FISCAL YEAR 2007-2008

Financial Report Year Ended June 30, 2008

ST. LOUIS PUBLIC SCHOOLSGENERAL OPERATING FUNDS

FINANCIAL REPORTYear Ended June 30, 2008

In Thousands

JULY 2007 BEGINNING FUND BALANCE (AUDITED) ($12,273)

APPROVED REVENUE BUDGET $332,610

YTD REVENUES $341,777

APPROVED EXPENDITURE BUDGET $332,188

YTD EXPENDITURES $337,638

Non-GOB TRANSFER $ 1,703

JUNE 30, 2008 ENDING FUND BALANCE ($10,509)

PRIOR YEAR ADJUSTMENT ( $672)

JUNE 2008EXECUTIVE SUMMARY

•$332.6M GOB Budget/Total Budget - $447.1M

•GOB Revenues $9.2M better than budget Local Revenue, +8.2M: higher property tax collection rate

(92.8% vs. 90% budgeted), higher interest income and indirect revenue

State Revenue, + 3.2M: higher basic formula funding and transportation

Federal Revenue, -2.7M: Medicaid, ERATE

County Revenue, +.5M

•GOB Expenditure $5.5M over budget$9.8M increase is salaries and benefits due to higher certified staffing, substitute teacher and health care benefits

Non-Payroll Expenditures currently reflect $4.3M positive variance, with transportation tracking $1.7M over budget

•Total District Cash - $169.3M

YEAR-TO-DATE SUMMARY

EXECUTIVE SUMMARY - Continued

• Non-General Operating Funds

Revenues tracking $5.3M higher than expenses Food Service deficit - $0.6M Special Education deficit - $1.1M

•Known shortfalls eliminated Contingencies Frozen positions Cost containments Central Office spending freeze

•No deficit spending (based on known obligations)

• Revenue is 2.4M in excess of expenses

EXECUTIVE SUMMARY - Continued

CONCERNS AND RISKS

• State Tax Commission protested tax rulings

• Equitable distribution of funds to charter schools

• Charter School Enrollments

• Food Service profit margin

• Legal settlements

• Transportation

• Budget creeps

-$40,000

-$30,000

-$20,000

-$10,000

$0

GOB UNRESTRICTED FUND BALANCEIn Thousands

-$37,848

-$25,987

-$24,915

-$12,945

FY 2004 FY 2005 FY 2006 FY 2007

-$10,509

FY 2008

Unaudited

St. Louis Public Schools GOB

Cash BalancesJuly 07 thru June 08

-20

0

20

40

60

80

Cash Balance

Mill

ions

35 36

22

6

-13

8

73 74

54

44

19

31

July

Au

gust

Sep

temb

er

Octob

er

Novem

ber

Decem

ber

Janu

ary

Feb

ruary

March

Ap

ril

May

Jun

e

Saint Louis Public Schools

Fiscal Year 2009 Amended Budget

June 2008 Financial Report - Talking Points

GOB revenues tracking $9.2m positive variance projection Local revenue, $8.2m

Property taxes, $8.2m – current, delinquent, and protested property taxes – [Collection rate was 92.8% vs. 90% budgeted; received 100% of protested taxes vs. 88% budgeted, $2.5M for FY05] A 1% increase in the real property (5111) FY08 collection rate (92.0%, $94,195,261.93) would yield an additional $1m (93.0% = $95,200,000).

A 1% increase in the entire FY08 tax levy base (real property – 5111, personal property – 5112, M&M tax – 5117, State Assessed Utility & RR Tax – 5221) collection rate of 92.8% ($127,398,779) would yield an additional $1.4m (93.8% = $128,771,610).

Current taxes, ($3.2m) [Prop C over budgeted] Other local, $3.3m [Higher interest income & Indirect revenue] VICC payments, ($0.1m)

State revenue, $3.2m Basic Formula, $2.8m – [SB287 funding higher than budgeted, dependent on charter enrollment] Transportation & Other, $0.4m [Prior year adjustment]

County & federal revenue, ($2.2m) [Medicaid over budgeted & behind in billing, ERATE due to audit]

GOB expenditures tracking $5.5m in excess of budget projections Salary & Benefits, ($9.8m)

Regular salaries, ($4.9m) [Assistant Principals, Stationary Engineers, eMints from non-GOB to GOB, Leadership, other unbudgeted positions]

Subs/Extra service/Overtime,($2.2m) – substitute teachers ($2.9m), O/T ($0.5m), ES $1.2m [Subs, offset by FTE & fringe savings]

Benefits, ($2.7) [22% medical increase + additional positions] Non-Payroll Expenditures, $4.3m [Overall savings from DESEG loan, Central Office freeze, contingency]

Purchased & Professional Services, $2.1m [Contingency, Prof/Tech Services] Property Services, $1.0m [Contracted repairs] Transportation,($1.7m) [Additional routes, higher fuel costs] Operational Expenditures, $2.6m [Textbooks, Supplies, Equipment, Misc. savings] Debt Obligations, $0.3m

Budget Actions

March 20 Central Office cost containments on uncommitted appropriations - $5.2m Contingency ($1.2m), Deseg Loan ($3.3m), Miscellaneous savings ($0.7m)

May 23 – A freeze placed on all overtime and extra service payments

June cash balance is $31.2m, Total Cash $169.3m

Non-GOB Revenues & Expenditures

Revenues tracking $5.3m higher than expenditures primarily due to delayed air conditioner projects.

Other $2.5m in protested tax funds from FY05 were released that had not been budgeted or accrued Cash is $12M higher than projected due to receiving protested taxes in June 2008 vs. July 2008

Budget Concerns

State Tax Commission protested tax ruling Equitable distribution of funds to charter schools Charter school enrollments Food Service profit margin Legal settlements Transportation Budget creeps