funds is on major funds rather than reporting funds by type. Each major fund is presented in a
separate column. Non-major funds are aggregated and presented in a single column.

    Governmental Funds All governmental funds are accounted for using the flow of current financial
    resources measurement focus and the modified accrual basis of accounting. With this measurement focus,
    only current assets and current liabilities generally are included on the balance sheet. The Statement of
    Revenues, Expenditures, and Changes in Fund Balance reports on the sources (revenues and other financing
    sources) and uses (expenditures and other financing uses) of current financial resources. This approach
    differs from the manner in which the governmental activities of the government-wide financial statements are
    prepared. Governmental fund financial statements, therefore, include reconciliations with brief explanations
    to better identify the relationship between the government-wide financial statements, prepared using the
    economic resources measurement focus and the accrual basis of accounting, and the governmental fund
    financial statements, prepared using the flow of current financial resources measurement focus and the
    modified accrual basis of accounting.

    Fiduciary Funds Fiduciary funds are accounted for using the flow of economic resources measurement
    focus and the accrual basis of accounting. Fiduciary funds are excluded from the government-wide financial
    statements because they do not represent resources of the District.

Revenues - Exchange and Non-Exchange Transactions Revenue resulting from exchange transactions, in
which each party gives and receives essentially equal value, is recorded on the accrual basis when the exchange
takes place. On a modified accrual basis, revenue is recorded in the fiscal year in which the resources are
measurable and become available. Available means that the resources will be collected within the current fiscal
year or are expected to be collected soon enough thereafter, to be used to pay liabilities of the current fiscal year.
Generally, available is defined as collectible within 45 or 60 days. However, to achieve comparability of
reporting among California districts and so as not to distort normal revenue patterns, with specific respect to
reimbursement grants and corrections to State-aid apportionments, the California Department of Education has
defined available for districts as collectible within one year. The following revenue sources are considered to be
both measurable and available at fiscal year-end: State apportionments, interest, certain grants, and other local
sources.

Non-exchange transactions, in which the District receives value without directly giving equal value in return,
include property taxes, certain grants, entitlements, and donations. Revenue from property taxes is recognized in
the fiscal year in which the taxes are received. Revenue from certain grants, entitlements, and donations is
recognized in the fiscal year in which all eligibility requirements have been satisfied. Eligibility requirements
include time and purpose restrictions. On a modified accrual basis, revenue from non-exchange transactions must
also be available before it can be recognized.

Deferred Revenue Deferred revenue arises when potential revenue does not meet both the "measurable" and
"available" criteria for recognition in the current period or when resources are received by the District prior to the
incurrence of qualifying expenditures. In subsequent periods, when both revenue recognition criteria are met, or
when the District has a legal claim to the resources, the liability for deferred revenue is removed from the balance
sheet and revenue is recognized.

Certain grants received before the eligibility requirements are met are recorded as deferred revenue. On the
governmental fund financial statements, receivables that will not be collected within the available period are also
recorded as deferred revenue.


                                                        26
SAN JACINTO UNIFIED SCHOOL DISTRICT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2010

Expenses/Expenditures On the accrual basis of accounting, expenses are recognized at the time they are
incurred. The measurement focus of governmental fund accounting is on decreases in net financial resources
(expenditures) rather than expenses. Expenditures are generally recognized in the accounting period in which the
related fund liability is incurred, if measurable. Principal and interest on long-term obligations, which has not
matured, are recognized when paid in the governmental funds as expenditures. Allocations of costs, such as
depreciation and amortization, are not recognized in the governmental funds.

Cash and Cash Equivalents

The District's cash and cash equivalents are considered to be cash on hand, demand deposits, and short-term
investments with original maturities of three months or less from the date of acquisition.

Investments

Investments held at June 30, 2010, with original maturities greater than one year are stated at fair value. Fair
value is estimated based on quoted market prices at year-end. All investments not required to be reported at fair
value are stated at cost or amortized cost. Fair values of investments in County investment pools are determined
by the program sponsor.

Stores Inventories

Inventories consist of expendable food and supplies held for consumption. Inventories are stated at cost, on the
first-in, first-out basis. The costs of inventory items are recorded as expenditures in the governmental type funds.

Capital Assets and Depreciation

The accounting and reporting treatment applied to the capital assets associated with a fund are determined by its
measurement focus. Capital assets are long-lived assets of the District. The District maintains a capitalization
threshold of $5,000. The District does not possess any infrastructure. Improvements are capitalized; the costs of
normal maintenance and repairs that do not add to the value of the asset or materially extend an asset's life are not
capitalized, but are expensed as incurred.

When purchased, such assets are recorded as expenditures in the governmental funds and capitalized in the
government-wide Statement of Net Assets. The valuation basis for capital assets is historical cost, or where
historical cost is not available, estimated historical cost based on replacement cost. Donated capital assets are
capitalized at estimated fair market value on the date donated.

Depreciation is computed using the straight-line method. Estimated useful lives of the various classes of
depreciable capital assets are as follows: buildings, 20 or 50 years; improvements, 20 years; equipment, 5 to 20
years.

Interfund Balances

On fund financial statements, receivables and payables resulting from short-term interfund loans are classified as
"interfund receivables/payables". These amounts are eliminated in the governmental activities columns of the
Statement of Net Assets.




                                                       27
SAN JACINTO UNIFIED SCHOOL DISTRICT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2010

Compensated Absences

Compensated absences are not recognized as liabilities of the District. The District's policy is to record these
amounts as operating expenses in the period vacation is taken. The calculated estimated value of accumulated
vacation benefits was determined not to be a material amount in relationship to the District's budget.

Sick leave is accumulated without limit for each employee at the rate of one day for each month worked. Leave
with pay is provided when employees are absent for health reasons; however, the employees do not gain a vested
right to accumulated sick leave. Employees are never paid for any sick leave balance at termination of
employment or any other time. Therefore, the value of accumulated sick leave is not recognized as a liability in
the District's financial statements. However, credit for unused sick leave is applicable to all classified school
members who retire after January 1, 1999. At retirement, each member will receive .004 year of service credit for
each day of unused sick leave. Credit for unused sick leave is applicable to all Certified employees and is
determined by dividing the number of unused sick days by the number of base service days required to complete
the last school year, if employed full-time.

Accrued Liabilities and Long-Term Obligations

All payables, accrued liabilities, and long-term obligations are reported in the government-wide fund financial
statements. In general, governmental fund payables and accrued liabilities that, once incurred, are paid in a timely
manner and in full from current financial resources are reported as obligations of the governmental funds.

However, claims and judgments, compensated absences, special termination benefits, and contractually required
pension contributions that will be paid from governmental funds are reported as a liability in the governmental
fund financial statements only to the extent that they are due for payment during the current year. Bonds, capital
leases, and other long-term obligations are recognized as liabilities in the governmental fund financial statements
when due.

Deferred Issuance Costs, Premiums, and Discounts
In the government-wide financial statements, long-term obligations are reported as liabilities in the applicable
governmental activities statement of net assets. Bond premiums and discounts, as well as issuance costs, are
deferred and amortized over the life of the bonds using the straight line method.

Fund Balance Reserves and Designations

The District reserves those portions of fund equity which are legally segregated for a specific future use or which
do not represent available expendable resources and therefore are not available for appropriation or expenditure.
Unreserved fund equity indicates that portion of fund balance which is available for appropriation in future
periods. Fund balance reserves have been established for revolving cash accounts, stores inventories, prepaid
expenditures (expenses), and legally restricted grants and entitlements.

Designations of fund balances consist of that portion of the fund balance that has been designated (set aside) by
the governing board to provide for specific purposes or uses. Fund balance designations have been established for
economic uncertainties and other purposes.




                                                       28
SAN JACINTO UNIFIED SCHOOL DISTRICT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2010

Net Assets

Net assets represent the difference between assets and liabilities. Net assets invested in capital assets, net of
related debt consists of capital assets, net of accumulated depreciation, reduced by the outstanding balances of any
borrowings used for the acquisition, construction, or improvement of those assets. The District has related debt
outstanding as of June 30, 2010. Net assets are reported as restricted when there are limitations imposed on their
use either through the enabling legislation adopted by the District or through external restrictions imposed by
creditors, grantors, or laws or regulations of other governments. The District first applies restricted resources
when an expense is incurred for purposes for which both restricted and unrestricted net assets are available. The
government-wide financial statements report $32,649,845 of restricted net assets.

Interfund Activity

Exchange transactions between funds are reported as revenues in the seller funds and as expenditures/expenses in
the purchaser funds. Flows of cash or goods from one fund to another without a requirement for repayment are
reported as interfund transfers. Interfund transfers are reported as other financing sources/uses in governmental
funds. Repayments from funds responsible for particular expenditures/expenses to the funds that initially paid for
them are not presented in the financial statements.

Estimates

The preparation of the financial statements in conformity with accounting principles generally accepted in the
United States of America requires management to make estimates and assumptions that affect the amounts
reported in the financial statements and accompanying notes. Actual results may differ from those estimates.

Budgetary Data

The budgetary process is prescribed by provisions of the California Education Code and requires the governing
board to hold a public hearing and adopt an operating budget no later than July 1st of each year. The District
governing board satisfied these requirements. The adopted budget is subject to amendment throughout the year to
give consideration to unanticipated revenue and expenditures primarily resulting from events unknown at the time
of budget adoption with the legal restriction that expenditures cannot exceed appropriations by major object
account.

The amounts reported as the original budgeted amounts in the budgetary statements reflect the amounts when the
original appropriations were adopted. The amounts reported as the final budgeted amounts in the budgetary
statements reflect the amounts after all budget amendments have been accounted for. For budget purposes, on
behalf payments have not been included as revenue and expenditures as required under generally accepted
accounting principles.

Property Tax

Secured property taxes attach as an enforceable lien on property as of January 1. Taxes are payable in two
installments on November 1 and February 1 and become delinquent on December 10 and April 10, respectively.
Unsecured property taxes are payable in one installment on or before August 31. The County of Riverside bills
and collects the taxes on behalf of the District. Local property tax revenues are recorded when received.




