SAN DIEGO UNIFIED SCHOOL DISTRICT 2015-16 THIRD INTERIM FINANCIAL REPORT UPDATE B O A R D O F E D U C A T I O N M A Y 1 0, 2 0 1 6
THIRD INTERIM AGENDA Requirements of the CA Education Code Changes to the Financial Reports Since Second Interim Reporting Period Multi-Year Projections (MYPs) Assumptions (MYPs for General Fund only) Updated General Fund Financial Projections (as of April 30, 2016) 2015-16 Cash Flow Projections (as of March 31, 2016) Next Steps 2
REQUIREMENTS OF THE CA EDUCATION CODE Qualified and Negative Districts are Required to Submit a Third Interim Financial Report to the County Office by May 15, 2016 Reflect the District s Projected Budget Status as of April 30, 2016 Update to General Fund and Cash Balances District is Not Required to Update Certification Status 3
CHANGES SINCE THE SECOND INTERIM REPORTING PERIOD Third Interim Report: Reflects No Financial Reporting Changes from Second Interim in any of the Following Categories: Revenues Expenditures Contributions 4
MYP ASSUMPTIONS - UNCERTAINTIES Every Student Succeeds Act (ESSA) TRANS Issuance Higher Borrowing Rates Food Services Potential Contribution Minimum Proportionality Percentage (MPP) Prop 30 Tax Extension LCFF Implementation (Prop 98 Guarantee) One-Time Funds STRS and PERS Pension Liability Reporting GASB 68 5
MYP ASSUMPTIONS GENERAL FUND REVENUES REVENUE ASSUMPTIONS Description 2015/16 2016/17 2017/18 LCFF Funding Model Funded ADA 102,512 100,659 99,127 COLA* 1.02%.47% 2.13% Funding Gap* 51.97% 49.08% 45.34% Federal : Impact Aid $8.0 Mil $8.0 Mil $8.0 Mil Other State Mandated Cost Reimbursement $3.74 Mil $ 3.66 Mil $ 3.60Mil Mandated Cost Reimbursement (one-time) $ - $ 21.21 Mil $ - Lottery (GFU- $128; GFR-$34.00) $140/ADA $140/ADA $140/ADA Local : Interest.690%.690%.690% Transfers In Redevelopment Agency (RDA) $10.3 Mil $10.3 Mil $10.3 Mil Sale of Property $2.8 Mil $ - $ - Hourly Cost - Temporary Classroom Moves $.3 Mil $ - $ - Retiree Medical Fund $0.4 Mil $0.4 Mil $0.4 Mil 6
MYP ASSUMPTIONS GENERAL FUND EXPENDITURES EXPENSE ASSUMPTIONS Description 2015/16 2016/17 2017/18 Salaries Step and Column: Cert / Class 2.06% /.73% 1.76% /.92% 1.76% /.92% Salary Increases* 4% 0% 0% STRS 10.73% 12.58% 14.43% PERS 11.85% 13.05% 16.60% Health & Welfare Premiums 6.50% 7.00% 7.00% Materials & Supplies (Consumer Price Index- CPI) 1.90% 2.22% 2.52% Contracted Services (CPI) 1.90% 2.22% 2.52% Utilities $26.0 Mil $31.2 Mil $33.9 Mil Implemented Board Solutions/Budget Deficit $ - $24.6 Mil $108.8 Mil Transfers Out Liability Insurance $3.6 Mil $3.6 Mil $3.6 Mil Property Insurance $3.3 Mil $3.3 Mil $3.3 Mil Child Development $6.2 Mil $9.2 Mil $9.2 Mil Retiree $2.1 Mil $2.1 Mil $2.1 Mil Contributions Special Education $188.2 Mil $195.0 Mil $195.0 Mil Restricted Routine Maintenance (RRM) $29.1 Mil $27.6 Mil $27.6 Mil Community Day School $2.0 Mil $ - $ - 7
