BPS F INANCIAL C ONTEXT AND FY17 P LANNING 1 BOSTON PUBLIC SCHOOLS - - PowerPoint PPT Presentation

BOSTON PUBLIC SCHOOLS

BPS FINANCIAL CONTEXT AND FY17 PLANNING

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Reminder of the “why”

Do more of what works for kids.

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Topics for discussion Background and context Historic trends in the BPS budget Preliminary planning for FY17

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City of Boston: General Fund Support for All Education

For the past five years, General Fund Spending for Education, including BPS and Charter Schools, has grown rapidly, at an average rate of 6% a year.

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City of Boston: Revenue to Support Boston Education

Stagnant State Education Funding

At the same time, State Revenue to support Education has been stagnant:

• Boston’s Chapter 70

Revenue has grown by <1% per year.

• The Commonwealth has

not fulfilled its obligation to fund Charter School Reimbursement, to the tune of $30M in lost revenue for Boston over the past 2 years. This has led to a 7.6% average annual growth in the City’s Contribution (net State Education Funding) to Education in Boston.

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City of Boston: Education as a portion of Boston’s Budget

BPS has traditionally accounted for 35% of Boston’s

• Budget. With the growth of

Charter Schools, Education now accounts for 40% of Boston’s budget.

General Fund FY16 Spending

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We face a structural deficit, where expenses consistently go up faster than revenues

Time $ Revenue Expenses

• Level service costs up (e.g. salary, benefits,

contractual step-up’s, student need)

• Do more (e.g. more K1, ELT)
• Do better (e.g. HC strategy, increased

support for level 4 and 5 schools)

• Loss of entitlement funds (shifting population)
• State Chapter 70 Education funding has been

growing <1% per year for the last 5 years

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Time $ Revenue Expenses

A long term financial plan means stepping back and identifying the bold, multi-year changes that reverse our structural deficit and allow us to reinvest in what works best for kids.

Annual “cuts” to align costs to revenues

And our annual budget cuts don’t solve the long term problem

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We are proactively taking steps to improve our financial picture for future years

Existing process New process Facilities Master Plan Collective bargaining Revenue strategy Operations work group SPED work group

Financial strategy

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Topics for discussion Background and context Historic trends in the BPS budget Preliminary planning for FY17

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We think about our budget in five broad categories

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Schools School Services Budgeted Centrally Central Benefits Transportation Expenses within a school’s budget, as well as funds held centrally that are disbursed to schools throughout the year.

• Teachers
• Support staff
• Aides

Programs/services for schools that are budgeted centrally.

• Special education
• Facilities and maintenance

(including custodians and utilities)

• Programs such as safety services

and psychological services Funds used for leadership and institutional support for the district .

• Central office departments (i.e.,

Office of Human Capital, Finance)

• Programs that support schools

(i.e., professional development, curriculum design) Funds used for transportation for students.

• Yellow bus services
• MBTA
• Transportation for special

education students, homeless students, and after school programs Funds used for employee benefits.

• Health insurance
• Medicare
• Unemployment compensation
• Workers compensation

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BPS spends $1.01B per year of general funds, with almost all going towards schools and school services

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Note: FY16 budget accurate as of 11/10/15

$537,304,226 53% $171,711,378 17% $132,740,088 13% $109,455,202 11% $62,289,573 6% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Dollars % of Total

FY16 Budget (General Fund only)

Central Office Transportation Benefits School Services Budgeted Centrally Schools

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This spending supports the key functions and cost items for the district

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FY16 Budget by Service Area and Function (General Fund)

Note: FY16 budget accurate as of 11/10/15

Note: Central includes both personnel and non-personnel costs

To read this chart: The full rectangle = the total FY16 general funds budget (excludes grants). The area of each rectangle corresponds to the size of the budget for that specific category (like a two dimensional a pie chart)

20 40 60 80 100% Schools Administrators and secretarial staff Support Staff Teachers

Non-personnel

Aides $537M School Services Budgeted Centrally Student / School Support Facilities and Maintenance Special Education

General Administration

Regular Education $172M Benefits Benefits $133M Transportation

Transportation

$109M OHC

Leadership

Special Education Professional Learning/TLTs

Operations

OIIT

Strategy (Other)

Finance

ELL

Data and Accountability Other Expanded LearningTime

$62M Total = $1.01B Central

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The district also has $139M in grant funding, for a grand total of $1.15B

