ROSEBURG PUBLIC SCHOOLS Roseburg, Oregon

Transcription

1 ROSEBURG PUBLIC SCHOOLS Roseburg, Oregon No. 1 Budget Committee Meeting April 3, 2012 BUDGET COMMITTEE MEMBERS: ADMINISTRATORS: X Rodney Cotton X Rick Barnes X Larry Parsons, Superintendent X Dan Endicott X Keith Cubic X David Hanson, Assistant Superintendent / HR X Joseph Garcia X Brian Davis X C. Lance Colley, Chief Operations Officer X Charles Lee X John Markovich X Dawne Huckaby, Director of Teaching & Learning X Paul Meyer X Kelly Morgan X Matt Brausam, Director of Student Services X Steve Patterson X Bernis Wagner X Stacy Stiefel X Gary Wayman Attendees: Cheryl Northam, Budget & Accounting Manager Janet Kischel, Budget Committee Secretary NOTES OF THE BUDGET MEETING TIME, PLACE: The first meeting of the Budget Committee of Douglas County School District No. 4 to approve the Budget for the fiscal year was held in the Board Room of the Central Office at 7:00 p.m. on Tuesday, April 3, ATTENDANCE: Committee members present were Rick Barnes, Rodney Cotton, Keith Cubic, Brian Davis, Dan Endicott, Joseph Garcia, Charles Lee, John Markovich, Paul Meyer, Kelly Morgan, Steve Patterson (7:05 p.m.), Stacy Stiefel, Bernis Wagner and Gary Wayman. Administrators present were Larry Parsons, David Hanson, Lance Colley, Dawne Huckaby, Matt Brausam and Cheryl Northam. CALL TO ORDER: order at 7:01 p.m. Budget Committee Chair for , Mr. Keith Cubic, called the meeting to FLAG SALUTE: Mr. Cubic led attendees in the pledge to the flag. SELECTION OF BUDGET COMMITTEE CHAIR AND VICE-CHAIR: Selection of Budget Committee Chair: Ms. Wagner nominated Mr. Cubic as Chair. Mr. Markovich seconded and the vote was unanimous. Selection of Vice-Chair: Mr. Davis nominated Mr. Barnes as Vice Chair. Mr. Markovich seconded and the vote was unanimous. Rules of Order: Chair Cubic explained that it s important that we follow adoptive rules and procedures, noting what the meeting process is, what constitutes a quorum (8 people) and we follow Robert s Rules of Order. We have an agenda format that includes public participation with time limits, followed by procedures for budget review. Ms. Wagner moved to adopt the Rules of Order, Mr. Barnes seconded and the vote was unanimous. Page 1 of 6

2 BUDGET COMMITTEE MEETING SCHEDULE: Site: The central office Administrative Board Room will be the site for subsequent Budget Committee Meetings. Tentative Dates for Subsequent Meetings: Potential dates were suggested as follows: Tuesday April 10, :00 p.m. Board Room Thursday April 12, :00 p.m. Board Room Mr. Cotton asked that he be excused April 12 th as he had a prior commitment. Mr. Barnes moved and Mr. Patterson seconded to accept the above dates, and the vote was unanimous. BUDGET MESSAGE Superintendent Parsons welcomed the attendees and thanked them for their willingness to serve on the Budget Committee. He noted that administration has been paying close attention to other districts within the state as the budget process progresses. We have heard that districts north of us are planning to cut personnel to meet budget constraints. The Portland area is considering the elimination of 100 teaching positions. Districts who are similar in size to us are considering reductions in excess of $1,000,000. He congratulated the Board and Budget Committee members for their efforts over the past year, and for doing the hard work in making tough decisions that now enable us not to have to make reductions. This has been a very difficult and painful process, and we feel very fortunate to not be considering staff reductions for the coming year in order to meet funding limitations. Given current circumstances, we feel fortunate to be in as good of shape as we find ourselves. Lance noted that our first budget committee meeting generally consists of going through the budget document, discussing highlights of the budget message, and begin discussion of what we hope to accomplish. The budget document is laid out a little differently this year in an attempt to make it easier to read. Cheryl Northam and Susan Tipton worked together to develop this updated format. Legislature - When this committee last met, the legislature was proposing a biennial budget for the state and K-12 education that included $5.7 billion for K-12 education, allocated in payments of roughly 49% first year and 51% in the second year, which is how they normally do the revenue split. They had some additional money in the first year that gave us a boost, along with reporting requirements. We are looking at virtually identical funding for the two year period. In the past, we have experienced our State School Fund (SSF) allocation being reduced a couple of times during the biennium. There were two consecutive bienniums when we didn t receive the budget dollars originally allocated to us due to the recession and reductions in personal and business income taxes. The legislature went back into session in January 2012 for the first regularly scheduled even-number year session, with the primary purpose of re-balancing a budget that was roughly $3 million short of original projections. However, they actually had budgeted and used reserves for the first time in four years, so the $3 million shortfall in revenue did not result in a reduction for K-12. The February-March 2012 forecast was down $23 million for a total of $13.7 billion. That decrease was within a level that resulted in no reduction to schools. The legislature re-balanced the budget by making some changes at the state level and other resource allocations, but did not reduce K-12 funding. We had been hoping for status quo, and that is basically what occurred. Page 2 of 6

