2016/17 Proposed Budget

Transcription

1 Farmingdale Public Schools THE GOAL OF THE FARMINGDALE PUBLIC SCHOOLS IS TO ESTABLISH OURSELVES AS A HIGH ACHIEVING SCHOOL DISTRICT AS EVIDENCED BY HIGH LEVELS OF STUDENT PERFORMANCE IN ALL AREAS. 2016/17 Proposed Budget Board of Education Special Meeting/Budget Workshop March 23, 2016

2 The Future of Public Education The state has assumed control over 98% of all revenue that supports public education Maximum allowable tax levy increases State aid A majority of expenditures are predefined in law or in local collective bargaining agreements Erodes Local Control 2

3 The Future of Public Education Many instructional decisions are now being legislated Evaluations (3012-d) New York State Curriculum Districts are still beset with new state provided mandates New regulations regarding Part 154 (English as a New Language) Legislation on elementary guidance counselors 3

4 What Can You Do to be an Active Participant in the Future of Public Education? PAY ATTENTION! Attend monthly board meetings and district meetings PTA meetings, budget meetings, curriculum presentation meetings, etc. Keep yourself and those around you informed about recent changes in public education and what aspects of the law will have a long-term impact on our district Stay focused on the elephants in the room Be a voice in all levels of government 4

5 Tonight s Discussion Budget Discussion Overview Revenue and Fund Balance & Reserves Tax Levy State Aid Other Forms of Revenue and Fund Balance & Reserves Appropriation Cost Element Review Contingent Budget 2014/15 Approved Legislation 2015/16 Approved Legislation Proposed Budget Calendar of Budget Meetings 5

6 2016/17 Budget Discussion Overview Maintains program opportunities for students Budget-to-budget increase is 0.97% Stays within the district s specific tax levy cap of 0.17% Maintains our current financial condition Continues to support capital needs throughout the district by addressing roof replacements through the capital reserve fund that was approved by the voters in May 2015 Establish new Five-Year Capital Facility Plan to continue important infrastructure and other needed repairs after consultation with the Facilities Advisory Committee 6

7 Revenue and Fund Balance & Reserves Revenue: Funds necessary to support academic programs and maintain district facilities Fund Balance & Reserves: District savings used to offset taxes and maintain programs 7

8 Revenue Sources and Fund Balance & Reserves Tax Levy State Aid Other Forms of Revenue Fund Balance & Reserves 8

9 Tax Levy Tax Levy: Funds a school district collects through property taxes to support academic programs and maintain district facilities 9

10 Eight-Year History of Tax Levy Increases Farmingdale School District Year % Increase 2008/ % 2009/ % 2010/ % 2011/ % 2012/ % 2013/ % 2014/ % 2015/ % Eight-Year Average 1.80% Nassau County School Districts Year % Increase 2008/ % 2009/ % 2010/ % 2011/ % 2012/ % 2013/ % 2014/ % 2015/ % Eight-Year Average 2.68% Farmingdale School District Proposed 2016/17 Tax Levy Increase 0.17% 10

11 Property Tax Cap (Established for the 2012/13 school year and in effect through 2019/20) When is 2% Not Really 2%? Property Tax Cap restricts tax levy set by school districts, not the assessed value or tax rate or individual tax bill Basic principle: school districts may not adopt a budget that requires a tax levy that exceeds the tax cap unless the voters approve the budget by a super-majority (60%) Given exclusions and adjustments, the tax cap may not actually be 2% Adjustments and exclusions will increase it Low inflation will decrease it Even under a 2% increase, not all taxpayers will see the same impact on their bills (e.g., if a taxpayer applies for and receives a reduced assessment, everyone else s tax bill would increase) 11

12 2016/17 Tax Levy Limit Calculation Farmingdale Public Schools 2016/17 Tax Levy Limit Calculation 2015/16 Tax Levy $ 119,056,937 Multiply: Tax Base Growth Factor Add: 2015/16 Estimated Payments in Lieu of Taxes (PILOT) 2,983,431 Less: 2015/16 Estimated Capital Local Expenditures (Net of Building Aid) (1,968,173) ADJUSTED 2015/16 TAX LEVY $ 120,167,441 Multiply: Allowable Growth Factor (Lesser of 2% or CPI) % Less: 2016/17 Estimated PILOT (3,086,251) Add: Available Carryover From 2015/16 Before Exclusions /17 TAX LEVY LIMIT BEFORE EXCLUSIONS $ 117,225, /17 Exclusions: Capital Local Expenditures (Net of Building Aid) 2,030,318 Court Orders/Judgments - ERS (0%) - TRS (0%) - MAXIMUM ALLOWABLE LEVY $ 119,255,708 % INCREASE 0.17% * 2015/16 tax levy adjusted for LIPA PILOT ($1,730,426) 12

