Status of & Budget Presentation. December 11, 2018
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1 Status of & Budget Presentation December 11,
2 Challenges & Causes $5.2M+ Shortfall does not include potential future enrollment decline or K-3 Compliance. Data included in presentation is preliminary and will change as estimates become more refined over time. Challenges Enrollment Decline K-3 Class Size Compliance Balancing Programs Fund Balance School Employees Benefit Board (SEBB) (Jan 2020) Operating with Reduced Levy Capacity (McCleary) Compliance with New Levy Spending Limitations (McCleary) Loss of 6% Regionalization Over Time (McCleary) 1% reduction/year starting in Impact of Future Legislative Changes to Funding Model Causes Reduction in Levy Capacity Continuing Enrollment Decline Salary & Benefit Increases Above State Allocations Staffing Levels Above State Allocations McCleary Decision 2
3 Total Local Uses & Net Impact on Fund Balance * Spending in excess of State Apportionment Allocation. ** Total Local Expenditure Over State and Local Resources does not take into consideration Enrollment Decline. K-3 Funding challenges, SEBB Impact. CPF = Capital Projects Fund TVF= Transportation Vehicle Fund Preliminary Total Local Resources $ 21,313,922 $ 18,133,349 $ 15,731,557 Certificated Instructional Staff $ (7,970,507) $ (6,874,132) $ (7,500,188) Certificated Administrative Staff $ (2,900,387) $ (2,028,921) $ (2,067,470) Classified Staff $ (8,252,658) $ (7,162,157) $ (7,298,238) * Subtotal Prog 01 & 97 BEA $ (19,123,552) $ (16,065,210) $ (16,865,896) MSOC Prog 01 & 97 BEA $ (800,410) $ (556,720) $ (567,298) BEA Rev 3121 Shift to SpEd $ (1,318,888) $ (1,628,202) $ (1,659,138) SpEd Program $ (1,139,927) $ 306,584 $ (200,000) Other Support $ (1,236,226) $ (1,364,828) $ (1,398,949) Operating Transfers to CPF/TVF $ ( 864,500) $ (250,000) $ (250,000) Total Uses of Local Resources $ (24,483,503) $ (19,558,376) $ (20,941,281) ** Net Impact on Fund Balance $ (3,169,581) $ (1,425,027) $ (5,209,724) 3
4 Enrollment Decline * Alcoa plant closure. School Year K-12 AAFTE , Annual FTE (Loss) * , (204.83) , (68.88) Cumulative FTE (Loss) from Est. 7, (68.93) (342.64) BEA Allocation per FTE $8, Loss of BEA Revenue Due to Enrollment Decline ($2,908,155) School Year Total Running Start FTE Annual Regular FTE (Loss) (48.76) (64.37) Cumulative FTE (Loss) from Est (1.41) (114.54) BEA Allocation per FTE $8, Loss of BEA Revenue Due to Running Start Increase ($972,155) 4
5 Funded BEA Staffing Units vs Actual FTE Prog 01 & 97 Only State Allocation Staff Unit Staff FTE Under (Over) State Allocation CIS (23.497) CLS (67.886) CAS (2.244) CIS Cert Instructional Staff CLS Classified Staff CAS Cert Admin Staff 5
6 BEA Funding vs Cost Based on October 2018 Enrollment Projection. Prog 01 & 97 Only State Allocation Salary & Benefit Cost Over (Under) State Allocation CIS $33,929,290 $40,803,422 ($6,874,132) CLS $8,117,505 $15,279,662 ($7,162,157) CAS $3,590,751 $5,619,672 ($2,028,921) Totals $45,637,546 $61,702,756 ($16,065,210) 6
7 Steps taken to reduce expenses: Steps Taken Reduction in Expenditures Reduction in Expenditures: Reduction in expenditures, where reasonable and not categorically funded, in capital outlay, supplies and materials, contractual services, and travel in an effort to retain as much of the basic educational program as possible within the resources available. 7
8 Steps Taken Attrition Attrition: In an effort to eliminate unnecessary non-renewals or involuntary terminations, every reasonable effort will be made to determine the number of certificated positions which will be open as a result of (a) voluntary or mandatory retirements; (b) normal resignations; (c) other transfers; and (d) leaves of absence. 8
9 Budgeted Use of Fund Balance ($3,000,000) Cuts to Date $1,850,000 Use of Fund Balance ($1,150,000) Steps Taken & 2018 Reductions : Reduction of $5,200,000 Budget reductions identified to date following Modified Education Plan steps above: $3,000,000 $2,200,000 dollars still needs to be reduced for the school year budget. This reduction will require that the school board identify savings through layoff or reduction in force by a modified education plan resolution. 9
10 Budget Development Process Slide #1 MEP = Modified Educational Program. 1) Agreement on Amount to be Cut a. $5.2 million+ b. Something Less c. 1 Year/2 Year 2) Potential Options a. Attrition/other reductions/involuntary transfers $ 3,000,000 (Difference - taken out of fund balance $2,200,000) b. Full Cuts/Modified Educational Plan (MEP) $5,200,000 10
11 Budget Development Process Slide #2 MEP = Modified Educational Program. 3) Prioritization Process by Board a. Time sensitive if involves reduced staffing b. Prototypical School Model c. Board Resolution for Modified Educational Program 4) If a MEP is Selected a Feedback Process will be Identified a. Internal Stakeholders * Certificated, Classified, Administration, Student(s) b. External Stakeholders * Parents, Community 11
12 Modified Education Plan (MEP) Modified Education Plan MEP Draft Resolution 12
13 Budget Workshop - January 14, 2018 Detail of $3,000,000 reductions. Next Steps Board Budget Workshop Detail of staff and programs supported by educational levy dollars. Process the school board will use to solicit input from stakeholders on budget priorities and reductions. 13
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