Lower Merion Board of School Directors PRELIMINARY BUDGET - - PowerPoint PPT Presentation

Lower Merion Board of School Directors

PRELIMINARY BUDGET PRESENTATION

January 23, 2017

Th The I Impact of

• f Enrollm

lment G Growth

The greatest cost to any school district is directly related to the number of children served. Our enrollment growth “cost” is about 1% annually. No other school district in the Commonwealth of Pennsylvania has been impacted more than Lower Merion.

Source: Pennsylvania Department of Education

4002

+589

2996

+872

8388

+1474

Source: Pennsylvania Department of Education

476 more students or a growth of 7.8% 1474 more students or a growth of 21.3% Source: Pennsylvania Department of Education

Source: Pennsylvania Department of Education

Two Dec Decisi sions T s That t Rea eally Mat attered

In 2004 the Lower Merion Board of School Directors authorized the building of two new high schools In the Spring of 2007 the LMSD community voted against an EIT or a PIT

2017 2017-18 B Budget C Cycle

Act 1

• Accelerated Budget Schedule
• Exceptions
• Back-End Referendum

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201 2017-18 Budg Budget Cy Cycl cle

• The 2017-18 Preliminary Budget must be on

display at least 20 days prior to its adoption.

• The deadline for the Board to advertise its intent

to adopt the Preliminary Budget, is at least 10 days prior to its adoption.

• February 15, 2017 is the deadline for Board to

adopt the 2017-18 Preliminary Budget which is scheduled for February 13, 2017 Business Meeting.

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2017-18 Budg dget C Cycle ( (cont’d) d)

• At least one week before submission of exception-

Deadline to advertise that Board is seeking exception to back-end referendum – February 23, 2017

• March 2, 2017– Deadline to submit exception filings

to PDE

• March 17, 2017– Deadline for Board to submit

referendum to county officials

1 1

2017-18 Budget Cycle (cont’d)

• March 22, 2017 – Deadline for PDE to rule and inform districts if

exceptions have been granted or denied.

• March 27, 2017 – Deadline for Board to submit referendum question

to county officials if exception is denied.

• June 10, 2017– Deadline to print and allow inspection of annual

budget.

• June 20, 2017– Deadline for Board to give notice of intent to adopt

final budget.

• June 30, 2017 – Deadline to adopt budget for 2017-18 fiscal year.

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Historical Index and Tax Increase

1 3

Scho hool Y l Year Index ex Tax I Increase 2006/0 2006/07 3. 3.9% 9% 10. 10.79 79% 2007/0 2007/08 3. 3.4% 4% 4. 4.46% 46% 2008/0 2008/09 4. 4.4% 4% 6. 6.36% 36% 2009/1 2009/10 4. 4.1% 1% 6. 6.59% 59% 2010/1 2010/11 2. 2.9% 9% 4. 4.15% 15% 2011/1 2011/12 1. 1.4% 4% 3. 3.31% 31% 2012/1 2012/13 1. 1.7% 7% 1. 1.99% 99% 2013/1 2013/14 1. 1.7% 7% 3. 3.82% 82% 2014/1 2014/15 2. 2.1% 1% 3. 3.90% 90% 2015/1 2015/16 1. 1.9% 9% 3. 3.55% 55% 2016/1 2016/17 2. 2.4% 4% 4. 4.44% 44% 2017/1 2017/18 2. 2.5% 5%

What Drives Budget Increases?

• 1. Instructional Program - maintaining low class size while continuing

student programs

• a. Enrollment Growth
• b. Salaries
• c. Retirement Contribution – (PSERS 8% increase)
• 2. Special Education Program Mandates
• 3. No/Minimal Increase in State or Federal Funding

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2017-18 Preliminary Budget Highlights

Uncertain Issues

• Current and Future tax revenues
• State Budget – Governor will present the

Commonwealth Budget in February

• Pending Budget Litigation

15

16

Where the Money Comes From

Local 84.01% State 13.20% Fund Balance 2.50% Federal .29%

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Anticipated Revenue

Budget Budget Description 2016-17 2017-18 Fund Balance Funds Designated as a Revenue 9,220,901 6,484,826 Local Sources Current Real Estate Taxes 204,197,135 208,764,687 Interim Real Estate Taxes 301,000 301,000 Public Utility Realty Tax 220,000 220,000 Local Services Tax 200,000 205,000 Realty Transfer Taxes 3,000,000 3,250,000 Delinquent Real Estate Taxes 3,850,000 3,600,000 Interest Income 250,000 375,000 Tuition - Summer Programs 200,000 200,000 IU Federal Funds 1,200,000 1,200,000

• Misc. Other Local Sources

106,300 107,500 Total Local Sources 213,524,435 218,223,187

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Anticipated Revenue (cont'd) Description Budget 2016-17 Budget 2017-18 State Sources Basic Education Funding Subsidy 3,497,119 3,794,830 Special Education Subsidy 2,882,307 2,932,363 Transportation Subsidy 2,400,000 2,400,000 Revenue for Social Security Payment 4,600,000 4,700,000 Revenue for Retirement 18,200,000 20,000,000 State Property Tax Reduction Allocation 3,473,906 Health Services Subsidies 260,000 250,000 Rental & Sinking Fund Reimbursement 150,000 200,000

• Misc. Other State Subsidies

20,000 20,000 Total State Sources 35,483,332 34,297,193 Federal Sources 705,600 745,000 Total Revenue 249,713,367 253,265,380 Total Revenue and Designated Fund Balance 258,934,268 259,750,206

How Does The Money Support Our Children?

