School Advocacy Committee - Finance

School Advocacy Committee - Finance February 24, 2013 6:00 p.m.

Tonight s Agenda Welcome and Introductions Tour of the Northern Middle Facility Finance Presentation Human Resources Presentation Small Group Reflection Share Out Next Steps and Evaluation

Housekeeping Items No decisions have been made regarding the future of the school system. You will play an active role and have input into what the Board will consider in determining future steps in the school system. The same Rules of Engagement apply that applied for the advisory group meetings. Proper etiquette for social media Be fair and unbiased and speak only factual information Respect each other s contributions and ideas Staying on schedule is everyone s responsibility Notes and Recordkeeping

Finance Discussion Topics Fiscal 2014 Loss Limitation Update Wealth Formula State Aid and Capital Impact Funding Trends Federal, State, and Local Fiscal 2015 Draft Budget and Funding Request Legislative Actions

Items to takeaway from tonight? Funding Trends Federal, State, and Local Funding Wealth Formula as an Equalizer Fiscal 2015 Budget Request School Construction Information

Fiscal 2014 Loss Limitation During last year s legislative session in the BRFA, a grant for 25% of the decrease between 2013 Direct Student Aid and 2014 Direct Student Aid where the decrease is greater than 1% was approved. The overall grant was $2,081,559 and the following districts were impacted: Carroll $750,732 Garrett $297,993 Harford $935,788 Kent $ 97,046

Fiscal 2014 Loss Limitation So each impacted district budgeted to receive these funds in their fiscal 2014 budget. The budget bill allowed the Governor to use $2.2 million in excess funding that was appropriated in the Transportation program to fund this grant. However, at this time, the Governor has not made these funds available. As a result, we are holding some county approved carryover funds for projects to fill the $297,993 operating budget gap in the fiscal 2014 budget.

Fiscal 2015 State Aid Update

State Aid Sources State aid is impacted by the wealth formula and enrollment for: Foundation Programs Compensatory Education Special Education Limited English Proficiency State Transportation aid is impacted by enrollment and not wealth.

What Is The Wealth Formula? The wealth formula is used to gauge a county s ability to fund school activities based upon its own resources. The formula is intended to be a wealth equalizer between state and local funding sources. The wealth formula is applied across all 24 school districts. Wealth is also a consideration in state supported capital projects. In fiscal 2000, Garrett County was seventeenth in per pupil wealth out of the 24 districts. In fiscal 2015, Garrett County remained the 5 th wealthiest district per pupil.

How Is Wealth Computed? 50% of the Personal Property base for: Railroad Operating Utility Operating Business Segment represents 3.51% of Garrett s wealth and 2.76% of state average for fiscal 2015. 100% of the Net Income Tax Base Segment represents 16.69% of Garrett s wealth and 32.04% of state average for fiscal 2015 at September measurement. 40% of the Real Property base for: Full Year Assessments New Construction Railroad Operating and 100% of Utility Operating for Real Property Segment represents 79.80% of Garrett s wealth and 65.20% of state average for fiscal 2015.

Wealth Statistics Garrett s overall wealth increased in fiscal 2015 with September NTI. Garrett s increase was 0.17% while the state s overall wealth for the same period increased by 0.82%. Garrett s fiscal 2015 Real Property decreased slightly while Personal Property increased by 1.40% and NTI increased 2.14%. The state s total wealth increased by 0.82% or about $3.2 billion from the same period last year. Since 2009, only St. Mary s has had higher wealth growth than Garrett s at 25.84%.

Enrollment Statistics Garrett s enrollment decrease was 3.38% or 132.50 students Four of the past five years, Garrett had the largest percentage decrease in the state each year. The state s overall enrollment increased by 6,525.50 students or 0.79%. Since 2009, no district has lost more students than Garrett s 13.86%. During that period, the state s overall enrollment increased 2.30%. Garrett has lost over 23.33% of its enrollment since fiscal 2000 or 1,151.75 students.