13 Summation of the Property Tax Cap The 2% tax cap is not really 2% after completing the calculation Even if the tax levy increase was 2%, your taxes will not necessarily increase by 2% The Assessor of Nassau County is responsible for determining assessed values which will impact individual homeowners tax bills There are other factors outside the district s control that affect actual taxes paid, which include: Two Separate Taxing Entities (Nassau County & Town of Babylon) Nassau County Property Classes (Class I, II, III & IV) STAR and Other Exemptions Settled Grievances So, 2% is not really 2%, and even if it was 2%, it is still not 2% 13

14 Governor s Proposed State Aid Governor s Proposed State Aid: Financial assistance the district receives from New York State to help support academic programs and maintain district facilities 14

15 Student Enrollment & State Aid Student Enrollment & State Aid Student Enrollment % of Total Student Enrollment % of State Aid Nassau County 242, % 4.28% Suffolk County 204, % 8.02% Total for Long Island 446, % 12.30% New York City 1,062, % 40.05% Rest of NY State 1,175, % 47.65% Total NY State 2,684, % % Nassau County residents subsidize the cost of public education for other school districts across New York State 15

16 Basic State Aid Packages Unrestricted Foundation & High Tax Wealth and needs-driven aid Reimbursement & Expense-Driven Aid Formulas tied to local district expense Categorical & Grants Need to meet eligibility thresholds 16

17 Foundation Aid & High Tax Aid Foundation Aid: Intended to provide districts with an appropriate share of state aid based on wealth and student need factors $18,681,119 Frozen from 2008/09 to 2012/13 and again frozen in 2014/15 and 2015/16 High Tax Aid: Intended to provide relief to areas in New York State that are viewed as high wealth due to high property values $3,243,907 Frozen at 2013/14 levels 17

18 Reimbursable Aid Categories Farmingdale Public Schools Reimbursable Aid Categories Aid Categories Amount Transportation Aid $2,803,629 Public Excess High Cost Aid 1,461,958 Private Excess Cost Aid 282,555 BOCES Aid 1,596,683 Software, Library, Textbook Aid 491,326 Computer Hardware & Technology Aid 56,474 Total Reimbursable Aid $6,692,625 18

19 Categorical & Grants Universal Pre-Kindergarten set to remain constant in 2016/17 Has been established as part of state aid in the amount of $419,194. Grant is accounted for in the special aid fund (no connection to general fund revenue) Title Grants IDEA 611 & 619 Nassau County Grants Special Legislative Projects County, State and Federal Grant funding has been reduced in each of the last three years 19

20 Gap Elimination Adjustment & Restoration Gap Elimination Adjustment ($1,682,851) Used to balance the 2016/17 state budget The Gap Elimination Adjustment is based on wealth and student need factors Gap Elimination Restoration $552,834 Used to begin the restoration of aid already taken as part of the Gap Elimination Adjustment Gap Elimination Adjustment is a legislative priority for the 2016/17 school year 20

21 Projected 2016/17 State Aid Farmingdale Public Schools Projected 2016/17 State Aid Unrestricted $21,925,026 Reimbursement/Expense-Driven 6,692,625 Categorical & Grants -- Building Aid 2,097,525 State Aid Entitlement 30,715,176 Gap Elimination (State Budget Deficit) (1,682,851) Gap Restoration 552,834 Total $29,585,159 21

22 Other Forms of Revenue and Fund Balance & Reserves Other Forms of Revenue and Fund Balance & Reserves: Other funds necessary to support academic programs and maintain district facilities 22

23 Long Island Power Authority (LIPA) District was informed in the fall of 2015 that LIPA would be coming off the tax rolls and would be included as a PILOT property At the time, Nassau County provided an assurance that LIPA PILOT would equal their tax liability Received correspondence indicating that Farmingdale School District would be shorted revenue in 2015/16 in the amount of $37,704 Nassau districts filed litigation against LIPA and the County LIPA will make districts whole in 2015/16 but future LIPA payments continue to be of concern Projected 2016/17 LIPA PILOT is $1,692,722 23

