NOVATO UNIFIED SCHOOL DISTRICT. March 25, Presented by: Karen Maloney, CFO

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1 NOVATO UNIFIED SCHOOL DISTRICT March 25, 2014 Presented by: Karen Maloney, CFO

2 1 Where we ve been Where we are now Where we re going

3 Revenue Limit Deficit Factors: 2

4 3 The Revenue Limit was not fully funded Deficited Revenue Limit Loss of Revenue Limit Dollars Each year ranged from $ 3,604,835 in to $ 11,356,655 in Cumulative loss of Revenue Limit funding amounted to $42,443,447 for the 5 years Revenue Limit calculation was replaced with new funding formula, Local Control Funding Formula, starting in Revenue Limit deficit of % for was not restored Revenue Limit loss for is $10,587,647 The State has underpaid NUSD $53,031,094 over the last 6 years LCFF attempts to RESTORE deficit over the next 8 years

5 4 NUSD Budget Cuts ( ): Fiscal Year Budgetary Reductions & Savings Amount Staffing Reductions $ 318, No Reductions Implemented $ Mid-Year Reductions Proposed but not Implemented $ Staffing Reductions $ 121, Staffing Reductions $ 544, Staffing Reductions $ 47, Operational Savings $ 30, No Reductions Implemented $ No Reductions Implemented $ Staffing Reductions $ 2,347, Staffing & Operational Reductions/Savings and use of One-Time Dollars $ 4,021, Staffing & Operational Reductions $ 545, Staffing & Operational Reductions $ 1,633,740 Total Reductions and Savings through $ 9,609,801

6 5 10-Year History of Revenue/Expense Fund Balance: Unrestricted Revenue $40,120,396 $41,290,427 $42,753,509 $48,622,905 $47,650,670 $46,766,924 $44,864,439 $46,935,876 $46,696,612 $47,334,188 Expenditures $33,675,613 $34,247,462 $36,234,512 $39,055,747 $38,726,702 $38,500,988 $37,868,434 $40,128,137 $39,973,493 $41,592,410 Excess/Deficiency $6,444,783 $7,042,965 $6,518,997 $9,567,158 $8,923,968 $8,265,936 $6,996,005 $6,807,739 $6,723,118 $5,741,778 Trans In $76,498 $73,277 $16,848 $349,794 $600 $0 $1,256,646 $0 $30,000 $0 Trans Out -$100,000 -$203,775 -$152,855 -$72,855 -$172,117 -$72,855 -$146,173 -$179,704 -$1,708,532 -$521,259 Sources $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Contributions -$5,916,136 -$6,008,894 -$6,211,065 -$6,800,750 -$7,633,245 -$5,847,939 -$5,192,448 -$6,149,723 -$5,983,655 -$5,392,314 Total, Trans In/Out, Sources/Uses & Contributions -$5,939,638 -$6,139,392 -$6,347,072 -$6,523,811 -$7,804,763 -$5,920,794 -$4,081,975 -$6,329,427 -$7,662,187 -$5,913,573 Net Increase/ Decrease $505,145 $903,573 $171,925 $3,043,347 $1,119,206 $2,345,142 $2,914,030 $478,312 -$939,069 -$171,795 Beg. Fund Balance $3,459,773 $3,964,917 $4,769,566 $4,941,491 $7,984,838 $8,980,764 $11,325,906 $13,690,618 $14,168,930 $13,229,861 Audit Adjustment $0 -$98,925 $0 $0 -$123,279 $0 -$549,318 $0 $0 $0 Ending Fund Balance $3,964,917 $4,769,566 $4,941,491 $7,984,838 $8,980,764 $11,325,906 $13,690,618 $14,168,930 $13,229,861 $13,058,066 Total Exp+Outgo $39,615,251 $40,386,854 $42,581,583 $45,579,558 $46,531,464 $44,421,782 $41,950,409 $46,457,564 $47,635,681 $47,505,983 Percent Reserve (URGF) 10.01% 11.81% 11.60% 17.52% 19.30% 25.50% 32.64% 30.50% 27.77% 27.49% Percent of Reserve (GF) 9.62% 11.06% 13.21% 20.17% 21.74% 26.53% 27.78% 26.68% 24.12% 24.32%