Wealth Formula Impact - Enrollment

Per Pupil Wealth By District Garrett County Board of Education Historical Analysis of Per Pupil Wealth Rankings - For State Aid Local Unit 2011 Local Unit 2012 Local Unit 2013 Local Unit Wealth w/sept NTI 2014 Local Unit Wealth w/nov NTI 2014 Local Unit Wealth w/sept NTI 2015 Local Unit Wealth FINAL w/nov NTI 14 Worcester $ 1,371,358 Worcester $ 1,276,025 Worcester $ 1,260,728 Worcester $ 1,146,967 Worcester $ 1,162,662 Worcester $ 1,094,785 Worcester $ 1,114,372 Talbot $ 1,142,003 Talbot $ 1,121,952 Talbot $ 1,086,948 Talbot $ 1,062,356 Talbot $ 1,111,452 Talbot $ 1,029,199 Talbot $ 1,087,437 Kent $ 783,593 Kent $ 786,125 Kent $ 764,790 Kent $ 765,949 Kent $ 779,422 Kent $ 780,720 Kent $ 825,857 Montgomery $ 740,535 Montgomery $ 698,439 Montgomery $ 666,722 Montgomery $ 654,775 Montgomery $ 701,593 Montgomery $ 657,040 Montgomery $ 718,645 Anne Arundel $ 648,477 Anne Arundel $ 627,838 Garrett $ 607,653 Garrett $ 601,519 Garrett $ 607,981 Garrett $ 623,611 Garrett $ 628,829 Queen Anne's $ 617,757 Queen Anne's $ 593,312 Anne Arundel $ 600,048 Anne Arundel $ 582,726 Anne Arundel $ 599,122 Anne Arundel $ 586,971 Anne Arundel $ 612,060 Howard $ 566,901 Garrett $ 583,132 Queen Anne's $ 586,497 Queen Anne's $ 564,189 Queen Anne's $ 578,510 Queen Anne's $ 559,848 Queen Anne's $ 575,026 Garrett $ 542,523 Howard $ 546,509 Howard $ 529,592 Howard $ 525,599 Howard $ 545,394 Howard $ 536,841 Howard $ 561,258 Baltimore $ 525,394 Baltimore $ 512,923 Baltimore $ 494,343 Baltimore $ 477,841 Baltimore $ 499,508 Baltimore $ 474,310 Baltimore $ 507,019 Frederick $ 454,814 Calvert $ 469,728 Calvert $ 459,368 Calvert $ 450,740 Calvert $ 458,316 Calvert $ 453,195 Calvert $ 463,438 Calvert $ 452,950 St. Mary's $ 445,122 Harford $ 430,762 Harford $ 434,674 Harford $ 441,840 Carroll $ 443,654 Carroll $ 452,370 Carroll $ 452,808 Carroll $ 439,029 Carroll $ 429,480 Carroll $ 431,724 Carroll $ 438,961 Harford $ 441,781 Harford $ 451,161 Harford $ 435,418 Prince George's $ 437,339 St. Mary's $ 429,455 St. Mary's $ 428,524 St. Mary's $ 434,084 St. Mary's $ 426,445 St. Mary's $ 433,004 Prince George's $ 433,556 Harford $ 434,535 Frederick $ 406,354 Frederick $ 397,831 Frederick $ 405,932 Frederick $ 402,478 Frederick $ 413,288 St. Mary's $ 432,658 Frederick $ 428,321 Prince George's $ 404,497 Prince George's $ 386,199 Prince George's $ 392,330 Charles $ 379,644 Charles $ 386,351 Charles $ 413,751 Dorchester $ 412,238 Dorchester $ 384,910 Cecil $ 378,139 Cecil $ 383,319 Prince George's $ 375,004 Prince George's $ 382,263 Dorchester $ 412,813 Charles $ 397,256 Cecil $ 384,435 Charles $ 377,701 Charles $ 382,594 Cecil $ 372,593 Cecil $ 379,072 Cecil $ 391,395 Cecil $ 393,895 Charles $ 384,172 Dorchester $ 370,298 Dorchester $ 374,247 Dorchester $ 357,707 Dorchester $ 363,635 Washington $ 383,087 Washington $ 361,191 Washington $ 344,933 Washington $ 337,200 Washington $ 341,785 Washington $ 334,161 Washington $ 340,173 Somerset $ 339,417 Somerset $ 337,402 Somerset $ 327,519 Caroline $ 295,845 Caroline $ 298,249 Allegany $ 294,349 Allegany $ 297,930 Caroline $ 324,375 Caroline $ 324,109 Caroline $ 305,212 Allegany $ 291,969 Allegany $ 294,770 Somerset $ 290,524 Somerset $ 295,023 Wicomico $ 316,297 Wicomico $ 312,264 Wicomico $ 294,809 Somerset $ 290,081 Somerset $ 293,393 Caroline $ 284,996 Caroline $ 288,882 Baltimore City $ 290,050 Baltimore City $ 291,018 Allegany $ 293,334 Wicomico $ 282,562 Wicomico $ 286,810 Wicomico $ 277,692 Baltimore City $ 285,568 Allegany $ 272,517 Allegany $ 289,935 Baltimore City $ 284,178 Baltimore City $ 272,412 Baltimore City $ 282,221 Baltimore City $ 272,638 Wicomico $ 283,502 $ 518,733 $ 505,354 $ 485,451 $ 473,847 $ 491,530 $ 473,985 $ 497,953 104.59% 115.39% 125.17% 126.94% 123.69% 131.57% 126.28%