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INSTRUCTIONAL SVCS 67.30% Regular Education Special Education Vocational Education Summer Programs Homebound Instruction Student Services Guidance Services Psychological Services Curriculum Development Staff Development Library Services Technology Serv DEBT SERVICES 10.53% NON-INSTRUCTIONAL SVCS 2.14% Athletics Student Activities OTHER FINANCING USES- .31% SUPPORT SVCS 19.72% Board Services Tax Collection Administration Legal Services Maintenance & Operations Public and Non-Public Transportation

20 DESCRIPTION Budget 2016-17 Preliminary Budget 2017-18 Salaries 122,792,506 124,609,663 Benefits 75,971,829 81,926,498 Other

• Purchased Professional and Technical Svcs (IU

services, consultants, etc)

• Purchased Property Svcs (utilities, repair work, leases etc)
• Other Purchased Svcs (tuition payments to charters,

special ed, vo-tech, general insurance, contracted transportation

• Supplies (general supplies, books, software licenses,

fuel, gas, etc)

• Property (equipment, laptops, iPads, etc)
• Other Objects (debt service principal payments)

59,369,933 60,438,092 Budget Reserve 800,000 800,000 258,934,268 267,774,253 Tax Monies required to balance the Budget (8,024,047) Budgeted Mill Value 7,576,074 7,620,178 Additional Increase in Mills Required 1.0530 Total Mills 27.3963 28.4493 Mills Increase 3.85% Budget Expenditure Increase 3.41%

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Real Estate Tax Change

Median Household Assessment $250,680 2016-17 Real Estate Tax mill rate 27.3963 Face amount of 2016-17 Real Estate Tax 6,868 2017-18 Real Estate Tax mill rate 28.4493 Face amount of 2017-18 Real Estate Tax 7,132 Tax Increase $264 Median household assessments provided by Montgomery Co. Board of Assessments

Exceptions for 2017-18

• Indebtedness Incurred Prior to Effective Date
• Electoral Debt Incurred Under 53 PA CS Part VII Part B

Special Education Retirement

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2010/11 2011/12 2012/13 2013/14 2014/15 Special Education Instruction and Related Services Expenditures

$32,184,625 $35,238,811 $37,472,964 $39,616,694 $42,909,800

Difference from Prior Year

$2,249,125 $3,054,186 $2,234,153 $2,143,730 $3,293,106

Special Education Exception Amount Approved

$711,781 $1,594,624 $1,932,946 $2,478,906 $1,592,463

Special Education Exception Amount Utilized

$324,357 $1,543,574 $486,768 $2,478,906 $1,592,463

Special Education Exceptions

Special Education Exception Amount Approved

711,781 1,594,624 1,932,946 2,478,906 1,592,463 8,310,720

Special Education Exception Amount Utilized

324,357 1,543,574 486,768 2,478,906 1,592,463 6,426,068

1,884,652

2010-11 2011-12 2012-13 2013-14 2014-15 Total

Use of Special Education Exceptions

Five Y e Year ar Us Use Of Of Excep eptions in LMSD f for Sp Specia ial l Educatio ion

Facts:

• The District was entitled to tax over 1.88 million

dollars more than was utilized.

• In all but one year the actual special education costs

exceeded the allowable exception.

• In some years special education increases were

partially funded through the Act 1 tax index.

• The Actual Special Ed. instructional increases total

12.9 million dollars.

USE OF PSERS EXCEPTIONS

Fiscal Year End PSERS Employer Contribution Rate % Inrease in Contribution Rate Net Increase From Prior Year Exception Approval by PDE Exception Utilized by LMSD Difference Between Exception Approval and Utilization 2012 8.65% 53% 1,602,037.83 1,621,343.00 1,621,343.00

• 2013

12.36% 43% 2,101,503.15 1,853,898.00

• (1,853,898.00)

2014 16.93% 37% 2,622,975.30 2,210,983.00 1,233,830.00 (977,153.00) 2015 21.40% 26% 2,829,946.72 2,086,531.00 1,714,965.00 (371,566.00) 2016 25.84% 21% 2,721,152.00 2,036,996.00 1,536,794.00 (500,202.00)

PSE SERS F S Facts

The total amount NOT taxed as an exception is $3,702,819. The total amount taken within the index was $5,770,683.

• 50,000,000

100,000,000 150,000,000 200,000,000 250,000,000 300,000,000 350,000,000 400,000,000 450,000,000 2006 2016 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 Budgeted Expenses Budgeted Revenue

WHY PSERS RESERVE IS NEEDED

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February - Superintendent presentation to ISC February – 13 Preliminary Budget Approval *March 15 - Finance Committee - Curriculum and Instruction presentation *April 5 - Finance Committee - Presentation of Operations including facilities and transportation April 24 – Proposed Final Budget Approval *April 26 - Finance Committee - Presentation on Student Services including gifted and talented *May 17 - Finance Committee - Presentation on staffing including enrollment impact and class size and Technology May 23 – Public Inspection Deadline of Proposed Final Budget May - Superintendent presentation to Federations May 28 – Public Notice of Intent to adopt 2017-18 Budget June - Superintendent presentation to Staff June 12 Final Budget Approval/Adoption

Budget Calendar - 2017

*Tentative Meeting Dates

Uncertainty Created by Budget Litigation

• Millage in effect for 2015-16:

26.2321 mills

• Millage as enacted by Board in June 2016:

27.3963 mills

• Millage as reduced by 8/29/16 injunction:

26.8616 mills

• Millage in dispute:

.5347 mills

Lower Merion School District: A Public lic School System

Independent schools implement a stringent vetting process designed to ensure that students entering will be successful. Public schools encourage all students – no matter where they are from , no matter their skills in language or mathematics, no matter their religion or beliefs and strive to provide a superior education – and we represent what has been a crown jewel in

• ur republic – a public education.