2015-2016 Preliminary Budget

February 2, 2015

Mission Statement

The Mission of the Kennett Consolidated School District is to provide a quality education that increases the achievement of every student in order for all to become successful and

thoughtful contributors to society.

Expenditures

Expenditures

$29,725

,454

$17,298,133

$6,418,

233

$1,703,

047

$13,083

,711

$2,652,

293

$8,181,196 SalariesBenefitsProf. Svcs.Property Svcs.Contracted Svcs.Supplies/EquipmentDebt Service

Total Expenses - $79,062,067

Expenditures

38%

22%

8%

2%

17%

3%

10%

SalariesBenefitsProf. Svcs.Property Svcs.Contracted Svcs.Supplies/EquipmentDebt Service

Total Expenses - $79,062,067

Budget Development Foundation

– Salaries▪ Collective Bargaining Agreement▪ Act 93 Agreement▪ All Other Employees – Act 1 Index to 3% Maximum▪ New Teaching Positions– High School S.T.E.M. – Special Education - 2 Positions– Middle School Social Studies

▪ Biology Remediation Program▪ Ready to Learn Summer Tutoring Program▪ No Retirements▪ No Furloughs/Outsourcing

Budget Development Foundation

– Benefits▪ Medical/Prescription/Dental Insurance – First Look Projections

▪ Pennsylvania School Employees Retirement Contribution Rate– Certified by PSERS

▪ Vision, Life, and Disability Insurance– Trend Analysis

▪ Worker’s Compensation– SDIC Estimate

Budget Development Foundation

– Allocations ▪ Instructional Buildings

– 1.9% Increase

▪ Department Allocations– No Increase

▪ Special Education– CCIU Projection

▪ Student Transportation– Krapf Bus Company Agreement

▪ Annual Consumer Price Index or Minimum 2%

▪ Occupational Education – CCIU Tuition Formula

▪ Paraprofessionals– CCRES Agreement

▪ Act 1 Index

▪ Charter School Tuition – Current Enrollment x (Tuition Rates x Act 1 Index)

▪ Debt Service– No Increase

Expenditures

DESCRIPTION 2014-2015

BUDGET

2015-2016 PRELIMINARY

BUDGET $ INC (DEC) % INC(DEC)

Salaries $ 28,886,644 $ 29,725,454 $ 838,810 2.90%

Employee Benefits 15,832,667 17,298,133 1,465,466

9.26%

Purchased Prof. Svcs. 5,893,175 6,418,233 525,058

8.91%

Purchased Property Svcs. 1,870,288 1,703,047 (167,241)

-8.94%

Other Contracted Svcs. 12,585,090 13,083,711 498,621

3.96%

Supplies 2,246,872 2,202,820 (44,052)

-1.96%

Equipment 438,190 449,473 11,283

2.57%

Other Objects 2,448,364 2,296,196 (152,168)

-6.22%

Other Financing Uses 5,695,500 5,885,000 189,500

3.33%

TOTAL ALL OBJECTS $ 75,896,790 $ 79,062,067 $ 3,165,277 4.17%

Expenditure Drivers

▪ Salaries– Existing Salaries

▪ Impact - $676,200– 2.3% Increase

– Three New Teaching Positions▪ Impact - $162,610– 0.6% Increase– Includes $10,000 for a Biology Remediation Program

▪ Benefits– Pennsylvania School Employees Retirement

System▪ Impact - $1,351,861 (Net Impact After State Subsidy-

$619,375)

– Prescription Insurance▪ Impact - $167,758

Benefits

DESCRIPTION 2014-2015

BUDGET 2015-2016

PRELIMINARY BUDGET $ INC (DEC) % INC(DEC)

Life Insurance $ 25,753 $ 26,479 $ 726 2.82%

Income Protection 54,651 55,725 1,074 1.97%

Vision 74,838 88,817 13,979 18.68%

Social Security 2,221,182 2,253,623 32,441 1.46%

Retirement 6,213,503 7,565,364 1,351,861 21.76%

Tuition 320,000 245,000 (75,000) -23.44%

Unemployment Comp. 45,781 40,000 (5,781) -12.63%

Workers Compensation 162,810 166,648 3,838 2.36%

Medical 4,726,502 4,709,316 (17,186) -0.36%

Dental 483,669 475,425 (8,244) -1.70%

Prescription 1,423,978 1,591,736 167,758 11.78%

Other Benefits 80,000 80,000 - 0.00%

TOTAL ALL BENEFITS $ 15,832,667 $ 17,298,133 $ 1,465,466 9.26%

PSERS History/Projections Employer Contribution Rates

1998-99

1999-00

2000-01

2001-02

2002-03

2003-04

2004-05

2005-06

2006-07

2007-08

2008-09

2009-10

2010-11

2011-12

2012-13

2013-14

2014-15

2015-16

2016-17

2017-18

2018-19

2019-20

2020-21

2021-22

0%

5%

10%

15%

20%

25%

30%

35%

1.09%

12.36%

16.93%

21.40%

25.84%

29.27%

32.22%

Act 110 of 2010PSERS Rate “Collars”

▪ The rate caps limit the amount the pension component of the employer contribution rate can increase over the prior year’s rate as follows:– FY 2011-12 – not more than 3.0%– FY 2012-13 – not more than 3.5%

– FY 2013-14 – not more than 4.5%– Thereafter – not more than 4.5%

The estimate for 2015-2016 prior to the rate caps being established was 33.49% which would have translated to an additional net

budgetary increase of $1.1 million.

