JEFFERSON PARISH PUBLIC SCHOOL SYSTEM 501 Manhattan Harvey, Louisiana 70058 DRAFT Fiscal Year 2013-2014 General Operations Fund Budget Proposal August 6, 2013 Prepared by: ROBERT FULTON Chief Financial Officer Submitted by: JAMES MEZA, JR., Ed.D. Superintendent
JEFFERSON PARISH PUBLIC SCHOOL SYSTEM OFFICIALS JAMES MEZA, JR., Ed.D SUPERINTENDENT SCHOOL BOARD MEMBERS Mark Morgan, District I Dr. Etta Licciardi, District II Ray St.Pierre, District III Patrick Tovrea, District IV Cedric Floyd, District V Larry Dale, District VI Mark Jacobs, District VII Mike Delesdernier, District VIII Sandy Denapolis-Bosarge, District IX
STRUCTURE OF THE SCHOOL BOARD The Jefferson Parish School Board is an independent legislative body created under Louisiana Revised Statute 17:51. The School Board has the power to sue and be sued, and to make rules and regulations for its own government consistent with the laws of the State of Louisiana and the regulations of the State Board of Elementary and Secondary Education, to levy taxes and collect revenues through state approved means. The School Board consists of nine (9) members elected from districts. Each Board Member serves a term of four (4) years, and terms are concurrent. The chief duties of the Jefferson Parish School Board are to: o Appoint the Superintendent of Schools, o Establish school attendance boundaries, o Establish public schools as it deems necessary to provide adequate facilities, o Formulate educational and other policy, o Establish short-and-long range planning processes, o Adopt a balanced annual budget, o Exercise oversight authority for all financial matters. COMPOSITION OF THE SCHOOL DISTRICT The school system is currently composed of 80 schools (76 district schools and 4 charter schools) and four central administrative office facilities. Student enrollment in February, 2012 was 45,759 and 46,159 at February 1, 2013. JEFFERSON PARISH PUBLIC SCHOOL SYSTEM
501 MANHATTAN BOULEVARD HARVEY, LOUISIANA 70058 (504) 349-7600 www.jppss.k12.la.us TO: SUBJECT: MEMBERS OF THE JEFFERSON PARISH SCHOOL BOARD ADOPTION OF THE FISCAL YEAR 2013/2014 GENERAL OPERATIONS FUND BUDGET Overview In accordance with Louisiana Revised Statutes 17:02, 17:82, 17:88(A) and 39:1301, et.seq, as amended, the Jefferson Parish Public School System Superintendent recommends to the School Board Fiscal Year (FY) 2013/2014 General Operations Fund Budget. The adoption of the budget requires public hearings and a published notice in the official journal. The hearing is August 6, 2013 and the official notice was published in the Times Picayune on Wednesday July 17 and Friday July 19, 2013. Discussion Each year, the Superintendent recommends to the School Board the General Operations Fund Budget. The budget was developed to continue district efforts: To stabilize the budget after years of over spending To transfer more resources to the classroom. Overall, the budget projects an increase in revenue from the revised FY 2012/2013 budget with a sharp increase in mandated costs. The major revenue and expenditure changes for FY 2013/2014 from the revised FY 2012/2013 budget are described below. Budget Revenues by Source Total revenues increased by $15.3 million with the majority coming from state revenue sources. Local Revenue Summary Local revenues increased in total by about $1.3 million from FY 2013 to FY 2014 (from $231.7 million to $233.0 million) Property tax and sales tax revenue is projected to be similar in FY 2014 compared to FY 2013. State Revenue Summary State revenues increased by $15.1 million from $170.8 million in FY 2013 to $185.9 million in FY 2014
o State MFP increased by $11.8 million driven by two separate components: A projected increase in enrollment of about 720 students which will generate $2.7 million. The state had to revert to the FY 2012 MFP formula which increased base funding by $3.4 million and eliminated the deductions for Legacy Type II charters ($3.4 million) and for scholarship vouchers ($2.3 million). o The State provided additional funding outside of MFP of $3.3 million of which 50% is mandated to be spent on teacher pay increases. Federal Revenue Summary Due to the sequestration which lowered all Federal Budget allocations, this revenue source to the General Fund Budget decreased from FY 2013 to FY 2014 by $0.4 million. Fund Balance Transfer Summary In FY 2012/2013 there was a transfer of $0.7 million from reserves. The FY 2013/2014 budget does not include such a transfer. Expense Summary by Type Total expenses increased by $15.3 million in FY 2013/2014 over FY 2012/2013 from $407.7 million in FY 2012/2013 to $423.0 million. Summary of Salary and Benefits Expense Total salary and benefits for FY 2013/2014 are projected to be $332.1 million (79% of the general fund budget), an increase of $7.2 million from FY 