Palo Alto Unified School District Town Hall and Webinar: Managing the Budget

Transcription

1 Palo Alto Unified School District Town Hall and Webinar: Managing the Budget September 7, 2016

2 A Town Hall AND a Webinar minute presenta7on from Superintendent and CBO 2. Town Hall par7cipants fill out a card and give it to administrators on one side of the room 3. Please try to limit comments and ques7ons to no more than 2 or 3 minutes so we can hear from everyone who wants to par7cipate 2

3 A Town Hall AND a Webinar 4. We will alternate between town hall and webinar par7cipants 5. Webinar par7cipants can send ques7ons or comments via the share bumon on their screens 6. Webinar feedback will be read in order received, but signed remarks go to the head of the line 3

4 PAUSD GOALS Vision Statement We support all PAUSD students as they prepare themselves to thrive as global citizens in a rapidly changing world. We develop our students knowledge, critical thinking, and problem solving skills, and nurture their curiosity, creativity, and resilience, empowering every child to reach his or her fullest intellectual, social, and creative potential. 4

5 The size of the tax revenue increase was not expected given recent trends Secured roll Increase (billions) Exemp7on Increase (billions) May Report Assessor June Report Assessor $ 0.35 $ 1.50 $ 1.83 $ 1.65 $ 3.07? $1.19 $0. 47 $0.10 $ 0.18 $ 1.43? 3.11% 4.41% 4.09% 4.30% 5.22% 6.42% 4.33% 5.56% 5.75% 5.02% 8.01% 8.62% July Report 1.54% 5.32% 7.39% 6.29% 10.83% Difference June to July (2.79) (0.24)

6 The size of the tax revenue increase was not expected given recent trends Secured Increase (billions) Exemp7on Increase (billions) May Report Assessor June Report Assessor $ 0.35 $ 1.50 $ 1.83 $ 1.65 $ 3.07 $1.78 $1.19 $0. 47 $0. 10 $ 0.18 $ 1.43 $ % 4.41% 4.09% 4.30% 5.22% 6.42% 4.33% 5.56% 5.75% 5.02% 8.01% 8.62% July Report 1.54% 5.32% 7.39% 6.29% 10.83% Difference June to July (2.79) (0.24)

7 The size of the tax revenue increase was not expected given recent trends Secured Increase (billions) Exemp7on Increase (billions) May Report Assessor June Report Assessor $ 0.35 $ 1.50 $ 1.83 $ 1.65 $ 3.07 $1.78 $1.19 $0. 47 $0. 10 $ 0.18 $ 1.43 $ % 4.41% 4.09% 4.30% 5.22% 6.42% 4.33% 5.56% 5.75% 5.02% 8.01% 8.62% July Report 1.54% 5.32% 7.39% 6.29% 10.83% 5.34% Difference June to July (2.79) (0.24) (3.28) 7

8 and we are taking steps to prevent a reoccurrence of a shornall! We are conduc7ng quarterly mee7ngs with Stanford regarding their construc7on and plans for claiming exemp7ons We will track major Stanford parcels by the specific parcel number We will call for weekly (or more frequent) updates with Assessor s Office May 1 to July 1. 8

9 The total shornall at this moment is $4.2 million The current property tax growth es7mate from the Controller is 4.6%. The es7mate is very likely to increase during the course of the year. We are recommending resolving this shorball over a two year 7me period through a series of adjustments including cutbacks, realloca7ons, and new revenue. The budget is scheduled for Board approval on September 27 th, though cutbacks can s7ll be made throughout the year. We have available reserves, but at this point we are not recommending they be used. 9

10 adjustments of $4.2 million are being recommended We are maintaining our current and future commitment to keeping class sizes at or below contractual requirements and reducing the number of larger classes Currently proposed budget adjustments include: Not hiring for 5.2 cer7ficated posi7ons including three elementary posi7ons for which we budgeted but do not need this year because enrollment declined much more than demographer s projec7ons Reinsta7ng the prac7ce of using bond funds for technology refresh as approved by voters in 2008 Not hiring district personnel for which we had budgeted District opera7onal cutbacks of more than $300K Using the surplus instead of adding it to reserves Realloca7ng funding for some salaries and textbook purchases 10

