2014-15 proposed final budget presentation (may 12, 2014) selinsgrove area school district
TRANSCRIPT
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2014-15 Proposed Final Budget Presentation (May 12, 2014)
Selinsgrove Area School District
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GENERAL FUND FINANCIAL STATEMENT(Current financial position)
2012-13 Actual
2013-14 Budget
2013-14 Projected
Beginning Balance
$ 6,142,492 $ 6,810,646 $ 8,082,703
Revenues $ 36,936,892 $ 37,780,849 $ 37,957,589
Expenditures $ 34,996,681 $ 37,780,849 $ 36,844,022
Surplus/(Deficit) $ 1,940,211 $ 0 $ 1,113,567
Transfer out to Capital Reserve
$ (500,000)
Transfer out for IS School Roof
$ (850,000)
Ending Balance $ 8,082,703 $ 6,810,646 $ 7,846,270
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2013-14 BUDGET SAVINGS (Current Yr.)
Adopted budget balance $ 0 Personnel Salary Savings (2.5%) $ 450,000 Fringes/Benefit Savings $ 125,000 Medical insurance savings $ 95,000 Unemployment comp savings $ 63,000 All other department savings (net) $ 4,000 Revenues over budget (EIT) $ 176,000 Not using budgetary reserve $ 187,000Total Savings (projected surplus) 3% $1.1 million
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TOTAL FUND BALANCES AT 6-30-14
Designations (“buckets”) Balance
Restricted - Special Ed ACCESS $ 266,345
Nonspendable - Inventory of Supplies
$ 33,631
Nonspendable – Prepaid Expenses $ 31,563
Committed – Retiree Healthcare $ 2,318,334
Committed - Future PSERS Expenses
$ 2,648,258
Committed – Educational Resources
$ 300,000
Unassigned Balance $ 2,248,139 (6.1% of budget)
TOTAL GENERAL FUND RESERVES $ 7,846,270 (21.3% of budget)
DEBT SERVICE FUND RESERVES $ 1,842,373
CAPITAL RESERVE FUND RESERVES $ 2,400,227
TOTAL ALL GOV’T FUNDS RESERVES
$ 12,088,870
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FUTURE CAPITAL RESERVE PROJECTS – Importance of maintaining a healthy Capital Reserve Fund
Project Amount Project start date
Intermediate school roof project
$ 880,500 Summer 2014
Middle school addition (total cost of $650,000 balance from food service)
$ 275,424 Fall 2014
High school bleacher replacement
$ 163,100 Summer 2015
Intermediate school A/C chiller
$ 91,000 as needed
Football field turf replacement (total cost of $313,000)
$ 247,300 as needed
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Other expenses: annual summer maintenance projects for carpeting, paving, vehicle replacement. Middle school HVAC system replacement (possible performance contract), stadium track surface replacement. Fund used to offset any unforeseen major equipment replacement.
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2014-15 BUDGET SUMMARY FLOW OF FUNDS – GENERAL FUND
Beginning Fund Balance $ 7,846,270
Revenues (without tax increase) $38,544,948
Expenditures $39,174,810
Deficit ( $ 629,862)
Transfer in from Educational Resources Reserve
$ 125,000
Adj Deficit before tax increase
( $504,862)
Proposed 1.66 mills (2.7%) Act 1 allowable tax increase
$411,811
Operating Deficit to be covered from unassigned fund balance
( $93,051 )
Ending Fund Balance $ 7,628,219
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REVENUE HIGHLIGHTS
Moderately growing local economy 1.66 mill real estate tax increase (2.7%) and a 0.5%
growth in the overall real estate base Earned Income Tax collection budgeted with a 2%
increase from proj 13-14 collections Basic education subsidy increase of 1.8% (state
funding is uncertain at this point) Special education subsidy level funding Accountability Block Grant level funding Reduction in federal funding (Keystone Literacy Grant
& Title I) Transfer in from educational resources reserve
$125,000
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2014-15 REVENUE BY SOURCE
LOCAL61%
STATE35%
FEDERAL4%
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$23.6 M
$13.7 M
$1.6 M
State averages: Local 54%, State 41%, Federal 3%, Other 2%
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HISTORICAL REVENUES BY SOURCE
$-
$5
$10
$15
$20
$25
10-11 11-12 12-13 13-14 14-15
Local
State
Federal
9
millions
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EXPENDITURE HIGHLIGHTS
Nine teacher retirements at end of 13/14 school year (not replacing one elementary position)