7 6 Local Control Funding Formula (LCFF): Replaces the Revenue Limit calculation and categorical funding distribution method Funding distribution is based on grade level tiers, demographics, and ADA Funding is based on full implementation by GAP or incremental funding determined each year by State Budget process LCFF Funding is restoration of deficited revenue limit

8 7 LCFF vs. Revenue Limit Funding: $70,000,000 State Aid Base Categoricals Gap Funding LCFF Target Funding Level $60,000,000 "Gap" = Relative increase in State Aid toward district's unique LCFF Target $50,000,000 $40,000,000 $30,000,000 $20,000,000 $10,000,000 $ *Rev Limit with 22.27% deficit *LCFF Fully Funded Funded Rev Limit "What If?" *Based on data

9 8 LCFF vs. Revenue Limit Funding (per pupil): $8, ADA Assumed Flat at 7,596 $7, $7, $7, $7, $6, $6, *Rev Limit with 22.27% deficit *LCFF Fully Funded Funded Rev Limit "What If?" *Based on data

10 Second Interim Report - Combined General Fund: First Interim Revisions Second Interim Local Control (LCFF) $48,890,251 $181,508 $49,071,759 Federal Revenue $3,376,530 $0 $3,376,530 State Revenue $3,711,911 $0 $3,711,911 Local Revenue $11,005,905 $153,418 $11,159,323 Total Revenues $66,984,597 $334,926 $67,319,523 Certificated $33,152,566 $181,127 $33,333,693 Classified $10,182,763 $165,239 $10,348,002 Benefits $10,111,283 $15,587 $10,126,870 Supplies $4,198,619 ($13,700) $4,184,919 Operating Expenses $10,115,601 $167,783 $10,283,384 Equipment $84,026 $0 $84,026 Transfer Services $1,264,359 ($101,593) $1,162,766 Indirect Costs ($94,234) $0 ($94,234) Total Expenditures $69,014,983 $414,443 $69,429,426 Excess of Revenues over Expenditures ($2,030,386) ($79,517) ($2,109,903) Transfers Out $375,484 $0 $375,484 Total Sources/Uses ($375,484) $0 ($375,484) Net Increase/Decrease in Fund Balance ($2,405,870) ($79,517) ($2,485,387) Beginning Fund Balance $15,732,225 $0 $15,732,225 Ending Fund Balance $13,326,355 ($79,517) $13,246,838

11 10 Local Control Accountability Plan (LCAP): Tied to the District Budget beginning with Budget Stakeholder Engagement Goals and Progress Indicators Actions, Services, and Expenditures The LCAP is a Plan for services for All students with targeted focus on students that are identified as English Learners, Low-Income, and Foster Youth More than 1-in-3 NUSD students are English Learners, Low-Income, and Foster Youth (39%)

12 11 Local Goals Aligned with State Priorities: LOCAL GOAL DEVELOPMENT STATE PRIORITIES Stakeholder Engagement Students Staff Parents English Learner Parents Community Local Agencies 1. Local Goal Action Plan 2. Local Goal Action Plan 3. Local Goal Action Plan 1. Basic Services 2. Common Core, Standardsbased Instruction 3. Parental Involvement 4. Pupil Achievement 5. Pupil Engagement 6. School Climate 7. Student Access to Core Subjects 8. Pupil Outcomes in Core Subjects

13 12 70% 60% 50% 40% 30% 20% 10% 0% 3rd Grade 2013 CST ELA (Proficient and Advanced) 63% All Students 28% English Learners 41% Low-Income 100% 80% 60% 40% 20% 0% 3rd Grade 2013 CST Math (Proficient and Advanced) 77% All Students 49% English Learners 61% Low-Income High School Graduation Rate (2012) 100% 80% 60% 40% 91% 59% 81% 61 % 39 % 20% 0% All Students English Learner Low-Income Underserved Students

14 13 Program-Based Budgeting: Budget responsibility moves to site-based from centrally controlled Connects school site goals and objectives, programs and budgets Offers schools greater flexibility Site Leadership Team involvement to ensure student needs are met

15 14 Program-Based Budgeting Considerations: to Salary Increase When comparing NHS and SMHS, it is important to note that SMHS includes SMHS Plus (continuation high school) and additional Special Education services including Counseling Enriched Classes

