2016-17 Budget Northville Public Schools February Budget Amendment February 14, 2017 1
State Revenue 2016-17 February 2017 Initial Budget Budget Amendment Comments FTE Enrollment (Blended - Gen Ed) 7,235 7,202 Loss of (33) FTE compared with budget -- revenue loss of $(271,557) Per Pupil Amounts Foundation Amount (per pupil) $ 8,229 $ 8,229 No change Categorical Revenue (per pupil) - Hold Harmless Guarantee (sec. 20f) $ 112 $ 112 No change - At-Risk (sec. 31a) $ 763 $ 763 Per student eligible for free lunch Other Categorical Revenue - MPSERS Cost Offset (sec. 147a) $ 601,426 $ 594,687 Based on Northville's % of total % of MPSERS payroll - MPSERS UAL Rate Stabilization (sec. 147c) $ 5,337,115 $ 5,269,967 Maintains UAAL Rate Cap at 20.96% - Headlee Data Collection (sec. 152a) $ 187,974 $ 189,011 - Early Literacy Targeted Instruction (sec. 35a(5)) $ - $ 77,385 - Financial Analytic Tools (sec. 102(d)) $ 10,852 $ 10,852 - FIRST Robotics (sec. 99b) $ 5,300 $ 3,800 2
Enrollment (Full Time Equivalent) 8,000 General Ed Special Ed 7,500 7,000 358 343 344 315 303 283 279 6,500 6,000 6,942 6,970 7,065 7,137 7,053 7,199 7,202 5,500 5,000 Fall 2010 Fall 2011 Fall 2012 Fall 2013 Fall 2014 Fall 2015 Fall 2016 (Unaudited) 3
Enrollment (By Grade Level) - FTE Fall 2012 Fall 2013 Fall 2014 Fall 2015 Fall 2016 Kindergarten 400 477 423 437 438 First Grade 518 442 496 462 455 Second Grade 507 538 468 527 481 Third Grade 549 540 538 511 545 Fourth Grade 540 567 544 571 526 Fifth Grade 559 556 579 571 577 Sub-Total 3,073 3,119 3,047 3,080 3,022 Lowest Sixth Grade 580 583 562 618 601 Seventh Grade 571 589 593 591 630 Eighth Grade 602 576 597 608 596 Sub -Total 1,753 1,748 1,752 1,817 1,827 Highest Ninth Grade 567 569 561 576 625 Tenth Grade 554 575 568 572 587 Eleventh Grade 587 547 577 564 575 Twelfth Grade 531 579 548 588 569 Sub-Total 2,239 2,270 2,254 2,300 2,356 Highest Total Gen Ed 7,065 7,137 7,053 7,197 7,205 Memo: Special Ed 344 315 303 282 280 Total Membership 7,408 7,452 7,356 7,479 7,485 4
General Fund Budget February Amendment (By Object) General Fund Budget 2016-17 2016-17 2016-17 Jan/Feb Budget Amendment 2015-16 Initial Jan/Feb Budget Better / (Worse) Than: Actual Budget Amendment 2016-17 Initial Bud 2015-16 Actual Total Revenues $ 72,289,215 $ 73,155,445 $ 75,509,087 $ 2,353,642 $ 3,219,872 (Incl. Net Transfers) Expenditures Salaries & Wages $ 35,533,970 $ 37,066,252 $ 37,632,285 $ (566,033) $ (2,098,315) Benefits 23,699,684 25,736,344 25,421,666 314,678 (1,721,982) Purchased Services 8,297,059 9,292,099 9,302,420 (10,321) (1,005,361) Supplies & Materials 2,931,671 3,564,057 4,164,590 (600,533) (1,232,919) Capital Outlays 357,546 537,509 1,689,536 (1,152,027) (1,331,990) All Other Expenditures 761,069 865,395 848,385 17,010 (87,316) Total Expenditures $ 71,580,999 $ 77,061,656 $ 79,058,882 $ (1,997,226) $ (7,477,883) Surplus / (Deficit) $ 708,216 $ (3,906,211) $ (3,549,795) $ 356,416 $ (4,258,011) Fund Balance - Beginning of year $ 17,913,191 $ 16,660,947 $ 18,621,407 $ 1,960,460 $ 708,216 Fund Balance - End of year $ 18,621,407 $ 12,754,736 $ 15,071,612 $ 2,316,876 $ (3,549,795) Fund Balance - Pct. 26.0% 16.6% 19.1% 5