Salary increases per personnel contracts – teachers 3.9% salary plus 2.3% steps, administrators 3.5%, classified 3.9%
PSERS rate increase from 16.93% to 21.40% Medical insurance premium increase of 7% and move to tiered
rates instead of composite rate Building and technology budgets level funded (4th year at reduced
funding)
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EXPENDITURE HIGHLIGHTS
Transfer out to debt service fund reduced by $400,000 (debt service reserves to be used)
Capital reserve transfer of $96,000 reflects Jackson-Penn rental income
New K-5 reading textbook series ($125,000) Total budget of $39.17 million – overall
increase of $1.4 million or 3.7% from 13/14 original budget and $2.3 million or 6.3% from 13/14 projected actual ending budget
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MAJOR EXPENDITURE INCREASES
EXPENSE INCREASE FROM 13-14 Projected
EMPLOYER SHR OF RETIREMENT EXP
$ 1,003,000 33.5%
EMPLOYEE SALARY/WAGES
$ 993,600 5.7%
MEDICAL INSURANCE $ 621,000 15.0%
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2014-15 EXPENDITURE ANALYSIS
Contractual/ Fixed97%
Discretionary3%
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Personnel costs, student tuition, transportation, utilities, debt service
Supplies, textbooks, equipment ,repairs, travel
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HISTORICAL USE OF FUNDS
$-
$5,000,000
$10,000,000
$15,000,000
$20,000,000
10-11 11-12 12-13 13-14 14-15
Salaries
Fringes/ Benefits
Professional Svcs
Propoerty Svcs
Purchased Svcs
Supplies
Equipment
Debt Service
Other Expenses
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Personnel costs make up 75% of total budget
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FUTURE BUDGET CONCERNS
Modest economic recovery producing inadequate local and state revenue growth
Act 1 index will remain low Limited state subsidy increases Reductions in federal revenue PSERS rate increases to reach 30% Teacher contract increases over the next 2
years New Federal Healthcare Legislation (increase
costs and administrative burden)
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PROJECTED PSERS RATE
4.785.64
8.6512.36
16.93
21.4025.8
28.3 29.1530.14 30.87
0
5
10
15
20
25
30
09-10 10-11 11-12 12-13 13-14 14-15 15-16 16-17 17-18 18-19 19-20
Employer % Rate
PSERS Rate
16Fiscal Year
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NET PSERS COST TO DISTRICT10 Year Analysis
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BUDGET RESTRUCTURING: ACTIONS TAKEN SINCE 2010-11
Reduced 27 professional staff (12.7%) Reduced 2.4 administrative staff (18.6%) Reduced 29 support staff positions (18.6%) Salary freeze in 2011-12 for all personnel Reduced pay increase for administrative staff
in 2012-13 Eliminated indemnity health insurance plan Refinanced 4 bond issues Cut building and technology budgets by 30%
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BUDGET RESTRUCTURING: ACTIONS TAKEN SINCE 2010-11
Leased Jackson-Penn for rental income Long term energy contracts for natural gas &
electricity Strategic use of federal funds to offset costs Four day work weeks in the summer
TOTAL FOUR YEAR CUMULATIVE BUDGET SAVINGS OF $14.3 MILLION
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FUTURE BUDGET PROJECTIONS
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GENERAL FUND PROJECTED ENDING FUND BALANCE
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PROPOSED FINAL BUDGET SUMMARY“THE BOTTOM LINE”
REVENUES $38,956,759
EXPENSES ($39,174,810)
USE OF FUND BALANCE ($125,000 FROM EDUCATIONAL RESOURCES & 93,051 FROM UNASSIGNED)
$ 218,051
MILLAGE INCREASE% INCREASE
1.66 2.7%
TOTAL MILLS 1 mill = $247,000 in revenue
63.41
INCREASE TO AVG HOMEOWNERHomestead/Farmstead credit $133
$45 ($3.75 per month)
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PRESENTATION SUMMARY (POINTS TO REMEMBER)
Financial reserves (fund balance) – very strong position in the short term
State funding is uncertain Significant budget challenges remain for
the future – PSERS, Healthcare, teacher contract increases
NEW FISCAL REALITY Importance of long-term budgeting
decisions and forecasting
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