16 15 Novato High School: Percent Enrollment (CBED) (0.74%) 1000: Certificated Salaries $4,517,340 $4,536,830 $4,856, % 2000: Classified Salaries $783,736 $849,609 $904, % 3000: Payroll/Retirement Benefits 4000: Instructional Materials /Supplies $1,220,841 $1,276,024 $1,330, % $225,206 $163,983 $317, % 5000: Operational Costs $415,441 $358,973 $502, % Total Budget $7,162,204 $7,185,418 $7,911, % Per Pupil Spending $5112 $5,252 $5, %

17 16 Novato High School: Percent Enrollment (CBED) Change in Enrollment (33) (10) (0.74%) Total Budget $7,162,204 $7,185,418 $7,911,297 Change in Total Budget $23,214 $725, % Per Pupil Spending $5112 $5,252 $5,825 Change in Per Pupil Spending $140 $ %

18 17 Novato High School Site Budget Code Resource Carryover Allocation Working Budget Expenditures Encumbered Balance as of March 21, UNRESTRICTED $2,273 $84,128 $86,401 $56,370 $5,786 $24, LOCAL DONATIONS $44,123 $35,084 $79,207 $59,404 $1,522 $18, COM REDEV FUNDS $0 $25,413 $25,413 $10,605 $4,393 $10, LCFF/Targeted (formerly EIA) $0 $27,762 $27,762 $13,282 $13,601 $ TIER III CATEGORICALS $10,446 $70,553 $80,999 $30,913 $6,378 $43, TIER III INTERVENTION $1,277 $0 $1,277 $0 $0 $1, TIER III IMFRP $672 $41,600 $42,272 $28,537 $3,377 $10, STATE LOTTERY $8 $0 $8 $0 $0 $ VOC EDUC-CARL PERKINS $0 $16,000 $16,000 $11,170 $4,335 $ TITLE II PT-A(TEACHER QUALITY) $96 $6,018 $6,114 $5,512 $300 $ LOTTERY-INST MTLS (REST) $598 $7,839 $8,437 $624 $0 $7, SPECIAL EDUCATION $0 $1,000 $1,000 $394 $0 $ ECONOMIC IMPACT AID LEP $13,656 $0 $13,656 $8,998 $346 $4, COMMON CORE $0 $135,800 $135,800 $2,519 $33,938 $99, PTA/C $3,685 $5,000 $8,685 $5,063 $0 $3, TEXTBOOK REPLACEMENT $135 $1,534 $1,669 $269 $0 $1, Library Book Replacement $7 $0 $7 $0 $0 $ SCHOOL FUEL - FOUNDATION $14 $2,228 $2,242 $0 $0 $2, PARCEL TAX $9,289 $57,076 $66,365 $20,978 $12,301 $33, PAUL ALLEN FOUNDATION $0 $387 $387 $371 $0 $16 TOTALS: $86,280 $517,421 $603,701 $255,009 $86,278 $262,413

19 San Marin High School (includes SMHS Plus): Percent Enrollment (CBED) % 1000: Certificated Salaries $3,126,067 $3,392,357 $3,692, % 2000: Classified Salaries $688,481 $763,915 $815, % : Payroll/ Retirement Benefits 4000: Instructional Materials/Supplies $971,717 $1,058,009 $1,106, % $132,418 $131,856 $309, % 5000: Operational Costs $314,303 $299,841 $352, % Total Budget* $5,232,987 $5,645,979 $6,278, % Per Pupil Spending* $5,763 $5,968 $6, % * SMHS budget includes SMHS Plus continuation high school and the Counseling Enriched Class (Spec Ed) that are funded at higher levels

20 19 San Marin High School (includes SMHS Plus): Percent Enrollment (CBED) Change in Enrollment % Total Budget* $5,232,987 $5,645,979 $6,278,905 Change in Total Budget $412,992 $632, % Per Pupil Spending* $5,763 $5,968 $6,459 Change in Per Pupil Spending $205 $ % * SMHS budget includes SMHS Plus continuation high school and the Counseling Enriched Class (Spec Ed) that are funded at higher levels

