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Overview of Fiscal Year 2010-11. Oakland Schools Proposed Budgets. Property Tax Forecast. Property Tax decreases Fiscal Year 2008-09 -0.5% - $ 0.4M Fiscal Year 2009-10 -4.5% - $ 11.7M Fiscal Year 2010-11 -13% - $ 38.4M Fiscal Year 2011-12 -12% - $ 59.8M

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overview of fiscal year 2010 11

Overview of Fiscal Year 2010-11

Oakland Schools Proposed Budgets

property tax forecast
Property Tax Forecast

Property Tax decreases

Fiscal Year 2008-09 -0.5% - $ 0.4M

Fiscal Year 2009-10 -4.5% - $ 11.7M

Fiscal Year 2010-11 -13% - $ 38.4M

Fiscal Year 2011-12 -12% - $ 59.8M

Fiscal Year 2012-13 -5.0% - $ 67.6M

Fiscal Year 2013-14 -0.0% - $ 67.6M

Fiscal Year 2014-15 2.0% - $ 64.7M

Annual Property Tax Collection has declined from FY 2009 to FY 2014 by 31%

Accumulative loss from FY 09 to FY 15 is $310.3m

FY 2008 base year tax levy is $216.9m

fund balance target setting protocol
Fund Balance Target Setting Protocol

The proposed protocol for the development of each fund’s

year ending fund balance target will be predicated upon:

    • 5 percent of the operating programs contained in said fund
    • Known economic liabilities or designated reserves of a specific fund

The fund balance target setting protocol recognizes the following economic realities:

  • The State of Michigan’s economic environment
  • The economic status of the LEAs that comprise the Intermediate School District.

Oakland Schools Board of Education approved the Protocol on 6/15/2009

Practice for the Special Education Fund is to distribute the amount in

excess of the target unreserved fund balance.

oakland schools total revenue summary
Oakland SchoolsTotal Revenue Summary

FY 2011 $323.9 Million

Dollars in millions

revenue assumptions
Revenue Assumptions
  • Property tax revenue decrease of 13%
  • Expected investment rate of return is 1.5% on available resources
  • Increased local district utilization of our Finance, Human Resource application, Benchmark & Inform system and Novanet fee-based software system.
  • General Education Section 81 reduced by 14.5%
  • All other State Aid held flat
oakland schools fiscal year 2011 total expenditure budget by type
Oakland Schools Fiscal Year 2011Total Expenditure Budget by Type

$351.7 Million

Cash to LEAs

Dollars in millions

difference between revenue expenditures
Difference between Revenue & Expenditures

Total Difference: $27.8 million

  • Capital Projects Funds $(10.9m)
  • Debt Service payments $(5m)
  • Special Education Fund $(11.0m)
  • All other funds $(.9m)
slide9

Oakland SchoolsFinancial Impact of Benefit Plan Changes

Savings Over Five Years = $ 5,387,820

Annual Cost

If No Changes

Data Source:

McGraw Wentworth Analysis of Actual Results

$ 6,764,089

$ 6,093,774

$ 5,491,541

$1,348,655

Oakland Schools

Annual Savings

$ 4,948,988

$ 1,628,613

$ 4,656,274

$ 4,524,888

$ 1,240,573

$ 931,342

$ 238,637

Oakland Schools

Annual Cost

$ 4,250,968

$ 4,417,109

$ 4,017,646

$ 4,465,160

$ 5,415,434

$ 4,524,888

Enrolled

405

Enrolled

397

Enrolled

400

Enrolled

405

Enrolled

402

Enrolled

388

Note: 1. Enrollment is noted at the bottom of each bar with 2010 cost at 1/1/2010 level (anticipated to change in June 2010)

2. Cost with no changes based on 11% annual rate of increase (most projections range from 7% to 13%)

3. 2010 savings based on actual 2010 BCBS rate renewal (no credit / adjustment for Risk Related Fund)

budget highlights
Budget Highlights
  • Continued health insurance premium share
  • FY 2010 & 2011 salary freeze
  • Five (5) unpaid furlough days for all employees (approx. 2% wage decrease)
  • Salary reduction in 2012 by 3%
  • Attrition, Voluntary Employee Sick Leave Program (VESLPP) and workforce reductions – 105.5 FTE reductions
  • Continued planned spend down of fund equity to 5%
budget highlights11
Budget Highlights
  • MPSERS retirement rate budgeted at the weighted average rate of 18.79% (19.41% effective October 1, 2010)
  • Non union & union healthcare cost budgeted at annual increase of 13%
  • Purchase Services, Supplies & Materials, Dues & Fees reduced by aggregate 10%
  • Utilities reflect a 6% decrease from the prior year
budget highlights12
Budget Highlights

FY 2011 proposed non-union salary & wage changes

A wage freeze was implemented on January 1, 2010 for

non union staff. Non-union wages follow the calendar

year.