                                                      29
SAN JACINTO UNIFIED SCHOOL DISTRICT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2010

New Accounting Pronouncements

In March 2009, GASB issued Statement No. 54, Fund Balance Reporting and Governmental Fund Type
Definitions. The objective of this Statement is to enhance the usefulness of fund balance information by
providing clearer fund balance classifications that can be more consistently applied and by clarifying the existing
governmental fund type definitions. This Statement establishes fund balance classifications that comprise a
hierarchy based primarily on the extent to which a government is bound to observe constraints imposed upon the
use of the resources reported in governmental funds. The requirements of this Statement are effective for the
financial statements for periods beginning after June 15, 2010. Early implementation is encouraged.



NOTE 2 - DEPOSITS AND INVESTMENTS

Summary of Deposits and Investments

Deposits and investments as of June 30, 2010, are classified in the accompanying financial statements as follows:

Governmental activities                                                                              $ 43,194,427
Fiduciary funds                                                                                         2,784,588
                 Total Deposits and Investments                                                      $ 45,979,015

Deposits and investments as of June 30, 2010, consist of the following:

Cash on hand and in banks                                                                            $    463,414
Cash in revolving                                                                                          10,200
Investments                                                                                            45,505,401
                  Total Deposits and Investments                                                     $ 45,979,015

Policies and Practices

The District is authorized under California Government Code to make direct investments in local agency bonds,
notes, or warrants within the State; U.S. Treasury instruments; registered State warrants or treasury notes;
securities of the U.S. Government, or its agencies; bankers acceptances; commercial paper; certificates of deposit
placed with commercial banks and/or savings and loan companies; repurchase or reverse repurchase agreements;
medium term corporate notes; shares of beneficial interest issued by diversified management companies,
certificates of participation, obligations with first priority security; and collateralized mortgage obligations.

Investment in County Treasury - The District is considered to be an involuntary participant in an external
investment pool as the District is required to deposit all receipts and collections of monies with their County
Treasurer (Education Code Section 41001). The fair value of the District's investment in the pool is reported in
the accounting financial statements at amounts based upon the District's pro-rata share of the fair value provided
by the County Treasurer for the entire portfolio (in relation to the amortized cost of that portfolio). The balance
available for withdrawal is based on the accounting records maintained by the County Treasurer, which is
recorded on the amortized cost basis.




                                                       30
SAN JACINTO UNIFIED SCHOOL DISTRICT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2010

General Authorizations

Limitations as they relate to interest rate risk, credit risk, and concentration of credit risk are indicated in the
schedules below:

                                                                       Maximum          Maximum             Maximum
                Authorized                                             Remaining        Percentage         Investment
             Investment Type                                            Maturity       of Portfolio       in One Issuer
Local Agency Bonds, Notes, Warrants                                      5 years          None                None
Registered State Bonds, Notes, Warrants                                  5 years          None                None
U.S. Treasury Obligations                                                5 years          None                None
U.S. Agency Securities                                                   5 years          None                None
Banker's Acceptance                                                     180 days           40%                30%
Commercial Paper                                                        270 days           25%                10%
Negotiable Certificates of Deposit                                       5 years           30%                None
Repurchase Agreements                                                     1 year          None                None
Reverse Repurchase Agreements                                            92 days       20% of base            None
Medium-Term Corporate Notes                                              5 years           30%                None
Mutual Funds                                                               N/A             20%                10%
Money Market Mutual Funds                                                  N/A             20%                10%
Mortgage Pass-Through Securities                                         5 years           20%                None
County Pooled Investment Funds                                             N/A            None                None
Local Agency Investment Fund (LAIF)                                        N/A            None                None
Joint Powers Authority Pools                                               N/A            None                None

Investments Authorized by Debt Agreements

Investments of debt proceeds held by bond trustee are governed by provisions of the debt agreements, rather than
the general provisions of the California Government Code or the County's investment policy. These provisions
allow for the acquisition of investment agreements with maturities of up to 30 years.

Interest Rate Risk

Interest rate risk is the risk that changes in market interest rates will adversely affect the fair value of an
investment. Generally, the longer the maturity of an investment, the greater the sensitivity of its fair value to
changes in market interest rates. The District manages its exposure to interest rate risk by investing in the County
Pool and having the pool purchase a combination of shorter term and longer term investments and by timing cash
flows from maturities so that a portion of the portfolio is maturing or coming close to maturity evenly over time
as necessary to provide the cash flow and liquidity needed for operations.




                                                         31
SAN JACINTO UNIFIED SCHOOL DISTRICT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2010

Information about the sensitivity of the fair values of the District's investments to market interest rate fluctuation
is provided by the following schedule that shows the distribution of the District's investment by maturity:

                                                                                                  Fair           Maturity
                                 Investment Type                                                  Value            Date
Money Market Funds-Dreyfus Treasury & Agency Cash Management                                  $ 3,268,980           54*
Money Market Funds-US Bank Money Market Account                                                 10,775,984       7/1/2010
Riverside County Investment Pool                                                                31,514,280         372*
Certificate of Deposit-Bank of Hemet                                                                12,138      11/17/2010
                Total                                                                         $ 45,571,382

Credit Risk

Credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder of the investment.
This is measured by the assignment of a rating by a nationally recognized statistical rating organization.
Presented below is the minimum rating required by the California Government Code, the District's investment
policy, or debt agreements, and the actual rating as of the year-end for each investment type.

                                                                         Minimum
                                                                           Legal        Rating                 Fair
                        Investment Type                                    Rating    June 30, 2010            Value
Money Market Funds-Dreyfus Treasury Cash Management                     Not Required     AAA               $ 3,268,980
Money Market Funds-First American Treasury                              Not Required     AAA                 10,775,984
Riverside County Investment Pool                                        Not Required     AAA                 31,514,280
Certificate of Deposit-Bank of Hemet                                    Not Required   Not Rated                 12,138
                                                                                                           $ 45,571,382

Custodial Credit Risk - Deposits

This is the risk that in the event of a bank failure, the District's deposits may not be returned to it. The District
does have a policy for custodial credit risk for deposits. However, the California Government Code requires that
a financial institution secure deposits made by state or local governmental units by pledging securities in an
undivided collateral pool held by a depository regulated under state law (unless so waived by the governmental
unit). The market value of the pledged securities in the collateral pool must equal at least 110 percent of the total
amount deposited by the public agency. California law also allows financial institutions to secure public deposits
by pledging first trust deed mortgage notes having a value of 150 percent of the secured public deposits and letters
of credit issued by the Federal Home Loan Bank of San Francisco having a value of 105 percent of the secured
deposits. As of June 30, 2010, the District's bank balance of $188,147 was exposed to custodial credit risk
because it was uninsured and collateralized with securities held by the pledging financial institution's trust
department or agent, but not in the name of the District.




                                                         32
SAN JACINTO UNIFIED SCHOOL DISTRICT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2010

NOTE 3 - RECEIVABLES

Receivables at June 30, 2010, consisted of intergovernmental grants, entitlements, interest, and other local
sources. All receivables are considered collectible in full.

                                                                          County School Non-Major
                                         General           Building         Facilities  Governmental
                                          Fund              Fund              Fund         Funds           Total
Federal Government
  Categorical Aid                     $ 1,397,857      $              -   $          -   $    60,585   $ 1,458,442
State Government
  Apportionment                          8,639,491                    -              -             -      8,639,491
  Categorical Aid                        1,225,967                    -              -       115,316      1,341,283
  Lottery                                  256,975                    -              -             -        256,975
  Class Size Reduction                     322,581                    -              -             -        322,581
  Other State Programs                     591,066                    -              -             -        591,066
Local Government
  Interest                                  33,275           32,250            19,095          9,454         94,074
Other Local Sources                        179,873                -                 -        322,146        502,019
               Total                  $ 12,647,085     $     32,250       $    19,095    $   507,501   $ 13,205,931




                                                      33
SAN JACINTO UNIFIED SCHOOL DISTRICT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2010

NOTE 4 - CAPITAL ASSETS

Capital asset activity for the fiscal year ended June 30, 2010, was as follows:

                                                      Balance                                              Balance
                                                    July 1, 2009         Additions    Deductions        June 30, 2010
Governmental Activities
Capital Assets Not Being Depreciated:
 Land                                             $ 11,693,647       $       28,347   $         -       $    11,721,994
 Construction in progress                           58,000,368           23,952,560    49,254,611            32,698,317
         Total Capital Assets
         Not Being Depreciated                        69,694,015         23,980,907    49,254,611            44,420,311
Capital Assets Being Depreciated:
 Site improvements                                    6,174,865           3,396,442             -             9,571,307
 Buildings and improvements                         115,869,052          45,793,194             -           161,662,246
 Furniture and equipment                              6,203,866             696,490             -             6,900,356
         Total Capital Assets
         Being Depreciated                          128,247,783          49,886,126             -           178,133,909
         Total Capital Assets                       197,941,798          73,867,033    49,254,611           222,554,220
Less Accumulated Depreciation:
 Site improvements                                     3,094,440            241,723             -             3,336,163
 Buildings and improvements                           18,801,565          2,490,533             -            21,292,098
 Furniture and equipment                               4,061,241            373,543             -             4,434,784
         Total Accumulated Depreciation               25,957,246          3,105,799             -            29,063,045
         Governmental Activities
         Capital Assets, Net                      $ 171,984,552      $ 70,761,234     $49,254,611       $ 193,491,175

Depreciation expense was charged as a direct expense to governmental functions as follows:

Governmental Activities
 Instruction                                                                                        $       2,080,885
 Supervision of instruction                                                                                    31,058
 Instructional library, media, and technology                                                                 217,406
 School site administration                                                                                   155,290
 Pupil transportation                                                                                          93,174
 Food services                                                                                                155,290
 All other general administration                                                                             124,232
 Data processing services                                                                                      62,116
 Plant services                                                                                               186,348
         Total Depreciation Expenses Governmental Activities                                        $       3,105,799




                                                       34
SAN JACINTO UNIFIED SCHOOL DISTRICT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2010

NOTE 5 - INTERFUND TRANSACTIONS

Interfund Receivables/Payables (Due To/Due From)

Interfund receivable and payable balances arise from interfund transactions and are recorded by all funds affected
in the period in which transactions are executed. Interfund receivable and payable balances at June 30, 2010,
between major and non-major governmental funds are as follows:

                                                                              Due From
                                                                   County Schools    Non-Major
                                                        General      Facilities    Governmental
            Due To                                       Fund          Fund            Funds             Total
General Fund                                        $          -   $            - $       84,655       $  84,655
Building Fund                                                  -         178,541               -         178,541
Non-Major Governmental Funds                              53,770                -            295          54,065
                                                    $     53,770   $     178,541 $        84,950       $ 317,261

The balance of $53,770 due to the General Fund from other funds resulted from the costs paid by the General
Fund, but incurred by other funds. All remaining balances resulted from the time lag between the date that
(1) interfund goods and services are provided or reimbursable expenditures occur, (2) transactions are recorded in
the accounting system, and (3) payments between funds are made.

