Budget Presentation December 5, 2016 2016-2017 Current Budget - - PowerPoint PPT Presentation

Budget Presentation

December 5, 2016

§ 2016-2017 Current Budget § 2017-2018 Preliminary Budget

§ Revenue § Expenses

§

Budget Options

2016-17 Budget Review

Adopted Budget (June)

— Revenue $82,989,834 — Expenses $83,222,521 — Deficit -$232,687

— Received $248,612 in additional State funds July/Aug 2016. — Added 2 new Kindergarten teachers to start 2016-17 ($140,000)

— Actual 2016-17 Deficit = -$124,075

— Using PSERS reserves to cover the deficit

— Projected ending unassigned fund balance

$5,127,671

2017-18 Revenue Projection

§ Local Revenue = $63,018,417 = 75.1% § State Revenue = $20,198,640 = 24.1% § Federal Revenue = $643,887 = 0.8% § SWAP reserve funds use = $500,000 § Total Revenue Generated = $84,360,944

Property Tax Revenue

§ Current Millage Rate is 18.92 § 2017-18 Act 1 Index is 3.2% § Equate to 0.61 mills § Average homeowner tax bill increase of $100.80 § Generates increase in local revenue of $1,724,698

State Basic Education Funding

$5,855,476 $6,147,119 $6,490,986 $6,491,697 $6,801,083 $6,801,065 $7,185,393 $7,687,226 $798,161 $704,623 $- $1,000,000 $2,000,000 $3,000,000 $4,000,000 $5,000,000 $6,000,000 $7,000,000 $8,000,000 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 PA State Funds ARRA Stimulus Funds

State Basic Education Funding - Update

— Share slides and data from a State Basic Education

Funding Workshop

— Participation was by a joint group from:

— PASA — PSBA — PASBO — PAIU

Basic E c Educ ducation F n Fund unding g Workshop

Wed ednesday, N November er 1 16

PA Public Education System

• 3,288 Public Schools
• 500 School Districts
• 176 Charter Schools
• 29 Intermediate Units
• 12 Comprehensive Career and Technology

Centers

• 59 Occupational Career and Technology Centers
• 7 State Juvenile Correctional Institutions
• 2 School District sponsored Community Colleges

2

School District Funding

Total S l State Re Revenue ue, $10,022, 022,41 410, 0,134 134 Total L l Local l Re Revenue ue, $15,886, 886,60 605, 5,775 775 Total Fe l Fede deral Re l Revenue ue, $1,454, 54,601, 601,058 58

58% 37% 5%

Source: PDE

3

For the Past Five Years the Base Index average is less than 2%

3. 3.9 3. 3.4 4. 4.4 4. 4.1 2. 2.9 1. 1.4 1. 1.7 1. 1.7 2. 2.1 1. 1.9 2. 2.4

200 006- 6-07 07 200 007- 7-08 08 200 008- 8-09 09 200 009- 9-10 10 201 010- 0-11 11 201 011- 1-12 12 201 012- 2-13 13 201 013- 3-14 14 201 014- 4-15 15 201 015- 5-16 16 201 016- 6-17 17

Base index average for the last six years is 1.87%

Act 1 Base Index History

Source: PDE

7

2016-17 Cost Increases

1% Salary Increase $110,000,000 Net Local Share of PSERS $212,014,000 Health Insurance at 4% $108,000,000 Charter School Increase $150,000,000 Special Education Increase $175,000,000

TOTAL COST INCREASES $756,014,000 Act 1 Index Revenue (Adjusted Index) $340,000,000

Shortf tfal all A AFTE TER T Tax Increa ease se $416 16,014, 014,00 000

9

The Resulting Inequity

PA had the most inequitable funding when comparing per student spending in the wealthiest school districts to the poorest school districts.