Changes from Initial Budget- Revenue Revenue Changes 2016-17 Budget Amendment Better / (Worse) Than 2016-17 Initial Budget Student Enrollment $ (271,557) (33) FTE decrease Foundation Allowance - Categorical Funding Changes: - MPSERS Cost Offset (6,739) Based on % of MPSERS FY2016 payroll - MPSERS Rate Stabilization (67,149) Pass thru revenue paid to ORS - Early Literacy Instruction 77,385 - FIRST Robotics (4,500) - Hold Harmless Guarantee 8,332 Federal Programs 9,828 Change in estimated allocations for Title I, II and III (LEP) Rental Income 15,255 Enhancement Millage 2,521,400 Levy is $385/student, assume $350/student is collected Act 18 Operating Transfer 70,000 Increase transfer from Act 18 to General Fund All Other 1,387 Total Revenue Changes $ 2,353,642 6
Changes from Initial Budget Salaries & Benefits Expenditure Changes Salary Changes 2016-17 Budget Amendment Better / (Worse) Than 2016-17 Initial Budget - Professional Staff Salaries $ 144,268 Adjustment from estimated salaries to actual contract amounts - Bonus Payment (908,526) Negotiated share of fund balance over 18% payable as a bonus payment to be made in December 2017, but accrued in 2016-17 - Other wage adjustments 198,225 $ (566,033) Benefit Changes - Medical / Dental $ 387,492 Reduction in payments through Q117 - MPSERS MPSERS Rate Stabilization 67,149 Other MPSERS District Contributions 52,402 - Life / LTD Insurance (32,365) - All Other (160,000) $ 314,678 7
Calculation of Bonus Payment Operating Revenue Surplus / Health Care Fund Fund Balance (incl. Transfers) Expenditures Deficit Balance > $1.2 Mil. ($) % of Revenue 2015-16 Audited Results $ 72,289,215 $ 71,580,999 $ 708,216 $ 18,621,407 25.76% 2016-17 Financials Initial Budget $ 73,155,445 $ 77,061,656 $ (3,906,211) $ 14,715,196 20.11% Changes from Initial Budget: Enrollment (271,557) Enhancement Millage Revenue 2,521,400 All Other 103,799 Sub-Total (Prior to Enhancement Spending) $ 75,509,087 $ 76,185,056 $ (675,969) Enhancement Millage Spending K-2 Replacement Furniture $ 1,000,000 Repalcement Textbooks 700,000 Middle School A.M. Busing Program (2) Buses 172,040 Additional Route 18,000 Sub-Total (Prior to Bonus Accrual) $ 75,509,087 $ 78,075,096 $ (2,566,009) $ - $ 16,055,398-18 21.26% Add: Add: Accrual for Bonus Eligible Staff Excess fund balance > 18% 3.26% Bonus Pool $ 983,786 Less: FICA (75,260) Allocation of Excess Fund Balance (% of Revenue): Bonus Payout $ 908,526 Est. Staff Share 40% 1.30% $ 983,786 Eligible Members 475 Est. District Share 60% 1.96% Payout/Member $ 1,913 $ 75,509,087 $ 79,058,882 $ (3,549,795) $ - $ 15,071,612 19.96% 8