Per Pupil Wealth

Historical Enrollment Statistics Garrett County Board of Education Historical Analysis of Full Time Enrollment (FTE's) 1/17 MSDE State Aid Local Unit Fiscal 2011 Fiscal 2012 Fiscal 2013 Fiscal 2014 Estimates for FY 2015 Garrett County Total FTE's 4,182.75-2.52% 4,084.00-2.36% 3,942.75-3.46% 3,918.00-0.63% 3,785.50-3.38% Free and Reduced Meals (FARMS) 1,947.00 5.13% 1,846.00-5.19% 1,811.00-1.90% 1,849.00 2.10% 1,763.00-4.65% Limited English Proficiency (LEPS) 3.00 0.00% 4.00 33.33% 1.00-75.00% 2.00 100.00% 3.00 50.00% Special Education Enrollment 532.00-8.12% 490.00-7.89% 482.00-1.63% 438.00-9.13% 417.00-4.79% FARMS % of Total FTE's 46.55% 45.20% 45.93% 47.19% 46.57% LEP Enrollment % of Total FTE's 0.07% 0.10% 0.03% 0.05% 0.08% Special Ed Enrollment % of Total FTE's 12.72% 12.00% 12.22% 11.18% 11.02% 10/31/2009 10/31/2010 10/31/2011 10/31/2012 10/31/2013

Historical State Aid

State Aid Statistics Since fiscal 2000, Garrett s total state aid has increased 15.61% from $16,252,745 to $18,789,990 for 2015. This increase is the lowest percentage in the state, while the state average has increased by 156.08% during the same period of time. No other district in the state has had to endure aid reductions of Garrett s magnitude of nearly $5.8 million dollars or 23.5% since 2009. Garrett s fiscal 2015 state aid allocation is over $725,000 less than the allocation it received in fiscal 2005.

Capital Project Cost Sharing

Southern Middle Capital Project This project was previously approved before the FEA facility study was performed. The study did not prompt the project as has been asserted. Due to low enrollment, the facility will not be able to fully take advantage of the state s participation rate. The state will be participating equally in approximately 76,995 of the 92,000 square foot project. At current enrollment rates, the county would need to pay 100% of the remaining foot print for the space to be fully renovated.

Southern Middle Capital Project The state also deducts from its cost share percentage the amounts of any recent renovations to the property. In the case of Southern Middle, it would be approximately $1,459,261. The local jurisdiction also pays for all design fees and the cost of any portable classrooms. The total project cost is estimated at $23,747,000 with the total local portion being $17,264,392 or 72.7%.