Operating Transfers

Interfund transfers for the year ended June 30, 2010, consisted of the following:

                                                                                       Transfer From
                                                                                        Non-Major
                                                                          General     Governmental
                            Transfer To                                    Fund           Funds           Total
COP Debt Service Fund                                                 $ 322,532       $ 9,769,038      $ 10,091,570
Non-Major Governmental Funds                                                 90,378                -         90,378
                               Total                                  $    412,910    $    9,769,038   $ 10,181,948



The General Fund transferred to the Non-Major Adult Education Fund for apportionment payments.         $     90,378
The General Fund transferred to the COP Debt Service Fund for principal and interest
payments on COP's.                                                                                          322,532
The Non-Major Cafeteria Fund transferred funds to the the COP Debt Service Fund for
principal and interest payments on COP'S.                                                                   331,485
The Non-Major Capital Facilities Fund transferred funds to the COP Debt Service Fund for
principal and interest payments on the COP's.                                                               209,368
The Non-Major COP Capital Project Fund transferred funds to the COP Debt Service fund
to pay off outstanding debt.                                                                               9,228,185
                               Total                                                                   $ 10,181,948




                                                         35
SAN JACINTO UNIFIED SCHOOL DISTRICT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2010

Interfund transfers are used to (1) move revenues from the fund that statute or budget requires to collect them to
the fund that statute or budget requires to expend them, (2) move receipts restricted to debt service from the funds
collecting the receipts to the debt service fund as debt service payments become due, and (3) use unrestricted
revenues collected in the General Fund to finance various programs accounted for in other funds in accordance
with budgetary authorizations.



NOTE 6 - ACCOUNTS PAYABLE

Accounts payable at June 30, 2010, consisted of the following:

                                                                 County School         Non-Major
                                   General          Building       Facilities         Governmental
                                    Fund             Fund            Fund                Funds                Total
State apportionment            $      907,392   $            -   $            -   $               -   $         907,392
Salaries and benefits                 125,889                -                -              16,305             142,194
Construction                            2,920        1,784,527                -                   -           1,787,447
Other vendor payables               1,249,831                -          14,844               40,949           1,305,624
             Total             $    2,286,032   $    1,784,527   $      14,844    $          57,254   $       4,142,657




NOTE 7 - DEFERRED REVENUE

Deferred revenue at June 30, 2010, consists of the following:

                                                                                         Non-Major
                                                                      General          Governmental
                                                                       Fund                Funds               Total
Federal financial assistance                                        $   392,241        $     21,470       $     413,711




                                                        36
SAN JACINTO UNIFIED SCHOOL DISTRICT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2010

NOTE 8 - LONG-TERM OBLIGATIONS

Summary

The changes in the District's long-term obligations during the year consisted of the following:

                                              Balance         Additions/                          Balance         Due in
                                            July 1, 2009     Adjustments      Deductions       June 30, 2010     One Year
General Obligation Bonds                   $ 44,710,431     $            -   $ 259,667         $ 44,450,764     $ 248,426
Premium on Bond                                1,639,139                 -        85,520           1,553,619              -
Certificates of Participation                 45,895,000       43,380,000     45,895,000         43,380,000               -
  Discount on bond issuance                     (216,114)        (764,038)       237,334            (742,818)             -
Arbitrage Rebate Liability                       327,869                 -       327,869                   -              -
Capital Leases                                   167,202                 -       100,721              66,481        20,891
Other Postemployment Benefits
  CSEA/SJTA                                     217,821                -         217,821                  -               -
  SERP                                                -          402,850          89,375            313,475          89,375
  Net OPEB obligation                           170,477          245,546         141,086            274,937               -
Compensated Absences                             92,472                -          61,111             31,361               -
                                           $ 93,004,297     $ 43,264,358     $47,415,504       $ 89,327,819     $   358,692

Payments on the General Obligations Bonds are made by the Bond Interest and Redemption Fund with local
revenue. The COP Debt Service Fund makes the payments for the Certificates of Participation. Capital leases
obligations are made in the General Fund. The SERP, net OPEB obligation, and the compensated absences will
be paid by the fund for which the employee worked.

Bonded Debt

The outstanding general obligation bonded debt is as follows:

                                                                 Bonds                                              Bonds
   Issue        Interest        Maturity       Original       Outstanding                                        Outstanding
   Date          Rate            Date           Issue         July 1, 2009        Issued          Redeemed      June 30, 2010
   1997       3.90-5.60%         2022        $ 3,500,000     $ 1,374,163      $            -      $ 137,644     $ 1,236,519
   1998       3.80-4.75%         2023          3,000,000         1,446,268                 -        122,023         1,324,245
   2007      4.25-5.258%         2033         42,000,000        41,890,000                 -              -        41,890,000
                                                             $ 44,710,431     $            -      $ 259,667     $ 44,450,764




                                                            37
SAN JACINTO UNIFIED SCHOOL DISTRICT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2010

Debt Service Requirements to Maturity
The bonds mature through 2033 as follows:

                                                                                   Interest to
  Fiscal Year                                                     Principal         Maturity            Total
     2011                                                       $     248,426    $ 2,445,724         $  2,694,150
     2012                                                             238,046        2,466,104          2,704,150
     2013                                                             228,506        2,485,644          2,714,150
     2014                                                             219,064        2,505,086          2,724,150
     2015                                                             207,619        2,521,531          2,729,150
  2016-2020                                                        3,807,423        12,694,421         16,501,844
  2021-2025                                                       11,221,680        10,388,415         21,610,095
  2026-2030                                                       18,855,000         5,147,494         24,002,494
  2031-2033                                                        9,425,000           595,218         10,020,218
     Total                                                      $ 44,450,764     $ 41,249,637        $ 85,700,401

2010 Refunding Certificates of Participation
In January 2010, the District, pursuant to a sublease agreement with the San Jacinto Unified School District
Facilities Corporation, issued the 2010 Refunding Certificates of Participation in the amount of $43,380,000. The
Certificates were issued at an aggregate price of $41,415,458 (representing the principal amount of $43,380,000,
less discount on issuance of $764,038 and less issuance costs of $1,200,504). The Certificates have a final
maturity date of September 1, 2041, with interest rates ranging from 2.00 to 5.45 percent. Proceeds from the
Certificates, together with other available funds, were used to refund all of the District's outstanding Certificates
of Participation (1997 Facility Bridge Funding, 1998 School Facility Bridge Funding Program, and 2006 School
Facility Bridge Funding Program). As of June 30, 2010, the principal balance outstanding was $43,380,000.
Unamortized discount and deferred cost of issuance as of June 30, 2010, were $742,818 and $1,167,156,
respectively.

The certificates mature through 2041 as follows:

  Year Ending
    June 30,                                                        Principal     Interest            Total
      2011                                                  $          -        $ 2,235,376        $ 2,235,376
      2012                                                       750,000           2,110,225          2,860,225
      2013                                                       765,000           2,091,250          2,856,250
      2014                                                       785,000           2,068,000          2,853,000
      2015                                                       810,000           2,044,075          2,854,075
   2016-2020                                                   4,480,000           9,761,972         14,241,972
   2021-2025                                                   5,495,000           8,698,994         14,193,994
   2026-2030                                                   6,965,000           7,177,822         14,142,822
   2031-2035                                                   8,965,000           5,113,509         14,078,509
   2036-2040                                                  11,645,000           2,360,566         14,005,566
      2041                                                     2,720,000              73,100          2,793,100
     Total                                                  $ 43,380,000        $ 43,734,889       $ 87,114,889



                                                       38
SAN JACINTO UNIFIED SCHOOL DISTRICT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2010

Arbitrage Rebate Liability

During the fiscal year ended June 30, 2010, the arbitrage liability was paid in full with proceeds from the 2010
refunding Certificates of Participation.

Capital Leases

The District has entered into agreements to lease various facilities and equipment. Such agreements are, in
substance, purchases (capital leases) and are reported as capital lease obligations. The District's liability on lease
agreements with options to purchase is summarized below:

Balance, July 1, 2009                                                                                  $     184,013
 Payments                                                                                                    109,454
Balance, June 30, 2010                                                                                 $      74,559


The capital leases have minimum lease payments as follows:

Year Ending                                                                                                Lease
  June 30,                                                                                                Payment
    2011                                                                                                $    24,853
    2012                                                                                                     24,853
    2013                                                                                                     24,853
    Total                                                                                                    74,559
Less: Amount Representing Interest                                                                            8,078
Present Value of Minimum Lease Payments                                                                 $    66,481

Supplemental Employee Retirement Plan (SERP)

The Board of Trustees of the San Jacinto Unified School District established a retirement plan for certain eligible
employees of the District effective July 1, 2009. The eligibility requirements for employees to participate in such
plan were as follows:

        Certificated Management, Certificated (non-management), Classified and Classified
         Management/Confidential
        Full-time age 55 and up with three years of service with the District
        Eligible to retire with CalSTRS or CalPERS
        Retire from the District during the agreed timeline




                                                        39
SAN JACINTO UNIFIED SCHOOL DISTRICT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2010

The plan provided two options as follows:

    1. The benefit under this Plan was based on a flat spend amount of 75 percent of salary with enhanced
       retiree health benefits (an additional $5,000 annually prorated based on the employee's full time
       equivalent status at the time of retirement). The retiree chose between a variety of options for retirement
       payments.

