1 / 39

2016/17 2nd Interim Budget

Board of Trustees Jeff Burch , President Darcy Knight Joe Scroggins Ronnie Ebitson Bill Drescher Superintendent Jeremy Meyers. 2016/17 2nd Interim Budget. Black Oak Mine Unified School District. Key Slides. 25 26 29 30 31 32 33 34. 36 38. 9 11 14 15 18 19 20 21.

orde
Download Presentation

2016/17 2nd Interim Budget

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Board of Trustees Jeff Burch, President Darcy Knight Joe Scroggins Ronnie Ebitson Bill Drescher Superintendent Jeremy Meyers 2016/17 2nd Interim Budget Black Oak Mine Unified School District

  2. Key Slides • 25 • 26 • 29 • 30 • 31 • 32 • 33 • 34 • 36 • 38 • 9 • 11 • 14 • 15 • 18 • 19 • 20 • 21

  3. How the Budget Process Works… • The State requires School Boards to adopt district budgets by June 30th of each year • After the adoption of the State budget schools are required under Education Code 42127(i)(4) to update district budgets with any significant changes within 45 days • Two interim reports are taken to the board for approval each year. • December - Referred to as 1st Interim • March - Referred to as 2nd Interim • Books are closed in July-August and taken to the Board for approval in September as “Unaudited Actuals”

  4. Budget Timelines JUNE 1ST – 3rd Interim Budget (Qualified or Negative Certified Districts Only) – No later than June 1, each school district with a qualified or negative certification for the second interim report must provide financial statement projections of the district’s fund and cash balances through June 30 for the period ending April 30 to the county superintendent, the Controller, and the SPI. SEPTEMBER – Unaudited Actuals The Unaudited Actuals report will be presented at the public board meeting in September of each year. This report will reflect the actual revenue and expenditures of the district for the budget year. • JULY 1st-Adopted Budget -or- Not later than 45 days after the Governor signs the annual Budget Act, the school district shall make available for public review any revisions in revenues and expenditures that it has made to its budget to reflect the funding made available by the Budget Act. (EC 42127 (i) (4)) • DECEMBER – 1st Interim Budget The 1st Interim report will be presented at the public board meeting in December of each year. This report will include any changes made to the budget since the budget adoption in June, including those reported 45 days after the Governor signed the annual Budget Act. • MARCH – 2nd Interim Budget The 2nd Interim report will be presented at the public board meeting in March of each year. This report will include any changes made to the budget since the 1st Interim report was presented in December.

  5. Budget Certifications 3 Choices BOMUSD’s Choice BOMUSD has certified “Qualified” for the school years: 2009/10, 2010/11, & 2011/12, 2014/15 and 2015/16. BOMUSD has certified “Positive” for two years in 2012/13 and 2013/14. The current administration recommendation is a “Qualified” budget certification for the 2016/17 First Interim Budget. • (1) "Positive," the district is able to meet its financial obligations for the remainder of the fiscal year and subsequent two fiscal years • (2) "Qualified," the district may not be able to meet its financial obligations for the current year or two subsequent fiscal years • (3) "Negative," the district will not be able to meet its financial obligations for the remainder of the current year or the subsequent year

  6. Budget Assumptions • There are many unpredictable factors that affect revenue • and expenditures. Because of that, the District bases its • budget on assumptions. This is the best information • available at the time the budget is adopted. The adopted • budget, therefore, should be considered a “financial • snapshot” on the date it is approved. As variables • change, formal adjustments, approved by the board, are • made throughout the course of the year.

  7. REVENUES

  8. Local Control Funding Formula - LCFF There are two distinct phases of LCFF: (1) The 8 year implementation phase – Transition Entitlement • Until the LCFF is fully funded, school districts and charter schools, will receive an LCFF Transition Entitlement. • The Transition Entitlement is based on an LEA’s 2012-13 funding level, adjusted for changes in student population, and the amount of funding the LEA would receive under the LCFF model at full implementation. The fully funded phase – Target Entitlement • Funding increases based on COLA

  9. Enrollment and Average Daily Attendance (ADA) Impact of declining enrollment on LCFF funding: 2016/17 – a loss of about $53,000 2017/18 – a loss of about $185,000 2018/19 – a loss of about $193,000