Changes from Initial Budget Non-Personnel Costs Purchased Services - Pupil Transportation $ (18,000) Change in Middle School morning busing program - Professional Services (14,958) - Equipment & Contracted Maintenance 37,900 Actual costs trending lower - Property & Casualty Insurance (8,027) - All Other $ (7,236) (10,321) Supplies / Utilities - Textbooks $ (700,000) Partial allocation of enhancement millage revenue - Bus Fuel / Vehicle Maintenance 25,950 - Utilities 16,612 Primarily lower natural gas costs - Building Maintenance & Custodial Supplies 16,225 - Other $ 40,680 (600,533) Capital Outlay - K-2 Elementary Furniture $ (1,000,000) Partial allocation of enhancement millage revenue - New Bus Purchase (172,040) Partial allocation of enhancement millage to accommodate change in Middle School busing - All Other $ 20,013 (1,152,027) Miscellaneous $ 17,010 Primarily lower entrollment in PCCS GOALS program Total Expenditure Changes $ (1,997,226) Net Change in Fund Balance $ 356,416 9
Enhancement Millage Recap (2016-17) Amount Enhancement Millage Levy / Pupil $ 385 Less: Provision for Uncollectible Taxes (35) Estimated Collectible Revenue/Pupil $ 350 Gen ED Enrollment 7,204 Estimated Enhancement Millage Revenue $ 2,521,400 Allocation of Enhacement Millage Revenue Purchase replacement K-2 furniture: $ 1,000,000 (60) classrooms x $16,667/classroom Purchase replacement textbooks 700,000 (Secondary - Language, Civics/Econ, AP Bio, AP Physics) Implement revised Middle School 190,040 A.M. busing program: - Purchase (2) Buses $ 172,040 - Schedule Additional Route 18,000 Offset costs of (2) additional Elementary teachers 177,650 previosuly hired for 2016-17 the school year to address class size Allocation to partially offset contractual 453,710 staff wage adjustments for 2016-17 $ 2,521,400 10
General Fund Budget February Amendment (By Function) Function Code 2016-17 Initial Budget 2016-17 March Amendment % of Spending Salaries Benefits Purchased Services Supplies & Materials Capital Outlays All Other Expenditures REVENUE LOCAL 1xx $8,565,996 $9,102,590 STATE 3xx 61,383,542 60,597,762 FEDERAL 4xx 1,490,707 1,500,535 INTERDISTRICT 5xx 920,200 3,438,200 OPERATING TRANSFRS 6xx 795,000 870,000 TOTAL REVENUE $73,155,445 $75,509,087 EXPENSE INSTRUCTION BASIC PROGRAMS 11x $43,516,798 $45,441,940 $24,985,765 $16,904,878 $763,426 $1,117,916 $1,189,695 $480,260 ADDED NEEDS 12x 7,836,810 7,651,995 4,286,090 3,028,188 244,189 78,528-15,000 SUBTOTAL $ 51,353,608 53,093,935 67.2% $29,271,855 $19,933,066 $1,007,615 $1,196,444 $1,189,695 $495,260 SUPPORT SERVICES PUPIL SERVICES 21x 4,087,694 4,299,513 5.4% 2,504,087 1,485,324 169,445 140657 - - INSTRUCTIONAL SERVICES 22x 2,393,476 2,477,518 3.1% 879,957 576,343 630,271 290163 77,634 23,150 GENERAL ADMINISTRATION 23x 961,734 1,009,166 1.3% 336,896 206,166 378,000 44,907 10,197 33,000 SCHOOL ADMINISTRATION 24x 4,170,733 4,131,105 5.2% 2,374,022 1,547,321 125,150 72,537 2,000 10,075 BUSINESS SERVICES 25x 968,456 921,322 1.2% 345,004 230,170 106,648 0 0 239,500 OPER & MAINTENANCE 26x 7,916,022 7,822,311 9.9% 973,084 813,819 3,898,696 2,092,044 41,668 3,000 TRANSPORTATION 27x 2,183,470 2,483,530 3.1% - - 2,059,163 160,025 263,342 1,000 