Budget study session. April 26,2018

Transcription

1 Budget study session April 26,2018

2 Agenda Budget basics HB2242 and SB 6362 McCleary Fixes Budget Goals and Options OSPI Multi year tool projections Post levy passage adjustments Questions 2

3 What is a Budget Spending authorization General plan of spending by program, object, activity Track expenditure and revenue variances By necessity of actual conditions adjustments made during fiscal year execution 3

4 HB 2242 and the SB 6362 McCleary Fixes

5 Recall from changes HB 2242 State Teacher Salary schedule eliminated Encourages simultaneous teacher unit bargaining for 295 districts State tax and local levy swap must change and redefine our past practices for teacher compensation Consumer Price Index (CPI) vs Implicit Price Deflator (IPD) Different inflationary indexes CPI typically higher than IPD State will use IPD for future inflationary increases to allocations Requires a 4 year budget outlook school year was the transition year from to full funding in

6 SB 6362 recap the McCleary fixes SY is Fully funded Fully funded still doesn t have allocation for Essential Locally Funded personnel not covered in the [state supreme court validated] prototypical model Transportation allocation is increasing by IPD but doesn t cover current (let alone future) costs Special Ed allocation is increasing but doesn t cover current (let alone future) costs Increased allocation for building and district administrators increasing but doesn t cover current (let alone future) costs MSOC allocations increasing by IPD but doesn t cover current (let alone future) costs Definition of enrichment seems to be anything not provided from the state documented and demonstrated Classified personnel adequacy study from 2010 OSPI study indicates the prototypical model is not properly allocated for FTE 6

7 SB 6362 recap the McCleary fixes State Full funding accelerated to SY due to the supreme court ruling on HB 2242 The original HB transition year plan was to half step the full funding increase to bridge the difference in school, state, and tax fiscal years State fiscal year: July 1 to June 30 School fiscal year: September 1 to August 31 Tax collection year: January 1 to December 31 Accelerating the state funding for SY creates additional revenue since the CY 2018 local levy being collected at the old levy rates Effects of Full funding legislative caps on salary increases basically limited to CPI with exception conditions by employee type Salary caps plus additional revenue creates one time spend opportunities 7

8 SB 6362 recap the McCleary fixes Local levy Sub Fund initiated in HB 2242 accelerated to SY Required to be created for SY in one section Required to be audited in another section vetoed by Governor Likely to more than double the over 20,000 account codes in the GF Software solution not available until late July Effort to institute and maintain the additional accounting is unclear 17 to 1 class size ratio Funding for all K 3 kids to all K 3 teacher ratio averaged across the NKSD Specialists and Special Education make the core classroom ratio approximately 20 to 1 to match the 17 to 1 allocation of actual $ Class size space currently available soon to be constrained in many schools 8

9 Budgeting Goals and Options

10 Budget goal Develop the NKSD prototypical model Establish local budget models to create a well functioning school district that creates ability to accomplish the strategic goals Accounts for Essential Locally Funded personnel not in state model Revisit rules periodically to account for changes in funded or unfunded mandates or changing conditions Establish Targets to maintain district well functioning as a whole Establish guidelines for appropriate ratios of labor/materials Historically (since 2001) Salaries and Benefits 80 to 87%, average 85%, last 3 year average 82% MSOC 20 to 13%, average 15%, last 3 year average 18% Recommended option for labor/materials Target 80%/20% with a limit of 82%/18% 10

11 Budget goal Develop the NKSD prototypical model Establish guidelines for appropriate support department ratios Historically (since 2001) Teaching and teaching support 72% to 67%, average 69%, last 3 year average 68% Teaching, Library, Counseling, Health Services, Student management, Professional Development, Extra curricular Other Support 20% to17%, average 18%, last 3 year average 19% Maintenance, Grounds, Custodial, Utilities, Building Security, Insurance, Food Service, Transportation, Technology, Facility Rental School Building Administration 6% to 5%, average 5.5%, last 3 year average 5.7% Principals and Office staff District wide administration 6% to 7.5%, average 6.5%, last 3 year average 7% Board expenses, Superintendent, Business office, Human Resources, Public Affairs, Payroll, Purchasing, Accounts Payable, Accounts receivable, Certificated Administration (Special Education, Federal Programs, Career Tech Education, Alternative Learning Experience, Native American Education, Bilingual Education, Student Support, Curriculum, Elementary, Secondary), Classified Administration (Food Service, Transportation, Maintenance, Technology, Finance, Human Resources) 11

12 Budget goal Develop the NKSD prototypical model Recommended option for Activity breakdowns Teaching and teaching support Target 68%, no more than 1% variance Teaching, Library, Counseling, Health Services, Student management, Professional Development, Extracurricular Other Support Target 19%, no more than 1% variance Maintenance, Grounds, Custodial, Utilities, Building Security, Insurance, Food Service, Transportation, Technology, Facility Rental School Building Administration 6%, no more than 0.2% variance Principals and Office staff District wide administration 7%, no more than 0.2% variance Board expenses, Superintendent, Business office, Human Resources, Public Affairs, Payroll, Purchasing, Accounts Payable, Accounts receivable, Certificated Administration (Special Education, Federal Programs, Career Tech Education, Alternative Learning Experience, Native American Education, Bilingual Education, Student Support, Curriculum, Elementary, Secondary), Classified Administration (Food Service, Transportation, Maintenance, Technology, Finance, Human Resources) 12