3 The first SSF estimate came out in March and that is reflected here. We could see 4-5 more estimates before our Board adopts the budget. Generally, most estimates for us will be +/- $100,000 and we should be able to accommodate that. Scheduling budget adoption by the Board in June would give us the opportunity to come back to the Board if there are increases or decreases beyond that tolerance. Some committee members are familiar with the impact of the Federal Forest Fees that provide money through the Secure Rural Schools Program, with 75% of those funds going to counties in Oregon and 25% to schools. That program has expired. At the federal level, the safety net was approved and added to the Transportation Bill. Ultimately, the legislature approved a 90-day extension of the Transportation Bill without the extension of the forest fees. Those monies are now in limbo and this budget does not contain any Federal Forest Fee dollars. You will see a reduction of approximately $1 million in the budget, but it only impacts us by $250,000 since fewer federal dollars reduce the whole SSF by $25 million, with a resulting impact to our district of $250,000. Mr. Meyer commented that expectations are that nothing will happen with those fees until after the November election. If additional resources become available after November, we would receive funds which would be reconciled in May 2013 through the equalization process. We are anticipating approximately $30.6 million from the state this year and $13.3 million from local property taxes. Together, those resources make up 99% of our General Fund. There is virtually no federal money in the General Fund and virtually no county, ESD or intermediate dollars ($75,000). The SSF was adjusted last year by the legislature and ESD s took a hit. While it is popular to take monies away from ESD s, there is a legislative requirement that 90% of ESD monies be spent on local districts. This most recent reduction resulted in a negative impact of 90% of those dollars to schools and 10% from ESD s. Funding: Lance referred to the graph on Page VI of the budget message. This graph has been included in our budget message for a number of years. A patron who attends most of our Board meetings reported to Lance that the editor of the newspaper refused to print his letter as they felt his information was inaccurate. He had noted that we receive 60% of our money locally and 40% from other sources. Nearly 31% of our General Fund is generated from local funding, primarily property taxes. Fees are charged for athletic and activity participation and we generate some resources from sporting events. The state provides almost 69% of resources. This is a flip-flop from what occurred prior to state-wide tax limitations and equalization. When Measure 5 went into effect, it rolled back property taxes for all local governments to $5 per $1,000 for all schools. Between Roseburg Public Schools, the ESD and Umpqua Community College, we have a combined tax rate of $5/$1,000. In , it was not uncommon to see those three taxing entities with tax rates between $18-25 per $1,000. In theory, the state was required to back-fill the resource. While they are paying more than they did previously, it doesn t back-fill the resource. After adjustment for inflation, the State of Oregon is actually funding K-12 at a level approximately 17% lower than ten years ago. During the same ten-year period, mandates, requirements, responsibilities and standards have all increased dramatically. Even at a reduced spending level, graduation rates are good and drop-out rates are low. Every dollar in the budget is being targeted to be utilized in the most efficient way, and this contributes to our success. Board members attend subcommittee meetings throughout the year, including Curriculum, Administrative, and Personnel, Building and Sites, etc., in order to help target what we are doing and how we do it. This is a tribute to the people we have in place. Labor Contracts and Staffing Levels: The proposed budget reflects current service levels at our current costs. We do not have bargaining agreements in place for salaries and benefits with either of our bargaining groups that go beyond June 30, 2012, so we recognize we will need to work hard with our employee groups to make Page 3 of 6

