Elida Local Schools Financial Summit V

Report to StakeholdersFiscal Year 2009-10Joel L. Parker,CPA

Introductions

Economic Outlook Federal Programs

Goals

Review the financial condition of Elida Local Schools

Expand the knowledge base on school funding issues

Review data for future financial planning Exchange ideas on “best practices” Encourage dialogue on future economic

trends

Trivia

$65,000 $38,000 $2,080 $10,000 $33,658 Indiana Schools

Concerns State budget gap- $5-$10 billion Projected loss to Elida FY 12- $1.6 to

$2.1 million(what is coming?) Tax delinquencies Loss in state aid Tax payer still hurting from

recession Unfunded mandates

Perfect Storm

Loss in stimulus $510,083 Loss in inventory tax $364,235 Loss in inventory tax $364,235 Foundation $129,560 Foundation $211,376 Inflation on expenses Levy fatigue

Legislation

SB 5 Collective Bargaining Reform HB 69 Pension Reform HB 136 Charter/voucher expansion HB 153 Budget Bill

State Aid

Fiscal Year Actual 2% Growth2003 7,085,910 2004 7,561,375 2005 7,502,306 7,712,603 2006 7,434,281 7,866,855 2007 7,567,028 8,024,192 2008 7,511,293 8,184,675 2009 7,502,152 8,348,369 2010 7,454,097 8,515,336 2011 7,352,109 8,685,643 2012 6,931,429 8,859,356 2013 7,142,806 9,036,543

Charter/Voucher Concerns

OVA $146,102 /23 = $6,352 Elida Cupp Report = $2,684

Tangible Personal Property Tax

Fiscal Year Actual2003 1,525,306 2004 1,513,272 2005 1,463,699 2006 1,531,472 2007 1,230,346 2008 826,456 2009 635,757 2010 249,114 1,276,192 LOSS2011 305,800 2012 150,000 2013 135,000

WHAT HAVE WE DONE TO GET LEAN?

Staff cuts Administrative cuts $239,155 Administrative Wages-0% increase 2 yrs Streamlined food service Moved staff to PPO insurance plan Moved to pay to participate Passed a levy in 2005 to bring back

specific programs Reduce bus fuel consumption Think long term Savings on Retire/Rehire Sharing on health premiums

Continued Withdrawal from ESC Alternative

Program - $7,000 Not replace mechanic - $58,472 Hire Psychologist - $9,923 2004-05 one less teacher at EE 2005-06 one less teacher at EE and

HS Partner with WCLA on software

$14,000 Review SF6 billing - $24,000

What have we done to get lean?

Review Staffing Meal Policy American Express Bus Idle Share Ins Increases Bulk Paper Bid

Property/Liability Diesel Grant Safe Route Grant Dir dep/email PO Hire maint. person

Turn down thermostats

Change drug company

No health ins R/R New health plans Auto lights

switches Bid projects MAC Grants Early bus buy

What have you done lately? Review set points $74,000 Reduce Teacher Academy $65,000 Re-route buses(4) $84,444 Reduce special ed teacher $76,102

What will you do next year? Consolidate choir position Reduce MS teacher-(technology

class) Move Central Office secretary to HS Reduce building budget Lean on grant $ for technology Work on reductions in health care Reduce bus route Review staffing Pay off HB 264 Note early

Cost Reduction-Spring 2011 Phase I- Cut 11.5 teachers

$878,000 Phase II – Close Gomer $433,000 Phase III – EMS re-configure

$275,000 Phase IV – Return to ½ K $240,000 TOTAL $ 1,826,000

Wage Freeze

Administrators – 2 yr freeze All Others – 0 on base 2 years, steps

year 1, no steps year 2 Savings $823,000

Fund Raising Efforts

Fieldhouse Renovation $350,000 Concession Building $150,000 Locker/weight room $100,000 Piano Fund Safe Route Grant

PERFORMANCE INDICATORS Carry-over Growth 1-5%(update) Strength of Carry-over - 60

day(update) 85% Rule on Salaries and

Benefits(update) Review Levy Cycles Debt to Total Assets Residential Tax Rate Per Pupil Spending (vs. other schools)

60 DAY CASH BALANCE ALMOST A REALITY

74 Day Cash Balance!

-

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

7,000,000

Month

Gen

era

l F

un

d C

ash

2003

2004

2005

2006

2007

2008

2009

2010

2011

June 30 Carry-Over: A New Cycle

2000 $1,048,819 23 days 2001 $ 758,675 17 days 2002 $ 821,146 18 days 2003 $ 360,933 8 days 2004 $ 967,429 21 days 2005 $1,865,900 39 days 2006 $2,645,703 53 days 2007 $3,496,376 68 days 2008 $4,071,288 76 days 2009 $4,127,565 74 days 2010 $3,454,672 60 days 2011 $2,702,030 47 days

(estimate)

Health Insurance 1/1/09 Medical Rate Increase 15% 1/1/09 Dental Rate Increase 20% 1/1/09 New Plan MDHP Developed 1/1/10 New High Deductible Plan 1/1/10 Medical Rate Increase 20% 1/1/10 Dental Rate Increase 20% Meeting this year to introduce HDHP plan Continue discussions on spousal coordination of

benefits What are you doing/seeing???