5 unpaid furlough days for 12 month staff (2% decrease)

Continuation of employee premium share based on pay

level (up to 4.5%)

The progression increment movement with in the market

ranges plus the longevity stipends account for an average

of 0.5% annually.

budget highlights13
Budget Highlights

FY 2011 proposed union salary & wage changes

The union & Board of Education approved a one year

extension on the existing contract, expiring June 30, 2011.

The contract includes a wage freeze implemented on July 1,

2010.

3 unpaid furlough days for 10 month staff (2% decrease)

Continuation of the 6% health insurance cap.

Step increases are provided by contract for an average of

1.2% annually.

allocation of costs
Allocation of costs

General Allocation

50% GE, 25% SE, 25% CFE

Activity Based Cost Allocation–FTE based

23% GE, 25% SE, 52% CFE

Abraham & Gaffney – sq footage based

50% GE, 26% SE, 24% CFE

Cost Based Allocation – Transportation

73% GE, 25% SE, 2% CFE

Reference Enterprise Wide Summary Document

general education fund summary
General Education Fund Summary
  • Total Revenue: $17.5 Million
    • Property tax – $10.6 M (60% of total revenue)
    • Other local revenues – $3.5 M
    • State sources revenues – $2.9 M
    • Other financing source revenues – $.5 M
  • Total Expenditures: $17.7 Million
    • General administration – $1.7 M
    • Finance and operations – $7.2 M
    • Instructional services – $8.7 M
    • Plant and fixed charges, transfers to LEAs – $.1 M

Note: Medicaid Revenue now reflected in Fund 273

general fund overview
General Fund Overview

Dollars in millions

fiscal year 2011 general education fund balance
Fiscal Year 2011General Education Fund Balance

END OF YEAR:

Unreserved: $ 3,392,200

Reserved:

Prepaid, Inventory and Deposits $ 35,000

Total Budgeted Ending Fund Balance $ 3,427,200

_______________________________________________________

5% of GEF operating expenditures ($17.7 m): $ 0.9 m

State Aid exposure (sec 81): $ 2.9 m

Fund Balance Protocol Target: $ 3.8 million

pending legislation limits general education fund to 15 fund balance
Pending Legislation limits General Education Fund to 15% fund balance

Current Operating Expenditures (COE) - MDE defined

Total Current Operating Expenditures do not include:

  • Capital Outlay
  • Community Services
  • Transfers outs (includes Medicaid transfers to districts)
fiscal year 2011 district debt
Fiscal Year 2011 District Debt

Amount Average Annual Payment

GEF Debt Principal: $ 5,165,000 $ 750,000

CFEF Debt Principal: $44,770,000 $ 3,100,000

QSCB Debt Principal (funds): $14,800,000$ 850,000

Total OS Bonded Debt: $64,735,000 $ 4,700,000

NOTE: Debt Service for the Administration Building

Project Bond (2003) and QSCB issue is pre-funded in Debt Service

Fund 310 & 313 and Debt Service for the campus renovations bond

(2007) is pre-funded in Debt Service Fund 312 through FY 2014

isd budget resolution
ISD Budget Resolution

Revised School Code 380.624 - Overview

  • Not later than May 1 of each year, the ISD shall submit proposed budget for next fiscal year to the board of each constituent district for review
  • Not later than June 1 of each year, the board of each constituent district shall review the proposed ISD budget, shall adopt a board resolution expressing its support for or disapproval of the proposed budget
  • Mail copy of resolution indicating support or disapproval (with rationale) to the Oakland Schools Board of Education
general education fund
General Education Fund
  • Questions & Comments
special education fund summary
Special Education Fund Summary
  • Total Revenue: $142.0 Million
    • Property tax – $134.9 M (95% of total revenue)
    • Other local revenues – $1.4 M
    • State sources revenues – $5.7 M
  • Total Expenditures: $153.0 Million
    • Program supervision and direction – $2.3 M
    • Program operations – $7.5 M
    • Plant and fixed charges – $5.7 M
    • LEA transfers and program subsidies – $137.5 M
slide24