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FY16 Budget by Service Area and Function (All Funds)

Note: FY16 budget accurate as of 11/10/15

To read this chart: The full rectangle = the total FY16 general funds budget (excludes grants). The area of each rectangle corresponds to the size of the budget for that specific category (like a two dimensional a pie chart)

20 40 60 80 100% Schools Grants

Non-personnel

Aides Administrators and secretarial staff Support Staff Teachers $571M School Services Budgeted Centrally Grants

General Administration

Regular Education Student / School Support Facilities and Maintenance Special Education $244M Benefits Grants Benefits $146M Transportation

Transportation Staff

SPED Out

• f District

SPED In District Regular Education $109M Grants

Finance

ELL

Other

Leadership

OHC

Professional Learning/TLTs

Strategy (Other)

OIIT

Operations

$83M Total = $1.15B Central

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% Annual Growth % Change FY11-16 $ Change FY11-16 0.8% 4% $3.1M 7.5% 44% $33.4M 1.3% 7% $9.0M 4.0% 22% $43.7M 2.8% 15% $73.1M Total 3.1% 16% $162.4M

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Total expenditures have been increasing 3.1% annually, with the highest growth seen in transportation, school services, and schools

$498M $501M $518M $529M $545M $571M $200M $191M $201M $208M $218M $244M $137M $133M $134M $134M $135M $146M $76M $81M $91M $108M $103M $109M $80M $83M $85M $86M $86M $83M $0M $200M $400M $600M $800M $1,000M $1,200M $1,400M FY11 FY12 FY13 FY14 FY15 FY16B Millions

Expenditures by Service Area, FY11-FY16B (All Funds)

Central Office Transportation Benefits School Services Budgeted Centrally Schools

Note: FY09-FY15 represent actual expenditures. FY16 represents budgeted amounts accurate as of 11/10/15. These cost combine both the increasing costs of service, and BPS’s efforts to control costs

Note: The work to understand the drivers of these changes is ongoing and in-process

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Of the $33M increase in transportation, $22M has come from SPED-related costs, both in district and out of district

$40 $41 $47 $54 $52 $51 $28 $30 $33 $40 $37 $42 $7 $8 $9 $11 $12 $14 $2 $2 $2 $2 $2 $2 $- $- $- $- $0 $0 $- $20 $40 $60 $80 $100 $120 FY11 FY12 FY13 FY14 FY15 FY16B Millions

FY11-FY16B Transportation Expenses (All Funds) % Annual Growth Rate: 7.5%

Athletics: n/a Transportation Staff: 8.5% SPED Out of District: 15.1% SPED In District: 8.5% Regular Education: 5.1%

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% Annual Growth % Change FY11-16 $ Change FY11-16 11.9% 75.6% $9M 6.8% 38.8% $6M

• 0.1%
• 0.7%

$0M 8.9% 53.3% $25M 3.3% 17.4% $13M 4.4% 24.2% $47M 1.1% 5.6% $17M Total 3.1% 16.8% $117M

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Within schools budgets and school services budgeted centrally, ELL and SPED account for 62% of increased spending

$298 $289 $294 $298 $307 $315 $194 $189 $199 $207 $217 $241 $75 $79 $82 $80 $81 $88 $48 $55 $59 $62 $64 $73 $55 $54 $57 $58 $58 $54 $16 $14 $17 $21 $25 $22 $12 $12 $11 $11 $12 $20 100 200 300 400 500 600 700 800 900 FY11 FY12 FY13 FY14 FY15 FY16B Millions

School and School Service Spending, FY11-FY16B

Other General Administration Physical Plant Bilingual / SEI Student / School Support Special Education Regular Education $72M, or 62%, of the increase from FY11-FY16 has gone towards services for SPED or ELL

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Over time, the number of FTEs in BPS has been relatively constant, with slight declines in recent years

7,168 7,053 7,267 7,327 7,312 7,280 1,203 1,172 1,258 1,279 1,286 1,280 589 633 701 685 615 554 210 210 218 238 239 240

• 2,000

4,000 6,000 8,000 10,000 12,000 FY11 FY12 FY13 FY14 FY15 FY16B

FY11-FY16B FTEs by Service Area (All Funds) % Annual Growth: 0.4%

Transportation 2.8% Central -1.2% School Services Budgeted Centrally 1.2% Schools 0.3% 77.8% 13.7% 5.9% 2.6% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% FY16B

