texas association of rural schools 1 school finance fundamentals an overview that determines the...

Texas Association Of Rural Schools1

SCHOOL FINANCE FUNDAMENTALS

An overview that determines the state and local revenue

of a typical small/rural school


Student Information Required

1. Total Refined ADA 295.0002. Sp Ed FTE 3.8603. Sp Ed WFTE 12.2404. Career & Technology FTE 10.2605. Comp Ed Students 108.0006. Biling/ESL ADA 2.9307. Gifted Ed ADA 14.7508. Regular ADA (1-2&4 above) 280.880


STATE ALLOTMENT CALCULATIONS

The first calculation is the Cost of Education Index (CEI). The CEI adjusts the Basic Allotment, a per pupil cost as set by the state, to account for personnel cost due to the cost of doing business in any given school district.

In our example the district has an index of 1.04 (a 4% add on) that is applied to 71% of the BA. It’s estimated that 71% of a district’s cost is for salaries.

Let’s see how the formula works !


THE ADJUSTED BASIC ALLOTMENT Basic Allotment @$4,765

ABA = ((BA *.71) * CEI) + (BA *.29) ABA = (($4,765 *.71) * 1.04) + ($4,765 *.29) ABA = ($3,383 * 1.04) + $1,382ABA = $3,518 + $1,382ABA = $4,900 This represents an increase of $135 per pupil over the original

Basic Allotment.


State Allotment Calculations(Continued)

The next step is the Small or Mid-size school calculation. This adjustment recognizes the high cost of small classes. The mid-size adjustment is for districts under 5000 pupils and

the small adjustment is for districts under 1600 pupils. Both work the same way.

The small district adjustment has two factors: .0004 for districts over 300 sq miles and .00025 for districts under 300 sq miles and presumed to be small by choice. Mid-Size uses .000025.

In our next example we will assume our typical small school has less than 300 sq miles.


THE ADJUSTED ALLOTMENTThe Adjusted Basic Allotment@ $4,900

AA = (1+((1600-ADA)*.00025)) * ABAAA = (1+((1600-280.88)*.00025)) * $4,900 AA = (1+(1319.12*.00025)) * $4,900AA = (1 + .32978) * $4,900 AA = I.32978 * $4,900AA = $6,516

This represents an $1,616 per pupil increase over the original Adjusted Basic Allotment and $1,761 per pupil over the original Basic Allotment.


STATE ALLOTMENT CALCULATION(Continued)

We are now ready to calculate the Foundation School Program cost for our typical small school.

The pupil or student counts from our first slide x their appropriate weights x the Adjusted Allotment of $6,516.


FOUNDATION PROGRAM COSTTypical Small / Rural School

Reg. Program (280.88 X $6,516) $1,830,214 Sp Ed (12.240 X $6,516) 79,756

Career& Tech (10.26 X1 .35 X $6,516) 90,253 Comp Ed (108 X .20 X $6.516) 140,746 Biling/ESL (2.930 X .10 X $6,516) 1,909 Gifted (14.75 X .12 X $6,516) 11,533 Transportation (Separate Calculation) 31,597 New Facilities Allotment (Campus ADA X $250) 0 High School Allotment (80 ADA x $275) 22,000Total FSP Cost $2,208,008


FOUNDATION SCHOOL PROGRAMLocal Share Calculation

Our District Has a Wealth of $28,529,448State Requires an $1.00 per $100 Local Share

Therefore The local Share is:$28,529,448 X .0100 = $285,294

Now let’s summarize where we are…


A SUMMARY OF STATE AID TO THIS POINT ALSO CALLED TIER 1

Reg program $1,830,214Sp Ed 79,765Career & Tech 90,253Comp Ed 140,746 Biling/ESL 1,909Gifted 11,533 Transportation 31,597

New Facilities 0High School_____________________22,000Total FSP $2,208,008

Less LFA - 285,294 Net State (Tier 1) $1,922,714


STATE ALLOTMENT CALCULATIONS CON’TGuaranteed Yield Allotment( GYA)

A district’s GYA is partly based on Weighted ADA so we must calculate the district WADA.

WADA equals the Total FSP less the transportation, the new facilities and high school allottments divided by the original BA less one half the effect of the ABA.

Thus : WADA = ( FSP – TRANS, FAC ,HS ) / ((( ABA – BA ) *.5 ) + BA ) WADA = (2,208,008- 53,597 ) / ((( 4,900 – 4,765 ) *.5 ) + 4,765 ) WADA = 2,154,411 / (( 135 *.5 ) + 4,765 ) WADA = 2,154411/ ( 67.5 + 4,765 ) WADA = 2,154,411 / 4,832.5 WADA = 445.82 Remember Refined ADA for the district was 280.88,therefore the use of WADA becomes

an extreme issue for small/rural schools.


GUARANTEED ALLOTMENT GYA(Continued)

The GYA or Tier 2 (The Golden Pennies) is calculated using the following: 1. WADA ( Calculated @ 445.82 ) 2. District Wealth ( $ 28,529,448 ) 3. District M&O Tax Rate above the Local Share of Tier 1(DTR) The Total M&O Tax Rate ($1.00), plus the GYA Pennies currently aloud by the State is $.06 ; therefore the DTR is $.06 4. Local Revenue (LR) is the amount raised by the DTR times District Wealth, therefore LR is $17,118 ($28,529,448*.0006) 5.State Guaranteed Level of wealth (GL) of $590,200 per WADA (Austin ISD) is stated as $59.02 per $.01 of tax effort The GYA formula is as follows: GYA = ( G L * WADA * ( DTR * 100 ) – LR We will examine the formula on the next slide


CALCULATING THE GYA

GYA = (GL * WADA * (DTR * 100) – LR GYA = ($59.02 * 445.82 * ($.06*100)) - $17,118) GYA = ($59.02 * 445.82 * 6) - $17,118) GYA = $157,874 - $17,118 GYA = $140,756 Therefore the 2nd Tier (The Discretionary Tier) revenue

for our typical small district is $ 140,756. Now we will Summarize Tier 1 and Tier 2.


A SUMMARY OF REVENUE TYPICAL ISD

TIER 1 (FSP) $2,208,008 Less Local Share - 285,294 Net Tier 1 1,922,714 TIER 2 (GYA Discretionary Tier) 140,756

Technology @ $30 per ADA 8,850 TOTAL STATE AID $2,072,320 $ 2,072,320

LOCAL REVENUE Tier 1 Local Share $ 285,294 Tier 2 Local Share 17,118 TOTAL LOCAL $ 302,412 $ 302,412

GRAND TOTAL $ 2,374,732

texas association of rural schools 1 school finance fundamentals an overview that determines the...

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