Source: Washington Post 3/12/15 20

Basic Education Funding Commission

• Commission formed in 2014
• Tasked with developing a BEF

formula

• Issued recommendations in June

2015

• Widespread, bi-partisan support for

formula

• Removed politics from process

21

Top 30 Districts in % BEF Increase

Source: PDE

60 School

• ol D

District 2014 2014 M Median Househ usehold Income I Index 2016 2016-17 17 3-yr a avg ADM Loca cal E Eff ffort Capaci city Index ex % I Increa ease se in BEF BEF Conestoga Valley SD 0.9432 4,456.821 1.3700 26.09% York Suburban SD 0.8063 2,930.249 1.3000 22.64% Wyomissing Area SD 0.7917 1,935.455 1.3500 21.56% Derry Township SD 0.8154 3,477.779 1.2200 20.68% Hanover Public SD 1.2004 1,873.701 1.4800 20.50% Jim Thorpe Area SD 0.9548 2,235.790 1.7500 20.19% State College Area SD 1.0704 7,071.132 1.0800 17.12% Quaker Valley SD 0.7444 1,893.993 1.1100 16.70% Manheim Township SD 0.7835 5,803.255 1.2800 16.57% Upper Merion Area SD 0.6937 3,883.531 0.8700 15.60% Parkland SD 0.6676 9,186.635 1.1900 14.19% Lewisburg Area SD 1.0776 1,938.182 1.4800 14.12% East Stroudsburg Area SD 0.9046 7,451.258 1.8500 13.47% Wilkes-Barre Area SD 1.4174 7,476.679 1.6500 13.03% Central York SD 0.8241 6,029.424 1.3700 13.02%

Top 30 Districts in % BEF Increase

Source: PDE

61 School

• ol D

District 2014 2014 M Median Househ usehold Income I Index 2016 2016-17 17 3-yr a avg ADM Loca cal E Eff ffort Capaci city Index ex % I Increa ease se in BEF BEF Muhlenberg SD 0.8817 3,585.549 1.3700 12.99% Upper Moreland Township SD 0.8145 3,123.594 1.1800 12.88% Springfield Township SD 0.6243 2,274.984 0.8800 12.88% Camp Hill SD 0.8147 1,249.161 1.2400 12.77% Wilson SD 0.7964 5,994.623 1.3700 12.75% Fox Chapel Area SD 0.6966 4,310.034 1.0200 12.73% Norristown Area SD 0.9529 7,584.842 1.1700 12.42% Abington SD 0.7056 7,715.025 1.0000 12.35% Pocono Mountain SD 0.9681 10,242.488 2.0300 12.25% Cornell SD 1.4662 685.201 1.2500 11.92% Wallenpaupack Area SD 0.9996 3,242.639 1.2200 11.68% Schuylkill Valley SD 0.7966 2,013.891 1.3300 11.66% Pottstown SD 1.1616 3,265.482 1.8600 11.64% South Fayette Township SD 0.6573 2,738.536 1.4100 11.52% Reading SD 1.9770 18,096.506 1.8400 11.49%

Previous distribution of BEF

Previous F s FY B Basic c Educ ucation F n Fundi nding ng State ate B Budget Incr crease i in Basic Educ ucation F n Fundi nding ng Ne New B Basic c Educ ucation F n Fundi nding ng Lev evel el

Previous basic education funding was distributed through the process of Hold Harmless, where no school district got less than it got in the previous year.

62

New distribution of BEF

What’s the difference? What’s the difference?

• No guarantee that BEF from the previous

year will increase even if the total appropriation increases.

• The formula reacts to changes in student

and district factors annually.

Hold harmless is out, BUT the formula maintains a baseline

• ver time to avoid negative financial impact

Base Ye Year i is 2014 2014-15 15 FY 2015 2015-16 16 BEF I Increa ease e ($150 m $150 million)

FY 2015 2015-16 B 6 BEF EF increase P PLUS 2016 2016-17 B 7 BEF Increase ase ($350 m millio ion) n)

63

Impact of new formula

• Predictability and consistency for school districts
• Formula is now based on the major cost drivers
• Directs resources to districts with greatest needs
• Will begin to close the gap between districts based
• n their funding per student

64

Federal Revenue

§ Projected Funding remains the same from 2016-17

but the future of Federal Funding is an unknown.

