PERKIOMEN VALLEY SCHOOL DISTRICT 2013-14 GENERAL FUND BUDGET - - PowerPoint PPT Presentation

PERKIOMEN VALLEY SCHOOL DISTRICT 2013-14 GENERAL FUND BUDGET

Proposed Preliminary Budget Approval For Board Review and Approval February 11, 2013

1

Revenue Budgetary Influences for 2013-14

2

Economy

• 1. Economy-What is doing now? Predictions??

2. Taxpayer’s ability to pay bills- still constant 96.4% collection on RE Tax bills- great!

• 3. Earned Income rising and Housing sales
• 4. Alternative Revenue Sources continue to dry

up so we try to create new ones

Revenue Budgetary Influences for 2013-14

3

Politics and the Economy

• Election and Political influences
• The “Great Unknown” factor of Federal (discussions of

elimination of Department of Education- Sequestration still not figured

• ut yet) and State (Voucher issues, Educational funding tie-ins and

retirement solutions) impact on our budget

Summary of revenue changes from the November 12, 2012 presentation

4

 The following revenues have been adjusted since the

November 12, 2012 presentation:

1.

Increase EIT $ 50,000

2.

RE Assessment growth from Oct. $ 35,658 Total adjustments $ 85,658

Summary of revenue changes from the December 10, 2012 presentation

5

 The Business Administrator (Jim Weaver) provided a one

page summary of the proposed 13-14 budget at the January 14, 2013 School Board Business Meeting

 There were two adjustments to the proposed revenues

at that meeting:

 Increased Earned Income Tax

$50,000

 Real Estate Tax Assessment growth

$46,147 Subtotal adjustments $96,147

Summary of revenue changes from the January 14, 2013 presentation

6

 The following revenues have been changed from the

January 14, 2013 presentation:

 Increased Earned Income Tax

$550,000

 Real Estate Tax Assessment growth

$ 8,989

 PSERS revenue adjustment for Salaries

($ 57,679)

 Additional ESBE per Gov’s budget

$239,588

 Decrease Spec Ed per Gov’s budget

($ 20,128) T

• tal Adjustments for presentation

$720,770

PERKIOMEN VALLEY SCHOOL DISTRICT 2013-14 PROJECTED REVENUES

REAL ESTATE TAX

7

 The Real Estate Tax is based upon the Assessment values provided by the

County times Millage rate.

 Assessment increased by .13% and 96.4% collection rate  These numbers represent Gaming Monies/Tax Relief shown under State

funding sources 2013-14 RE Tax Revenue Projected $55,908,958 2012-13 RE Tax Revenue Budget $55,834,054 Projected Increase $ 74,904 *- Based upon October County report Projected one mill to equal $2,049,500 as of January 2013

PERKIOMEN VALLEY SCHOOL DISTRICT 2013-14 PROJECTED REVENUES REAL ESTATE TAX (cont’d)

8

 Some additional information to consider for this first

revenue look:

 Our overall assessment appeal totals are down from previous

years (less than 90 for July through October – We had 79 in 1 month last year)

 These assessment appeals will be monitored and reviewed as

the results become known

 There are several large properties that make up the majority of

assessment value

 We have taken a conservative approach and have an estimated

loss built into the presentation at this time as it has proven worthy over the past couple of years

PERKIOMEN VALLEY SCHOOL DISTRICT 2013-14 PROJECTED REVENUES REAL ESTATE TAX (cont’d)

9

 We continue to monitor and assess less than 10

properties whose value exceeds our minimum threshold

• f $400,000

 We continue to work with counsel on these ongoing

issues and hope to work out some settlements to get these “back onto the books” moving forward

Real Estate Tax History Budget vs. Actual

10

2008-09 TR 2009-10TR 2010-11TR 2011-12TR 2012-13TR 2013-14TR Budget 50,158,586 51,677,498 53,500,467 54,710,820 55,834,054 55,908,958 Actual 49,236,409 52,015,850 53,567,500 54,615,231 55,834,054 55,908,958

40,000,000 42,000,000 44,000,000 46,000,000 48,000,000 50,000,000 52,000,000 54,000,000 56,000,000 58,000,000

Real Estate Tax History Gross Tax Relief figures not included for 2013-14 “TR”

Real Estate Tax 2012-13 for Tax Relief Monies

11

There was a Tax Relief distribution declared for the 2012-13 fiscal year…this is the fifth consecutive year. This distribution resulted in a “Dollar Value of Homestead Exclusion” figure ($1,891,055) removed from the local Real Estate Tax Revenue line item and moved into a State Provided line item as per the law Real base number for 12-13 is the combination of PDE 2028 line item for Real Estate Tax Revenues plus Homestead monies from State **Presumption is that 13-14 will remain the same as 12-13 until further notice

PERKIOMEN VALLEY SCHOOL DISTRICT 2013-14 PROJECTED REVENUES

EARNED INCOME TAX

12

Occupation Assessment Referendum was passed in 2009 (PV’s rate moved from .5% to .9%) Fiscal year 2011-12 audited were higher than the budgeted figure by 8% 13-14 Budget figure exceeds the original calculation by about 6%