Special Education Fund Overview

*FY 2004 contains “one time” operating adjustment for prior years **Dollars in millions

fiscal year 2011 special education program support subsidies
Fiscal Year 2011 Special Education Program Support & Subsidies

PA-18 Base Distribution $ 134,332,100

Start-up Contingency $ 850,000

Extraordinary Contingency $ 250,000

Section 24 subsidy $ 100,000

Group Homes $ 1,200,000

Havenwick $ 150,000

SEI Regional Day Treatment $ 450,000

Michigan Rehab Services Cash Match $ 180,000

Total $ 137,512,100

PA-18 Base Distribution $(8.8m) decline from FY 2010

oakland schools special education expenditure budget comparison
Oakland Schools Special Education Expenditure Budget Comparison

Dollars in millions

*External services with offsetting revenue not included in FY 2010 OS Operations

pa 18 base distribution fy 2003 2015
PA-18 Base Distribution FY 2003-2015

Trend Line: Red

After Property Tax Decline: Blue

Dollars in millions

fiscal year 2011 special education fund balance
Fiscal Year 2011Special Education Fund Balance

END OF YEAR:

Unreserved: $ 755,200

Reserved:

Future SE Center Facility Renovations $ 286,000

Total Budgeted Ending Fund Balance $ 1,061,200

5% of SEF operating expenditures ($15.5 m): $ .775 m

State Aid exposure (sec 51a, 51a.8) $ 3.9 m

Fund Balance Protocol Target: $ 4.675 million

special education fund
Special Education Fund
  • Questions & Comments
career focused education fund summary
Career Focused Education Fund Summary
  • Total Revenue: $34.1 Million
    • Property tax – $33.0 M (96% of total revenue)
    • Other local revenues – $0.6 M
    • State sources revenues – $.4 M
    • Other financing source revenues – $0.1 M
  • Total Expenditures: $32.9 Million
    • Campus and other program administration – $21.8 M
    • LEA transfers and direct program operations – $5.1 M
    • Facility and technology maintenance/renovations – $0.1 M
    • Plant and fixed charges – $5.9 M
fiscal year 2011 career focused education fund balance
Fiscal Year 2011Career Focused Education Fund Balance

END OF YEAR:

Unreserved: $ 8,069,800

Reserved:

Prepaid, Inventory and Deposits $ 67,200

Total Budgeted Ending Fund Balance $ 8,137,000

_______________________________________________________

5% of CFEF operating expenditures ($32.9): $ 1.6 m

State Aid exposure (sec 61a.1, 61a.2): $ .4 m

Fund Balance Protocol Target $ 2.0 million

career focused education fund
Career Focused Education Fund
  • Questions & Comments
proposed grants and funded projects summary
Proposed Grants and Funded Projects Summary
  • Total dollar award value of all current grants and funded projects: $113.7 Million
      • New Awards $94.5 Million
      • Carry Over $19.2 Million
  • Direct transfer to districts: $88 Million
  • ISD administered grants and projects: $25.7 Million (Includes JobLink $11.8M)
other funds
Other Funds
  • Cooperative Activities Fund 270 – Collaborative Program Development Initiative (CPDI)
  • Cooperative Activities Fund 271 – Oakland Network for Education (ONE)
  • Cooperative Activities Fund 272 - Alternative Education High School ( Under Study)
  • Cooperative Activities Fund 273 – Medicaid
  • Debt Service Fund 310 – Administrative Building Bond 2003: 15 years, ending 2018
  • Debt Service Fund 312 – CFE Campus Renovations Bond: 29 years, ending 2036
  • Debt Service Fund 313 – Qualified School Construction Bond:17 years, ending 2027
other funds38
Other Funds
  • Capital Projects Fund 404 - CFE Technical Campus Renovations Phase II Project
  • Capital Projects Fund 406 – Admin Bldg Renovation & Maintenance
  • Capital Projects Fund 408 – Qualified School Construction Bond
  • Production Print Fund 710 – Enterprise Fund (subsidy eliminated)
  • Risk Related Activity Fund 810 – Internal Service Fund (unemployment pre-funded)