Budget Overview 2020-21 School Year December 9, 2019 Budget - - PowerPoint PPT Presentation

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Budget Overview 2020-21 School Year December 9, 2019 Budget - - PowerPoint PPT Presentation

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Budget Overview 2020-21 School Year December 9, 2019 Budget Timeline Oct. Jan. Feb. - April May - June Budget creation Budget work Proposed final w/admin sessions: budget approval May 4 th Act 1 resolution

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SLIDE 1

Budget Overview 2020-21 School Year December 9, 2019

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SLIDE 2

Budget Timeline

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  • Oct. – Jan.
  • Budget creation

w/admin

  • Act 1 resolution

(recommended)

  • r exceptions –

Dec 9th

  • Adopt prelim

budget if filing for exceptions – Jan 6th (not recommended)

  • Feb. - April
  • Budget work

sessions:

  • Revenues
  • Curriculum
  • Special Ed
  • Technology
  • Maintenance
  • Transportation
  • Athletics
  • Salary/Benefits

May - June

  • Proposed final

budget approval – May 4th

  • Final budget

approval – June 8th (30 day review required)

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SLIDE 3

2018-19 Financial Summary

2018-19 Budget 2018-19 Actual 2019-20 Budget Revenues $31,828,130 $31,731,701 $32,428,635 Expenditures 32,517,700 31,381,287 $33,215,448 Revenues over Expenditures (689,570) 350,414 (786,813) Beginning Fund Balance 8,625,029 8,625,029 8,975,443 Ending Fund Balance $7,435,459 $8,975,443 $8,188,630

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SLIDE 4

Revenue

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SLIDE 5

Revenue - 2019-20 Budgeted

Local 68% State 31% Federal 1%

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Local

  • Real Estate
  • Earned Income
  • Interest earnings
  • Transfer
  • Per Capita

State

  • Basic Ed
  • Special Ed
  • Transportation Subsidy
  • Social Security & PSERS – 50%

Federal

  • Title I, II, & IV
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SLIDE 6

Local effort – Real Estate 2019-20 Budgeted

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Residential 72% Farm 11% Exempt 8% Commercial 9%

Local

  • Real Estate
  • Earned Income
  • Interest earnings
  • Transfer
  • Per Capita
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SLIDE 7

Act 1

 Act 1 of 2006 limits the percentage increase of real estate tax millage to

an amount established by two factors:

 Statewide Average Weekly Wage (SAWW)  Employment Cost Index (ECI)

 Average of both factors determines base Act 1 Index

 2.6% for 2020-21

 Adjustment for districts with a market value/personal income aid ratio

greater than .4000

 .4159% adjustment for BHASD

 Adjusted Act 1 Index for 2020-21 is 3.0%

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SLIDE 8

Act 1 History

School Year SAWW Index EC Index Base Index MV/PI AR BHASD Adjusted Index

2006-07 4.20% 3.50% 3.90% 0.5312 5.00% 2007-08 2.80% 4.00% 3.40% 0.5360 4.40% 2008-09 4.30% 4.50% 4.40% 0.5254 5.60% 2009-10 4.60% 3.60% 4.10% 0.5029 5.10% 2010-11 2.70% 3.00% 2.90% 0.5112 3.70% 2011-12 0.90% 1.90% 1.40% 0.5019 1.80% 2012-13 2.10% 1.30% 1.70% 0.4938 2.10% 2013-14 2.00% 1.40% 1.70% 0.4847 2.10% 2014-15 2.60% 1.60% 2.10% 0.4665 2.60% 2015-16 2.40% 1.40% 1.90% 0.4676 2.30% 2016-17 2.50% 2.20% 2.40% 0.4494 2.90% 2017-18 2.60% 2.30% 2.50% 0.4378 3.00% 2018-19 2.60% 2.20% 2.40% 0.4236 2.80% 2019-20 2.20% 2.40% 2.30% 0.4090 2.70% 2020-21 2.20% 2.90% 2.60% 0.4159 3.00%

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SLIDE 9

Tax Increase History compared to index

5.6 5.1 3.7 1.8 2.1 2.1 2.6 2.3 2.9 3.0 2.8 2.7 3.0 3.2 2.4 1.0 1.8 2.3 3.4 0.0 0.0 0.0 1.5 1.4 1.5

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

BHASD Adjusted Index BHASD Increase

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SLIDE 10

Millage

 The millage rate is a figure representing the amount per $1,000 of

the assessed value of property, which is used to calculate the amount of property tax.

 2019-20 millage rate = 33.7422  2019-20 assessed value = $599,353,761  2019-20 Homestead exclusion = $788,059  Collection percentage = 96%  Net tax generated by mills = $18,658,037  Value of 1 mil = $552,958

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SLIDE 11

What’s the value of a mil?