Total estimated for 2013-14 $10,600,000 Budget for 2012-13 $ 9,650,000 Increase $ 950,000

Earned Income Tax History Budget vs. Actual

13

2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 Budget 4,800,000 4,900,000 9,200,000 9,200,000 9,650,000 10,600,000 Actual 4,973,902 5,200,029 8,022,343 9,944,026 9,650,000 10,600,000

• 2,000,000

4,000,000 6,000,000 8,000,000 10,000,000 12,000,000

Earned Income Tax History

PERKIOMEN VALLEY SCHOOL DISTRICT 2013-14 PROJECTED REVENUES

INTERIM REAL ESTATE TAX

14

Fiscal Year Budget Actual Difference 2002-03 $1,000,000 $1,532,525 $532,525 2003-04 $1,200,000 $ 938,645 ($261,355) 2004-05 $1,200,000 $ 970,006 ($229,000) 2005-06 $1,200,000 $ 736,163 ($463,837) 2006-07 $1,000,000 $ 633,068 ($366,932) 2007-08 $1,000,000 $ 410,909 ($589,091) 2008-09 $ 650,000 $ 740,478 $ 90,478 2009-10 $ 650,000 $ 250,626 ($399,374) 2010-11 $ 350,000 $ 205,200 ($144,800) 2011-12 $ 250,000 $ 147,048 ($102,952) 2012-13 $ 250,000 $ ? $ ? 2013-14 $ 150,000 $ ? $ ?

Interim Real Estate Tax History Budget vs. Actual

15

2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 Budget 650,000 650,000 350,000 250,000 250,000 150,000 Actual 740,478 250,626 205,200 154,721 250,000 150,000 100,000 200,000 300,000 400,000 500,000 600,000 700,000 800,000

INTERIM REAL ESTATE TAX HISTORY

Budget Actual

PERKIOMEN VALLEY SCHOOL DISTRICT 2013-14 PROJECTED REVENUES

INTERIM REAL ESTATE TAX (cont’d)

16

Recent trend has shown we have over budgeted over the past several years Therefore, this budget will contain a negative adjustment We will continue to monitor this one as well

T

• tal estimated for 2013-14

$ 150,000 Budget for 2012-13 $ 250,000 Decrease of $ 100,000

PERKIOMEN VALLEY SCHOOL DISTRICT 2013-14 PROJECTED REVENUES

REAL ESTATE TRANSFER TAX

17

Analysis shows a steady stream of income at this time We will maintain the current budget for 2013-14 fiscal year and monitor for progress and possible adjustment if warranted Total estimated for 2013-14 $ 700,000 Budget for 2012-13 $ 700,000 No Change $ 0

Real Estate Transfer Tax History Budget vs. Actual

18

2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 Budget 1,400,000 1,100,000 700,000 700,000 700,000 700,000 Actual 769,152 1,100,000 652,620 671,232 700,000 700,000 200,000 400,000 600,000 800,000 1,000,000 1,200,000 1,400,000 1,600,000

REAL ESTATE TRANSFER TAX HISTORY

Budget Actual

PERKIOMEN VALLEY SCHOOL DISTRICT 2013-14 PROJECTED REVENUES

DELINQUENT REAL ESTATE AND PERSONAL TAXES

19

Delinquent Real Estate and Personal Taxes

Adjustments made last year to figure No recommended change as of this presentation but we will continue to monitor Change in Delinquent Tax Collector will impact negatively

T

• tal estimated for 2013-14

$ 1,839,000 Budget for 2012-13 $ 1,839,000 Change of $ 0

Delinquent Personal & RE Tax History Budget vs. Actual

20

2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 Budget 1,350,000 1,500,000 1,739,000 1,689,000 1,839,000 1,839,000 Actual 1,465,337 2,042,438 1,845,261 2,011,909 1,839,000 1,839,000 500,000 1,000,000 1,500,000 2,000,000 2,500,000

Delinquent Personal & RE Tax History

Budget Actual

PERKIOMEN VALLEY SCHOOL DISTRICT 2013-14 PROJECTED REVENUES

INTEREST EARNINGS

21

Historic low rates continue with no end in sight We continue to review our limited opportunities (PSDLAF, PLGIT or Bank CD’s) but this reflects actuals for 11-12 Safety and liquidity for cash flow is key Total estimated for 2013-14 $ 100,000 Budget for 2012-13 $ 100,000 No change $ 0

PERKIOMEN VALLEY SCHOOL DISTRICT 2013-14 PROJECTED REVENUES

OTHER LOCAL TAXES AND REVENUES

22

Budget Budget

Account Title 12-13 13-14 Inc/Dec PURTA $ 90,000 $ 90,000 $ 0 Pmts in Lieu of $ 305,000 $ 305,000 $ 0 Per Cap. 679 $ 91,200 $ 91,200 $ 0 Per Cap. 511 $ 182,400 $ 182,400 $ 0 Student Activities $ 50,000 $ 50,000 $ 0 IDEA (via local) $ 827,000 $ 847,000 $ 20,000 IDEA Stimulus $ 0 $ 0 $ All Other Local Revenues $ 895,210 $ 860,000 $ 35,210 T

