BUDGET WORKSHOP

2010

1

STRATEGIC BUDGET PLANNING GOALS

5 YEAR OPERATIONAL BUDGETS

5 YEAR FUND BALANCE ANALYSIS

5 YEAR PHYSICAL PLANT/CAPITAL IMPROVEMENT SCHEDULE

2

FISCAL PLANNING

• 5 Year Budget Forecasting– National Fiscal Indicators– State Trends– Health of Local Economy/Tax District• Commercial Development• Appraisal Values

3

4

5

6

7

8

9

10

11

12

13

14

LOCAL FISCAL DEVELOPMENTS

• CALLER TIMES-APRIL 28, 2010

– TAX ROLLS OF NUECES COUNTY DECREASED TO $18.5B FROM $19.4B IN 2009

– 56% OF RESIDENTIAL PROPERTY APPRAISED LOWER IN VALUE THAN IN 2009

15

FISCAL IMPACT ON BUDGET

• PRELIMINARY DISTRICT APPRAISAL VALUE

-$713,013,474

• APPLY 2009/2010 TAX RATE

-$1,792,452

16

REVENUE BALANCING ACT

• STATE FORMULA FUNDING- Earned During the Base Year- Funded for the Biennium

• COLLEGE DISTRICT AD VALOREM TAXES• Appraisal Established in Preceding Year• Tax Rate Change Requires Board Action

• STUDENT CHARGES• Set by Board in January/February

17

2010/2011 PreliminaryBudget Estimates

New Dollars

State Formula Funding $932,000Collegiate H.S. Revenue 330,000Dual Credit Revenue 180,000Tax Revenues from Property Valuation decrease at Same Tax Rate 1,792,452Increase in Tuition Revenue from Conservative 5% Enrollment Growth & $5 psh Increase 2,503,196Adjustment in Course Fees to Comply with the TX Education Code 420,000 Total New Anticipated Revenues $131,256

18

New Expenses

Increase to Budget for 10 Unbudgeted FT term faculty positions $500,000Restore Dual Credit Faculty Salary 255,000Increase for Faculty Education &Promotions 145,507Salary Step Expense 482,942Election Expenses 150,000SACS Accreditation 25,000Increase in Debt Service for 2008 Tuition Bond 279,279QEP Expense 150,000Property Insurance Estimated Increase 6,200Northwest Center Operations 270,0002% Increase to All Other Expense Categories 374,331Remote back-up Datatel Server System 100,000 Total Minimum Expenditure Increases $2,738,259Return of Contingency Budget Stipulated in Board Policy 1,000,000Total Preliminary Budget Shortfall for 2010/2011 $3,607,003

2010/2011 PreliminaryBudget Estimates

19

BUDGET STRATEGIES

• IMMEDIATELY FREEZE 2010 EXPENDITURES• INCREASE USE OF PART-TIME WORKERS AND

ADJUNCT FACULTY• DECREASE 2010/2011 EXPENDITURES• REQUEST THE BOARD TO WAIVE BUDGET

CONTINGENCY REQUIREMENT• CONSIDER FUND BALANCE AS ONE-TIME

RESOURCE• FREEZE SALARY STEP/EXPERIENCE PAY

20

21

BIENNIUM FUNDING PROJECTION2011-2012

• 2009-2010 CH X 1.05% = BASE YEAR CH FOR 2011-2012• 5,313,184 CH X 1.05% = 5,578,843 CH • Projected value for Average Contact Hour = $6.35 • Projected 2011-2012 Biennium Funding = $35,425,654

• $1,754,176 LESS than 2009-2010 Biennium or

• $877,088 LESS STATE REVENUES/FISCAL YEAR

2011 – 2012 Preliminary Budget Estimate

22

New Dollars

State Formula Funding ($877, 068)Collegiate High School Revenue 50,118Increase in Tuition Revenue from Conservative 5% Enrollment Growth and $1 psh Increase 586,850Dual Credit Revenue 0Property Tax Revenue 0 Total New Anticipated Revenues ($240,100)

23

New Expenses

Decrease in Debt Service Requirement for General Obligation Bonds ($163,500)Increase in Debt Service for 2008 Tuition Revenue Bonds 279,158Election Expense ($150,000)2% Increase to All Other Expense Categories 381,818Increase for Faculty Education and Promotions 145,507Salary Step Expense 482,942Achieving the Dream 35,000Furniture and Equipment Estimate 200,000 Total New Anticipated Expenses $1,210,925Total Preliminary Budget Shortfall for 2011- 2012 ($1,451,025)

2011 – 2012 Preliminary Budget Estimate