Expenditure Drivers

▪ Purchased Professional Services– Home and Community Services

▪ Impact – $322,035▪ Personal Care Assistants

– CCIU Market Place Services/Other▪ Impact - $141,456▪ Special Education Services

– Security and Safety Services▪ Impact - $61,000▪ Middle School Security Guard

Expenditure Drivers

▪ Purchased Property Services– Electricity Savings

▪ Impact - ($167,700)

▪ Other Contracted Services– Occupational Education Tuition

▪ Impact - $180,666

– CCRES Paraprofessionals▪ Impact - $208,445– Affordable Care Act - $100,000 - Core Services -

$20,456– Extended School Year - $36,000 - Substitutes - $16,620– High School Study Hall Monitor - $35,050

– Charter School Tuition▪ Impact - $114,000

Charter School Tuition

▪ Fast Facts– Regular Education Tuition Rate -

$10,345– Special Education Tuition Rate -

$24,175– Traditional and Cyber Charter

Schools▪ Tuition Rates are Identical

– Current Enrollment▪ Regular Education – 157▪ Special Education – 49

– Avon Grove Charter School

– Total 2015-16 Budgeted Expense - $2,750,000

74%

26%

AGCS En-rollment

Regular Ed.Special Ed.

Revenues

Revenues

$61,798

,324

$3,839,

237

$11,683

,186 $1,026,990 $714,330

LocalState - PSERSState - OtherFederal Fund Balance

Total Revenues - $79,062,067

Revenues

78%

5%

15%

1% 1%

LocalState - PSERSState - OtherFederal Fund Balance

Total Revenues - $79,062,067

Revenues – State

2014-2015 2015-16

DESCRIPTION BUDGET PRELIMINARY $ INC (DEC) % INC (DEC)

BASIC ED SUBSIDY $5,135,000 $5,135,000 $0 0.00%

SPECIAL ED SUBSIDY 1,641,323 1,641,323 -

0.00%

TRANSPORTATION SUBSIDY 1,440,000 1,440,000 -

0.00%

RENTAL & SINKING FUND 362,000 560,408

198,408 54.81%

HEALTH SERVICES 86,000 86,000 -

0.00%

PROPERTY TAX REDUCTION ALLOCATION 1,379,058 1,379,058 -

0.00%

PA ACCOUNTABILITY GRANT 128,446 -

(128,446) -100.00%

READY TO LEARN BLOCK GRANT - 304,781

304,781

SOCIAL SECURITY 1,110,591 1,136,616

26,025 2.34%

RETIREMENT 3,106,752 3,839,237

732,485 23.58%TOTAL REVENUE FROM STATE SOURCES $14,389,170 $15,522,423 $1,133,253 7.88%

State Subsidy Increases

2011-12 2012-13 2013-14 2014-15 2015-16 Budget -

2,000,000

4,000,000

6,000,000

8,000,000

10,000,000

12,000,000

14,000,000

16,000,000

18,000,000

Basic Education Other State Subsidies Special Education Subsidy Transportation Subsidy

Authority Rental Reimbursement Medical & Dental Subsidy Property Tax Reduction Accountability Grant\Ready to Learn

FICA Reimbursement Retirement Reimbursement

5-Year In-crease in

State Subsidy$3,003,993

State Subsidy Increases

2011-12 2012-13 2013-14 2014-15 2015-16 Budget -

2,000,000

4,000,000

6,000,000

8,000,000

10,000,000

12,000,000

14,000,000

16,000,000

18,000,000

Basic Education Other State Subsidies Special Education Subsidy Transportation Subsidy

Authority Rental Reimbursement Medical & Dental Subsidy Property Tax Reduction Accountability Grant\Ready to Learn

FICA Reimbursement Retirement Reimbursement

5-Year In-crease in All Other State Subsidies$432,336

5-Year In-crease in

PSERS Subsidy

$2,571,567

State Revenue Drivers

▪ Rental and Sinking Fund– State’s Share of Debt Service Obligation

▪ Impact - $148,000– PDE’s Moratorium on Plan Con Projects Removed– Bancroft Elementary School Debt Service Issues are Eligible for Reimbursement

– CCIU’s Debt Service for TCHS▪ Impact - $48,000▪ Pass-Through Funding

▪ Ready To Learn Grant– Combined with Accountability Block Grant

▪ Impact - $176,335

▪ Pennsylvania School Employees Retirement System– State’s Obligation to Reimburse 50% of the Certified