• tals

$2,440,810 $2,425,600 $ 15,210

PERKIOMEN VALLEY SCHOOL DISTRICT 2013-14 PROJECTED REVENUES

LOCAL REVENUES SUMMARY (as of February 11, 2013)

23

Audited BUDGET BUDGET 2011-12 2012-13 2013-14 Real Estate Tax $54,615,231 $55,834,054 $55,908,958 Earned Income Tax 9,944,026 9,650,000 10,600,000 Interim RE Tax 154,721 250,000 150,000

• R. E. Transfer Tax

671,232 700,000 700,000

• Del. R.E. and P

.C. 2,011,909 1,839,000 1,839,000 Interest Earnings 64,799 100,000 100,000 All Other Local 2,364,987 2,440,810 2,425,600 TOTALS $ 69,826,905 $70,813,864 $71,723,558

PERKIOMEN VALLEY SCHOOL DISTRICT 2013-14 PROJECTED REVENUES LOCAL REVENUES SUMMARY (as of February 11, 2013)

24

 Highlights of Local Revenues:

 Local Revenues are increasing by $ 909,694 (1.28%) budget

2012-2013 vs. budget 2013-2014

 Several main areas to consider:

 Real Estate Tax appeal assessments continue  This shows growth and is different than past several years have been

at this point

 EIT may help us out even more as it is showing strength

0.00 500,000.00 1,000,000.00 1,500,000.00 2,000,000.00 2,500,000.00 3,000,000.00 3,500,000.00 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 Investment Earnings Re Transfer Tax Interim Tax

Where have the alternative revenue streams gone??

25

$3,050,000 $ 950,000 $2,100,000 reduction which is a 68.85% reduction in 6 fiscal budget years

2013-14 GENERAL FUND BUDGET PROPOSED LOCAL REVENUES

26

10000000 20000000 30000000 40000000 50000000 60000000 Audited 11-12 Budget 2012- 13 Budget 2013- 14

Real Estate Tax Earned Income Tax Interim RE Tax RE Transfer Tax

• Del. RE and Personal

Tax Interest Earnings Other Local

Local Revenue History Budget vs. Actual

27

2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 Budget 65,383,983 67,917,385 68,355,130 69,050,356 70,813,864 71,723,558 Actual 64,247,320 66,700,592 66,841,261 69,826,905 70,813,864 71,723,558 60,000,000 70,000,000 80,000,000

Local Revenue History

Budget Actual

28

State Subsidies as of February 11, 2013 State Subsidies as of February 11, 2013

State Subsidies

29

 Governor Corbett proposed the State’s budget on

Tuesday, February 5, 2013.

 Professional groups are reviewing the proposal and trying

to evaluate the impact of the proposal

 More information will be learned about the budget over

the next several weeks and months to come

 Remember that the proposal is complicated in the way

that it draws on several different ideas to help fund the proposed additional dollars to fund these programs

 We must remain conservative in our approach and how

we shows these monies. Nothing is guaranteed!

State Subsidies (cont’d)

30

 These things we do know about the PROPOSED budget

from Governor Corbett and Perkiomen Valley:

1.

There is increased funding for Basic Education Subsidy

2.

There is increased funding for Transportation- What does that mean for PV?

3.

There is increased funding for PSERS increase- Commitment of state is in proposal

4.

There is reduced funding for Special Education

5.

There is flat funding for ABG How do these PROPOSED items impact Perkiomen Valley?

Conservative approach to subsidy information from governor’s proposal

31 Total State Subsidies shown in Budget as reviewed December 10, 2012: 19,006,480 $ (Not adjusted in January's one page presentation) Currently in budget as of December 10, 2012 ESBE (Basic Education Subsidy) 5,577,546 $ Tranpsortation (Pub and Non‐pub) 2,270,000 Spec ED 2,030,000 FICA 1,646,239 11,523,785 $ Per Governor's budget presentation February 5, 2013 ESBE (Basic Education Subsidy) 5,817,134 $

239,588 $

Tranpsortation (Pub and Non‐pub) 2,270,000 Spec ED 2,009,872

(20,128)

FICA 1,646,239 11,743,245 $ Projected difference Prelim Budget vs. State Budget 219,460 $ 219,460 $ Estimated Impact in dollars 19,225,940 $ Net increase budget to budget of 1.15%

If Governor’s proposal on PSERS is passed as presented then…

32

PSERS Retirement change impact Total Expenditures for PSERS at 16.93% 7,661,073 Total Expenditures for PSERS at 14.68% 6,642,915 Total GROSS expenditure reduction 1,018,158 NET LOSS from half Revenue 509,079 Net impact on Deficit (509,079)

The proposal would help to decrease deficit. It has way too many variables to confidently place into consideration so we will take note and wait

Adjustments already made to State Subsidies

33

The following adjustments were made to beginning revenue subsidy information in November 2012 presentation:

• 1. Fica Subsidy (driven by Payroll)

$ 40,152

• 2. Retirement Subsidy (driven by Payroll)

$1,485,000

• 3. Transportation Subsidy (reduce)

($ 210,000)

• 4. Rental Reimbursement (reduce)

($ 160,000)

Net adjustments to start with $ 1,155,152

Changes from January 14, 2013 Budget presentation for State Subsides

34

 The following additional adjustment has been made from the

January 14, 2013 budget presentation for state subsidies

1.

