A fresh audit of Denver Public Schools revealed a startling reality: Colorado’s largest school district owes more in long-term debt than it owns in assets.

As The Denver Gazette reported last month, the 2024-25 fiscal year audit revealed DPS carries $4.07 billion in long-term liabilities — far greater than the district’s assets and many times its most recent annual budget of $1.5 billion.

Those long-term liabilities include roughly $2.5 billion in general obligation bonds as well as $785 million in Certificates of Participation and lease-purchase obligations — a financing mechanism being challenged in court for allegedly violating state law.

Since 1984, DPS has transferred ownership of school buildings to a shell corporation, which leased them back for hundreds of millions of dollars. It’s a sneaky way to dodge Colorado’s constitutional mandate that voters first must approve any new debt.

The scheme has added $1 billion to the DPS balance sheet, paid for with taxpayer-approved bond dollars.

It’s worth underscoring this school-building shell game only came to light through a Denver Gazette investigation.

Meanwhile, district taxpayers are also paying interest on nearly $1 billion in unspent money from voter-approved bonds — including $170 million approved five years ago. As those dollars are eventually spent, the district’s cash assets shrink while the debt stays on the books, deepening DPS’ negative net position.

The audit is an indictment of the district’s reckless fiscal irresponsibility, amplified by a stunning breakdown in transparency. It comes down to what DPS says versus what the numbers show.

During the audit presentation, staff offered board members only bar graphs comparing assets and liabilities — without listing dollar amounts. When asked for the district’s asset total, spokesman Scott Pribble told The Denver Gazette he didn’t know.

So, why aren’t staff providing the board with the actual numbers?

“I knew it was significant, but I was not aware of the aggregate number (of long-term debt),” Director John Youngquist told The Denver Gazette. “I have identified, as a significant priority, that our new board needs to be presented with the realities of our current budget status and immediate, mid-term and long-term realities, as soon as is possible.”

With an information vacuum like this, it’s no wonder Youngquist gets frustrated when board members are blocked from accessing comprehensive data.

Still, district officials insist on gaslighting over district finances. Despite a negative net position, $4 billion in liabilities, declining enrollment and ongoing school closures, Chief Financial Officer Chuck Carpenter insists the district is in “strong financial health.”

Carpenter’s evidence for “optimism” includes the $975 million bond voters approved last year — $808 million of which remains unspent. Until it isn’t.

That’s not “strong financial health.” It’s another piece in a fiscal house of cards built on unanswered questions and hidden data.

The questions keep piling up. Why are they omitting key financial data? Why accumulate nearly $1 billion in debt without voter approval, then use voter-approved bond money to pay it back? Why pay interest on another $1 billion in unspent cash?

As the new school board begins its work under President Xóchitl “Sochi” Gaytán, one of their top priorities should be demanding answers, hard data and accountability — and no more gimmicks, bar graphs and spin.

Because taxpayers — and the classrooms they support — deserve fiscal honesty, not feel-good finances.