4 this happen. Our School Board, throughout the course of the year, has maintained that we want to try and keep the current service and staffing levels that we now have. This proposed budget reflects what we have on the ground today. We were concerned that with enrollment declines over the past few years and legislative reductions to our resources that we might not be able to achieve that. This is a whole cost-contained budget at the current service level. Page XI of the budget message contains a graph reflecting budgeted levels. It is reflective of more employees in this year s budget than we had in last year s. What we are budgeting this year is what is in place today. Following completion of the budget process last year, a little more revenue became available because of some resources that came in that were not anticipated. In the May 2011 SSF adjustment, our district received additional funding when state-wide resources were adjusted. Therefore, we began the current year with more money, and our bargaining groups took two furlough days as well. That had not been part of the original budget reduction scenario. As an example, we currently have 2.5 elementary music teachers this year that were not in the budget. Because of furlough days, money was saved to accommodate those positions. The additional resources allowed us to add Instructional assistants when class sizes increased. We also moved additional staff into the General Fund because of the reduction in ESD money. Part of our Menu B was used to support our on-campus security staff at the high school, and these are now budgeted in the General Fund. While the chart shows an additional 11 FTE, this is reflective of what we have on the ground today. We are working diligently with enrollment projections to make sure that we have the right amount of staff at each elementary school. In summary, this proposed budget is what is happening right now in the classroom. Budget Transparency: For those who are interested in comparing what we spend to other districts, the Oregon Department of Education has the database initiative program. It won t reflect this year s budget information for a number of months, but they have actual information for the past ten years. Financial and student achievement data is available. A number of years ago, ODE standardized the chart of accounts throughout school districts and ESD s in Oregon. Theoretically, if all school districts are using those accounts accurately, you should be able to look at what we spend on elementary, middle and high school instruction and compare it to other districts our size, as well as all the other districts in the state. School Consolidation: There is no school closure included in this budget. The Superintendent, with direction from the Board, appointed a committee to look at school consolidation. We spent months working with that committee. Stacy and Dan participated in that process, along with representatives from each elementary school. Budget Chair Keith Cubic participated, along with a few other business representatives from the community. The nine elementary schools were evaluated and criteria established to reach a recommendation to submit to the Superintendent. At the end of the process, for the most part individuals did not want to see a school closed. The committee did narrow it down to a couple of schools should it be determined to move forward with consolidation. Ultimately, the Board considered all the information including funding and budget issues, and determined that they did not wish to close a school in the current climate. This budget reflects nine elementary schools as it has in the past. If funding improves next year, there is a possibility we won t have to revisit that process. If funding decreases, in all likelihood we will have to revisit consolidation. The Board s concern and direction to us was not to diminish services to our community and kids. Local Option Levy: The Board is also talking about the possibility of a Local Option Levy that would go to the community for a vote in November. This could potentially provide additional funds in future budget years. We are not currently spending money on capital improvements (our existing infrastructure) or spending Page 4 of 6