MYP GENERAL FUND UNRESTRICTED 2015/16 2016/17 2017/18 DESCRIPTION PROJECTION PROJECTION PROJECTION Beginning Balance $144,094,134 $73,580,795 $29,532,028 Revenues 983,432,106 1,028,007,321 1,022,584,780 Expenditures (834,687,104) (868,029,034) (903,648,621) Projected Shortfall Solutions 2016/17 24,564,230 Projected Shortfall Solutions 2017/18 108,841,125 TOTAL EXPENDITURES (834,687,104) (843,464,804) (794,807,496) Other Sources / Uses (219,258,341) (228,591,284) (228,591,284) Ending Balance $ 73,580,795 $ 29,532,028 $28,718,028 SURPLUS/(SHORTFALL) (70,513,339) (44,048,767) (814,000) Required Reserves Economic Uncertainties $26,281,000 $26,950,000 $26,136,000 Reserve for FY16/17 Projected Shortfall 44,717,767 - - Stores 1,674,228 1,674,228 1,674,228 Prepaid Expenses 850,000 850,000 850,000 Revolving Cash 57,800 57,800 57,800 Total Required Reserves $73,580,795 $29,532,028 $28,718,028 Reserve (Shortfall) / Surplus $0 $0 $0 Multi-Year Projection involves hybrid approach to include 2016-17 deficit solutions 8
MYP GENERAL FUND TOTAL 2015/16 2016/17 2017/18 DESCRIPTION PROJECTION PROJECTION PROJECTION -1- -2- -3- -4- Beginning Balance $ 162,318,205 $ 140,129,564 $ 68,468,453 Revenues 1,278,072,041 1,265,067,907 1,258,406,016 Expenditures (1,300,360,419) (1,330,737,182) (1,290,072,747) Other Sources / Uses 99,737 (5,991,836) (5,991,836) ENDING BALANCE $ 140,129,564 $ 68,468,453 $ 30,809,886 SURPLUS/(DEFICIT) $ (22,188,641) $ (71,661,111) $ (37,658,567) Required Reserves Economic Uncertainties $ 26,281,000 $ 26,950,000 $ 26,136,000 Reserve for FY16/17 Deficit 44,717,767 - - Restricted Grant Carryover 66,548,769 38,936,425 2,091,858 Unexpended Balances / Set Aside* - - - School Site Ending Balances - - - Stores 1,674,228 1,674,228 1,674,228 Prepaid Expenses 850,000 850,000 850,000 Revolving Cash 57,800 57,800 57,800 Total Required Reserve $ 140,129,564 $ 68,468,453 $ 30,809,886 Reserve (shortfall) / Surplus $ - $ - $ - 9
Millions 2015-16 GENERAL FUND PROJECTED CASH FLOW WITH TRANS $250.0 $225.0 TTRANS $ 185 Million $200.0 $175.0 $150.0 $125.0 $100.0 $75.0 $50.0 $25.0 JUL AUG SEPT OCT NOV DEC 01-07 DEC 08-31 JAN FEB MAR APR MAY JUN Actual $54.20 $60.71 $93.79 $89.14 $67.52 $35.80 $136.38 $243.93 $195.09 $132.55 Projected $147.90 $138.52 $101.73 $- *Reflects Monthly Balances after Payroll *Any Increase/Decrease in Entitlement for this Fiscal Year will Not be Realized Until the P-2 Certification in July 2016. * As of March 31, 2016 10
2016-17 SOLUTIONS Description Amount (in millions) Program Vacancy Savings (Special Education) $10.0 Position Review $3.0 Funding Alignment $5.0 Program Adjustments $6.6 Total Solutions $24.6 11
CLOSING REMARKS Governor s May Revise Will Provide a Much Clearer Fiscal Picture for Budgeting Update to be shared on May 24, 2016 12
BUDGET DEVELOPMENT PROCESS NEXT STEPS Step Task Date 1 LCAP Community Stakeholder Input September 2015 June 2016 2 Informational Update to Board on Third Interim May 10, 2016 3 May Revise Board Presentation May 24, 2016 4 Public Hearing and Adoption of 2016-17 Budget and LCAP (First Reading) 5 Board Adoption of 2016-17 Budget and LCAP (Second Reading) BOARD ACTION 6 Board Approval of TRANs Resolution BOARD ACTION 7 2016-17 Adopted Budget and LCAP due to the SDCOE June 14, 2016 June 28, 2016 June 28, 2016 June 30, 2016 13
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