FY16B FTEs

Note: These FTE counts are not adjusted for some part time positions, such as bus monitors and food service workers, which are coded as a full FTEs though the positions are part time The increase in central after FY11 was driven by +30 FTEs in SPED and +10 in operations. Going into FY13, the increase was driven by +25 in welcome centers and +20 in engagement

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While total FTEs have been relatively flat, we are spending $87M more on salaries vs FY12 as average salaries have risen, including an 11% increase in average teacher salaries

$624 $648 $675 $698 $711 $81.4 $82.3 $86.4 $88.1 $90.0

10 20 30 40 50 60 70 80 90 $- $100 $200 $300 $400 $500 $600 $700 $800 FY2012 FY2013 FY2014 FY2015 FY2016B Thousands Millions

Overall Salary Expenses and Average Salary, FY12-FY16B

Salary Avg Salary (teachers)

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FY 2015 $71.4M Reductions:

• $33.8M: Central office

reductions (including 126.6 FTE reduction)

• $11M: Enrollment adjustments
• $11M: Transportation services
• $5.5M: SPED changes
• $5M: Health insurance
• $4M: Grant changes
• $1.1M: Adult Ed

FY 2016 $36.1M Reductions:

• $15.5M Central office reductions

(including 134 FTE reduction)

• $9.8M Transportation services
• $4M Food and nutrition services
• $3.8M School budgets
• $2.9M School Services

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In past budget cycles, BPS has focused cuts on central administration to protect schools

$34 $16 $11 $10 $11 $6 $5 $4 $4 $4 $3 $1 $- $10 $20 $30 $40 $50 $60 $70 $80 FY 2015 FY 2016 Millions

Proposed Cost Reductions, FY15 & FY16

Adult Ed School services School budgets Grant changes Food and nutrition services Health insurance SPED changes Enrollment adjustments Transportation services Central office reductions

Only $3.8M of $100M+ reductions in the past two years have been from school budgets

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As a result, the majority of FTE changes have been to the central office

Schools School Services Budgeted Centrally Central Transportation Grand Total # Change in FTEs

• 31
• 6
• 61

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• 98

% Change FY15-FY16

• 0.4%
• 0.5%
• 10.0%

0.6%

• 1.0%
• 12.0%
• 10.0%
• 8.0%
• 6.0%
• 4.0%
• 2.0%

0.0% 2.0%

• 120
• 100
• 80
• 60
• 40
• 20

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FY15 to FY16B FTE Changes by Service Area (All Funds)

# Change in FTEs % Change FY15-FY16

Note: These FTE counts are adjusted for some part time positions, such as bus monitors which are coded as a full FTE though the work is part time. Additionally, the FTE for “food service workers” has be reclassified as “schools” though the budget team is in the process of re-allocating those FTEs to the school budget codes

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Topics for discussion Background and context Historic trends in the BPS budget Preliminary planning for FY17

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As we contemplate tradeoffs for FY17 and beyond, our decision-making is guided by our core values

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Preliminary FY17 overview

* Strategic priorities will only be funded pending success in achieving efficiencies

$- $5 $10 $15 $20 $25 $30 $35 $40 $45 $50

~$36M ~$28M ~$10M ~$5M ~$7- $14M* ~$8M $12- $17M ~$14M ~$6M

Includes $21M increase in salary & benefits

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What’s driving up costs for BPS in FY17?

• Rising cost of salaries and benefits for existing

employees

• Adjusting where we are running over-budget

today (transportation, custodians, early hiring)

• Inflation / general cost-of-doing business for non-

personnel expenses

• Slightly off-set by small decline in overall

enrollment projection

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What are some of the potential FY17 investments?

Basic Operations and Past Commitments

• Deferred maintenance to support health and safety in our

schools

• Turnaround supports
• ACC move
• Classroom expansions

Strategic Investments

• Extended Learning Time, Cohort 2
• Supports for Special Education transitions to new service models
• Expansion of K1 seats
• 100 Day Plan

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The following changes were included in WSF school budgets released this Monday

• High school staffing assumptions
• Special education weights
• Projections reconciliation (adjusting funding

based on actual enrollment)

• Putting guardrails on the costs of our early hiring

initiative

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We are still early in the budget process with important steps ahead of us

• Partnering with schools to navigate changes to

their budgets

• Continuing to partner with central departments

to identify possible efficiencies or reductions in service

• Engaging with our community and the School

Committee for feedback and to iterate on our plans