24 Projected 2016/17 PILOT Top Six Properties Farmingdale Public Schools Projected 2016/17 PILOT LIPA $ 1,692,722 Runway Hotel (2 Properties) 268,531 Harold Levinson (2 Properties) 259, Bi-County (4 Businesses, 1 Property) 162,985 TDI Jefferson Station (2 Properties) 162,416 Piping Rock 112,788 Other Properties 676,101 Sub-Total All PILOT Properties 3,335,322 Less: Credits (Tax Certs) (285,322) Total $ 3,050,000 24

25 Other Forms of Revenue and Fund Balance & Reserves PILOT Based on the abated amounts of selected commercial property in the district Tuitions Foster and Special Education $3,050,000 $315,000 Rental of Property BOCES and outside organizations use of facilities $165,000 Medicaid Reimbursement $150,000 Interest - Lowest rates in recent history.05% -.25% on money market and checking accounts $80,000 Student Fees $75,000 Fund Balance & Reserves - Maintain application of fund balance To be discussed during the March 30 budget presentation as part of the multi-year financial plan $5,500,000 25

26 Miscellaneous Revenue Miscellaneous Revenue Categories Interfund Revenue $300,000 Refunds of Prior Years 150,000 Insurance Recoveries 65,000 E-Rate 50,000 Continuing Education Tuition 40,000 Health Services 25,000 Interest & Penalties on Property 20,000 Textbooks 5,000 Other 50,000 Total Miscellaneous Revenue $705,000 26

27 Putting Together What We Have Discussed Tax Levy $119,255,708 State Aid $29,585,159 Other Forms of Revenue $4,540,000 Fund Balance & Reserves $5,500,000 TOTAL REVENUE $158,880,867 27

28 2016/17 Proposed Revenue FARMINGDALE PUBLIC SCHOOLS 2016/17 PROPOSED REVENUE BUDGET REVENUE 2015/16 APPROVED REVENUE BUDGET 2016/17 PROPOSED REVENUE BUDGET STATE AID $ 28,080,345 $ 29,585,159 PILOT 3,230,426 3,050,000 TUITIONS 315, ,000 RENTAL OF PROPERTY 165, ,000 MEDICAID REIMBURSEMENT 150, ,000 INTEREST 80,000 80,000 STUDENT FEES 75,000 75,000 MISCELLANEOUS INCOME 705, ,000 TOTAL OTHER INCOME 4,720,426 4,540,000 FUND BALANCE/RESERVES 5,500,000 5,500,000 SUB TOTAL 38,300,771 39,625,159 TAX LEVY 119,056, ,255,708 TOTAL BUDGET $ 157,357,708 $ 158,880,867 TAX LEVY % INCREASE 1.28% 0.17% * $1,730,426 was reclassifed from the 2015/16 TAX LEVY to PILOT in connection with LIPA PILOT litigation 28

29 Appropriation Appropriation: Funds necessary to provide academic programs and maintain district facilities 29

30 2016/17 Proposed Cost Element Review Salaries Collective Bargaining Unit contracts will expire on June 30, 2017 Increases in projected 2016/17 salaries are a result of contract negotiations Benefits Teachers Retirement System (TRS) projected to decrease by 11.61% for 2016/17 Employees Retirement System (ERS) projected to decrease by 14.84% for 2016/17 No exemption from the levy as the employer contribution rates for both TRS and ERS decreased Major Medical 7.8% increase projected for January 2017 based on NYSHIP analysis Questions still exist regarding the Patient Protection and Affordable Care Act (PPACA) Lack of predictability with premium increases Implementation of the Cadillac Tax in January

31 2016/17 Proposed Cost Element Review Increase in BOCES as a result of Special Education and Curriculum services (under 2% increase in administration, capital, facilities, and program costs) Decrease in equipment costs as various one-time equipment purchases were made in the 2015/16 school year in the Fine Arts, Career & Technical Education, and Districtwide Operations Departments A majority of last year s increases were reduced this year with a portion reallocated to continue needed upgrades Increase in materials & supplies districtwide Energy Performance Contract and resulting energy savings Debt service schedule increased for the 2016/17 school year Energy savings to be realized in 2016/17 school year is more than increase in debt service payments generating savings for the community 31

