Northeastern School District Preliminary Budget Presentation - PowerPoint PPT Presentation

Northeastern School District Preliminary Budget Presentation 2019-2020 School Year The Bobcat Way: 100% of our students will graduate and be fully prepared for post-secondary education.

Preliminary Budget Summary DESCRIPTION 2019-20 BUDGET SUMMARY TOTAL REVENUE $ 71,398,000 - TOTAL EXPENDITURES -$70,552,000 Gross surplus (rounded) $ 846,000 Use of Fund Balance $ 0 Budgetary Reserve $ (400,000) Other RE Tax increase $ 0 Budget (w/o spec. request) $ 446,000 Budget (w/ spec. requests) $ TBD Note: Above #s include transfer to Capital Reserve Capital Improvements $ (300,000) HS Renovations (tax increase) $ (224,000)

Big Picture 2017-18 Audit results • Summary • Actual revenue over-budget $2.5M or +3.87%. • Actual expenditures were only under by $147k or 0.22%. • Note main areas of revenue and expenditure results that were different from budget and prior yr actuals • Due to a large transfer to Capital Reserve for HS renovations, GF net position decreased by $1.1M to $10.4M.

Big Picture 2019-20 BUDGET • Revenue – Top increases from 2018-19 budget – Comments on local, state, and federal • Expenditures – Top increases from 2018-19 budget – Areas to watch this year: • Labor negotiations with both NEA and Act 93 • Redistricting of elementary schools • HS renovation project • Other contracts • Charter School tuition

2019-20 Revenue Tax for HS Renovations, $224,000 , 0% Federal, $728,620 , 1% State, $24,302,331 , 34% Local, 46,143,049 , 65% Local State Federal Tax for HS Renovations

10 year Revenue History 80,000,000 70,000,000 60,000,000 50,000,000 40,000,000 30,000,000 20,000,000 10,000,000 - A2014-15 A2015-16 A2016-17 B2018-19 B2019-20 A2010-11 A2011-12 A2012-13 A2013-14 A2017-18

Revenue % - 10 yr History 8.0% 6.72% 7.0% 6.1% 6.0% 5.62% 5.55% 5.0% 4.02% 3.84% 4.0% 3.61% 3.0% 1.91% 2.0% 1.0% 0.0% A2010-11 A2011-12 A2012-13 A2013-14 A2014-15 A2015-16 A2016-17 A2017-18 B2018-19 B2019-20 -0.32% -1.0% -2.0% -2.36% -3.0%

2019-20 Expenditures Transfer to Capital Reserve, Transfer HS renovations, $300,000 , 1% $224,000 , 0% Budgetary Reserve, $400,000 Safe Schools, $100,000 , 0% , 1% Other, $16,877,093 , 24% Salary, $28,613,566 , 40% Debt Service, $5,840,786 , 8% Benefits, $18,596,555 , 26% Salary Benefits Debt Service Other Safe Schools Transfer to Capital Reserve Transfer HS renovations Budgetary Reserve

Salary • By contract: – Professional = TBD - contract expires 6/30/19 – Central Office administrators = under individual contracts – raise TBD – Act 93 Administrators = TBD – expires 6/30/19 • Budgeted but Board decides: – Confidential = +2.3% (index) – Classified = +2.7% (avg) – move 1 step on matrix* – Co-/Extra-curricular = longevity only • Total projected salary increase = +$877k

2019-20 BENEFITS Group Life Insurance, $27,000 Social Security, $2,169,048 , , 0% 12% Health Insurance, $5,999,117 , 32% Worker's Compensation, $225,000 , 1% Unemployment Compensation, Retirement, 9,916,391 , 53% $10,000 , 0% Tuition Reimbursement, $250,000 , 2% Group Life Insurance Social Security Retirement Tuition Reimbursement Unemployment Compensation Worker's Compensation Health Insurance

Benefits: Health Insurance • Funding rate to LBT: – As of 6/30/18, $4.5M as net position in LBT – For 2019-20, 0% medical rate offered. – Recommend funding at 3% increase • Smooth future rate increases at 3% per year. Medical trend is double. • boosts fund balance at LBT for future labor negotiations – poss health saving accounts in next contract. • District cost at $6M (assumes +3% funding) • Current employee cost sharing: – Premium share = +3% increase – Deductible at $500/$1500 – Spousal surcharge at $100/mth

Total Exp % Growth -10 yr History 6.0% 4.9% 4.80% 5.0% 4.6% 4.2% 4.0% 3.6% 3.5% 3.37% 3.3% 3.0% 1.9% 2.0% 1.0% 0.0% 2014-15 A2015-16 A2016-17 B2018-19 B2019-20 2010-11 2011-12 2012-13 2013-14 A2017-18 -1.0% -2.0% -2.5% -3.0%

Expenditure Growth % (2018-19 to 2019-20) 7.0% 6.0% 6.0% 5.0% 4.0% 3.7% 3.4% 3.2% 3.0% 2.0% 1.6% 1.0% 0.0% Salary Benefits Debt Service Other Total Series1

20.00% Total Fund Balance % - 10 yr History 18.26% 18.00% 16.29% 16.26% 15.86% 16.00% 14.00% 12.64% 12.00% 11.20% 10.00% 8.54% 8.00% 6.35% 6.00% 4.26% 3.62% 4.00% 2.00% 0.00% A2010-11 A2011-12 A2012-13 A2013-14 A2014-15 A2015-16 A2016-17 A2017-18 B2018-19 B2019-20

TAXES: District Perspective DISTRICT Perspective Index No Exceptions Real Estate Millage Increase +2.3% to be filed 1 mil = $1.4M in new reoccurring revenue Adjusted Index +3.1% Additional Real Estate Revenue possible $840,000 to $0 through tax increase $1,134,000

TAXES: Taxpayer Perspective TAXPAYER Perspective $ 100k $ 150k $ 200k Real Estate Millage Increase based on assessed property value Tax increase: Adjusted Index to 3.1% +$ 81 +$ 122 +$ 162 Real Estate Tax bill at 27.06mils w/o H/F excl $ 2,706 $ 4,059 $ 5,412

Board to consider… • Salary – Any Confidential, Classified, co-curricular, and extra-curricular raises will need board approval. – Labor negotiations begin w/ NEA and Act 93 administrators – Classified hourly rate matrix – New special staffing requests • Benefits – Health insurance – select funding rate of either +0% or +3% for 1/2019 LBT mtg • Academics and Operations – $100k of safe schools funding not yet allocated for Act 44 and ALICE. Waiting to learn results of safe schools grant (part B) submitted in October. – Contract decisions needed by the end of 2018-19: • Questeq (technology) • Legal services GF Other • Redistricting the elementary buildings – Revenue – no added state subsidy money added to budget. – Maintain budgetary reserve to mitigate some uncertainty. –

Board to consider… • General Fund Balance – Keeping unassigned fund balance as a % of total budgeted expenditures between 4% - 8%. Recommend moving any funds >8% of unassigned fund balance to Capital Reserve for – future capital needs. $2.0M of committed and assigned fund balance for use towards PSERS. Consider holding – for now since PSERS continues to raise the employer rate % level. Other Funds • Keeping fund balances strong in LBT for labor negotiations and HI budget forecasts – – Timing and funding of new artificial turf and new high school (or major renovations) needed • Taxes – See the HS master plan to determine if the current annual tax increase of +0.16 mils is correct. – Caution using “budget surplus” for too many reoccurring expenditures as it may have long term tax implications. – File tax resolution or preliminary budget with exceptions

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