§ Title I § Title II § Title III

Revenue Breakdown

$63,018,417 75.1% $20,198,640 24.1% $643,887 0.8% $500,000

Local State Federal SWAP

Revenue Review

§ 2016-17 Total = $82,989,834 § 2016-17 Total = $84,360,944 § Increase of $1,371,110 = 1.65%

§ Does not include any tax increase projected

Tax Rate History

16.00 17.00 18.00 19.00 20.00 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17

17.76 17.76 17.76 17.76 18.22 18.57 18.92

Millage Rates

Tax Rate History

Adopted Act 1 CYSD Full Millage Index % Index 08/09 16.81 4.40% 3.10% 17.03 09/10 17.26 4.80% 2.70% 17.62 10/11 17.76 3.50% 2.90% 17.86 11/12 17.76 1.70% 0.00% 18.06 12/13 17.76 2.00% 0.00% 18.12 13/14 17.76 2.10% 0.00% 18.13 14/15 18.22 2.60% 2.55% 18.23 15/16 18.57 2.40% 1.90% 18.66 16/17 18.92 3.00% 1.90% 19.13

2016-17 York County Tax Rates

33.736 26.090 23.470 22.930 22.430 22.410 22.350 22.250 21.970 21.934 21.390 18.920 18.850 18.460 York City Northeastern West York Dallastown Eastern York Suburban Red Lion South Eastern Spring Grove Dover Hanover CENTRAL South Western Southern

Budget Increase History

2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 0.50% 0.00% 2.52% 1.11% 3.72% 4.47% 3.30% Percent

2017-18 Expenses

2017-18 Expenses

§ Budget changes/increases:

§ Salaries $1,444,681 § Health Insurance Benefits $1,410,008 § PSERS Retirement $1,204,145 § Special Education Services $597,983 § Social Security $87,366

§ Total Expenses Increase = $5,132,946

Salary Costs

$0 $5,000,000 $10,000,000 $15,000,000 $20,000,000 $25,000,000 $30,000,000 $35,000,000 $40,000,000 $45,000,000 $50,000,000 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18

$34,930,902 $34,665,919 $34,952,696 $35,557,047 $37,191,178 $38,635,860

Dollar Amount

Insurance Costs

$0 $2,000,000 $4,000,000 $6,000,000 $8,000,000 $10,000,000 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18

$6,510,792 $6,589,875 $7,696,299 $7,375,096 $7,820,623 $9,230,632

Dollar Amount

Pension Contribution Rates

0.00% 10.00% 20.00% 30.00% 40.00% 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18

8.65% 12.36% 16.93% 21.40% 25.84% 30.05% 32.00%

Employer Contribution Rate

Pension Costs

$- $5,000,000 $10,000,000 $15,000,000 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18

$2,920,771 $4,248,869 $5,784,351 $7,548,272 $9,045,437 $10,905,268 $12,109,413

Employer Costs

Expense Breakdown

$38,635,860 43.7% $24,982,463 28.3% $13,730,969 15.6% $7,800,000 8.8%

$3,206,175 3.6% Salaries Benefits Operational Debt Transportation

Projected Revenue = $84,360,944 Projected Expenses = $88,355,467 Deficit = ($3,994,523)

Budget Comparison

2016-17 2017-18 Beginning Fund Balance $5,127,671 $5,127,671 Local Revenue $62,201,193 $63,018,417 State Revenue $19,395,463 $20,198,640 Federal Revenue $643,178 $643,887 SWAP Reserve Use +$750,000 +$500,000 TOTAL REVENUE $83,238,446 $84,360,944 TOTAL EXPENDITURES $83,362,521 $88,355,467 Surplus (Deficit) ($124,075) ($3,994,523) Designated Funds $5,142,690 $4,642,690 Ending Fund Balance $5,127,671 $1,133,148

December Preliminary Budget History

Budget Year Projected Expenses Projected Deficit 2016-2017 $85,357,336

• $4,198,650

2015-2016 $82,081,622

• $3,638,375

2014-2015 $80,082,081

• $3,898,446

2013-2014 $77,999,632

• $3,311,183

2012-2013 $75,841,030

• $2,987,142

2011-2012 $73,655,053

• $1,925,957

2010-2011 $73,218,960

• $2,171,252

Budget Options (Per Act 1)

— Index Resolution (Not-to-Exceed) — Preliminary Budget & File for Exceptions

— Special Education $410,156 — Retirement Contributions $0

— Referendum Question

What’s Next?

• December 12, 2016 – Approve the Index Resolution
• February 2017 – Governor releases PA Budget
• March 6, 2017 – Board Meeting (Budget Update)
• April 12, 2017 Board Budget Workshop
• April 18, 2017 – Town Meeting
• May 15, 2017 Board Meeting (Preliminary Approval)
• June 19, 2017 Board Meeting
• (Final Adoption of 2017-18 General Fund Budget)