CENTRAL SERVICES 28x 1,803,081 1,655,027 2.1% 595,836 435,458 542,533 81,200-0 ATHLETICS 29x 933,401 935,327 1.2% 301,201 170,031 293,000 77,695 50,000 43,400 COMMUNITY SERV 37x 85,673 155,128 0.2% 50,343 23,968 16,899 8,918 55000 - CAPITAL IMPROVEMENTS 45x 204,308 75,000 0.1% 0 0 75,000 0-0 TOTAL EXPENSES $77,061,656 $79,058,882 100% $37,632,285 $25,421,666 $9,302,420 $4,164,590 $1,689,536 $848,385 REVENUE OVER/(UNDER) (3,906,211) (3,549,795) BEGIN FUND BALANCE 16,660,947 18,621,407 ENDING FUND BALANCE $12,754,736 $15,071,612 MILL RATES-ALL PROPERTY STATE 6.0 STATE 6.0 -NONHOMESTD LOCAL 18.0 LOCAL 18.0 11
Expenditures as a Percent of Revenue General Fund 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 Actual Actual Actual Actual Actual Amendment Total Revenues $ 67,005,457 $ 68,338,646 $ 68,886,667 $ 70,081,315 $ 72,289,215 $ 75,509,087 (Incl. Net Transfers) Expenditures Salaries & Wages $ 33,035,801 $ 32,655,256 $ 34,060,161 $ 34,683,640 $ 35,533,970 $ 37,632,285 Benefits 18,047,797 17,757,090 18,009,267 20,280,068 23,699,684 25,421,666 Purchased Services 5,892,337 7,834,850 8,040,445 8,453,895 8,297,059 9,302,420 Supplies & Materials 3,173,569 3,169,385 3,112,064 3,114,236 2,931,671 4,164,590 Capital Outlays 1,178,215 571,039 908,199 676,596 357,546 1,689,536 All Other Expenditures 865,914 1,598,755 860,948 831,617 761,069 848,385 Total Expenditures $ 62,193,634 $ 63,586,375 $ 64,991,085 $ 68,040,052 $ 71,580,999 $ 79,058,882 Surplus / (Deficit) $ 4,811,823 $ 4,752,271 $ 3,895,582 $ 2,041,263 $ 708,216 $ (3,549,795) Memo: % of Revenue Salaries & Wages 49.3% 47.8% 49.4% 49.5% 49.2% 52.1% Benefits 26.9% 26.0% 26.1% 28.9% 32.8% 35.2% Purchased Services 8.8% 11.5% 11.7% 12.1% 11.5% 12.9% Supplies & Materials 4.7% 4.6% 4.5% 4.4% 4.1% 5.8% Capital Outlays 1.8% 0.8% 1.3% 1.0% 0.5% 2.3% All Other Expenditures 1.3% 2.3% 1.2% 1.2% 1.1% 1.2% 92.8% 93.0% 94.3% 97.1% 99.0% 109.4% 12
Revenue / Expenditure Trends 13
Key Take-Aways February Amendment Budgeted enrollment increase did not materialize but enrollment remained stable from 2015-16 Enhancement millage revenue enabled some classroom-centered updates (furniture, textbooks) Increase in health care costs have moderated from 2015-16 Projected fund balance at June 30, 2017 projected to exceed 18%, triggering a bonus payment to eligible staff that must be accrued in 2016-17, but payable in December 2017 14
Watch Points Enrollment trends Caution in allocating enhancement millage revenue Levy is for (6) years Renewal is not guaranteed Future School Aid Bill discussions Likely continuation of equity-based state funding increases Continued increased state funding for MPSERS liability Recent legislative discussions that would divert an estimated $430 million of income tax revenue from the School Aid Fund, which would require unidentified replacement funding Continued growth in on-line and career tech enrollments Impact on building utilization, staffing Assessment of future facility and equipment needs 15