13 Considerations for future budget planning State provided projections IPD projected to increase at a lower rate than CPI CPI 3.1% 3.1% 2.1% IPD 1.9% 1.9% 2.0% IPD and CPI measure increases in market baskets of consumer goods May not necessarily be representative of increases for NKSD Example recent insurance bill, recycling bills 13

14 Options for future budget planning Revenue State revenue inflate by IPD Federal revenue Inflate by IPD or CPI Hold constant until know actuals Project federal cuts Local revenue Inflate Assessed Value by CPI, IPD, historical, hold steady Recommend Budgeting on flat Assessed Value and Flat Federal funding levels. State revenue increasing at IPD unless otherwise known Expenses Inflate current expenses by CPI Material Supplies & Operating Costs (MSOC) Inflate by CPI, IPD, historical, other Recommend Budget on inflating current expenses at CPI unless otherwise known 14

15 OSPI Multi year tool projections

16 OSPI Multi year tool Quotes and Notes This model in no way represents a guarantee of future funding for any school district. It is intended to be a projection tool for budgeting and analysis purposes only. Based on the state assumption of 5,885.3 enrollment Internal enrollment projections: 5,874 for SY and 5,829 for SY Enrollment held steady for like for like year by year comparison Assumes the Local M&O Levy will be collected at the 2018 voter approved amounts Property values assessed valuations increasing less than 5% per year will lower these amounts and collect on a maximum of $1.50 / $1000 Assessed Value Qualifications Includes increasing allocation for health benefits that will be paid to health benefits vendors on behalf of employees (Money in Money out) Includes increasing allocation for running start students (Money in Money out) LAP revenue overstated due to future loss of Hi poverty LAP allocation State revenue increasing at the IPD rates (lower than the CPI rates) 16

17 OSPI Multi year tool projection North Kitsap School District SY School Year School Year School Year Apportionment (does not include K 3, CTE, SC, & MSOC) $ 20,397, $ 26,441, $ 27,009, $ 27,491, Apportionment Grades K 3 only $ 11,790, $ 16,590, $ 16,959, $ 17,263, Materials, Supplies, & Operating Costs (w/o CTE & SC) $ 6,836, $ 6,966, $ 7,098, $ 7,240, Career & Technical & Skills Center (CTE & SC) $ 3,064, $ 3,915, $ 3,998, $ 4,071, Bilingual (TBIP) $ 296, $ 381, $ 391, $ 398, Highly Capable (HiCap) $ 138, $ 178, $ 182, $ 186, Learning Assistance Program (LAP) $ 1,170, $ 1,245, $ 1,277, $ 1,300, LAP Concentration $ $ 114, $ 116, $ 118, Special Education $ 5,813, $ 7,461, $ 7,620, $ 7,759, Transportation $ 2,391, $ 3,243, $ 3,397, $ 3,446, Total Apportionment $ 51,899, $ 66,538, $ 68,052, $ 69,276, Professional Learning Time $ $ 198, $ 404, $ 619, Hold Harmless $ $ $ Local Effort Assistance (LEA) $ $ $ $ Net State Costs not allocated by district Total Other $ $ 198, $ 404, $ 619, Total State Funding $ 51,899, $ 66,736, $ 68,457, $ 69,895, M&O Levy / Enrichment Levy $ 17,713, $ 14,409, $ 11,535, $ 12,034, Total Local $ 17,713, $ 14,409, $ 11,535, $ 12,034, Total State And Local Funding $ 69,612, $ 81,146, $ 79,992, $ 81,930,

18 Expenditures as Percent of projected Revneue Revenue Data from the OSPI provided Multi year tool Expenses based on current year projections Assumes State revenue inflates by IPD yearly Assumes labor and material costs inflate by CPI yearly Percent of Projected Revenue 120% 100% 80% 60% 40% 20% 0% Capacity for one time spends only in Materials, Supplies, Operating Costs % 18% 16% 17% 17% Labor % 82% 74% 82% 82% Yearly projections Labor % Materials, Supplies, Operating Costs % 18

19 Assumptions Local levy increasing at 5% Assumes no drop in Assessed Value (limit $1.50/ 1000AV) and continued ability to collect at voted levels Economic forecasts are predicting potential economic slowdowns in 2019 Local levy increasing at 5% offsets the difference between CPI and IPD Allow for a constant ratio available to necessary MSOCs Allows in future to take care of those things not done during the post financial crisis years Allows for predictable capacity to ensure we can keep salaries in pace with cost of living increases HB 2242 requires reassessment of funding / taxing models in

20 and beyond budgeting Guideposts for decision making Appropriate model driven funding that restoring past cut or underfunding (classified support, tech, curriculum, maintenance) Forward looking plans that support the strategic goals Forward looking enrollment shifts Space constraints and population growth and concentrations Poulsbo Elementary, Vinland, Gordon Leadership team inputs on future needs District Service Council discussion to refine Continuing needs Classified staffing Security SRO for Kingston ALE 24 credit graduation requirements (ALE program, potential 7 or 8 period HS day) One time Possibilities Curriculum Technology Space constraints and population growth and population concentrations PBO, VIN, GOR Non Capital Maintenance project catch up 20

21 Post Levy Passage adjustments

22 Post levy adjustments North Kitsap Regional Event Center (NKREC) fund transfer $600k Per the note schedule on the original inter local agreement and past board consensus for turf replacement funding General Fund to Captial Project Fund (CPF) loan to jump start projects, pay design & planning $2M 3M Will require a CPF budget extension in FY Technology equipment upgrades Will require a GF budget extension in FY Authorize by future board resolution in May 22

23 Questions