Health Care

2011-Spousal language Increase employee share(20,15,10) 3 plans(low,mid,high ded) Change TPA Change consultant

General FundRevenue Chart FYD as of June 30, 2010

43%

1%

35%

0%

2%

10%

9%

Real Estate

PersonalPropertyFoundation

Restricted Aid

Restricted SFSF

Homestead/Roll

Other

General Fund Expenditures

Expense Chart FYD as of June 30, 2010

54%

20%

20%

3%

1%

0%

0%

2%

Salaries

Retire/Ins

PurchasedServiceSupplies

Capital Outlay

Debt-Prin.

Debt-Int.

Other

Elida Local Schools - Data Graph

-

2,000,000

4,000,000

6,000,000

8,000,000

10,000,000

12,000,000

14,000,000

Fiscal Year

Do

llars

Tax Revenue-Real

State Aid

Interest Income

Salaries

Benefits

Utilities

FOOD SERVICEFiscal Year 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Revenue Federal 243,346 234,529 223,494 278,530 243,644 239,122 320,161 279,240 386,010 430,062 509,152 State 10,072 10,092 10,756 10,706 12,630 13,207 11,028 10,954 11,001 11,507 12,275 Local 594,211 576,010 561,344 575,917 586,843 513,334 575,959 571,476 548,922 559,512 515,619

Total 847,629 820,631 795,594 865,153 843,117 765,663 907,148 861,670 945,933 1,001,081 1,037,046

ExpensesSalaries 325,736 332,741 345,760 353,996 350,154 276,396 283,380 313,751 317,182 335,930 369,702 Fringes 134,816 156,892 198,125 211,198 245,929 181,288 153,651 179,800 171,619 179,011 194,911 Purchased Service 9,128 8,421 5,285 5,011 4,507 7,022 11,485 13,657 16,928 15,275 21,367 Supplies 339,680 338,004 327,304 314,984 292,572 279,624 307,740 342,635 351,055 390,685 382,230 Equipment 9,333 12,348 20,709 - - 16,241 - - 2,105 - 3,307

Total 818,693 848,406 897,183 885,189 893,162 760,571 756,256 849,843 858,889 920,901 971,517

Net Gain/(Loss) 28,936 (27,775) (101,589) (20,036) (50,045) 5,092 150,892 11,827 87,044 80,180 65,529

Plus Advances - - - 48,636 40,000 54,000 - - (10,000) (15,000) (40,000) Plus Beginning Bal. 111,602 140,538 112,763 11,174 39,774 29,726 88,818 239,711 251,538 328,582 393,762

Ending Balance 140,538 112,763 11,174 39,774 29,729 88,818 239,710 251,538 328,582 393,762 419,291

Program Spending-6/30/10REPORT TO STAKEHOLDERS

General Fund Revenue General Fund Expenditures

Local Revenue Instructions Real Estate Taxes 8,389,617$ 42% Regular 12,335,622$ 59% Personal Property Taxes 249,114 1% Special Education 1,680,792 8% Vocational 898 0% Total Local 8,638,731 43% Total Instructions 14,017,312 64%

State Revenue Supporting Services Foundation 6,952,866 35% Pupil Support** 698,943 3% Foundation-Stimulus Funding 454,960 Homestead Rollback 2,096,592 10% Instr. Staff Support## 495,287 2% - Administration 1,404,901 7%

Transportation 1,064,168 5% Total State 9,504,418 48% Business/Maintenance 2,530,616 12%

Total Support Svcs. 6,193,915 30% - Other 1,851,068 9% Extracurriculars 540,692 3%Total Revenue 19,994,217$ 100%

Debt Requirements Principal/Interest 69,616 0%

Total Expenditures 20,821,535$ 100%

Elida Transportation Data

0

500000

1000000

1500000

Fiscal Year

Am

ount

Fuel

Gallons

Miles

Total Expense

Fiscal Year 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Fuel 86,985 61,233 70,591 66,988 92,372 144,618 127,159 193,731 131,442 123,714

Gallons 83,123 67,209 63,354 60,504 57,217 62,220 64,631 62,355 63,139 56,670

Miles 428,886 440,673 415,682 376,971 372,549 402,349 398,107 393,866 410,360 361,171

Total Expense 915,528 935,059 941,924 841,161 1,099,56 997,411 1,131,07 1,359,02 1,246,31 1,064,16

