Thoughts for Consideration 2011-12 JE School Budget

Thoughts for Consideration2011-12 JE School Budget

Citizen ForumFire Hall

Elbridge, New YorkApril 7, 2011

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The numbers presented in this presentation are best estimates developed using information provided by the state, the district’s website and the presenter’s own knowledge of revenues and costs. It is impossible to fine tune these estimates without having direct access to system reports and analysis models. Other unknown cost considerations may also be in play that have not been factored in to the numbers presented here.

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Disclaimer

Citizens asked me to speak. Care about the community. Grew up here. Want to help. Have always been willing to

help. Abrupt change with no consultation =

knowledge gap. Hope this information will filter back to the

district and benefit everyone in some way.

Why am I Here?

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TerminologyTerm Explanation

Fund Acounting School districts manage several funds. The public votes on the third Tuesday in May on the expenditure budget of the General Fund. The General Fund is also referred to as the Operating Fund or "A" Fund.

Other funds include the Special Aid Fund (F), where grants are accounted for, the Food Service or Cafteria Fund (C), where the food service program is accounted for, the Capital Fund (H), where capital projects are accounted for, and the Debt Service Fund (V), where left over monies from previous borrowings are accounted for.

Fund Balance Fund balance is what is left over (i.e., the "balance in a fund"). A positive fund balance (a good thing) is when actual revenue (money in) exceeds expenditures (money out).

Designated or Appropriated Fund Balance

This is money set aside expressly to reduce to tax levy.

Undesignated or Unappropriated Fund Balance

This is "rainy day" money. Legally it can be as much as 4% of the current year voter approved General Fund budget.

Reserve Reserves are like different monies you might have at home that you set aside for a very specific purpose. Reserve management in schools is a critical component of overall financial management. The reserves we talk about are part of the General (A) Fund and exist for very specific purposes. Some reserves require voter approval to set up and to spend from (e.g., capital reserve). Others only require board authorization.

FYE FYE is short for "fiscal year end." The school's fiscal year is July 1 - June 30. For example, "FYE2012" refers to the fiscal year July 1, 2011 - June 30, 2012. Many times you will see a descriptor "2011-12" or "11-12" instead of FYE2012.

CPI Consumer Price Index. The average monthly CPI for 2010 was 1.6%. Contingency Budget

A contingency budget is a budget that the board must have in place July 1 if voters do not approve the proposed budget in May and/or they do not approve a second proposed in June. The board can elect to go directly a contingency budget if the first proposed budget is defeated.

Contingency Budget %

The contingency budget percentage increase cap this year is 1.92%. Per law is is the minimum of either 1.2 x CPI (1.6%) or 4%.

Debt service on previously voter-approved capital projects is apart from the 1.92% ceiling since voters already authorized this spending. Note too, that there is an administrative cap inside the contingency cap that must be calculated.

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Times are Very Difficult for Everyone

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What is the plan to get there?

Where do we want to be five years from nowand beyond?

That plan should determine budget and spending priorities.

Assumptions% Levy Increase (Contingency =1.92%) 3.00%Tax Levy Revenue 11,433,868Non-Levy Revenue 12,546,886Fund Balance and Reserves 1,200,000Total Revenue (Target Budget) 25,180,754

Projected "Status Quo" Budget 28,202,811 7.00%Target Budget 25,180,754 -4.47%The Estimated Budget "Gap" 3,022,057

ActionEst

ReductionGap

RemainingTotal Est. Budget Gap 3,022,057 3,022,0573 Admin by Attrition 246,000 2,776,057Add'l Central Admin Play 113,280 2,530,057Keep T's In School (Sub $ Red) 125,000 2,416,777Trim Budget to Actual 500,000 2,291,777Reduce Operations & Maintenance 172,000 1,791,777Reduce Health Insurance Per Above 40,000 1,619,777ReduceFICA/Pension Per Above 71,856 1,579,777Reduce Number of Advisors/Dept Chairs 39,000 1,540,777Settle Legal Issues 180,000 1,360,777Use (F Fund) Fed Educ Jobs Funding 620,438 740,339Deduct (F Fund) ARRA IDEA 611 -190,253 930,592Deduct (F Fund) ARRA IDEA 619 -8,849 939,441Reduce BOCES or Equivalent 250,000 689,441Freeze wages 330,000 359,441Increase Health Insurance Contributions 100,000 259,441Increase Vision Insurance Contributions 12,500 246,941Adjust staff count +/- Based On NeedImplement Additional Measures (Ideas?)

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In summary, ….• The estimated funding

gap is $3.0 million.• This assumes a 3% levy

increase, $12.5 in non-levy revenue, the use of $1.2 million from fund balance and reserves and a projected status quo budget increase projection of 7.0%.

• It would appear that a lot can be done to close the gap without having to make wholesale layoffs and program cuts.

TARGETBUDGE

T

PROJECTED BUDGET

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$12,951,145 $12,234,386

$37,500$275,000

$620,438

Original SlideDr. Larry ZacherMarch 29, 2011

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FYE2011 State AidBudget v. ActualActual 13,546,817Budget 13,573,525Actual - Budget -26,708

Estimate of total non-tax levy revenue is $925,259 less than the district’s previously stated estimate.