21 20 San Marin High School (includes SMHS Plus): Code Resource Carryover Allocation Working Budget Expenditures Encumbered Balance as of March 21, UNRESTRICTED $10,081 $52,700 $62,781 $35,437 $7,137 $20, LOCAL DONATIONS $38,573 $47,718 $86,291 $20,887 $36,681 $28, LCFF/Targeted (formerly EIA) $0 $16,484 $16,484 $7,581 $0 $8, TIER III CATEGORICALS $20,926 $48,005 $68,931 $24,355 $16,935 $27, TIER III INTERVENTION $12,212 $0 $12,212 $882 $5,140 $6, TIER III IMFRP $6,158 $30,400 $36,558 $22,257 $411 $13, STATE LOTTERY $23 $0 $23 $0 $0 $ VOC EDUC-CARL PERKINS $0 $13,000 $13,000 $7,855 $4,618 $ TITLE II PT-A(TEACHER QUALITY) $2,383 $4,021 $6,404 $6,908 $0 -$ LOTTERY-INST MTLS (REST) $390 $5,203 $5,593 $4,246 $1,054 $ SPECIAL EDUCATION $0 $1,500 $1,500 $0 $0 $1, ECONOMIC IMPACT AID $1,968 $0 $1,968 $910 $0 $1, ECONOMIC IMPACT AID LEP $5,601 $0 $5,601 $1,580 $2,274 $1, COMMON CORE $0 $93,200 $93,200 $621 $53,990 $38, PTA/C $4 $0 $4 $0 $0 $ TEXTBOOK REPLACEMENT $20,036 $2,389 $22,425 $4,223 $0 $18, Library Book Replacement $2,645 $2,637 $5,282 $23 $0 $5, SCHOOL FUEL - FOUNDATION $13 $1,741 $1,754 $486 $0 $1, PARCEL TAX $3,063 $42,042 $45,105 $27,444 $4,782 $12, ROTARY $0 $5,000 $5,000 $3,456 $0 $1,544 TOTALS: $124,075 $366,041 $490,116 $169,154 $133,023 $187,940

22 Budget & LCAP Calendar: DUE DATE ITEM DESCRIPTION RESPONSIBILITY SEP 17, 2013 Board Meeting Unaudited Actual Report Board of Trustees Chief Financial Officer OCT 2, 2013 BAC Budget Advisory Committee Meeting BUDGET ADVISORY DEC 17, 2013 Board Meeting First Interim Report Board of Trustees Chief Financial Officer JAN 9, 2013 BAC Budget Advisory Committee Meeting BUDGET ADVISORY JAN 10, 2014 Proposed Governor's Budget Published State Governor JAN 17, 2014 Attend Governor's Budget Workshop in Sacramento Chief Financial Officer Director of Fiscal Services MAR 2014 LCAP Community Various Community Locations MAR 3-7, 2014 ADCO Trainings for sites and departments Superintendent Chief Financial Officer Chief Financial Officer Director of Fiscal Services MAR 4, 2014 Board Meeting Non re-elect and release of certificated positions staffing presented to Board Board of Trustees Chief Financial Officer Director of HR MAR 18, 2014 Board Meeting Second Interim Report / Multi-Year Projections presented to the Board for review and direction Board of Trustees Chief Financial Officer

23 Budget & LCAP Calendar (continued): DUE DATE ITEM DESCRIPTION RESPONSIBILITY MAR 25, 2014 Board Workshop (Budget) Complete enrollment & ADA projections Project staffing ratios, staffing & facilities needs Project LCFF revenues Review preliminary budget information Review multi-year projections Final date for Board recommendation of Certificated layoff ( deadline) Board of Trustees Chief Financial Officer Director of HR MAR 25, 2014 LCAP Community Survey ( /online survey) LCAP COMMITTEE MAR 31, 2014 CDE adopts the LCAP Template CA DEPT OF ED APR 2014 LCAP Community Various Community Locations APR 15, 2014 ADCO Site/Department Budgets to Business Services Superintendent Chief Financial Officer Chief Financial Officer Director of Fiscal Services APR 30, 2014 Classified reduction in force if necessary Director of HR MAY 2014 (TBD) LCAP Staff recommendations on LCAP to committee for review and comment LCAP COMMITTEE MAY 2014 (TBD) LCAP Public Notice of the opportunity to submit written comments LCAP COMMITTEE