  10. 2016/17 LCFF Income Assumptions Four Main Assumptions to Project LCFF Income: 1. ATTENDANCE (ADA PROJECTIONS) District ADA Projections: 2016/17 CBEDS ENROLLMENT= 1,076 (decrease of 49 from 15/16 CBEDS) 2016/17 FUNDED ADA = 1,074 (based on 15/16 ADA) – includes NSS ADA Charter ADA Projections: 2016/17 CHARTER ENROLLMENT = 182 (decrease of 10 from 15/16 CBEDS) 2016/17 FUNDED CHARTER ADA = 176 (based on 16/17 current year projected ADA) 2. ANNUAL COLA 2016/17 COLA = 0.0%, but District is funded at 3% below its LCFF target 3. UNDUPLICATED PERCENTAGE (% of FRPM students, Foster Youth, English Learners) 2016/17 Unduplicated Percentage = 45.79% 4. PERCENTAGE OF GAP FUNDING DURING TRANSITION (remember the GAP is the difference to where we are currently funded to our Target LCFF rate) 2016/17 Percentage = 55.28%

  11. TRANSITION-SIMPLIFIED LCFF CALCULATION

  12. Unrestricted vs. Restricted Income UNRESTRICTED INCOME RESTRICTED INCOME (AKA Categoricals) Expenditures must follow the specific guidelines of the grant or entitlement. Grants and Entitlements are often referred to as “Categoricals” Examples: Special Education, Title IA, Title II, Workability • Can be used for any school related expense. Examples: LCFF, Non-Prop 20 Lottery

  13. 2016/17 INCOME = $12.6 millionBY MAJOR CATEGORIES UNRESTRICTED INCOME = $10.4 m RESTRICTED INCOME = $2.2 m

  14. Major Income Changes Since First Interim Budget LCFF Income - $21,000 Increase • 1.1% increase in projected GAP plus increase in Special Ed COE students Federal Income – $17,000 Increase • MAA cash basis receipt of $6k • Medi-Cal cash basis receipt of $7k • Title IA entitlement change of $4k

  15. Major Income Changes Since First Interim Budget Other State Income - $122,000 Increase • Lottery $21k • Energy Efficiency $102k Other Local Income – $17,000 Increase • Facility Fee reduction from GDRD ($13k) • E-Rate Accounting Change $117k • Worker’s Compensation Reimbursements $9k • Bus Grant ($9k) • Student Accounts cash basis $26k

  16. EXPENDITURES

  17. 2016/17 EXPENSES = $12.7 millionBY MAJOR CATEGORIES UNRESTRICTED EXPENSE = $8.8 m RESTRICTED EXPENSE = $3.9 m

  18. Major Expense Changes Since First Interim Budget CERTIFICATED SALARIES - $47,000 decrease • Special Ed changes, NED/GED sub usage, and staff turnover CLASSIFIED - $12,000 increase • Staffing of final GDRD contract position plus increase of busing needs of a Special Ed student EMPLOYEE BENEFITS - $50,000 decrease • Recognition of staffing changes

  19. Major Expense Changes Since First Interim Budget BOOKS/SUPPLIES - $95,000 increase • Title IA re-class from services $37k • Lottery $13k • CTEIG re-class from equipment $3k • FMOT changes $4k SERVICE/OTHER OPERATING COSTS - $40,000 increase • Changes is Direct Service, Utilities, Internet and Other ($66k) • Energy Efficiency Final Project Approval $110k • Special Education Non Public School $29k • Student Accounts Cash Basis $6k

  20. Major Expense Changes Since First Interim Budget CAPITAL OUTLAY – $87,000 increase • Special Ed Transportation Needs $20k • CTEIG Grant re-class to supplies ($37k) • AQMD Bus Grant ($9k) • E-Rate Accounting Change $108k • TeichertGrant $5k OTHER OUTGO - $9,000 • COE student services $20k • CSROP transfer ($7k)

  21. Net Position

  22. RESERVES

  23. BENEFITS OF HIGHER THAN MINIMUM RESERVES Protection against declining enrollment. Protection to cover increases in fixed and statutory costs. (ex – STRS increases) Financial flexibility to shift resources as priorities set through the LCAP process change. Planning for major projects such as information technology upgrades or deferred maintenance. • Financial flexibility to absorb unanticipated expenditures without significant disruption to educational programs. • Protection against exposure to significant one-time outlays such as disasters, lawsuits, or material audit findings. • Protection against the volatility of state revenues. • Cash management / avoiding the cost of borrowing cash.