32 2016/17 Proposed Cost Element Summary FARMINGDALE PUBLIC SCHOOLS 2016/17 PROPOSED BUDGET COST ELEMENT SUMMARY DESCRIPTION 2015/16 APPROVED BUDGET 2016/17 PROPOSED BUDGET BUDGET INCREASE/ (DECREASE) SALARIES $ 81,689,427 $ 83,662,653 $ 1,973,226 EMPLOYEE BENEFITS 39,559,065 39,548,194 (10,871) BOCES 11,583,300 11,646,990 63,690 CONTRACT TRANSPORTATION 7,229,300 7,303,520 74,220 DEBT SERVICE 3,267,856 3,706, ,791 CONTRACT SERVICES 4,427,076 4,585, ,706 UTILITIES 2,273,825 1,667,000 (606,825) MATERIALS & SUPPLIES 2,112,279 2,404, ,151 TUITIONS 1,850,000 1,758,851 (91,149) INSURANCE 1,070, ,000 (85,000) TEXTBOOKS 361, ,000 - EQUIPMENT 1,119, ,800 (433,780) LEGAL FEES 395, ,000 - CAPITAL PROJECTS 250,000 - (250,000) NASSAU COUNTY SEWER TAX 170, ,000 - TOTAL $ 157,357,708 $ 158,880,867 $ 1,523,159 PERCENTAGE INCREASE 0.97% 32

33 Contingent Budget Contingent Budget: If voters of the district fail to approve the school district budget, the district is required by law to operate under a contingent budget 33

34 2016/17 Contingent Budget 2016/17 Contingent Budget 2016/17 Proposed Budget $158,880,867 Program Reduction (198,771) 2016/17 Contingent Budget $158,682,096 In the event of a defeated budget, reductions may include, but are not limited to the following: Increased class size at the elementary level Reduced elective opportunities at the secondary level Reduction in athletic teams Reduction in musical performing groups Reduction in extra-curricular activities Reductions in equipment Reductions in maintenance projects Reductions in support services 34

35 2014/15 Approved Legislation 2014/15 Approved Legislation: Other items enacted into law as part of the 2014/15 New York State Budget for 2014/15 and 2015/16 35

36 Fiscal/Political Environment Government Efficiency Plan Instituted as part of the 2014/15 state budget In year 1, rebate checks in 2014/15 were delivered contingent upon districts staying within the tax levy limit In year 2, rebate checks in 2015/16 equaled any amount received in 2014/15, plus the difference in 2014/15 and 2015/16 tax bills, or 1.62% of the 2014/15 tax bill Was contingent on local governments staying within the tax levy limit in 2015/16 and enacting a Government Efficiency Plan District provided 3 years of savings equal to 1% of a local government s tax levy Local governments worked together to share savings 36

37 Government Efficiency Plan Farmingdale acted in the capacity of the lead district in our area for compiling and submitting information on the Government Efficiency Plan In addition to the Farmingdale School District, the following school districts also participated Bethpage Hicksville Island Trees Levittown Malverne Plainview-Old Bethpage Central New Hyde Park- Garden City Park Oceanside Plainedge Roosevelt Seaford Wantagh Areas of potential savings included, but were not limited to, negotiations, transportation, special education and purchasing Plan was submitted on June 1, 2015 and approved by the Division of Budget in the fall of

38 2015/16 Approved Legislation 2015/16 Approved Legislation: Other items enacted into law as part of the 2015/16 New York State Budget for 2016/17 through 2019/20 38

39 New State Tax Law Section 606 (n-1) Section 606 (n-1) provides for a credit against income taxes (which will be paid via a refund check to the taxpayer) for the years 2016 through 2019 for eligible taxpayers under certain conditions. The most significant conditions are that the taxpayer: Owns and primarily resides in real property receiving the STAR exemption Has qualified gross income not greater than $275,000 School districts must be within the tax levy limit No credit shall be allowed if: Such property is located in a school district that has adopted a budget in excess of the tax levy limit Only applicable to school districts and not to any other municipalities 39