    2. Ninety percent of salary with no health benefits or the normal benefits as outlined in employee
       agreements and as determined by the District. The retiree chose between a variety of options for
       retirement payments.

On June 30, 2010, there were 31 participants that elected early retirement under this Plan. Future minimum
annual payments are as follows:

 Year Ending
   June 30,
     2011                                                                                           $     89,375
     2012                                                                                                 88,542
     2013                                                                                                 73,641
     2014                                                                                                 60,625
     2015                                                                                                  1,292
    Total                                                                                           $    313,475

Compensated Absences

The long-term portion of accumulated unpaid employee vacation for the District at June 30, 2010, amounted to
$31,361.

Other Postemployment Benefit (OPEB) Obligation

The District implemented GASBS No. 45, Accounting and Financial Reporting by Employers for
Postemployment Benefits Other Than Pensions during the year ended June 30, 2009. The District's annual
required contribution for the year ended June 30, 2010, was $245,546 and contributions made by the District
during the year were $141,086, which resulted in a net OPEB obligation of $274,937. See Note 11 for additional
information regarding the OPEB Obligation and the postemployment benefit plan.




                                                      40
SAN JACINTO UNIFIED SCHOOL DISTRICT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2010

NOTE 9 - NON-OBLIGATORY DEBT

Non-obligatory debt relates to debt issued by the Community Facility District as authorized by the Mello-Roos
Community Facilities Act of 1982 as amended, and are payable from special taxes levied on property within the
Community Facilities District according to a methodology approved by the voters within the District. Neither the
faith and credit nor taxing power of the District is pledged to the payment of the bonds. Reserves have been
established from the bond proceeds to meet delinquencies should they occur. If delinquencies occur beyond the
amounts held in those reserves, the District has no duty to pay the delinquency out of any available funds of the
District. The District acts solely as an agent for those paying taxes levied and the bondholders. The Community
Facilities District Special Tax Bonds currently active include Community Facilities District 2003-2, 2004-3,
2004-5, 2005-1, 2005-4, and 2006-1, with a remaining balance as of June 30, 2010 of $12,400,000.



NOTE 10 - FUND BALANCES

Fund balances are composed of the following elements:

                                                                     County
                                                                     School             COP          Non-Major
                                General         Building            Facilities       Debt Service   Governmental
                                 Fund            Fund                 Fund              Fund           Funds            Total
Reserved
 Revolving cash             $      10,000   $              -    $                -   $          -   $       200    $       10,200
 Stores inventories                     -                  -                     -              -       107,255           107,255
 Restricted programs            9,942,958                  -                     -              -             -         9,942,958
       Total Reserved           9,952,958                  -                     -              -       107,455        10,060,413
Unreserved
 Designated
   Economic uncertainties      2,008,933              -                   -                     -             -       2,008,933
   Other designations          6,455,438      9,492,553           6,582,045                     -     4,455,640      26,985,676
       Total Designated        8,464,371      9,492,553           6,582,045                     -     4,455,640      28,994,609
 Undesignated                          -              -                   -            10,775,984     2,120,239      12,896,223
       Total Unreserved        8,464,371      9,492,553           6,582,045            10,775,984     6,575,879      41,890,832
       Total                $ 18,417,329    $ 9,492,553         $ 6,582,045          $ 10,775,984   $ 6,683,334    $ 51,951,245




                                                           41
SAN JACINTO UNIFIED SCHOOL DISTRICT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2010

NOTE 11 - POSTEMPLOYMENT HEALTH CARE PLAN AND OTHER POSTEMPLOYMENT
BENEFITS (OPEB) OBLIGATION

Plan Description

The Postemployment Benefit Plan (the Plan) is a single-employer defined benefit healthcare plan administered by
the San Jacinto Unified School District. The Plan provides medical and dental insurance benefits to eligible
retirees and their spouses. Membership of the Plan consists of retirees and beneficiaries currently receiving
benefits, terminated plan members entitled to but not yet receiving benefits, and active plan members.

Contribution Information

The contribution requirements of plan members and the District are established and may be amended by the
District and the Teachers Association (CEA), the local California Service Employees Association (CSEA), and
unrepresented groups. The required contribution is based on projected pay-as-you-go financing requirements.
For fiscal year 2009-2010, the District contributed $141,086 to the plan, all of which was used for current
premiums.

Annual OPEB Cost and Net OPEB Obligation

The District's annual OPEB cost (expense) is calculated based on the annual required contribution of the employer
(ARC), an amount actuarially determined in accordance with the parameters of GASB Statement No. 45. The
ARC represents a level of funding that, if paid on an ongoing basis, is projected to cover normal cost each year
and amortize any unfunded actuarial accrued liabilities (UAAL) (or funding excess) over a period not to exceed
thirty years. The following table shows the components of the District's annual OPEB cost for the year, the
amount actually contributed to the plan, and changes in the District's net OPEB obligation to the Plan:

Annual required contribution                                                                     $     245,546
Contributions made                                                                                    (141,086)
Increase in net OPEB obligation                                                                        104,460
Net OPEB obligation, beginning of year                                                                 170,477
Net OPEB obligation, end of year                                                                 $     274,937

Trend Information

Trend information for the annual OPEB cost, the percentage of annual OPEB cost contributed to the Plan, and the
net OPEB obligation is as follows:

        Year Ended                     Annual OPEB             Annual          Percentage         Net OPEB
         June 30,                         Cost               Contribution      Contributed        Obligation
           2009                       $     245,546        $        75,069         31%          $     170,477
           2010                             245,546                141,086         57%                274,937




                                                     42
SAN JACINTO UNIFIED SCHOOL DISTRICT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2010

Funded Status and Funding Progress

A schedule of funding progress as of the most recent valuation is as follows:

                                         Actuarial
                                         Accrued                                                         UAAL as a
                                         Liability        Unfunded                                       Percentage
     Actuarial           Actuarial       (AAL) -             AAL         Funded                          of Covered
     Valuation           Value of       Unprojected        (UAAL)         Ratio         Covered            Payroll
       Date             Assets (a)     Unit Credit (b)      (b - a)       (a / b)      Payroll (c)       ([b - a] / c)
September 24, 2009     $           -   $ 2,659,010       $ 2,659,010       0%         $ 45,748,647           6%

Actuarial valuations of an ongoing plan involve estimates of the value of reported amounts and assumptions about
the probability of occurrence of events far into the future. Examples include assumptions about future
employment, investment returns, mortality, and the healthcare cost trend. Amounts determined regarding the
funded status of the plan and the annual required contributions of the employer are subject to continual revision as
actual results are compared with past expectations and new estimates are made about the future. The schedule of
funding progress, presented as required supplementary information following the notes to the financial statements,
presents multiyear trend information about whether the actuarial value of plan assets is increasing or decreasing
over time relative to the actuarial accrued liabilities for benefits.

Actuarial Methods and Assumptions

Projections of benefits for financial reporting purposes are based on the substantive plan (the plan as understood
by the employer and the plan members) and include the types of benefits provided at the time of each valuation
and the historical pattern of sharing of benefit costs between the employer and plan members to that point. The
actuarial methods and assumptions used include techniques that are designed to reduce the effects of short-term
volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the long-term perspective
of the calculations.

In the September 24, 2009, actuarial valuation, the entry age normal actuarial cost method was used. The
actuarial assumptions included a five percent investment rate of return, based on the assumed long-term return on
Plan assets or employer assets. The cost trend rate used for the Medical, Dental, and Vision Programs was four
percent. The UAAL is being amortized at a level dollar method. The remaining amortization period is 28 years.
The actuarial value of assets was not determined in this actuarial valuation.




                                                         43
SAN JACINTO UNIFIED SCHOOL DISTRICT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2010

NOTE 12 - RISK MANAGEMENT

The District is exposed to various risks of loss related to torts; theft, damage and destruction of assets; errors and
omissions; injuries to employees; life and health of employees; and natural disasters. The District purchases
commercial insurance for property damage with coverage up to a maximum of $300 million; subject to various
policy sublimits generally ranging from $1 million to $50 million and deductibles ranging from $25,000 to
$300,000 per occurrence. The District also purchases commercial insurance for general liability claims with
coverage up to $1 million per occurrence and $2 million aggregate, with excess liability coverage over $25
million, all subject to various deductibles up to $20,000 per occurrence and per employee policy limit, subject to a
deductible of $100,000 per occurrence per claim, up to a maximum of $1.5 million for 2010. Employee health
benefits are covered by a commercial insurance policy purchased by the District. The District provides health
insurance benefits to District employees electing to participate in the plan by paying a monthly premium based on
the number of District employees participating in the plan.

Property and Liability

The District's risk management activities are recorded in the General Fund. The fund administers employee life,
health, property, and liability, workers' compensation, and unemployment programs of the District as premiums
are paid to insurance carriers and JPAs to which the District is a member.

Significant losses are covered by commercial insurance via the carriers and JPAs. For insured programs, there
have been no significant reductions in insurance coverage. Settlement amounts have not exceeded insurance
coverage for the current year or the three prior years.



NOTE 13 - EMPLOYEE RETIREMENT SYSTEMS

Qualified employees are covered under multiple-employer retirement plans maintained by agencies of the State of
California. Certificated employees are members of the California State Teachers' Retirement System (CalSTRS)
and classified employees are members of the California Public Employees' Retirement System (CalPERS).