2012/FY2013. The budget for salaries was increased in FY 2013/2014 from FY 2012/2013 by $4.3 million including: o Forty-seven additional teachers (increase of $2 million over FY 2012/2013) o Fifty paraprofessionals to support special education students and English as a Second Language students (increase of $1 million ) o A one-time stipend for teachers and support staff ($1.9 million) o SAVINGS: These increases were offset by about $1.0 million in projected savings from the Additional Pay and Temporary Salaries portion of the budget. The budget for Benefits was driven by rapid increases in Pension Benefits and Health Benefits. o Retirement Benefits increased by 13% or $6.8 million from FY 2012/2013 to a total of $59.1 million. o Equalizing health care benefits to comply with the Affordable Care Act increased costs by $1.0 million. o Projected Retiree Health Care benefit costs remained relatively flat but continue to be a significant cost to the District at $23.6 million.
o SAVINGS: By restricting severance payouts for unused sick days the District will realize savings of $4.5 million. Summary of Other Expense Areas All other expense areas account for just over twenty percent of the budget and remained relatively flat with some areas of modest increases. Total Purchased Services, Supplies and Equipment, which includes items such as insurance, utilities, contracted bus transportation, and professional services, increased by $0.4 million to $50.6 million in FY 2013/2014. Total Fees which the district pays for the collection and billing of sales and property taxes essentially remained the same at about $19.6 million Total Transfers for various items including maintenance, child nutrition, charter schools and debt service increased by $7.8 million to a total of $20.6 million in FY 2013/2014. o Debt service increased by $3 million to support the new $50 million bond issue authorized by the Board. o The amount of revenue passed through to charters is $9.2 million for FY 2013/2014. Conclusion The increase in revenue this year has allowed Jefferson Parish to keep up with the rapid increase in mandated costs. To continue to make Jefferson Parish a student-centered organization, the District has had to be creative in realizing savings in existing spending to continue to invest in innovative academic programs. This balanced budget allows the district to continue to build on the academic and organizational progress of the past several years. The FY 2013/2014 General Operations Fund Budget revision is a best estimate of revenues and expenditures utilizing current data and revenue trends.
RECOMMENDATION: That the Jefferson Parish School Board approves the Fiscal Year 2013/2014 General Operations Fund Budget as presented and discussed. Respectfully Submitted: James Meza, Jr., Ed.D Superintendent
BUDGET PROCESS The primary purpose of the budget is to set forth in financial terms the educational objectives of Jefferson Parish Public School System. The Jefferson Parish Public School System fiscal year runs from July 1 through June 30. The process, as described in the annual Budget Planning Process Chart underscores the who and why of what we are - an educational institution. Therefore, every dollar spent must be directly traceable to student outcomes otherwise the expenditure should not be incurred. The budget process is divided into four parts: I. BUDGET PREPARATION As defined in the annual Budget Planning Process Chart, the preparation includes the consideration of the following: a. The state and local educational mandated programs b. The Jefferson Parish School Board s goals, plans, and policies c. The Superintendent s goals and priorities d. Fixed costs such as collection fees, etc. e. Enrollment projections f. Revenue projections g. Teacher pupil staffing ratios h. Per-pupil expenditures for non-salary items i. Central and regional office staffing j. Capital expenditures priorities II. BUDGET PRESENTATION A comprehensive budget presentation is given to the Jefferson Parish School Board, employees, and citizens of Jefferson Parish. The goal of the presentation is to foster credibility and trust and sets forth the educational programs and their associated costs and benefits. III. BUDGET ADOPTION The budget adoption provides the financial wherewithal and legal basis upon which the administration carries out the educational plan and sets legal limits on expenditures. IV. BUDGET EXECUTION The execution of the budget provides for a system of managerial accounting provided through the establishment of financial records and accounts; provides real-time information upon which the Superintendent and Board base their decisions. V. BUDGET CALENDAR