24 Budget & LCAP Calendar (end): DUE DATE ITEM DESCRIPTION RESPONSIBILITY MAY 2014 (TBD) Board Meeting Review Final Draft of LCAP recommendation to the Board (Public Hearing) Board of Trustees Chief Financial Officer MAY 14, 2014 LCAP Community Forum - District Office LCAP COMMITTEE MAY 15, 2014 Release of May Revise State Governor MAY 20, 2014 Board Meeting Governor's May Revision Board of Trustees Chief Financial Officer JUN 3, 2014 Board Meeting Draft LCAP to the Board for approval (Public Hearing) Draft Budget to the Board for approval (Public Hearing) Board of Trustees Superintendent Chief Financial Officer JUN 12, 2014 Publish notice of Proposed Budget Chief Financial Officer JUN 13, 2014 Proposed Budget available for public review June 13, 2014 District Education Center Chief Financial Officer JUN 17, 2014 Board Meeting Board adoption of Proposed Budget/LCAP Board of Trustees Superintendent Chief Financial Officer JUN 30, 2014 FINAL DEADLINE: State reports must be filed with MCOE Chief Financial Officer

25 24 Governor s Proposed Budget: Base Funding vs. Targeted Funding Base Funding - All Students Different amounts per grade level Additional amounts for Class Size Reduction Additional amounts for CTE high school Targeted Funding - Under-resourced students 39% Required growth of 3.4% in services for

26 25 Governor s Proposed Budget: Base Funding and Targeted Funding Base Funding $48,727,744 Est Base Funding $52,032,600 Estimate of Restored Base Funding $3,304, Targeted Funding $ 767,196 Est Targeted Funding $ 1,853,424 Estimate of Restored Targeted Funding $1,086,228 Total Estimated Restored Funding $4,390,284

27 and Future Needs of NUSD: English Learner (EL) Coordinator Elementary Summer School Middle School Career Counselors Teacher Coaches Community Liaisons Each School Bilingual Tutors Spanish Classes (All Students) Elementary Preschool at All Elementary Sites Step and Column Increase 2% for certificated and classified staff Health Benefits Adjustments as result of Affordable Care Act (ACA) Facility Improvements

28 27 Current Parcel Tax: $251 per parcel Expires in June 2015 Provides $4.4 million to NUSD, represents approximately 5% of NUSD s annual budget Parcel Tax Extension: May 6, 2014 mail-in election, ballots mailed April 7, 2014 No increase - $251 for 8 years Exemptions for Seniors & Disabled

29 28 Parcel Tax Currently Funds: A total of FTE = $4.4 million annually 88 coaches and.8 FTE AD 9.8 FTE library staff 8.2FTE counselors 7.3 FTE elementary music/secondary performing arts 4 FTE technology/tech staff 1.6 FTE high school CSR 1.6 FTE K-3 CSR $235,000 contribution to General Fund for attracting and retaining staff $1,405,285 to offset shortfall in State Revenue Limit funding representing 24.9 FTE

30 Multi-Year Projections Combined General Fund, Fiscal Years & : Revenue $67,319,523 $68,569,422 $64,656,948 Expenditures ($69,429,426) ($66,206,205) ($66,935,809) Excess/Deficiency ($2,109,903) $2,363,217 ($2,278,861) 29 Transfers Out ($375,484) ($375,484) ($375,484) Net Increase (Decrease) in Fund Balance ($2,485,387) $1,987,733 ($2,654,345) Beginning Fund Balance, July 1 $15,732,225 $13,246,838 $15,234,571 Projected Ending Fund Balance, June 30 $13,246,838 $15,234,571 $12,580,226

31 30 Fund Balance: The purpose of Fund Balance is to provide NUSD with adequate resources due to the following: Uncertain or unpredictable revenue streams External events Economic downturn Cash management Protection against exposure to one-time cash outlays such as disasters, lawsuits, and emergency facility needs

32 31 Fund Balance (continued): The State of California requires a 3% Reserve (Fund Balance) NUSD maintains the required 3% = $2,094,178 The Government Finance Officers Association recommends two months of average general fund operation expenditures average is 17% 89% of NUSD general fund is salaries and benefits An average month is $3.3 million; 2 months = $6.6 million, or 9.5% of General Fund Other NUSD operating expenditures average $1.1 million per month; 2 months = $2.2 million, or 3.1% of General Fund Two months of General Fund operation expenditures NUSD = 12.6% Average Unrestricted General Fund plus Fund 17 for Unified School Districts % %

33 NOVATO UNIFIED SCHOOL DISTRICT

34 NOVATO UNIFIED SCHOOL DISTRICT