Reduce PSERS revenue for salary adjustment ($57,679)

Aid ratio

35

AID RATIO FOR 12-13 APPLICABLE FOR THE 13-14 BUDGET YEAR

36

123460302 Abington SD Montgomery 0.2195 0.2225 0.2151 123460504 Bryn Athyn SD Montgomery 0.1500 0.1000 0.1000 123461302 Cheltenham Tow nship SD Montgomery 0.2847 0.2894 0.2778 123461602 Colonial SD Montgomery 0.1500 0.1000 0.1000 123463603 Hatboro-Horsham SD Montgomery 0.2004 0.1459 0.2824 123463803 Jenkintow n SD Montgomery 0.1765 0.2276 0.1000 123464502 Low er Merion SD Montgomery 0.1500 0.1000 0.1000 123464603 Low er Moreland Tow nship SD Montgomery 0.1500 0.1610 0.1217 123465303 Methacton SD Montgomery 0.2172 0.1913 0.2564 123465602 Norristow n Area SD Montgomery 0.3851 0.3772 0.3971 123465702 North Penn SD Montgomery 0.1655 0.1000 0.2638 123466103 Perkiomen Valley SD Montgomery 0.4216 0.4273 0.4134 123466303 Pottsgrove SD Montgomery 0.5311 0.5211 0.5463 123466403 Pottstow n SD Montgomery 0.6490 0.6355 0.6694 123467103 Souderton Area SD Montgomery 0.3643 0.3400 0.4008 123467203 Springfield Tow nship SD Montgomery 0.1500 0.1000 0.1000 123467303 Spring-Ford Area SD Montgomery 0.2774 0.2115 0.3764 123468303 Upper Dublin SD Montgomery 0.1500 0.1000 0.1134 123468402 Upper Merion Area SD Montgomery 0.1500 0.1000 0.1000 123468503 Upper Moreland Tow nship SD Montgomery 0.2750 0.1916 0.4004 123468603 Upper Perkiomen SD Montgomery 0.4419 0.4066 0.4951 123469303 Wissahickon SD Montgomery 0.1500 0.1000 0.1000

Basic Education Subsidy (ESBE)

37

 The Governor’s proposed budget provides for an

increase of $239,588 or about 4.3% for this subsidy

 This is welcome but may be tied to the accomplishment

• f other variables not necessarily education related

 Budget process will need to be complete but we feel

confident this will stay in the final budget Total Proposed ESBE 13-14 $ 5,817,134 Total Budgeted ESBE 12-13 $ 5,577,546 Increase of $ 239,588

Basic Education Subsidy (ESBE)

38

4,200,000 4,400,000 4,600,000 4,800,000 5,000,000 5,200,000 5,400,000 5,600,000 5,800,000 6,000,000 2009-2010 2010-2011 2011-2012 2012-2013 2013-2014

ESBE

ESBE

19.63% over 5 fiscal years. Average increase under Governor Corbett is 1.4% over 3 yrs (Please note 11-12 was Funding study shortfall makeup year for PV)

Special Education Subsidy

39

 The Governor’s proposed budget shows a reduction of

$20,128 or about a 1.0% decline for this subsidy

 Budget process will need to be complete but we feel

confident this will not be impacted throughout the Commonwealth’s budget process Total Proposed Spec Ed 13-14 $ 2,009,872 Total Budgeted Spec Ed 12-13 $ 2,030,000 Decrease of ($ 20,128)

Special Education Subsidy

40

1,900,000 1,950,000 2,000,000 2,050,000 2,100,000 2,150,000 2009-2010 2010-2011 2011-2012 2012-2013 2013-2014

Special Ed

Special Ed

Special Ed Funding has actually decreased by 1.21% over the past five fiscal years

FICA Subsidy

41

 The Governor’s proposed budget maintains the

Commonwealth’s commitment to fund 50% of this expense back to Pennsylvania School Districts

 Funding on this does not depend on budget approval for

this fiscal year

 Revenue is ultimately driven by Salaries subject to FICA

Total Proposed FICA 13-14 $ 1,646,239 Total Budgeted FICA 12-13 $ 1,606,087 Increase of $ 40,152

FICA Subsidy

42

1,400,000 1,450,000 1,500,000 1,550,000 1,600,000 1,650,000 1,700,000 2009-2010 2010-2011 2011-2012 2012-2013 2013-2014

FICA

FICA

FICA subsidy has increased by 10.36% over the past 5 years as shown This is driven by total salaries subject to FICA

Retirement Subsidy (PSERS base)

43

 The Governor’s proposed budget maintains the

Commonwealth’s commitment to fund 50% of this expense back to Pennsylvania School Districts

 Funding on this does not depend on state budget approval for

this fiscal year (Note some years it has been)

 Revenue is ultimately driven by Salaries subject to PSERS and

Commonwealth approved employer rate (16.93% for 13-14)

 The 2013-14 budget figure was adjusted in February for salary

adjustments Total Proposed PSERS 13-14 $ 4,190,961 Total Budgeted PSERS 12-13 $ 2,763,640 Increase of $1,427,321

 The Governor’s proposed budget is funding the PSERS

commitment by 100%

 This is being done by honoring the legal requirement and

also “tailoring” the collars further to a max 2.5% increase per year

 Please remember that the vast majority of the funding

increase will go directly towards the employers share of the PSERS mandate (12-13 budget 92% of increase)

 Also, consider that we have an offsetting dollar increase

to the district’s share of PSERS that is not covered but still subject to the Act 1 Index limits!