Contribution Rate▪ Impact - $732,485 (Net Impact After Mandatory Contribution is an Expense

of $619,375)

Revenues – Local

2014-2015 2015-16DESCRIPTION BUDGET PRELIMINARY $ INC (DEC) % INC (DEC)

CURRENT REAL ESTATE $52,677,984 $54,210,008 $1,532,024 2.91%

INTERIM REAL ESTATE

400,000 400,000 - 0.00%

PUBLIC UTILITY TAX

73,000 73,000 - 0.00%

EARNED INCOME

3,650,000 3,900,000 250,000 6.85%

TRANSFER TAX

700,000 700,000 - 0.00%

DELINQUENT TAX

1,450,000 1,700,000 250,000 17.24%

EARNINGS ON INVESTMENTS

50,000 50,000 - 0.00%

IDEA

565,257 565,257 - 0.00%

RENTALS/FEES/MISCELLANEOUS

150,000 150,000 - 0.00%

FACILITY USAGE/CONTRIBUTIONS

50,059 50,059 - 0.00%

FUND BALANCE APPROPRIATION

714,330 714,330 - 0.00%TOTAL REVENUE FROM LOCAL SOURCES $60,480,630 $62,512,654 $2,032,024 3.36%

Local Revenue Drivers

▪ Real Estate Tax – Imposition of Increased Millage Rate

▪ Impact - $1,398,343

– Growth of Assessment Base▪ Impact - $133,681

▪ Delinquent Real Estate Tax– Liens Filed with Chester County Tax Claim

Bureau▪ Impact - $250,000

▪ Earned Income Tax– Collections Through Keystone Collection Group

▪ Impact - $250,000

Interim Real Estate Taxes

2008 2009 2010 2011 2012 2013 2014 2014-15

Budget

2015-2016

0

100,000

200,000

300,000

400,000

500,000

600,000

700,000

800,000

900,000

1,000,000

$893,284

$691,571

$417,250

$245,391$198,738

$405,286

$176,233

$400,000$400,000

Transfer Taxes

2008 2009 2010 2011 2012 2013 2014 2014-15

Budget

2015-16

Budget

0

200,000

400,000

600,000

800,000

1,000,000

1,200,000

$997,550

$701,374 $683,944$653,733

$623,290

$710,079

$788,695

$700,000 $700,000

Earned Income Taxes

2008 2009 2010 2011 2012 2013 2014 2014-15 Budget

2015-16 Budget

0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

3,000,000

3,500,000

4,000,000

4,500,000

$3,446,846$3,492,318$3,393,938$3,451,401

$3,144,285

$3,860,952$4,077,297

$3,650,000

$3,900,000

Delinquent Taxes

2008 2009 2010 2011 2012 2013 2014 2014-15 Budget

2015-16 Budget

0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

$1,083,191$1,031,744

$2,053,482

$1,346,243

$1,453,960$1,498,661

$1,786,340

$1,450,000

$1,700,000

Earnings from Investments

2008 2009 2010 2011 2012 2013 2014 2014-15

Budget

2015-16

Budget

0

200,000

400,000

600,000

800,000

1,000,000

1,200,000$1,133,042

$579,652

$154,298$101,328

$47,642 $42,296 $54,727 $50,000 $50,000

Summary

Preliminary Budget

▪ Proposed Real Estate Tax Increase– 2.67% Increase– 28.6871 Mills

▪ Apply for Act 1 Exceptions– PSERS Contributions

▪ Appropriation of Fund Balance– $714,320

▪ Begin Process of Budget Deliberations– Finance Committee Meetings

▪ First Monday of Every Month▪ Next Meeting – March 2, 2015▪ Open to the Public

▪ Governor Wolf’s Budget– Proposed Budget Release in March

Historical Millage Rates

2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 Budget

0

5

10

15

20

25

30

35

21.950023.1400 23.9537

24.778125.7293

26.730327.4520 27.9406 28.6871

Historical Millage Percentage Increase

2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 Budget

0.00%

1.00%

2.00%

3.00%

4.00%

5.00%

6.00%

1.8%

5.4%

3.5% 3.4%

3.8% 3.9%

2.7%

1.7%

2.6%

Average Real Estate Tax

2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 Budget

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

4,3904,628 4,791

4,9565,146

5,3465,490 5,588 5,737

Average Real Estate Tax Increase

2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 Budget

0

50

100

150

200

250

76

238

163 165

190200

144

98

149

Real Estate Tax Rate History

2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 Budget

-2.0%

-1.0%

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

8.0%

4.1%

2.9%

1.4%1.7% 1.7%

2.1%1.9%

3.50% 3.40%

3.80% 3.89%

2.70%

1.78%

2.67%

6.86%

2.33%

-0.91%

1.85%

2.38%2.71%

4.17%

Act 1 Index Millage Increase Budget Increase

Questions?