40 Tax Refund in 2016/17 The refund in 2016/17 applies to all who receive the Basic or Enhanced STAR The amount of the refund for 2016/17 is $185 if the residence is outside the Metropolitan Commuter Transportation District (MCTD) The amount of the refund for 2016/17 is $130 if the residence is in the MCTD Farmingdale is in the MCTD and therefore our residents will receive a refund of $130 in 2016/17 if they meet the conditions in this new tax law 40

41 Tax Refund in Future Years The refund in future years is based on a percentage of the Basic STAR savings on a homeowner s income level. The refund increases during the three-year period as per the following: Basic STAR Qualified Gross Income 2017/ / /20 Not over $75, % 60.0% 85.0% Over $75,000 but not over $150, % 42.5% 60.0% Over $150,000 but not over $200, % 25.0% 35.0% Over $200,000 but not over $275, % 7.5% 10.0% Over $275,000 No Refund No Refund No Refund 41

42 Enhanced STAR For a taxpayer who owns and primarily resides in real property receiving the Enhanced STAR exemption, the amount of the credit shall equal the STAR tax savings associated with such enhanced STAR exemption multiplied by the following percentage: Enhanced STAR Taxable Year Percentage 2017/18 12% 2018/19 26% 2019/20 34% 42

43 Example of Basic STAR Refund Checks 2016/17 is a flat amount of $130 for all qualified homeowners in MCTD (Basic and Enhanced STAR) 2015/16 maximum Basic STAR amount for Farmingdale is $1,481 Example of Basic STAR Refund Checks Qualified Gross Income 2017/ / /20 Not over $75,000 $415 $889 $1,259 Over $75,000 but not over $150,000 $304 $629 $889 Over $150,000 but not over $200,000 $193 $370 $518 Over $200,000 but not over $275,000 $81 $111 $148 Over $275,000 No Refund No Refund No Refund This example is for Farmingdale residents living in the Nassau County portion of the district 43

44 Example of Enhanced STAR Refund Checks 2016/17 is a flat amount of $130 for all qualified homeowners in MCTD (Basic and Enhanced STAR) Maximum Enhanced STAR amount for Farmingdale is $3,083 Enhanced STAR Taxable Year Refund Example 2017/18 $ /19 $ /20 $1,048 44

45 Other Proposed Legislation Governor s Other Proposed Items The STAR Program (Basic & Enhanced) STAR was limited to a 2% growth in 2012/13 through 2015/16 Governor proposes to freeze STAR program beginning in 2016/17 (0% growth) STAR would not be included on individual property tax bills, but instead on state income tax returns for new homeowners May cause confusion in the early fall with new residents when they receive their tax bill 45

46 Tax Credit Program Governor proposed $150 million for the Parental Choice in Education Act. This program would include: $50 million in credits to support scholarships for low and middle income students to attend a non-public school or a public school outside of their district $20 million in credits to support public school education improvement programs such as pre-kindergarten and afterschool activities. Corporation franchise and individual taxpayers who make donations will receive a non-refundable credit equal to 75 percent of their authorized contributions, up to a maximum annual credit of $1 million $70 million in reimbursements to families with incomes below $60,000 per year for eligible tuition expenses paid to elementary and secondary schools in New York State $10 million to reimburse teachers for supplies that they have purchased up to $200 per year 46

47 2016/17 Proposed Budget 2016/17 Proposed Budget: A one-page summary of proposed budget information for the 2016/17 school year 47

48 2016/17 Proposed Budget 2016/17 Proposed Budget $158,880, /16 Approved Budget $157,357,708 Increase $1,523,159 Percentage Increase 0.97% Proposed Tax Levy Increase 0.17% 48

49 2016/17 Budget Calendar Farmingdale School District s Budget Calendar Board of Education Special Meeting/Budget Workshop Wednesday, March 23, 2016 Board of Education Special Meeting/Budget Workshop Wednesday, March 30, 2016 Board of Education Special Meeting/Budget Workshop/Public Input Wednesday, April 6, 2016 Board of Education Regular Meeting/Adopt Budget for Voter Approval Wednesday, April 13, 2016 Board of Education Special Meeting/Adopt BOCES Admin. Budget Tuesday, April 19, 2016 Board of Education Special Meeting/Public Hearing Tuesday, May 10, 2016 BUDGET VOTE & ELECTION Tuesday, May 17, 2016 Weldon E. Howitt Middle School East Gymnasium 6:00 a.m. 9:00 p.m. 49