Breaking down the Governor’s proposal for Perkiomen Valley for Retirement

44

Retirement Subsidy (PSERS base)

45

• 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 2009-2010 2010-2011 2011-2012 2012-2013 2013-2014

PSERS

PSERS

Retirement Increase has been 351% over past 5 years. Actual Employer Rate in 09-10 was 4.78% and the proposed rate for 13-14 is 16.93%

Rental Reimbursement

46

 The Commonwealth of Pennsylvania provides a

reimbursement for Debt Service expenses to districts that follow the PlanCon process

 Perkiomen Valley School District has followed the

PlanCon process for all building projects (rates range from 17% to 34% for PV)

 Whenever the district has a successful refunding, the

Commonwealth also shares in that savings

 We have had successful refundings over the past four

fiscal years and so our Rental Reimbursement will be reduced

Rental Reimbursement

47

• 200,000

400,000 600,000 800,000 1,000,000 1,200,000 1,400,000 1,600,000 1,800,000 2,000,000 2009-2010 2010-2011 2011-2012 2012-2013 2013-2014

Rental Reimbursement

Rental Reimbursement Peak year of 2010-2011 includes Final approval of PlanCon J for Schwenksville, MS WEST and HS renovation/Technology wing

2013-14 GENERAL FUND REVENUES STATE SUMMARY (AS OF February 11, 2013)

48

Audited BUDGET BUDGET 2011-12 2012-13 2013-14 ESBE $ 5,577,546 $ 5,577,546 $ 5,817,134 Spec Ed. 2,019,972 2,019,972 2,009,872 Transportation 2,270,381 2,480,000 2,270,000 FICA 1,584,027 1,606,087 1,646,239 Retirement 1,765,263 2,763,640 4,190,961 Rental Reimbursement 1,086,867 1,210,000 1,050,000 Charter Schools 0 0 Tax Relief 1,702,407 1,891,055 1,891,055 Other State* 401,263 $ 345,717 $ 293,000 TOTALS $16,407,726 $17,894,017 $19,168,261 Tax Relief monies is included in these totals…if no gaming monies approved for distribution…offset will be to increase the Real Estate taxes under Local Revenues

2013-14 GENERAL FUND REVENUES STATE SUMMARY (AS OF February 11, 2013)

49

 Highlights of State Revenues:

 T

• tal growth shows an increase of 7.12% or $1,274,244

 Main growth is through increase in Retirement Subsidy

(remember the total expenditure side grows as rate goes from 12.36% to 16.93% for 13-14)

 There are some adjustments as we enter different figures into

calculations which drive less subsidy (Debt and Transportation)

 Hold off on any other changes until the Commonwealth

budget process takes shape and more in known

2013-14 GENERAL FUND REVENUES STATE MONIES

50

1000000 2000000 3000000 4000000 5000000 6000000 Actual 2011-12 Budget 2012-13 Budget 2013-14

ESBE

• Spec. Ed

Transpo. FICA Retirement DS Reimb. Tax Relief Other

State Revenue History Budget vs. Actual

51

2008- 2009 2009- 2010 2010-11 2011-12 2012-13 2013-14 Budget 15,950,034 16,699,399 17,565,819 16,515,220 17,894,017 19,168,261 Actual 15,720,635 15,448,049 16,312,022 16,407,726 17,894,017 19,168,261 10,000,000 20,000,000 30,000,000

State Revenue History

Budget Actual

2013-14 GENERAL FUND REVENUES FEDERAL

52

We continue to participate in Title I, Project Access and

• ther grants

Continued discussion on Federal participation in Education remains something “less than stable” at this point “Sequestration” and “fiscal cliff” realities will be driving any federal monies for 13-14 which could result in a reduction if this happens Continue to watch closely!

Possible Sequestration Loss for PV

53

7.8% Cut 8.2% Cut 9.1% Cut $10,835.92 $11,391.60 $12,641.90 $7,979.48 $8,388.68 $9,309.39 $1,142.86 $1,201.46 $1,333.33 $641.94 $674.86 $748.93 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $67,205.35 $70,651.77 $78,406.24 $87,805.54 $92,308.38 $102,439.79 $87,805.54 $92,308.38 $102,439.79 IDEA Section 611 TOTAL BALANCE DUE: IDEA Section 611 IDEA Section 619 Title III Title I/Delinquent Perkins Grant Funds Homeless Children's Pgrm SUMMARY Program Outstanding Balance Title I/Basic Programs Title II

TOTAL REVENUES THREE YEAR ANALYSIS (as of February 11, 2013)

54

Audited BUDGET BUDGET

2011-12 2012-13 2013-14 Local $69,826,905 $70,813,864 $71,723,558 State 16,407,726 17,894,017 19,168,261 Federal 452,512 500,000 500,000 Other