CalSTRS

Plan Description

The District contributes to the CalSTRS, a cost-sharing multiple-employer public employee retirement system
defined benefit pension plan administered by CalSTRS. The plan provides retirement and disability benefits,
annual cost-of-living adjustments, and survivor benefits to beneficiaries. Benefit provisions are established by
State statutes, as legislatively amended, within the State Teachers' Retirement Law. CalSTRS issues a separate
comprehensive annual financial report that includes financial statements and required supplementary information.
Copies of the CalSTRS annual financial report may be obtained from CalSTRS, 7919 Folsom Blvd., Sacramento,
California 95826.




                                                       44
SAN JACINTO UNIFIED SCHOOL DISTRICT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2010

Funding Policy

Active plan members are required to contribute 8.0 percent of their salary and the District is required to contribute
an actuarially determined rate. The actuarial methods and assumptions used for determining the rate are those
adopted by CalSTRS Teachers' Retirement Board. The required employer contribution rate for fiscal year
2009-2010 was 8.25 percent of annual payroll. The contribution requirements of the plan members are
established by State statute. The District's contributions to CalSTRS for the fiscal years ending June 30, 2010,
2009, and 2008, were $2,707,610, $2,883,370, and $2,954,059, respectively, and equal 100 percent of the
required contributions for each year.

CalPERS

Plan Description

The District contributes to the School Employer Pool under the CalPERS, a cost-sharing multiple-employer
public employee retirement system defined benefit pension plan administered by CalPERS. The plan provides
retirement and disability benefits, annual cost-of-living adjustments, and survivor benefits to plan members and
beneficiaries. Benefit provisions are established by State statutes, as legislatively amended, within the Public
Employees' Retirement Laws. CalPERS issues a separate comprehensive annual financial report that includes
financial statements and required supplementary information. Copies of the CalPERS' annual financial report
may be obtained from the CalPERS Executive Office, 400 P Street, Sacramento, California 95811.

Funding Policy

Active plan members are required to contribute 7.0 percent of their salary and the District is required to contribute
an actuarially determined rate. The actuarial methods and assumptions used for determining the rate are those
adopted by the CalPERS Board of Administration. The required employer contribution rate for fiscal year
2009-2010 was 9.709 percent of annual payroll. The contribution requirements of the plan members are
established by State statute. The District's contributions to CalPERS for the fiscal years ending June 30, 2010,
2009, and 2008, were $1,603,477, $1,752,747, and $1,762,138, respectively, and equal 100 percent of the
required contributions for each year.

On Behalf Payments

The State of California makes contributions to CalSTRS on behalf of the District. These payments consist of
State General Fund contributions to CalSTRS in the amount of $1,393,760 (4.267 percent of annual payroll).
Contributions were made for CalPERS for the year ended June 30, 2010. Under accounting principles generally
accepted in the United States of America, these amounts are to be reported as revenues and expenditures.
Accordingly, these amounts have recorded in these financial statements. On behalf payments have been excluded
from the calculation of available reserves and have not been included in the budget amounts reported in the
General Fund - Budgetary Comparison Schedule.




                                                       45
SAN JACINTO UNIFIED SCHOOL DISTRICT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2010

NOTE 14 - COMMITMENTS AND CONTINGENCIES

The District entered into a five-year contract with Hemet Unified School District (HUSD) for home-to-school
pupil transportation services and maintenance and repair services for buses and related support vehicles for the
San Jacinto Unified School District. The contract was effective April 1, 2007.

Future minimum lease payments under these arrangements are as follows:

       Year Ending
        June 30,
          2011                                                                                     $     1,487,000
          2012                                                                                           1,487,000
          Total                                                                                    $     2,974,000

Grants

The District received financial assistance from Federal and State agencies in the form of grants. The
disbursement of funds received under these programs generally requires compliance with terms and conditions
specified in the grant agreements and are subject to audit by the grantor agencies. Any disallowed claims
resulting from such audits could become a liability of the General Fund or other applicable funds. However, in
the opinion of management, any such disallowed claims will not have a material adverse effect on the overall
financial position of the District at June 30, 2010.

Litigation

The District is involved in various litigation arising from the normal course of business. In the opinion of
management and legal counsel, the disposition of all litigation pending is not expected to have a material adverse
effect on the overall financial position of the District at June 30, 2010.

Operating Leases

The District has entered into various operating leases for buildings and equipment with lease terms in excess of
one year. None of these agreements contain purchase options. All agreements contain a termination clause
providing for cancellation after a specified number of days written notice to lessors, but it is unlikely that the
District will cancel any of the agreements prior to the expiration date.

Employee Flexible Benefit Plan

The District adopted a Section 125 Flexible Benefit Plan, effective April 1, 2001. Eligible participants must be at
least 17 years old and work a minimum of 15 hours per week. The participant is eligible on the first day of the
month following 30 days of employment. The maximum salary reduction allowed per plan year is $15,000.
Available benefits of the plan are: Group Hospital and Surgery Insurance, Disability Income Insurance, Cancer
Coverage, Dental/Vision Insurance, Group Life Insurance, Dependent Care Assistance Plan, and Medical Expense
Reimbursement Plan. The District may, at its sole discretion, provide a non-elective contribution to provide
benefits for each participant under the plan. This amount will be set by the District each plan year in a uniform
and nondiscriminatory manner. The District did not make any non-elective contributions during the year ended
June 30, 2010.


                                                       46
SAN JACINTO UNIFIED SCHOOL DISTRICT

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2010

NOTE 15 - PARTICIPATION IN PUBLIC ENTITY RISK POOLS AND JOINT POWER AUTHORITIES

The District is a member of the Riverside Schools Insurance Authority (RSIA), Riverside County
Employer/Employee Partnership for Benefits (REEP), Joint Education Transit (JET), and Riverside Schools Risk
Management Authority (RSRMA) joint powers authorities (JPAs). The District pays an annual premium to the
applicable entity for its health, workers' compensation, and property liability coverage. Payments for these
services received are paid to the above mentioned JPAs. The relationships between the District, the pools, and the
JPAs are such that they are not component units of the District for financial reporting purposes.

These entities have budgeting and financial reporting requirements independent of member units and their
financial statements are not presented in these financial statements; however, fund transactions between the
entities and the District are included in these statements. Audited financial statements are generally available
from the respective entities.

The District has appointed no board members to the governing board of the JPAs mentioned above.

During the year ended June 30, 2010, the District made payments of $360,227 to RSIA for services received.



NOTE 16 - FISCAL ISSUES RELATING TO BUDGET REDUCTIONS

The State of California continues to suffer the effects of a recessionary economy. California school districts are
reliant on the State of California to appropriate the funding necessary to continue the level of educational services
expected by the State constituency. With the implementation of education trailer bill Senate Bill 16 of the
2009-10 Fourth Extraordinary Session (SBX4 16) (Chapter 23, Statutes of 2009), 25 percent of current year
appropriations have now been deferred to a subsequent period, creating significant cash flow management issues
for districts in addition to requiring substantial budget reductions, ultimately impacting the ability of California
school districts to meet their goals for educational services.




                                                       47
REQUIRED SUPPLEMENTARY INFORMATION




                48
SAN JACINTO UNIFIED SCHOOL DISTRICT

GENERAL FUND
BUDGETARY COMPARISON SCHEDULE
FOR THE YEAR ENDED JUNE 30, 2010

                                                                                                                                Variances -
                                                                                                                                 Positive
                                                                   Budgeted Amounts                                             (Negative)
                                                                      (GAAP Basis)                           Actual                Final
                                                                Original        Final                     (GAAP Basis)           to Actual
REVENUES
Revenue limit sources                                        $ 44,234,816          $    42,552,654        $ 42,350,226         $     (202,428)
Federal sources                                                 7,898,189               10,276,899           8,020,930             (2,255,969)
Other State sources                                             8,455,382                7,816,402           9,401,790              1,585,388
Other local sources                                             4,521,176                6,064,393           6,047,785                (16,608)
                              1
               Total Revenues                                  65,109,563               66,710,348          65,820,731               (889,617)
EXPENDITURES
Current
 Certificated salaries                                           34,978,924             34,763,096            33,134,867              1,628,229
 Classified salaries                                              9,328,179              9,229,816             9,067,894                161,922
 Employee benefits                                               12,057,512             13,122,351            13,864,463               (742,112)
 Books and supplies                                               2,976,646              4,688,209             3,037,289              1,650,920
 Services and operating expenditures                              9,045,753             10,895,724             8,727,853              2,167,871
 Capital Outlay                                                     618,591                212,075               183,050                 29,025
 Other outgo                                                       (141,944)              (187,905)             (179,607)                (8,298)
 Debt service:
   Principal                                                      1,290,941                423,253               100,721                322,532
   Interest                                                           8,734                  8,734                 8,734                      -
                            1
         Total Expenditures                                      70,163,336             73,155,353            67,945,264              5,210,089
Excess (Deficiency) of Revenues
Over Expenditures                                                (5,053,773)             (6,445,005)          (2,124,533)             4,320,472
OTHER FINANCING SOURCES (USES)
 Other sources                                                          -                        -      990,517     990,517
 Transfers out                                                    (69,827)                 (90,378)    (412,910)   (322,532)
         Net Financing Sources (Uses)                             (69,827)                 (90,378)     577,607     667,985
NET CHANGE IN FUND BALANCES                                    (5,123,600)              (6,535,383)  (1,546,926)  4,988,457
Fund Balance - Beginning                                       19,694,255               19,964,255   19,964,255           -
Fund Balance - Ending                                        $ 14,570,655          $    13,428,872 $ 18,417,329 $ 4,988,457




1
    On behalf payments of $1,393,760 are included in the actual revenues and expenditures, but have not been included in the budget
    amounts.