Remember the Box????? Do you recall Dr. Wilson s presentation at the college? If so, you will remember that we must work within the funding confines determined by the state funding formula along with limited federal funding and rely on County Government for the remainder of our revenues. County Government has agreed to provide up to $2 million in additional funding for fiscal 2015, which provides for status quo funding

DRAFT Fiscal 2015 Budget ESTIMATED REVENUES $ 51,331,855 $ 51,124,495 EXPENDITURES by OBJECT: Fiscal 2014 Fiscal 2014 Fiscal 2015 Fiscal 2015 Approved % of Budget Proposed % of Budget Salaries $ 27,133,488 57.0% $ 27,052,654 57.0% Contracted Services 5,420,013 11.4% 5,889,902 12.4% Supplies and Materials 1,290,223 2.7% 1,386,069 2.9% Fixed Charges 9,951,554 20.9% 9,112,374 19.2% Other Charges 2,398,357 5.0% 2,427,481 5.1% Equipment 295,750 0.6% 624,100 1.3% Transfers 1,085,400 2.3% 983,398 2.1% $ 47,574,785 100.0% $ 47,475,978 100.0% Restricted Projects 3,582,748 3,553,117 Total General Current & Restricted 51,157,533 51,029,095 School Construction 174,322 795,400 Total All Funds 51,331,855 51,824,495 Additional Request of County Government (700,000)

DRAFT Fiscal 2015 Budget ESTIMATED REVENUES $ 51,331,855 $ 51,124,495 EXPENDITURES by CATEGORY: Fiscal 2014 Fiscal 2014 Fiscal 2015 Fiscal 2015 Approved % of Budget Proposed % of Budget Administration $ 1,464,723 3.1% $ 1,490,752 3.1% Mid-Level Administration 2,437,942 5.1% 2,475,384 5.2% Instruction 19,501,124 41.0% 19,702,800 41.5% Special Education 3,645,644 7.7% 3,557,601 7.5% Pupil Services 670,680 1.4% 692,721 1.5% Health Services 434,850 0.9% 441,923 0.9% Pupil Transportation 4,306,014 9.1% 4,292,578 9.0% Maintenance of Plant 3,755,103 7.9% 3,898,269 8.2% Operation of Plant 798,891 1.7% 1,056,577 2.2% Fixed Charges 9,951,554 20.9% 9,112,374 19.2% Food Services 300,000 0.6% 300,000 0.6% Community Services - 0.0% - 0.0% Capital Outlays 308,260 0.6% 455,000 1.0% $ 47,574,785 100.0% $ 47,475,978 100.0% Restricted Projects 3,582,748 3,553,117 Total General Current & Restricted 51,157,533 51,029,095 School Construction 174,322 795,400 Total All Funds 51,331,855 51,824,495 Additional Request of County Government (700,000)

DRAFT Fiscal 2015 Budget New Items included in Fiscal 2015 Budget: $ 175,000 Alternative Education/Discipline Regulation Adjustments $ 79,000 Document Scanning for Pupil Services, HR, and Finance $ 57,000 Textbook purchases increase $ 25,000 School based equipment increase (meets priority requests of schools) $ 204,000 Computer based testing needs for PARCC (grants may be available) $ 438,865 Dennett Road Pole Building and Garage Doors plus other "listed" items net of $175,000 $ 978,865

Local Funding Trends Local funding is the final piece of the district s funding puzzle. Dr. Wilson had requested some historic funding information as part of the first year of her tenure and here are some of the results. Historic data indicates that there is a discrepancy between how the funding formula is designed to work, compared to the actual level of funding by local government provided over the past decade.