TOTALS $86,687,143

$89,207,881 $91,391,819

TOTAL REVENUES THREE YEAR ANALYSIS (as of February 11, 2013)

55

 Total Revenues Highlights:

 T

• tal Revenues are up by $2,183,938 (or about 2.45%) overall

 Major driving force is PSERS (as presented) and EIT growth in

budget figures- increases of $2,377,321

 In fact, taking those two revenues aside

 We actually reduced revenues by $251,032 (.28%)

TOTAL REVENUES THREE YEAR ANALYSIS (as of February 11, 2013)

56

 Watch and be patient!!  Final decisions and assumptions will be driven by trend and actual

data over the 2012-13fiscal year

 Impact of a Governor’s budget on the district and will it be

approved as is? What changes or challenges lie ahead for the Commonwealth budget as proposed?

TOTAL REVENUES THREE YEAR GRAPH

10000000 20000000 30000000 40000000 50000000 60000000 70000000 80000000 Audited 11-12 Budget 2012-13 Budget 2013-14

Local State Federal Other

57

TOTAL REVENUES THREE YEAR GRAPH “Another way to look at it”

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 2009-10 2010-11 2011-12 2012-2013 2013-2014 80.15 78.99 79.54 79.38 78.43 18.56 20.3 19.73 20.26 21.02 Federal State Local

58

Total Revenue History Budget vs. Actual

59

2008-09 2009-10 2010-11 2011-12 2012-2013 2013-2014 Budget 81,981,517 85,234,284 86,538,449 86,183,076 89,207,881 91,391,819 Actual 80,530,480 83,217,587 84,600,588 86,687,143 89,207,881 91,391,819 70,000,000 80,000,000 90,000,000 100,000,000

Total Revenue History

Budget Actual

60

 EXPENDITURES AS OF FEBRUARY 11, 2013

Enrollment Projections

61

PERKIOMEN VALLEY SCHOOL DISTRICT

ENROLLMENT HISTORY AND PROJECTIONS October 2012 LAST TEN YEARS ACTUAL-PROJECTED TEN YEARS TOTAL CHANGE TOTAL W/KDG FROM YEAR BIRTHS KDG 1 2 3 4 5 6 7 8 9 10 11 12 STUDENT@50% PRIOR YR 2003-04 501 396 479 422 450 407 403 356 387 361 380 328 307 282 4958 4760 #REF! 2004-05 467 396 450 493 443 462 416 415 374 383 367 378 322 290 5189 4991 231 2005-06 474 413 464 439 484 433 452 411 413 358 378 353 359 303 5260 5054 71 2006-07 486 412 457 467 443 495 436 472 426 412 367 390 353 362 5492 5286 232 2007-08 566 392 461 448 468 437 498 447 483 437 434 378 379 344 5606 5410 114 2008-09 525 419 428 478 462 468 438 496 459 484 436 435 375 369 5747 5538 141 2009-10 531 451 468 449 489 465 475 449 504 452 493 420 416 361 5892 5667 145 2010-11 513 366 474 461 453 493 474 494 454 507 439 489 410 397 5911 5728 19 2011-12 525 376 426 469 454 440 484 451 479 446 496 433 474 403 5831 5643

• 80

2012-13 515 357 424 427 453 448 456 488 455 476 457 496 424 461 5822 5644

• 9

P R O J E C T E D 2013-14 490 383 400 427 430 452 451 461 495 452 480 455 484 411 5781 5590

• 41

2014-15 450 352 429 402 429 429 456 457 469 492 456 478 444 468 5761 5585

• 20

2015-16 440 344 394 432 405 429 432 461 464 465 496 454 466 430 5672 5500

• 89

2016-17 414 * 324 386 397 435 404 432 437 468 461 469 494 442 451 5600 5438

• 72

2017-18 414 * 324 363 388 399 434 407 437 444 465 464 467 482 428 5503 5341

• 97

2018-19 414 * 324 363 365 390 399 437 412 444 441 469 462 456 466 5428 5266

• 75

2019-20 414 * 324 363 365 367 390 402 443 419 441 445 467 451 441 5316 5154

• 113

2020-21 414 * 324 363 365 367 367 393 406 449 416 444 443 455 437 5229 5067

• 87

2021-22 414 * 324 363 365 367 367 369 397 413 446 419 442 432 441 5146 4984

• 83

2022-23 414 * 324 363 365 367 367 369 374 404 410 450 417 431 418 5059 4897

• 86

SOURCES AND NOTES:

• 1. Live birth numbers were supplied by the Division of Health Statistics, Pa. Department of Health, Harrisburg. (2011 -Prelim) (Oct 2012)
• 2. Live births listed are recorded from calendar year information five years prior to the school year listed on the left.
• 3. Live birth numbers with an asterisk were estimated from the average of the previous six years of known data.
• 4. Enrollment data are from the monthly enrollment reports given to the Board (October 2012)
• 5. Enrollment projections are based upon the cohort survival method using the prior nine years to calculate survival rate.

* Data not available…assumed to remain consistent

Areas of adjustments for the 2013-14 budget year (From December 2012)

62

 The list is a quick review of items on the expenditure side of the

2013-14 budget that were increased over the 2012-13 budget figures:

1.