                                                                 49
SAN JACINTO UNIFIED SCHOOL DISTRICT

SCHEDULE OF OTHER POSTEMPLOYMENT BENEFITS (OPEB)
 FUNDING PROGRESS
FOR THE YEAR ENDED JUNE 30, 2010

                                        Schedule of Funding Progress
                                    Actuarial
                                    Accrued                                                  UAAL as a
                                    Liability       Unfunded                                 Percentage
    Actuarial        Actuarial       (AAL) -           AAL         Funded                    of Covered
    Valuation        Value of      Unprojected       (UAAL)         Ratio       Covered        Payroll
      Date           Assets (a)   Unit Credit (b)     (b - a)       (a / b)    Payroll (c)   ([b - a] / c)

September 24, 2009   $        -   $ 2,659,010      $ 2,659,010       0%       $ 45,748,647       6%




                                                   50
SUPPLEMENTARY INFORMATION




           51
SAN JACINTO UNIFIED SCHOOL DISTRICT

SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
FOR THE YEAR ENDED JUNE 30, 2010

                                                                                       Pass-Through
                                                                             Federal      Entity
                           Federal Grantor/Pass-Through                      CFDA       Identifying     Federal
                          Grantor/Program or Cluster Title                   Number      Number       Expenditures
U.S. DEPARTMENT OF EDUCATION
 Passed through the California Department of Education (CDE):
       Title I, Part A Cluster
         NCLB: Title I, Part A, Basic Grants Low-Income and Neglected        84.010       14329       $ 1,612,026
         NCLB: Title I, Part D, Local Delinquent Programs                    84.010       14357            17,195
         NCLB: Title I, Part A, Program Improvement Local
           Educational Agency Corrective Action Resources                    84.010       14957           144,636
         NCLB: ARRA Title I, Part A, Basic Grants Low Income and Neglected   84.389       15005           342,802
           Total Title I Cluster                                                                        2,116,659

        NCLB: Title I, Part B, Reading First Program                         84.357A      14328           283,553
        NCLB: Title I, Part B, Reading First, Special Education Teacher
          Professional Development Pilot                                     84.357A      14911           279,955
        NCLB: Title II, Part A, Improving Teacher Quality                    84.367       14341           368,326
        NCLB Title II, Bilingual Teacher Training Program                    84.367       01038            16,422
        NCLB: Title II, Part D, Enhancing Education Through Technology       84.318       14334            24,686
        NCLB: Title III, Immigrant Education Program                         84.365       14346            55,965
        NCLB: Title III, Limited English Proficiency (LEP) Student Program   84.365       10084           300,622
        NCLB: Title IV, Safe and Drug Free Schools and Communities           84.186       14347            40,613
        NCLB: Title V, Part A, Innovative Education Strategies               84.298A      13340            14,018
        Fund For the Improvement of Education - Smaller Learning
        Communities                                                          84.215L       N/A            213,134
        ARRA-State Fiscal Stabilization Fund                                 84.394       25008         1,230,487
        Voc. and Appl. Tech. Secondary II C, Sec 131 (Carl Perkins Act)      84.048A      14894            53,175
      Special Education Cluster
        IDEA Basic Local Assistance Entitlement, Part B, Section 611         84.027       13379         1,279,932
        IDEA Local Assistance, Part B, Sec 611, Private School ISPs          84.027       10115             1,558
        IDEA Preschool Grants, Part B, Sec 619                               84.173       13430            27,367
        ARRA IDEA Part B, Sec 611, Basic Local Assistance                    84.391       15003           817,715
        ARRA IDEA Part B, Sec 611, Local Assistance Private School ISPs      84.391       10123               222
        ARRA IDEA Part B, Sec 611, Preschool Local Entitlement               84.391       15002            66,945
        ARRA IDEA Part B, Sec 619, Preschool Grants                          84.392       15000            38,884
        IDEA Preschool Local Entitlement, Part B, Sec 611                    84.027A      13682            71,796
            Total Special Education Cluster                                                             2,304,419
            Total U.S. Department of Education                                                          7,302,034




N/A – Due to the fact that the grant is direct funded.




See accompanying note to supplementary information.

                                                          52
SAN JACINTO UNIFIED SCHOOL DISTRICT

SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS, CONTINUED
FOR THE YEAR ENDED JUNE 30, 2010

                                                                            Pass-Through
                                                                  Federal      Entity
                          Federal Grantor/Pass-Through            CFDA       Identifying     Federal
                         Grantor/Program or Cluster Title         Number      Number       Expenditures
U.S. DEPARTMENT OF HEALTH AND HUMAN RESOURCES
 Passed through the California Department of Education:
      Medi-Cal Billing Option                                     93.778       10013       $    104,526
  Passed through the Riverside County Office of Education:
    Head Start Cluster
      Head Start                                                  93.600       10016           1,000,299
      ARRA Head Start                                             93.708       10130              36,937
            Total Head Start Cluster                                                           1,037,236
            Total U.S. Department of Health and Human Resources                                1,141,762

U.S. DEPARTMENT OF AGRICULTURE
 Passed through the California Department of Education:
 National School Lunch Cluster
    National School Lunch Program                                 10.555       13391          2,146,730
    Commodities                                                   10.555        N/A             230,830
    Especially Needy Breakfast                                    10.556       13391            817,734
    Meal Supplements                                              10.556       13391             55,388
            Total U.S. Department of Agriculture                                              3,250,682
            Total Federal Programs                                                         $ 11,694,478




N/A – Due to the fact that the grant is direct funded.


See accompanying note to supplementary information.

                                                          53
SAN JACINTO UNIFIED SCHOOL DISTRICT

LOCAL EDUCATION AGENCY ORGANIZATION STRUCTURE
JUNE 30, 2010

ORGANIZATION

The San Jacinto Unified School District (the District) was unified on March 29, 1944, and consists of an area
comprising approximately 100 square miles. The District operates six elementary schools, two middle schools,
one high school, one continuation high school, one adult school, four State preschools, and two head start
preschools. There were no boundary changes during the year.


                                           GOVERNING BOARD

            MEMBER                                  OFFICE                              TERM EXPIRES

Mrs. Deborah J. Rex                                President                                   2010

Mr. Willie Hamilton                                   Clerk                                    2012

Mrs. Nancy Ayres                                    Member                                     2012

Mr. John I. Norman                                  Member                                     2012

Mr. John W. Schouten                                Member                                     2010



                                            ADMINISTRATION

Dr. Shari Fox                            District Superintendent

Mrs. Jayne Christakos                    Assistant Superintendent, Business Services

Mrs. Lucinda Edmunds                     Assistant Superintendent, Educational Services

Mrs. Diane Perez                         Assistant Superintendent, Personnel Services

Mr. Scott Shira                          Assistant Superintendent, Facilities and Operations




See accompanying note to supplementary information.

                                                       54
SAN JACINTO UNIFIED SCHOOL DISTRICT

SCHEDULE OF AVERAGE DAILY ATTENDANCE
FOR THE YEAR ENDED JUNE 30, 2010

                                                                  Final Report
                                                           Second Period       Annual
                                                              Report           Report
ELEMENTARY
   Kindergarten                                                     633             633
   First through third                                            1,995           1,998
   Fourth through sixth                                           1,869           1,874
   Seventh and eighth                                             1,290           1,285
   Home and hospital                                                  2               3
   Special education                                                214             215
                   Total Elementary                               6,003           6,008
SECONDARY
   Regular classes                                                2,079           2,050
   Continuation education                                           244             235
   Home and hospital                                                  3               4
   Special education                                                135             131
                   Total Secondary                                2,461           2,420
                   Total K-12                                     8,464           8,428




See accompanying note to supplementary information.

                                                      55
SAN JACINTO UNIFIED SCHOOL DISTRICT

SCHEDULE OF INSTRUCTIONAL TIME
FOR THE YEAR ENDED JUNE 30, 2010

                          Reduced                     2009-10
                1982-83   1982-83     1986-87       Proportional     2009-10    Number of Days
                 Actual    Actual     Minutes        Reduction        Actual Traditional Multitrack
 Grade Level    Minutes   Minutes   Requirement   Minimum Minutes    Minutes Calendar    Calendar      Status
Kindergarten     31,500    30,625        36,000             35,000    35,400        177        177    Complied
Grades 1 - 3     50,125    48,733        50,400             49,000
   Grade 1                                                           55,300         177        177    Complied
   Grade 2                                                           55,300         177        177    Complied
   Grade 3                                                           55,300         177        177    Complied
Grades 4 - 6     49,525    48,149       54,000             52,500
   Grade 4                                                           55,300         177        177    Complied
   Grade 5                                                           54,330         177        177    Complied
   Grade 6                                                           55,300         177        177    Complied
Grades 7 - 8     48,875    47,517       54,000             52,500
   Grade 7                                                           58,560         177       N/A     Complied
   Grade 8                                                           57,498         177       N/A     Complied
Grades 9 - 12    57,750    56,146       64,800             63,000
   Grade 9                                                           64,700         177       N/A     Complied
   Grade 10                                                          64,700         177       N/A     Complied
   Grade 11                                                          64,700         177       N/A     Complied
   Grade 12                                                          64,700         177       N/A     Complied




See accompanying note to supplementary information.

                                                      56
SAN JACINTO UNIFIED SCHOOL DISTRICT

RECONCILIATION OF ANNUAL FINANCIAL AND BUDGET REPORT WITH
AUDITED FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2010

There were no adjustments to the Unaudited Actual Financial Report, which required reconciliation to the audited
financial statements at June 30, 2010.




See accompanying note to supplementary information.

                                                       57
SAN JACINTO UNIFIED SCHOOL DISTRICT

SCHEDULE OF FINANCIAL TRENDS AND ANALYSIS
FOR THE YEAR ENDED JUNE 30, 2010

                                                          (Budget)
                                                                1
                                                           2011                  2010                 2009                 2008
GENERAL FUND
  Revenues and other sources                           $ 60,912,077         $ 66,811,248         $ 74,520,290         $ 76,434,475
  Expenditures                                           66,806,762           67,945,264           71,025,449           75,940,953
  Other uses and transfers out                               82,079              412,910               36,070              931,984
           Total Expenditures
           and Other Uses                                 66,888,841           68,358,174           71,061,519            76,872,937
INCREASE (DECREASE)
    IN FUND BALANCE                                    $ (5,976,764)        $ (1,546,926)        $ 3,458,771          $     (438,462)
ENDING FUND BALANCE                                    $ 12,440,565         $ 18,417,329         $ 19,964,255         $ 16,505,484
                                  2
AVAILABLE RESERVES                                     $ 2,006,668          $ 2,008,933          $ 3,660,677          $ 3,257,615
AVAILABLE RESERVES AS A
PERCENTAGE OF TOTAL OUTGO 3                                    3.00%               3.00%                5.24%                4.34%
LONG-TERM OBLIGATIONS                                        N/A            $ 89,327,819         $ 93,004,366         $ 93,837,478
AVERAGE DAILY
ATTENDANCE AT P-2 4                                              8,464                8,464                8,229               8,483

The General Fund balance has increased by $1,911,845 over the past two years. The fiscal year 2010-2011
budget projects a significant decrease of $5,976,764 (32 percent). For a district this size, the State recommends
available reserves of at least three percent of total General Fund expenditures, transfers out, and other uses (total
outgo).

