INDEPENDENT SCHOOL DISTRICT NO. 719 BUDGET PLANNING. Presented on Monday, January 23, 2017 by Julie Cink, SFO Executive Director of Business Services

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1 INDEPENDENT SCHOOL DISTRICT NO. 719 BUDGET PLANNING Presented on Monday, January 23, 2017 by Julie Cink, SFO Executive Director of Business Services

2 Agenda Outcomes Strategic Roadmap Budget Calendar Financial Data Enrollment Projections Revenue Assumptions Expenditure Assumptions Expenditure Considerations and Discussion

3 Outcomes Overview of the PLSAS District Finances Provide input on assumptions for enrollment and revenue Build a better understanding of financial impact of the assumptions on the budget

4 Strategic Roadmap Our mission is to educate all learners to reach their full potential as contributing and productive members of our ever-changing global community.

5 Budget Calendar January 23, 2017 Board Work Session Budget Parameter Discussion o Enrollment Projections o Revenue assumptions o Expenditure assumptions o Staffing assumptions o Legislative assumptions February 27, 2017 Board Work Session Enrollment Update o Preliminary Kindergarten Enrollment Numbers Preliminary Budget Update based on Budget Assumptions Program and Staffing Reductions/Additions Discussion March 27, April 24 and May 22, 2017 Board Work Sessions Enrollment Update Preliminary Budget Discussion Staffing Update Legislative Updates June 5, 2017 Board Meeting Preliminary Budget Presentation/Approval

6 District Budget Overview Approved Budget

7 District Budget Overview Current Revenue

8 District Budget Overview Current Expenditures

9 District Budget Overview District-Wide Levy

10 District Budget Overview Operating Referendum and Tech Levy

11 District Budget Overview Referendum and Tech Levy Comparisons

12 General Education Revenue* Comparison There are 331 School Districts in Minnesota. Burnsville #71 $9,469 Bloomington #85 $9,287 Eden Prairie #96 $9,095 Eastern Carver County #154 $8,618 Rosemount AVE #164 $8,531 Lakeville #191 $8,342 Farmington #228 $8,104 PLSAS #260 $7,908 Shakopee** #292 $7,708 * General Education Revenue includes basic formula, declining pupil, gifted & talented, referendum, local option revenue, Qcomp, equity, compensatory, compensatory pilot, limited English profficiency, extended time, pension adjustment, operating capital, sparsity, transportation sparsity, school trust lands endowment, transition, small schools, optional charter transportation, and optional Faribault academies. ** Does not receive QComp funding Source: Schools for Equity in Education

13 State Aid and Referendum Referendum revenue allows districts to increase the revenue available in the district s general fund with the approval of the voters in the district. State Aid Formula Tier 1: Referendum revenue up to $300 per pupil unit is equalized at $880,000 of market value. Tier 2: Referendum revenue between $300 and $760 per pupil unit is equalized at $510,000 of market value. Tier 3: Referendum revenue above $760, up to 25% of the basic formula allowance is equalized at $290,000. Districts that qualify for sparsity revenue are eligible for equalization of $290,000 on the entire amount of referendum authority above $760. PLSAS: 2017 Equalizing Factor is $527,161

PLSAS Operating Referendum Expires 2018-19 Maximum Referendum Levy: $1,936.70 Tier 2: The next $373.97 of referenda is local levy ($527,161/$510,000).

14 PLSAS Operating Referendum Expires Maximum Referendum Levy: $1, Tier 2: The next $ of referenda is local levy ($527,161/$510,000). Average MN School Referendum Amount: $805 Tier 1: The remaining 60% is local levy ($527,161/$880,000). Tier 1: Of the first $300 of referendum for PLSAS, 40% is paid via State Aid.

15 Source: PLSAS Audit General Fund Revenue and Expenditure per Student

16 District Fund Balance Policy The school district will strive to maintain a minimum total unassigned and assigned general fund balance of eight (8) to twelve (12) percent of the annual budget (4-6 weeks of operating expenses). Deviation from the fund balance will be reviewed and addressed by the school board with recommendation from Administration/Finance Committee.

17 District Budget Overview Fund Balance

18 Historical Enrollment

19 Oct 1 Resident Enrollment Projections At High Migration, the district would expect an average enrollment of 250 additional resident students over the next 5 years. *Source: 2016 Hazel Reinhardt Demographic Study

20 Oct 1 Resident Enrollment Trends Ten-year average increases in resident enrollment range from 151 to 231 students. Source: 2016 Hazel Reinhardt Demographic Study

21 Open Enrollment Fall Data

22 Open Enrollment Trends The following table illustrates the effect of reducing nonresident kindergarten combined with the net migration rates of the past year. (Three of the survival rates are positive and nine are negative.) Of course, if total net migration were not negative, nonresident enrollment projections would be different from those shown in the table below. NONRESIDENT ENROLLMENT PROJECTIONS Year K at 105 K at 90 K at 80 K at ,008 1,008 1,008 1, , , , , , , , , Source: 2016 Hazel Reinhardt Demographic Study

23 5 Year Enrollment Projections Assumptions Moderate to High Resident District Growth in Migration Open enrollment is closed to 1% at all grade levels for Open enrollment is open for subsequent years

24 Enrollment Projections Kindergarten First Second Third Fourth Fifth Sixth Seventh Eighth Ninth Tenth Eleventh Twelfth TOTAL 8,275 8,479 8,811 9,159 9,555 9,859

25 General Fund Revenue Assumptions 2% on Base Formula $121 PPU for FY18 ($1.1M) Additional revenue due to student enrollment growth ($1.2M $1.8M) Compensatory funding unchanged Operating referendum revenue at $674 PPU for FY 18 and FY 19 Discussion of Affect of Increases/Decreases for FY20-FY22 Changes in fees (activities, parking, etc.)

26 General Fund Expenditure Assumptions Current staff wages and benefits Additional teaching staff to accommodate for enrollment $62,500 per teaching staff $82,500 per Special Education teaching staff Other staffing needs (custodial, clerical, para, admin) Additional $60,000 1% increase in transportation $50,000 Actual salary and wages and/or 4-year average increase calculation $2.25M 2% increase in supplies/materials

27 Impact of Open Enrollment on District Finances Legend Base Assumptions with OE Base Assumptions Minus OE Base Assumptions Minus OE FY18 Only

28 Other Potential Expenditures Add l technology due to enrollment growth Add l technology needs due to reduction of computer labs in elementary schools Add l furniture, fixtures and curriculum due to enrollment growth Expansion of MNCaps

29 Lease and Rental Information Lease Levy: Bridges ALC and MNCAPS PLHS Addition and Turf Rent: Co-curricular Activities: Ice Time at Dakotah Savage Dome - As needed due to inclement weather Minneapolis Gun Club-trap shooting Golf Course Rental Alpine and Nordic Ski - Buck Hill and Highland Hills McColl Pond ELC

30 Historical Enrollment & Building Capacity

31 Projected Enrollment & Building Capacity *Enrollment totals are K-12 excluding ALC

32 Kindergarten Enrollment To be updated after K registration

33 Questions and Comments

Understanding the K-12 General Education Funding Program

Understanding the K-12 General Education Funding Program 2002-03 Money Matters: Number 02.06 June 2002 Greg rowe, Fiscal Analyst, 296-7165 Fiscal Analysis Department Minnesota House of Representatives