Even after adjusting last year’s state aid budget downward we still ended up too close for comfort!!

Revenue District Est District - EstState Aid 12,951,145 12,234,386 716,759Other Revenues 446,000 275,000 171,000Onondaga County Sales Tax 75,000 37,500 37,500

13,472,145 12,546,886 925,259

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Breakdown of Projected Revenue

Local Taxes 9,287,542STAR 2,146,326State Aid 12,234,386Other Revenue 312,500Fund Balance 800,000Debt Service 250,000Reserves 150,000

25,180,754 = Budget

11,433,868

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Estimate of FYE2012 percentages of total revenue…• state aid

49%, down from 51%

• property taxes 37%, up from 32%

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$800,000FYE2010 Balance $251,733

$250,000

<$251,733

not

Debt service is easily predicted (like your own mortgage).

Debt service planning, along with corresponding state aid projecting, is done in concert with the board-appointed fiscal advisor. Presently, Bernard P. Dongegan, located in Victor, NY.

Debt Service Planning

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Fund balance and reserves are presently strong. This is a good thing heading into a crisis and prior to bonding. It will be important to maintain a strong balance sheet.

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$25,180,754

4.5% lower

3.00%

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No change in labor. 3% increase in wages across all labor

codes. Equipment, supplies and most contractual

the same. 3% increase in BOCES. No contract

change. 11.1% Teacher Retirement System. 18.0% Employee Retirement System. 5.0% Workers’ Comp. 6.0% Health Insurance. FICA and Pension for $640K in wages from

F and C funds. $250K for legal per LZ (3/29/11). $540K increase in debt service.

Assumptions used to project current budget out

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FYE2011 FYE201226,357,767 28,174,735

6.90%

This Year'sTax Levy This Year's Budget --> 26,357,767 26,357,767 26,357,767 26,357,767

"What if" Est Budget % Increases --> 4.70% 5.00% 6.00% 7.00%11,100,843 "What if" Projected "Status Quo" Budgets--> 27,596,582 27,675,655 27,939,233 28,202,811

% Levy Inc Levy NLR FB & Res Target Budget

1.00% 11,211,851 12,546,886 600,000 24,358,737 3,237,845 3,316,918 3,580,496 3,844,0741.00% 11,211,851 12,546,886 1,200,000 24,958,737 2,637,845 2,716,918 2,980,496 3,244,0741.00% 11,211,851 12,546,886 1,800,000 25,558,737 2,037,845 2,116,918 2,380,496 2,644,0742.00% 11,322,860 12,546,886 600,000 24,469,746 3,126,836 3,205,909 3,469,487 3,733,0652.00% 11,322,860 12,546,886 1,200,000 25,069,746 2,526,836 2,605,909 2,869,487 3,133,0652.00% 11,322,860 12,546,886 1,800,000 25,669,746 1,926,836 2,005,909 2,269,487 2,533,0653.00% 11,433,868 12,546,886 600,000 24,580,754 3,015,828 3,094,901 3,358,479 3,622,0573.00% 11,433,868 12,546,886 1,200,000 25,180,754 2,415,828 2,494,901 2,758,479 3,022,0573.00% 11,433,868 12,546,886 1,800,000 25,780,754 1,815,828 1,894,901 2,158,479 2,422,0574.00% 11,544,877 12,546,886 600,000 24,691,763 2,904,819 2,983,892 3,247,470 3,511,0484.00% 11,544,877 12,546,886 1,200,000 25,291,763 2,304,819 2,383,892 2,647,470 2,911,0484.00% 11,544,877 12,546,886 1,800,000 25,891,763 1,704,819 1,783,892 2,047,470 2,311,048

State Aid 12,234,386Cty Sales Tax 37,500Other 275,000

12,546,886

Budget Caps Under Different Assumptions

FYE2012

Budget Gap "What if" Analysis

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3 4 56

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The estimated “gap”

= $3,022,057= $28,202,811 - $25,180,754

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Expenditures by area have stayed about the same as percentage of total expenditures

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TRS Employer Contribution Rates Over Time

11.1%, up from 8.6%est $285K increase

Athletics and Cocurricular Activities (clubs, drama, marching band, etc.) as a percentage of total expenditures

∆ ∆ ∆ ∆∆ ∆∆

∆

District began to invest more in athletics (labor and fields) a few years ago. Costs were charged to athletics (A2855) to get a true picture of total cost.

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Legal$250K = $180/StudentState Average = $50/Student

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Look carefully

It does not appear to be necessary to make these “overnight” systemic decisions to balance the budget.

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Again, it does not appear to be necessary to make these “overnight” systemic decisions to balance the budget.

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18.018.619.820.422.520.7

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Success in the early grades means a greater likelihood of success all the way through

For More Information Please Contact

Bill [email protected]

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mailto:[email protected]

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Dissatisfaction and discouragement are not caused by the absence of things but the absence of vision.— Anonymous

Thoughts for Consideration 2011-12 JE School Budget

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