The District has incurred operating deficit in two of the past three years and anticipates incurring an operating
deficit during the 2010-2011 fiscal year. Total long-term obligations have decreased by $4,509,659 over the past
two years.

Average daily attendance has decreased by 19 over the past two years. No additional growth of ADA is
anticipated during fiscal year 2010-2011.




1
  Budget 2011 is included for analytical purposes only and has not been subjected to audit.
2
  Available reserves consist of all undesignated fund balances and all funds designated for economic uncertainty contained within the
  General Fund.
3
  On-behalf payments of $1,393,760, $1,570,525, and $1,609,319, have been excluded from the calculation of available reserves for fiscal
  years ending June 30, 2010, 2009, and 2008, respectively.
4
  Excludes Adult Education.



See accompanying note to supplementary information.

                                                                   58
SAN JACINTO UNIFIED SCHOOL DISTRICT

SCHEDULE OF CHARTER SCHOOLS
FOR THE YEAR ENDED JUNE 30, 2010

                                                           Included in
   Name of Charter School                                  Audit Report
San Jacinto Valley Academy                                     No




See accompanying note to supplementary information.

                                                      59
SAN JACINTO UNIFIED SCHOOL DISTRICT

NON-MAJOR GOVERNMENTAL FUNDS
COMBINING BALANCE SHEET
JUNE 30, 2010


                                                        Adult                Child
                                                      Education           Development           Cafeteria
                                                        Fund                 Fund                Fund
ASSETS
 Deposits and investments                         $        67,491     $         57,246      $      1,591,929
 Receivables                                                  166              116,296               385,426
 Due from other funds                                      31,086                  738                22,241
 Stores inventories                                             -                    -               107,255
          Total Assets                            $        98,743     $        174,280      $      2,106,851

LIABILITIES AND FUND BALANCES
Liabilities:
 Accounts payable                                 $             7     $         16,207      $        26,224
 Due to other funds                                           307               53,151               31,492
 Deferred revenue                                               -                    -               21,470
            Total Liabilities                                 314               69,358               79,186
Fund Balances:
 Reserved for:
   Revolving cash                                                 -                     -               200
   Stores inventories                                             -                     -           107,255
 Unreserved:
   Designated                                              98,429              104,922             1,920,210
   Undesignated, reported in:
     Debt service funds                                         -                    -                     -
     Capital projects funds                                     -                    -                     -
           Total Fund Balances                             98,429              104,922             2,027,665
           Total Liabilities and
           Fund Balances                          $        98,743     $        174,280      $      2,106,851




See accompanying note to supplementary information.

                                                      60
                      Special Reserve
     Deferred         Fund for Other         Capital                 COP                   Special Reserve
    Maintenance        Than Capital         Facilities           Capital Project           Fund for Capital
       Fund           Outlay Projects         Fund                   Fund                  Outlay Projects

$        1,403,617    $         2,172   $        927,208     $                     -   $               8,285
             3,689                  6              1,897                           -                      21
                 -                  -                  -                           -                       -
                 -                  -                  -                           -                       -
$        1,407,306    $         2,178   $        929,105     $                     -   $               8,306




$          14,816     $             -   $                -   $                     -   $                      -
                -                   -                    -                         -                          -
                -                   -                    -                         -                          -
           14,816                   -                    -                         -                          -



                  -                 -                    -                         -                          -
                  -                 -                                              -                          -

         1,392,490              2,178            929,105                           -                   8,306

                 -                  -                  -                           -                       -
                 -                  -                  -                           -                       -
         1,392,490              2,178            929,105                           -                   8,306

$        1,407,306    $         2,178   $        929,105     $                     -   $               8,306




                                                 60
SAN JACINTO UNIFIED SCHOOL DISTRICT

NON-MAJOR GOVERNMENTAL FUNDS
COMBINING BALANCE SHEET, CONTINUED
JUNE 30, 2010

                                                                                          Total
                                                      CFD Capital     Bond Interest     Non-Major
                                                        Project      and Redemption    Governmental
                                                         Fund             Fund            Funds
ASSETS
 Deposits and investments                             $    640,075   $     1,480,164   $   6,178,187
 Receivables                                                     -                 -         507,501
 Due from other funds                                            -                 -          54,065
 Stores inventories                                              -                 -         107,255
          Total Assets                                $    640,075   $     1,480,164   $   6,847,008

LIABILITIES AND FUND BALANCES
Liabilities:
 Accounts payable                                     $          -   $             -   $      57,254
 Due to other funds                                              -                 -          84,950
   Deferred revenue                                              -                 -          21,470
            Total Liabilities                                    -                 -         163,674
Fund Balances:
 Reserved for:
   Revolving cash                                                -                 -             200
   Stores inventories                                            -                 -         107,255
 Unreserved:
   Designated                                                    -                 -       4,455,640
   Undesignated, reported in:
     Debt service funds                                          -         1,480,164       1,480,164
     Capital projects funds                                640,075                 -         640,075
           Total Fund Balances                             640,075         1,480,164       6,683,334
           Total Liabilities and
           Fund Balances                              $    640,075   $     1,480,164   $   6,847,008




See accompanying note to supplementary information.

                                                      61
SAN JACINTO UNIFIED SCHOOL DISTRICT

NON-MAJOR GOVERNMENTAL FUNDS
COMBINING STATEMENT OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCE
FOR THE YEAR ENDED JUNE 30, 2010


                                                                 Adult           Child
                                                               Education      Development           Cafeteria
                                                                 Fund            Fund                Fund
REVENUES
Federal sources                                            $             -    $          -      $     3,250,682
Other State sources                                                      -         201,641              276,221
Other local sources                                                    864         455,045              286,238
               Total Revenues                                          864         656,686            3,813,141
EXPENDITURES
Current:
 Instruction                                                        35,544         497,799                      -
 Instruction related activities:
   Supervision of instruction                                            -          20,121                      -
   School site administration                                        1,926          57,400                      -
 Pupil services:
   Food services                                                         -          12,783            3,135,035
   All other pupil services                                         40,969               -                    -
 General administration:
   All other general administration                                  3,466          36,966             139,175
 Plant services                                                          -          15,596             236,255
 Facility acquisition and construction                                   -               -                   -
 Other outgo                                                             -               -                   -
 Debt service:
   Principal                                                             -               -                    -
   Interest and other                                                    -               -                    -
               Total Expenditures                                   81,905         640,665            3,510,465
Excess (Deficiency) of Revenues
Over Expenditures                                                  (81,041)         16,021             302,676
OTHER FINANCING SOURCES (USES)
 Transfers in                                                       90,378                  -                 -
 Transfers out                                                           -                  -          (331,485)
              Net Financing Sources (Uses)                          90,378                  -          (331,485)
NET CHANGE IN FUND BALANCES                                          9,337          16,021              (28,809)
Fund Balance - Beginning                                            89,092          88,901            2,056,474
Fund Balance - Ending                                      $        98,429    $    104,922      $     2,027,665




See accompanying note to supplementary information.

                                                      62
                          Special Reserve
     Deferred             Fund for Other             Capital                 COP                   Special Reserve
    Maintenance            Than Capital             Facilities           Capital Project           Fund for Capital
       Fund               Outlay Projects             Fund                   Fund                  Outlay Projects

$              -      $                 -       $               -    $                  -      $                  -
               -                        -                       -                       -                         -
          20,730                       27                 131,811               1,350,034                       103
          20,730                       27                 131,811               1,350,034                       103


                  -                         -                    -                         -                          -

                  -                         -                    -                         -                          -
                  -                         -                    -                         -                          -

                  -                         -                    -                         -                          -
                  -                         -                    -                         -                          -

               -                            -              56,395                       -                             -
         519,054                            -                   -                  42,000                             -
               -                            -               2,557                       -                             -
               -                            -                   -               1,350,034                             -

               -                            -                   -                       -                             -
               -                            -                   -                       -                             -
         519,054                            -              58,952               1,392,034                             -

        (498,324)                      27                  72,859                 (42,000)                      103

                  -                         -                   -                       -                             -
                  -                         -            (209,368)             (9,228,185)                            -
                  -                         -            (209,368)             (9,228,185)                            -
        (498,324)                       27               (136,509)             (9,270,185)                       103
       1,890,814                     2,151              1,065,614               9,270,185                      8,203
$      1,392,490      $              2,178      $         929,105    $                  -      $               8,306




                                                         62
SAN JACINTO UNIFIED SCHOOL DISTRICT

NON-MAJOR GOVERNMENTAL FUNDS
COMBINING STATEMENT OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCE, CONTINUED
FOR THE YEAR ENDED JUNE 30, 2010

                                                                                              Total
                                                      CFD Capital        Bond Interest      Non-Major
                                                        Project         and Redemption     Governmental
                                                         Fund                Fund             Funds
REVENUES
Federal sources                                       $          -      $             -    $    3,250,682
Other State sources                                              -               36,266           514,128
Other local sources                                        315,416            2,333,457         4,893,725
               Total Revenues                              315,416            2,369,723         8,658,535
EXPENDITURES
Current
 Instruction                                                        -                 -           533,343
 Instruction related activities:
   Supervision of instruction                                       -                 -            20,121
   School site administration                                       -                 -            59,326
 Pupil Services:
   Food services                                                    -                 -         3,147,818
   All other pupil services                                         -                 -            40,969
 General administration:
   All other general administration                              -                    -           236,002
 Plant services                                            272,091                    -         1,084,996
 Facility acquisition and construction                           -                    -             2,557
 Other outgo                                                     -                    -         1,350,034
 Debt service:
   Principal                                                     -              259,667           259,667
   Interest and other                                            -            2,424,483         2,424,483
               Total Expenditures                          272,091            2,684,150         9,159,316
Excess (Deficiency) of Revenues
Over Expenditures                                           43,325             (314,427)         (500,781)
OTHER FINANCING SOURCES (USES)
 Transfers in                                                       -                 -             90,378
 Transfers out                                                      -                 -         (9,769,038)
              Net Financing Sources (Uses)                          -                 -         (9,678,660)
NET CHANGE IN FUND BALANCES                                 43,325             (314,427)       (10,179,441)
Fund Balance - Beginning                                   596,750            1,794,591         16,862,775
Fund Balance - Ending                                 $    640,075      $     1,480,164    $     6,683,334




See accompanying note to supplementary information.