Salary increases for staff $1,557,488

2.

Proposed new Staffing $ 305,801

3.

Other benefits increase (non-health/script) $ 639,474

4.

PSERS increase for rate increase $ 2,509,789

5.

Professional Substitute costs $ 165,000

6.

Debt Service increase per schedule $ 684,000

7.

Transportation increase by contract $ 229,000

8.

Charter School tuitions $ 300,000

9.

Tax collector increase (County- Del RE) $ 75,000

• 10. Increased Legal for Spec Ed

$ 50,000 Quick Summary of increase $ 6,515,552

Adjustments from January 14, 2013 presentation for Expenditures

63

 The following items have been adjusted on the expenditures

side of the budget since the January 14, 2013:

1.

Reduction in Debt Service for two refundings ($ 543,497)

2.

Salary & Benefits (recalculation) ($ 1,552,340) Total adjustments to Expenditures for Tonight’s presentation ($2,095,837)

Proposed New Staff

64

 The following positions (salary and benes) are proposed and

listed below. These positions do not currently exist in the 2012-13 budget and are included in salary and benefit budget figures presented for 13-14

T echnology has 2 positions 1 FT Level I desktop position (based on current salary estimates) $ 68,138 1 TECH TOSA at Master’s Step 1 (based on current estimates) $ 79,221 Special Ed has 2 positions 2 FT Additional Learning Support at HS (current estimates at $79,221 X 2) $158,442 T

• tal estimated NEW salaries and benefits

$305,801

Other Benefits

65

 Items to include in these line items include increased

FICA (7.65% of increase in salaries), Disability, Worker’s comp, Unemployment comp, ERIP benefits, Dental and Vision increases

 Total increased combined is $639,474

Expenditure Assumptions from current through 2015‐16 fiscal

• One expenditure will change in a known way

from year to year and that is PSERS

– PSERS increase from 12.36% to 16.93% (36.97% increase rate to rate only) for 2013‐14** – PSERS increase from 16.93% to 21.25% (25.52% increase rate to rate only) for 2014‐15 – PSERS increase from 21.25% to 25.56% (20.28% increase) for 2015‐16

66 ** Governor has proposed to change rate with CAPS adjustments

PSERS Impact for 13‐14 (as shown)

• The PSERS (Pennsylvania School Employee

Retirement System) employer rate is being increased from 12.36% to 16.93% **

• This is a 36.97% increase for budget year 13‐14
• The total dollar impact on the expenditure side

is $2,394,431 INCREASE

** Governor has proposed to change rate with CAPS adjustments 67

PSERS Impact for 13‐14 (as shown)

• The Governor has proposed that there be a

“tailored collar” placed onto the PSERS rates capping the increase per year at 2.5% (resulting rate would be 14.68%)**

• Previous collar was placed at 4.5% per year

increase (rate is at 16.93%)

• We will keep the 16.93% until further notice

** Governor has proposed to change rate with CAPS adjustments 68

Debt Service (NEW)

• The PV Debt Service was schedule to be $ 10,286,820

for the 2013‐14 fiscal year ( in December presentation)

• We experienced 2 very successful refundings (Series

2013 and Series A of 2013)

• The net result is that the district has actually saved

$1,298,886 between the two issues

69

Debt Service (NEW)

• There were several options to address these

savings.

– Use all savings during 13‐14 fiscal budget planning – Use savings to equal 12‐13 Debt Service expense of $9,602,609 for 13‐14 – Use savings to equal 14‐15 Debt Service $9,743,323 – Use savings in any other combination

70

Debt Service (NEW)

• Refunding Options‐ A

– Use of all savings from both issues on 13‐14 budget – Would help to reduce deficit by $1,298,881 – Real problem is that it sets PV up for our own “Fiscal Cliff” as 13‐14 budget figure would be $8,987,934 – That would create a huge hole in the 14‐15 budget as payments are scheduled to increase by $775,000 – Finance Committee in agreement not to use in this manner

71

Debt Service (NEW)

• Refunding Options‐ B

– Use savings from refundings only to the extent that we maintain the 13‐14 Debt Service payment at the current 12‐13 payment $9,602,269 – Remaining savings get placed into Debt Service Fund to offset future expenditures $768,206 – Fixes only one year 13‐14 and then need to use for 14‐15 moving forward

72

Debt Service (NEW)

• Refunding Options‐ C

– Use savings from refundings to level payments for Debt Service for BOTH the 13‐14 and 14‐15 fiscal year at the 14‐15 fiscal year rate of $9,743,323 – Fixes rate for 2 years for level expenditures – Still adds $543,497 to Debt Service Fund for future uses – The best use of available refunding options and recommended for action in 13‐14 budget

73

Salary and Benefits adjustments

• The Business Office performed a very labor

intensive process that compared actuals, budget and forecast projections from 2011‐12 through 2013‐14 projected fiscal years

• Remember that we always consider our

budget process in 3 year increments

– Last year’s (11‐12) results, Current year (12‐13) and Next year’s (13‐14) budget

74

Salary and Benefits adjustments

• This review of the “True Up” costs has shown that

we could reduce our initial 13‐14 projected expenditures by a combined total of $1,552,340