The following timetable is recommended for the Budget September Submit the Jefferson Parish School Board s adopted current year General Fund Budget to the Superintendent of Education at the State Department of Education prior to the 15 th of the month. Begin the process of developing the next year Capital Improvement Fund Budget (Fund 2) for minor/major improvement, repairs, and replacements, etc. Ensure that all grant funds are encumbered and that all requisitions for equipment are submitted to the purchasing department. On-going collection of financial data with which to measure program performance and to which the revision of the general fund will be based upon. October First draft of Capital Improvement Budget ready for Superintendent s review. Capital Improvement Budget submitted to the Jefferson Parish School Board for review and recommendations. December Capital Improvement Budget for next fiscal year submitted to the Board for approval. July August August August Submit the preliminary next year s General Fund Budget to the Board. The Board sets the formal public hearing dates and places notices in the official journal. Hold the official public hearings on the next year s General Fund Budget. Submit the Superintendent s recommended next year s General Fund Budget to the Board for consideration and approval. Upon Board approval, publish the official budget document. VI. BUDGET POLICY In accordance with provisions of Louisiana Revised Statutes 17:88 and Revised Statutes 39:1301 et seq., a comprehensive budget for the ensuing fiscal year for the general and each special fund must be prepared, adopted and implemented. Responsibilities of the Board shall include: Conducting at least one public hearing on the General Fund Budget proposed by the Superintendent.
Adopting a balanced budget, for each fund, with approved expenditures not exceeding the total of estimated funds available. Based on information provided by the Superintendent during the year, adopting an amended budget(s) reflecting significant changes in revenues expenditures estimates. Adapting, as necessary, supplementary emergency budgets to cover unforeseen expenditures. Reviewing long/short-range plans approving system-wide objectives. Ensuring that there is a system of procedures and internal controls to properly account for revenues and expenditures. Determining the amount of local funds to be raised in any school year. By state law, referring the issue of a tax levy above the statutory limit directly to the people. Determining the size and time of bond levy, and referring proposals to the electors. Providing for the establishment of necessary procedures to assure proper accounting of receipts, disbursements, and balances. Providing for an annual audit of funds of the system as required by law, including those of student organizations, child nutrition, and other funds under the supervision of the Board. Seeking to promote by state and federal legislation adequate financial support of the public schools. Requiring and considering reports of business transactions of the system and of the financial condition of the system. Responsibilities of the Superintendent shall include: Preparation of a comprehensive budget for the general fund and for each fund with expenditures not exceeding estimated revenues. Making available such budget(s) for public inspection prior to adoption by the Board. Informing the Board when any one of the following conditions occur: Projected revenues within a fund fail to meet the budgeted revenue by five percent or more. Projected expenditures within a fund are expected to exceed budgeted expenditures by five percent or more.
Beginning fund balance for any given fund fails to meet the estimated balance by five percent or more when the fund balance is being used to fund current operations. Making budget revisions, moving budgeted items within the general fund, but not increasing the total amount approved in the budget. The hiring or firing of all personnel Determination of personnel salaries and benefits. Providing all possible economies that do not endanger educational programs. Supervising the general business procedures of the system to secure the proper accounting of funds, supplies and equipment. Seeking to secure materials and supplies best suited to the educational needs of the system. Approving all contracts to be entered into by the system or any person on behalf of the system and acting as authorized agent of the system and the Board in contracts between other governmental agencies. Recommending an adequate program of insurance in all phases of system operation with regard to those prescribed by law. Making proper reports to the School Board, keeping the School Board fully advised as to the financial status of the system and all implications of the financial aspects of school administration. Formulating a student grade organization and housing plan. Formulating the student educational plan.