Local Funding Trends Garrett County Board of Education FY13 Analysis of Full Time Enrollment and Local Appropriations including Pension Shift Per pupil Wealth Rank Local Unit Local Appropriation Fiscal 2013 FY13 FTE's 1 Worcester 72,351,483 2 Talbot 34,960,007 3 Kent 17,362,758 4 Montgomery 1,419,513,701 5 Garrett 26,023,714 6 Anne Arundel 584,579,700 7 Queen Anne's 44,860,051 8 Howard 482,384,818 9 Baltimore 689,791,448 10 Calvert 110,284,424 11 Harford 219,821,368 12 Carroll 170,878,900 13 St. Mary's 85,697,709 14 Frederick 237,841,221 15 Prince George's 633,069,100 16 Cecil 69,615,833 17 Charles 153,957,200 18 Dorchester 17,963,318 19 Washington 92,951,603 20 Caroline 13,206,304 21 Allegany 29,391,956 22 Somerset 9,104,448 23 Wicomico 39,173,593 24 Baltimore City 252,813,655 Additional Appropriations to Move Up in Per Pupil Rankings Local Appropriation Per Pupil Local Unit Ranked Local Appropriation Per Pupil Rank $ 6,241.00 $ 11,592.93 Worcester $ 11,592.93 1 $ 4,273.25 $ 8,181.13 Montgomery $ 9,949.58 2 $ 2,041.00 $ 8,506.99 Howard $ 9,555.68 3 $ 142,670.75 $ 9,949.58 Kent $ 8,506.99 4 $ 7,517,204 $ 3,942.75 $ 6,600.40 Talbot $ 8,181.13 5 $ 6,232,430 $ 74,305.25 $ 7,867.27 Anne Arundel $ 7,867.27 6 $ 4,994,977 $ 7,508.00 $ 5,974.97 Calvert $ 6,834.58 7 $ 923,310 $ 50,481.50 $ 9,555.68 Baltimore $ 6,810.62 8 $ 828,856 $ 101,281.75 $ 6,810.62 Garrett $ 6,600.40 9 $ 16,136.25 $ 6,834.58 Carroll $ 6,379.47 10 $ 37,426.00 $ 5,873.49 Frederick $ 6,049.44 11 $ 26,785.75 $ 6,379.47 Queen Anne's $ 5,974.97 12 $ 16,732.25 $ 5,121.71 Charles $ 5,951.30 13 $ 39,316.25 $ 6,049.44 Harford $ 5,873.49 14 $ 117,995.25 $ 5,365.21 Prince George's $ 5,365.21 15 $ 15,236.00 $ 4,569.17 St. Mary's $ 5,121.71 16 $ 25,869.50 $ 5,951.30 Cecil $ 4,569.17 17 $ 4,391.00 $ 4,090.94 Washington $ 4,278.65 18 $ 21,724.50 $ 4,278.65 Dorchester $ 4,090.94 19 $ 5,221.00 $ 2,529.46 Allegany $ 3,493.22 20 $ 8,414.00 $ 3,493.22 Somerset $ 3,400.99 21 $ 2,677.00 $ 3,400.99 Baltimore City $ 3,205.41 22 $ 13,911.00 $ 2,816.02 Wicomico $ 2,816.02 23 $ 78,871.00 $ 3,205.41 Caroline $ 2,529.46 24 $ 5,507,598,312 823,452.00 $ 6,688.43 Note: Historic Information Compiled from MSDE Annual State Aid Reports

Local Funding Trends

Local Funding Trends

Local Funding Trends

Local Funding Trends

Local Funding Trends County Government has committed up to $2 million dollars in additional funding for fiscal 2015. The Board has requested an additional $700,000 to allow for the purchase of additional resources that will allow the system to move beyond the status quo.

Federal Funding Trends There have been some grants impacted by federal sequestration. However, the impacts have been absorbed to the extent possible. Fiscal 2014 is the last year for Race to the Top, so that funding stream will no longer be available. The district received project support of over $800,000 in the past four years.

Legislative Action Senate Bill 534 Education State Grant to Counties With Small and Declining Student Enrollment. This bill is sponsored by Senator Edwards and Senator Hershey and was cross-filed by Delegate Beitzel in the House of Delegates as HB814. Bill 534 is for fiscal years 2015 through 2017 and would limit losses of districts with enrollments less than 5,000 students whose overall loss was greater than 1% to 50% of the decrease in total direct education aid from the prior fiscal year to the current fiscal year.

Finance Questions???