11 We are keeping classes small Despite the less- than- an7cipated increase in tax revenues, this year s class size averages in our secondary schools are less than or equal to last year s. Of the 544 core classes (English, math, science, social studies and world language) in our three middle schools, just 11 have more than 30 students. Jordan and JLS do not have English, math, science or social studies classes with more than 30 students. Our August 18 th snapshot of high school enrollment showed out of 714 core classes, we had just 44 core with class sizes of more than 32 students and 122 core classes with less than 24 students! 11

12 Our future budget projecvons range from 25 to 40% below city tax revenue increase projecvons One scenario is to use the city s projec7ons (Scenario A) but we think tax increases will be between 75% of the city s projected increases (Scenario B) and a more conserva7ve scenario of 60% of city s projec7ons (Scenario C). In Scenario B results in a shorball of $1.6 million Scenario C results in a shorball of $2.9 million We intend to make up the shorball in two years through thoughbul adjustments that do not impact students in our classrooms 12

13 The Board will determine adjustments in March and April azer September 13 th series of meevngs October 18 th budget study session February 14 th budget study session Other mee7ngs tbd preliminary budget developed in April budget to be formally approved at a Board mee7ng in June 13

14 For we are idenvfying ~ $4 million more in adjustments in six different categories 1. Updated budget projecvons: A larger than an7cipated surplus and lower than an7cipated enrollment impact budget projec7ons. 2. District Office Budget reducvons: We will cut opera7onal expenses and also consolidate, reassign, or remove certain posi7ons. 3. AlternaVve Funding Sources: An increase in rental income and payments from other districts are examples of addi7onal revenue. 14

15 For we are idenvfying ~ $4 million more in adjustments in six different categories 4. Roll back recent funding increases: During the last four years we have added posi7ons, programs and services and increased district per pupil contribu7ons to the schools. We expect to roll back some of these more recent increases. 5. Program adjustments: Capping par7cular elec7ves and consolida7ng our smallest classes (less than 10 students) are possible ways to balance class sizes and save costs. 6. CerVficated and classified personnel: compensa7on increase will be renego7ated and the administra7ve compensa7on will likely be adjusted. Some non- teaching posi7ons may be eliminated. 15

16 Future compensavon increases will be based on available funds Safety valve language eliminates 3% (and possible 4%) increase in unless property tax revenue increases ~ 3% addi7onally this year. We will be proposing a new model for administra7ve compensa7on in If we reverted to former nego7a7ons prac7ces of awarding increases retroac7vely, contracts would not need to be finalized un7l May of 2018 Compensa7on can be frozen and/or offered off schedule, which is equivalent to a one 7me bonus payment and does not compound yearly. 16

17 The district has healthy reserves with a current General Fund and Basic Aid Reserve fund balance of $53.6 M State Statue requires an undesignated 3% reserve level. District policy requires a 10% undesignated reserve level. In addi7on to mee7ng these requirements, we have addi7onal designated reserves such as a new school fund, professional development fund, school carryover fund, and others that raise the total fund balance amount to ~ 25% of the PAUSD general fund expenditures. 17

18 We are guided by these 2009 Board adopted principles Maintain academic excellence Transparency and openness about our challenge Con7nued support and fidelity to the district s Strategic Plan Par7cipa7on by all stakeholder groups Understanding of and dedica7on to what works educa7onally Op7mism about ability to solve problem Long term fiscal health no gimmicks Staffing levels that sustain program quality as we grow Avoiding layoffs is a high priority 18

19 It is important to make budget adjustments now as well as over the course of the next few months, and to do so in a thoughnul and inclusive manner. We are eager to hear your quesvons, comments, and ideas. 19