5 adequate resources on technology or curriculum. If the additional resource was made available, it would be targeted specifically for technology, curriculum and major maintenance/capital improvements to provide higher levels of air quality and safety. The topic is included on the Board Agenda next Wednesday, but again does not impact the budget directly. With our existing resources, we can only provide the service level that we are providing today, and it does not include money for curriculum at a high level. We are adding some money for curriculum for for a very targeted purpose and Dawne will discuss this further next Tuesday. Mr. Garcia indicated that considering how long we have postponed capital projects and curriculum, the Board recognizes that we may be several years out in attempting to build needed reserves and this is one of the reasons a potential levy is under discussion. Budget Document: General Fund Revenue: Budget Actuals are now located on the left side of the descriptions, making it easer to follow across the page (these are audited actuals, reflecting dollars spent). Data for appears next, followed by the proposed budget. General Fund Revenue is followed by the General Fund Recaps which are by function. Data under specific tabs follow, just as we have done in the past. Following the General Fund budget, we have the Other Fund recap starting on Page 90. This includes our federal funding, Title programs, IDEA, etc. Detail follows by Local, State and Federal Funds. Under State Funds, Lance explained that we no longer receive any state funds in our special revenue program. We used to directly run the education program at the Juvenile Detention facility. This fiscal year the ESD took over that program. Special Revenue Fund recaps follow along with detail. Under Debt Service, we have General Obligation debt outstanding that was utilized to pay for the new facilities at the high school and the second high school property, and some other improvements around the district. Pension Obligation Bonds were sold to reduce our PERS liability. Capital Projects includes debt on projects for which we still receive SB1149 energy efficiency monies. The rentals behind the high school generate enough money to help us pay some of the other debts. The School Lunch Fund is found under Special Revenue Funds. Those designated resources may not be used in the GF for general services. Next week, Dawne Huckaby and Matt Brausam will discuss curricular components of Special Education and Teaching and Learning, and Lance will report on the School Lunch program. School lunch is the one federal program that is being enhanced due to the President and First Lady s focus on childhood obesity. They have instituted mandates and changed requirements, but reimbursements should increase assuming all requirements are met. Lance noted that staff has worked very hard to put a budget together for consideration that at least does not diminish our capacity to provide service for kids this year. Organizationally, it maintains what we have in place. It is encouraging that initially this budget doesn t require us to make further reductions. Enrollment: We believe that we have now bottomed out of our enrollment decline. This year the high school will be graduating the smallest overall class of the 13 grade levels K-12 and we have a larger class coming in. Kindergarten is about the same as it has been. We will actually see our first increase in enrollment in a number of years. The number of students in each class is fluctuating very little. We topped out at over 7,000 students many years ago and are now at about 6,000 students. We would anticipate that we won t be seeing any spikes coming forward. This is great news from a stability standpoint. Page 5 of 6

6 DISCUSSION Phoenix Enrollment Ms. Wagner inquired if Phoenix was having an impact on our enrollment. Lance explained that Phoenix enrollment is down this year, party due to fewer students overall in Douglas County. We also have identified some very specific programs for students who might previously have gone to Phoenix. There is now a GED program, an on-line program through Insight Schools and targeted programs at the middle schools and high school. Wooley offers a different type of GED program and adult high school diploma program. Larry added that there are other things we would like to offer but the economic downturn has forced us to delay those plans. Contingency Fund Mr. Morgan inquired if we would be considering building up the reserve account if additional funding becomes available. Lance responded that we are budgeting a $750,000 contingency and ending fund balance with no reduction in service level, assuming we can achieve the cost containment we have in the budget. Any additional funds should be set aside as we know we have increasing costs coming in the next biennium. We would certainly prefer a contingency fund closer to 5% of our budget, but are unwilling to take funds from buildings to achieve that goal. PERS Mr. Lee noted that PERS will be increasing by an additional 6% of payroll after next year. We maintain reserves in Fund 302 to help offset those increases. Health Insurance Costs - Lance explained that we now offer a high deductible plan with a health savings account. Over 10% of our staff has migrated to that plan. A significant number of employees may be interested in that plan in the future as it costs less than our cap and enables us to put money into the HSA for those employees. Many employees have utilized a 125 plan in the past, and they are now able to put those dollars into their HSA. We are hoping that we don t see a huge increase in health care costs to our staff, but rather some benefit selection changes that will minimize the impact to our staff as the budget does not reflect increases to the employee cap. Mr. Garcia excused himself at 8:00 p.m. due to family illness Revenue Projection Mr. Lee noted that the revenue forecasts for the next biennium are up substantially. Lance explained that the forecast for the period reflects a 14.2% increase. PUBLIC PARTICIPATION: A District library employee and representative of the District Oregon State Education Association (OSEA), Judy Kulluson, was present in the audience and confirmed that she had no questions for the group this evening. Chair Cubic thanked her for taking the time to attend. ADJOURNMENT: Lance encouraged the committee to forward any questions via prior to the next meeting and staff will make every effort to respond to all committee members either prior to or during that meeting so that all parties know of any questions and the subsequent answers. Mr. Barnes moved to adjourn the meeting and Mr. Wayman seconded. Hearing no objections, Chair Cubic adjourned the meeting at 8:10 p.m. NEXT MEETING TIME AND SITE: The committee will convene again on Tuesday, April 10, 2012 at 7:00 p.m. in the Administrative Office Board Room. Page 6 of 6 Janet Kischel, Budget Committee Secretary