1 2 3 4 5 6 7 8 9 10

FY 2009 June June FY Percent FY 09 YTD FY 09 YTD FY 10 YTD Difference Change

RevenueReal Estate 8,374,681$ 8,374,681$ 8,389,617$ 14,936 0.18%

Personal Property 635,757 635,757 249,114 (386,643) -60.82%

Unrestricted State Aid 7,538,353 7,538,353 6,928,844 (609,509) -8.09%

Restricted Grants - State 76,065 76,065 24,022 (52,043) -68.42%

Restricted Grants - SFSF - - 454,960 454,960 0.00%

Homestead & Rollback 1,905,561 1,905,561 2,096,592 191,031 0.00%

Other Revenues 1,703,586 1,703,586 1,851,068 147,482 8.66%

Sale of Notes - - - - 0.00%

Transfers - - - - 0.00%

Advances 31,398 31,398 296,647 265,249 0.00%

All Other Sources 202,510 202,510 - (202,510) 0.00%

Total 20,467,911 20,467,911 20,290,864 (177,047)

ExpendituresPersonnel Services 10,852,446 10,852,446 11,281,803 429,357 3.96%

Retirement/Insurance Benefits 3,736,685 3,736,685 4,109,281 372,596 9.97%

Purchased Services 4,083,616 4,083,616 4,093,160 9,544 0.23%

Supplies and Materials 717,250 717,250 712,560 (4,690) -0.65%

Capital Outlay 381,339 381,339 232,223 (149,116) -39.10%

Debt Service - Principal 54,985 54,985 57,237 2,252 4.10%

Debt Service - Interest 14,631 14,631 12,379 (2,252) -15.39%

Other 314,035 314,035 322,892 8,857 2.82%

Transfers - - - - 0.00%

Advances 256,647 256,647 142,221 (114,426) 0.00%

Totals 20,411,634 20,411,634 20,963,756

Revenue Over/(Under) Exp 56,277 56,277 (672,892)

AUDIT REPORT Performed every year Cost to taxpayers $16,000 Cash basis (saves taxpayers

$10,000-$13,000 each year) Tests are performed on accounts

payable, payroll, compliance with ORC, fund raising, athletics, food service, grants, etc.

Clean opinion No adjustments

Administration: Salaries for administrators, office staff, and office supplies

ADMINISTRATIVE EXPENSES

-

200

400

600

800

1,000

1,200

1,400

Comparison Group-Administrative Expense Per Pupil

 

-

2,000

4,000

6,000

8,000

10,000

12,000

Comparison Group-Expense Per Pupil

-

5

10

15

20

25

30

Comparison Group-Report Card Data

TAX BASE

2003 2004 2005 2006 2007 2008 2009Values Values Values Values Values Values Values

Collected Year 2004 2005 2006 2007 2008 2009 2010

Ag/Residential 213,179,340 216,149,940 219,179,010 240,726,340 243,660,870 246,525,140 244,378,910 Commercial/Industrial 87,268,820 90,926,040 91,884,270 97,276,200 100,017,980 101,438,990 108,803,850 Sub Total 300,448,160 307,075,980 311,063,280 338,002,540 343,678,850 347,964,130 353,182,760

Utility Real 47,120 47,890 31,820 21,120 21,590 19,340 22,190 Total Real 300,495,280 307,123,870 311,095,100 338,023,660 343,700,440 347,983,470 353,204,950

Utility Personal 9,517,850 9,280,790 8,795,910 8,919,930 6,906,750 7,215,890 7,471,370 Tangible Personal 32,993,852 36,274,840 27,665,882 18,362,998 5,116,935 - - Total Personal 42,511,702 45,555,630 36,461,792 27,282,928 12,023,685 7,215,890 7,471,370

Total All 343,006,982 352,679,500 347,556,892 365,306,588 355,724,125 355,199,360 360,676,320

Exempt Values 20,946,010 24,203,770 24,291,910 69,828,126 69,828,126 69,828,126 29,657,730

State Budget Concerns-FY 2010 CAT $ 1.3 billion new Corporate Franchise Tax 1.1 billion loss Tangible Property Tax 1.6 billion loss Income Tax 2.1 billion loss NET LOSS 3.5 billion in state revenue 10 year job loss – 210,000

manufacturing 10 year job loss- 4,000 Allen County BUDGET GAP $5-$10 BILLION????

Levy Timeline-Future Dates

May 2010 Renew Emergency Levy Fall 2012, 2013 Renew PI Levy 2012, 2013 Levy Discussion 2012-2013 OSFC Issue 2014,2015 Renew Emergency Levy

Revenue Shortfalls-Ernie Strawser SBO Quarterly Ohio’s income tax down by 12% By FY 2011- 9% of state education

budget supported by stimulus $ Unemployment at 11% (difficult to

achieve tax revenue at pre-recession levels(would take 2 years to respond)

In 30 years, never witnessed greater challenges for schools

Open Enrollment

FY 07 In $535,000 Out $1.3 million

FY 08 In $597,000 Out $1.4 million

FY 09 In $912,000 Out $1.5 million

FY 10 In $1.24 million Out $1.48 million

FY 11 In $1.38 million Out $ 1.6 million

What Next???