  24. Reserve Standards • RESERVES are necessary to protect the integrity of the educational program in an unpredictable operating environment. • 3% Reserve is equal to 2 weeks payroll • Moody’s recommends governmental agencies keep a 17% reserve –the equivalent of 2 months of operating expenditures • Remember it is important to remember that reserves are meant for one time expenses, not on-going. Most of BOMUSD expenses are on-going.

  25. District Reserve Comparisons Note: The reserves are all unrestricted reserves, including any assigned

  26. Management of Funds Current Reserves or Components of Ending Fund Balance – 2016/17 2nd Interim Need State EUR of 4% plus 1% Board Reserve

  27. General Fund Multi-Year Projections 2016/17 to 2018/19

  28. Multi-Year Projection Assumptions(details on pages 158-164 in 2nd Interim Budget Packet) EXPENSE Projections assume the same level of staffing & spending with the following major changes: STEP/COLUMN 2017/18 = $143k increase 2018/19 = $88k increase STRS/PERS RATE INCREASES 2017/18 = $142k increase 2018/19 = $150k increase MINIMUM WAGE CHANGES 2017/18 = $50k increase 2018/19 = $150k increase INCOME Projections for income assume same level of income with the following major changes: LCFF – GAP Funding increase 2017/18 = $80k 2018/19 = $239k LCFF – Loss due to declining enrollment 2017/18 = ($185k) 2018/19 = ($193k) Decreased One-Time or Temporary Grant Income received in 16/17 Mandated Cost/Discretionary Funds, MAA, NEA Contract, COE Direct Service Funding,

  29. CalSTRS Rate Increases – Scheduleper Education Code Sections 22901.7 & 22950.5 These are the rates that BOMUSD will be paying.

  30. CalSTRS Rate Increases – in Dollars Based on 2017-18 salaries with no future adjustments for step and column

  31. CalPERS Rate Increases – Actual and Projected These are the rates that BOMUSD will be paying.

  32. CalPERSRate Increases – in Dollars Based on 2017-18 salaries with no future adjustments for step and column

  33. Net New Revenue

  34. Further reductions needed to meet 2018/19 EUR of 4% and additional Board Reserve of 1%

  35. How do we get to a POSITIVE certification? The district continues to face challenges dealing with the fiscal implications of declining enrollment. By 2017-18 ADA is predicted to have dropped far enough that the district’s Economic Uncertainty Reserve will be mandated at 4%. In order to move towards a POSITIVE certification, the district must show that it can meet its minimum required state economic reserve for uncertainty in the current year and the two subsequent years. The levels of budget reductions recommended: 2017/18 = ($311,000) on-going 2018/19 = ($396,000) on-going

  36. District Risks • Uncertainty at the Federal Level • Economic slowdown/Volatility of State Revenues. • Changes of El Dorado County Office of Education Service rates • El Dorado County Office Special Education Local Plan Area (SELPA) reimbursement/funding changes. • State Revenue Deferrals; Cash-flow; borrowing needs

  37. Planning Ahead for Black Oak Mine Budget Priorities: • Minimize impact on academic achievement and student safety • Minimize layoffs where possible • Balance a comprehensive program at the junior/senior high school level within financial restraints • Maintain a budget reserve at the level required by the State and the Board • Challenge for Black Oak Mine is to develop a plan with these priorities.

  38. In Summary • Black Oak Mine USD continues to face many budgetary challenges. • A decade of steep declining enrollment • Step & Column • Minimum Wage • Steeply increasing employer portion of pensions (STRS/PERS) • Rapidly approaching fully funded LCFF Revenue

  39. Conclusion • The Board and District have faced and continue to face many difficult decisions as we plan for the next school year and the years ahead in regards to programs and budget reductions. We must continue to identify reductions to match revenues. • Keys to success in these difficult times: • Patience, courage, and flexibility • Conservative plans and backup plans • Great communication with stakeholders • Strong financial reserves and policies • .

More Related