 Value of 1 mil = $552,958  Current millage rate = 33.7422  Keep assessment base equal for assumption

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New Millage Rate Revenue Generated Impact on a Property assessed at $115,000 1.0% increase 34.0796 $194,146 $38.80 1.5% increase 34.2483 $291,219 $58.21 2.0% increase 34.4170 $388,291 $77.61 2.5% increase 34.5858 $473,937 $97.01 3.0% increase 34.7545 $570,955 $116.41

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SLIDE 12

Millage Comparison

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District 2018-19 Millage 2019-20 Millage Change % Change

Antietam 39.7400 41.0500 1.3100 3.30% Brandywine Hts. Area 33.2435 33.7422 0.4987 1.50% Exeter Twp. 32.6214 33.1107 0.4893 1.50% Fleetwood Area 33.1100 33.1100 0.0000 0.00% Daniel Boone Area 30.8340 31.9850 1.1510 3.73% Wyomissing Area 30.6680 31.4340 0.7660 2.50% Muhlenberg 29.8100 30.7300 0.9200 3.09% Kutztown Area 29.9543 29.9543 0.0000 0.00% Conrad Weiser Area 28.8600 29.6500 0.7900 2.74% Governor Mifflin 28.1000 28.6000 0.5000 1.78% Oley Valley 27.3406 27.9394 0.5988 2.19% Schuylkill Valley 27.0700 27.8200 0.7500 2.77% Twin Valley 27.5465 27.5624 0.0159 0.06% Boyertown Area 26.3700 27.3300 0.9600 3.64% Hamburg Area 26.9600 26.9600 0.0000 0.00% Tulpehocken Area 27.1000 26.8500

  • 0.2500
  • 0.92%

Wilson 25.6700 26.2600 0.5900 2.30% Reading 17.9300 17.9300 0.0000 0.00%

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SLIDE 13

Expenditures

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SLIDE 14

Expenditures by Major Function – 2019-20 Budget

56% 30% 2% 0% 12%

Instruction Support Services Non-Instructional Services Facilities Other Expenditures and Financing Uses

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SLIDE 15

Expenditures by Object – 2019-20 Budget

40% 24% 6% 3% 10% 5% 0% 1% 1% 10%

Salaries Benefits Technical Services Property Services Other Purchased Services Supplies Property & Equipment Budgetary Reserve Dues & Interest Financing Uses

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SLIDE 16

Expenditure Considerations

 Salaries – Teacher contract and ACT 93 agreement in place  Benefits

 Consistent year – to – year medical/RX increases  Flat dental, life, long term disability rates

 PSERS

 Rate leveling off compared to recent history  2019-20 budget employer contribution rate of 34.29%, 2020-21 is 34.51%  Funded through three sources: employee contributions, employer contribution rate

which includes contributions from school employers and the Commonwealth, and investment returns from the System.

 Over 75% of the employer contribution rate is for the payment of an unfunded

liability, which is primarily debt for past service already earned by members.

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SLIDE 17

PSERS – Historical Employer Contribution Rate

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2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Series1 1.09 1.15 3.77 4.23 4.69 6.46 7.13 4.76 4.78 5.64 8.65 12.3 16.9 21.4 25.8 30.0 32.5 33.4 34.2 34.5

0.00 5.00 10.00 15.00 20.00 25.00 30.00 35.00 40.00

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SLIDE 18

PSERS – Long term Employer Contribution projection

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SLIDE 19

Unfunded State Mandates

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  • State Funding is at an all time high, however, state mandated costs have

significantly outpaced state funding.

  • 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 5,000,000 Basic Ed Funding PSERS Net Special Ed Funding Special Ed Cost Charter School Funding Charter School Cost 2008-09 2018-19

9% 584% 8% 66%

  • 100%

23%

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SLIDE 20

Debt Service

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G.O.N. G.O.N. G.O.B. G.O.B. TOTAL FISCAL YEAR SERIES of 2014 SERIES B of 2016 SERIES A of 2019 SERIES B of 2019 PAYMENTS 2019-20 10,000 $ 2,175,000 $ 5,000 $ 5,000 $ 2,195,000 $ 2020-21

  • 1,855,000

5,000 5,000 1,865,000 2021-22 1,765,000

  • 5,000

5,000 1,775,000 2022-23 460,000

  • 5,000

1,465,000 1,930,000 2023-24

  • 1,345,000

585,000 1,930,000 2024-29

  • 9,000,000

50,000 9,050,000 TOTAL 2,235,000 4,030,000 10,365,000 2,115,000 18,745,000

 GOB of 2019 generated $10 million of “new money” to finance major

district capital improvements and provided $0.7 million of ongoing

  • perating budget relief.

 Plan to borrow an additional $4 million in 2020 as per original facility

improvement plan.

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SLIDE 21

Fund balance as of June 30, 2019

 Fund balance post audit:

 Committed: $1,224,000

 Pension increases

 Assigned: $3,886,813

 Emergency maintenance, state budget delays, litigation, etc.

 Unassigned: $3,864,630, 12% of expenditures  Total Fund balance: $8,975,443

 Capital Reserve: $500,000  Potential uses of fund balance and capital reserve:

 Capital projects and one-time expenditures

 Projects outside of major bond issuance scope

 Move away from practice of funding budget shortfalls

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SLIDE 22

Budget discussion/Recommendations

 Decision to opt-out (stay within Act 1) or file for exceptions

 Administration recommends opt-out  Exceptions (administration does not recommend) could be used to cover

costs related to Retirement and Special Education, or Debt payments that are anticipated to outpace the Act 1 index.

 Discussion on use of fund balance and potential tax increase

 No decision needed tonight

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SLIDE 23

Next steps

 Tonight

 Decision to opt-out (stay within Act 1) or file for exceptions

 December

 Receive budget requests from managers

 January

 Build preliminary budget  Monitor state and federal budget progress

 February / March

 Budget Workshops

 May 4th - Proposed final budget approval  June 8th - Final budget approval

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