                                                      63
SAN JACINTO UNIFIED SCHOOL DISTRICT

NOTE TO SUPPLEMENTARY INFORMATION
JUNE 30, 2010

NOTE 1 - PURPOSE OF SCHEDULES

Schedule of Expenditures of Federal Awards

The accompanying Schedule of Expenditures of Federal Awards includes the Federal grant activity of the District
and is presented on the modified accrual basis of accounting. The information in this schedule is presented in
accordance with the requirements of the United States Office of Management and Budget Circular A-133, Audits
of States, Local Governments, and Non-Profit Organizations. Therefore, some amounts presented in this
schedule may differ from amounts presented in, or used in the preparation of, the financial statements.

The following schedule provides a reconciliation between revenues reported on the Statement of Revenues,
Expenditures and Changes in Fund Balance and the related expenditures reported on the Schedule of Expenditures
of Federal Awards. The reconciling amounts represent Federal funds that have been recorded as revenues that
have not been expended by June 30, 2010. The unspent balances are reported as legally restricted ending balances
within the General Fund.

                                                                                      CFDA
                                                                                      Number            Amount
Description
   Total Federal Revenues From the Statement of Revenues, Expenditures,
   and Changes in Fund Balance:                                                                     $   11,271,612
       ARRA-State Stabilization Fund                                                   84.394              732,888
       Medi-Cal Billing Option                                                         93.778             (302,504)
       Advanced Placement Program (Advanced Placement
          Test Fee; Advanced Placement Incentive Program Grants)                       84.330B              (7,518)
   Total Schedule of Expenditures of Federal Awards                                                 $   11,694,478

Local Education Agency Organization Structure

This schedule provides information about the District's boundaries and schools operated, members of the
governing board, and members of administration.

Schedule of Average Daily Attendance (ADA)

Average daily attendance (ADA) is a measurement of the number of pupils attending classes of the District. The
purpose of attendance accounting from a fiscal standpoint is to provide the basis on which apportionments of
State funds are made to school districts. This schedule provides information regarding the attendance of students
at various grade levels and in different programs.




                                                       64
SAN JACINTO UNIFIED SCHOOL DISTRICT

NOTE TO SUPPLEMENTARY INFORMATION
JUNE 30, 2010

Schedule of Instructional Time

The District has received incentive funding for increasing instructional time as provided by the Incentives for
Longer Instructional Day. This schedule presents information on the amount of instructional time offered by the
District and whether the District complied with the provisions of Education Code Sections 46200 through 46206.

Districts must maintain their instructional minutes at either the 1982-83 actual minutes or the 1986-87
requirements, whichever is greater, as required by Education Code Section 46201. Senate Bill 2 of the
2009-10 Fourth Extraordinary Session (SBX4 2) allows for an equivalent five-day reduction to the required
number of instructional minutes for the fiscal years 2009-10 through 2012-13.

Reconciliation of Annual Financial and Budget Report with Audited Financial Statements

This schedule provides the information necessary to reconcile the fund balance of all funds reported on the
Unaudited Actual Financial Report to the audited financial statements.

Schedule of Financial Trends and Analysis

This schedule discloses the District's financial trends by displaying past years' data along with current year budget
information. These financial trend disclosures are used to evaluate the District's ability to continue as a going
concern for a reasonable period of time.

Schedule of Charter Schools

This schedule lists all Charter Schools chartered by the District, and displays information for each Charter School
on whether or not the Charter School is included in the District's audit.

Non-Major Governmental Funds - Balance Sheet and Statement of Revenues, Expenditures, and Changes
in Fund Balance

The Non-Major Governmental Funds Combining Balance Sheet and Combining Statement of Revenues,
Expenditures and Changes in Fund Balance is included to provide information regarding the individual funds that
have been included in the Non-Major Governmental Funds column on the Governmental Funds Balance Sheet
and Statement of Revenues, Expenditures, and Changes in Fund Balance.




                                                         65
INDEPENDENT AUDITORS' REPORTS




             66
SCHEDULE OF FINDINGS AND QUESTIONED COSTS




                   73
SAN JACINTO UNIFIED SCHOOL DISTRICT

SUMMARY OF AUDITORS' RESULTS
FOR THE YEAR ENDED JUNE 30, 2010

FINANCIAL STATEMENTS
 Type of auditors' report issued:                                                                    Unqualified
 Internal control over financial reporting:
   Material weakness(es) identified?                                                                 No
   Significant deficiency(ies) identified?                                                       None reported
 Noncompliance material to financial statements noted?                                               No

FEDERAL AWARDS
 Internal control over major programs:
   Material weakness(es) identified?                                                                 No
   Significant deficiency(ies) identified?                                                       None reported
 Type of auditors' report issued on compliance for major programs:                                Unqualified
   Any audit findings disclosed that are required to be reported in accordance with
    Section .510(a) of OMB Circular A-133?                                                               No
 Identification of major programs:

       CFDA Numbers                         Name of Federal Program or Cluster
                                            Title I, Part A Cluster (includes ARRA); Title I,
                                            Part D, Local Delinquent Programs; Title I,
       84.010; 84.389 (ARRA)                Part A, Program Improvement Local
       84.394 (ARRA)                        ARRA-State Fiscal Stabilization Fund
       84.027; 84.173; 84.391 (ARRA);
       84.392 (ARRA); 84.027A               Special Education Cluster (Includes ARRA)
                                            Title II, Part A, Improving Teacher Quality; Title
       84.367                               II, Bilingual Teacher Training Program
                                            Title III, Immigant Education Program; Title III,
                                            Limited English Proficiency (LEP) Student
       84.365                               Program
       93.600; 93.708 (ARRA)                Head Start Cluster (includes ARRA)

 Dollar threshold used to distinguish between Type A and Type B programs:                        $       350,834
  Auditee qualified as low-risk auditee?                                                                Yes

STATE AWARDS
 Internal control over State programs:
   Material weakness(es) identified?                                                                 No
   Significant deficiency(ies) identified?                                                       None reported
 Type of auditors' report issued on compliance for State programs:                                Unqualified




                                                      74
SAN JACINTO UNIFIED SCHOOL DISTRICT

FINANCIAL STATEMENT FINDINGS
FOR THE YEAR ENDED JUNE 30, 2010

None reported.




                                   75
SAN JACINTO UNIFIED SCHOOL DISTRICT

FEDERAL AWARDS FINDINGS AND QUESTIONED COSTS
FOR THE YEAR ENDED JUNE 30, 2010

None reported.




                               76
SAN JACINTO UNIFIED SCHOOL DISTRICT

STATE AWARDS FINDINGS AND QUESTIONED COSTS
FOR THE YEAR ENDED JUNE 30, 2010

None reported.




                               77
SAN JACINTO UNIFIED SCHOOL DISTRICT

SUMMARY SCHEDULE OF PRIOR AUDIT FINDINGS
FOR THE YEAR ENDED JUNE 30, 2010

Except as specified in previous sections of this report, summarized below is the current status of all audit findings
reported in the prior year's schedule of financial statement findings.

State Awards Findings

2009-1     40000

           After School Education and Safety (ASES)

           Criteria

           According to the California Education Code Section 8483 (a) (1), every after school program must
           establish a policy regarding reasonable early release of pupils from the program. The policy must
           include at a minimum the following five elements:

               1. Attendance expectations and requirements.
               2. Consequences for unauthorized instances or unacceptable pattern of unauthorized early
                  program departures.
               3. Individuals authorized to request early-release and sign out pupils.
               4. List of authorized/unauthorized reasons for early-release.
               5. Sign out procedures for early-release pupils.

           Condition

           The District has implemented an early release policy containing the five elements. However, in
           reviewing the attendance records, specifically the sign in/out sheets utilized by the program, it was
           noted that students are signing out early, without documentation as to why they signed out early. As
           a result, we were unable to determine if the early sign out was in accordance with the early release
           policy.

           Questioned Costs

           Under the provisions of the program, there are no questioned costs associated with this condition.

           Context

           In reviewing the sign in/out sheets it was noted that no record as to why a student was leaving early is
           being maintained by the sites on a consistent basis.

           Effect

           As a result of the condition identified, the District was not compliant with Education Code Section
           (a) (1) for the 2008-09 fiscal year.




                                                         78
SAN JACINTO UNIFIED SCHOOL DISTRICT

SUMMARY SCHEDULE OF PRIOR AUDIT FINDINGS
FOR THE YEAR ENDED JUNE 30, 2010

      Cause

      The sites are not enforcing the District's early leave policy. Parents are allowed to pick up the
      students without the proper documentation being recorded on the sign in/out sheets.

      Recommendation

      The District should implement procedures requiring parents to document the reason for picking up a
      student early. This can be accomplished through documentation on the sign in/out sheet or through
      completion of a separate "Request for Early Release Form". The purpose of the early release should
      be consistent with the early release policy and reviewed by the program instructor upon release of the
      student.

      Current Status

      Implemented.




                                                   79

				
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