• Combination of factors go into this figure which

include trend being below budget, movement of personnel below anticipated ranges, negotiations and hiring personnel below (or above) set budget amount during year

• Results in an adjustment of 2.42% of Salary and

Benefits budget

75

Transportation increases

 Contract calls for 2% increase overall on all bus runs  Total increase for Transportation is $229,000 which

maintains current busing without critical analysis of bus service at this time

 Remember that the new agreement created a minimum

floor (2%) and maximum ceiling (3%) base on Act 1 Index

76

Increased Tuition for Charter Schools

77

 Charter Schools are basically unfunded mandates for

public schools at this time

 Total costs are based on PDE 363 (state form) which lists

Perkiomen Valley School District Tuition rates at $10,328.07 for Regular Ed and $21,348.49 for Special Ed

 There is need to increase due to increased participation

(budgeted for 50 in 11-12 now at 74 for 12-13)

 Total cost is now over $1.1 million dollars so we need to

add a total budget increase of $300,000 to existing budget figure

 We are currently reviewing legislation that has changed

the base PDE 363 figures and what that impact may be

Fees paid to Delinquent Real Estate Tax Collectors (Montgomery County)

78

 Montgomery County is insisting the district pay a 5%

commission fee that had been previously waived in the past ($75,000)

 District has decided to continue to utilize Portnoff (since

2009) as our collection agent but we are still required to pay a 5% commission fee to the County

 We believe Portnoff’s collection rate far exceeds the

previous collection rates from the County and this efficiency means quicker turnaround of cash for the district that more than pays for the 5% addition

Fees paid to Delinquent Real Estate Tax Collectors (Montgomery County)

79

 Please remember that there is no fee paid to Portnoff

from the District for this service

 Taxpayers pay the entire cost of this process during their

settlements

 This is a pure add to our budget with no additional

services provided

 Challenge in future may happen due to court intervention

and/or direction

Insurances

80

 The BUXMONT Health Insurance success has been

immediate in our first year

 We have been provided rates that show no increase

which certainly helps considering our trend has been 11% per year over the past couple of years

 Our self-funded prescription group SEPaST is also

successful with an even rate as well

 This is a positive for PV for 13-14 moving forward

Other Expenditures to note

81

 Building budgets have been created with a per student

allotment and enrollment projections per 9 year survival method information

 Standard Cost per pupil for Elementary is $170/student  Standard Cost per pupil for Middle School is $245/student  Standard Cost per pupil for High School is $288/student  The actual rate per pupil remains the same as the 12-13

budget only the enrollment changes

Other Expenditures to note

82

 Operations Department is held flat for 13-14 as

proposed

 We continue to benefit from consortium enterprises in

electric, fuel oil, heating oil, natural gas and various supplies through the MCIU

 The Operations Department has been reviewed by Mr.

Clemmer, Mrs. Hurd and Mr. Weaver and is deemed to be proper in its allotment so there are no recommended changes in expenditures at this time

Other Expenditures to note

83

 Technology Department continues to look at different

ways to look at the technology needs of the district

 Important projects being discussed continue to be

wireless (functionality and efficiency), service and maintaining and upgrading computers throughout the district

 Funding and staffing are key elements to this conversation  Technology has been held even 12-13 = 13-14  Further presentations will help to clarify

Other Expenditures to note

84

 Special Education Department continues to review the

effectiveness of programs and program alternatives

 Careful consideration is being given to current costs and

where additional needs may happen

 We have taken back various programs back in-house over

the past several years for savings

 Further presentations will help to clarify

PROPOSED 2013-14 GENERAL FUND EXPENDITURES

(as of February 11, 2013) Budget Budget Budget Budget Budget

FYE 09-10 FYE 10-11 FYE 11-12 FYE 12-13 FYE 13-14 Salary $41,040,447 $41,553,904 $43,189,152 $43,408,158 $ 44,179,855 Benefits 13,967,830 15,026,177 15,053,189 $17,175,006 $ 19,972,264

PSERS $ 7,545,715

Debt 9,931,274 10,118,389 9,499,876 $ 9,602,269 $ 9,743,323 R&M, Trans Utilities 13,804,314 13,776,314 12,880,803 $13,355,180 $ 13,584,180 FF&E/T 4,127,144 3,982,649 3,848,373 $ 3,841,054 $ 4,321,760 Other 3,863,275 3,170,016 2,868,257 $ 2,826,214 $ 2,826,214 T

• tal $86,734,284 $87,627,449

$87,339,650 $90,207,881 $ 94,627,596

1.03% (.33%) 3.28% 4.90%

85

Proposed 2013-14 General Fund Expenditures Proposed as of February 11, 2013

86

Salaries, $44,179,855, 46.69% Benefits, $19,972,264 21.11% Debt $ 9,743,323 10.30% R&M, Trans, Utilities, $13,584,180 14.36% FF&E/Tuitions, $4,321,760 4.56% Other, $2,826,214 2.98% Salaries Benefits Debt R&M, Trans, Utilities FF&E/Tuitions Other Total Salaries and Benefits = 67.80%

TONIGHT’S BOTTOM LINE February 11, 2013

Total Budgeted Sources $ 91,391,819 Total Budgeted Uses ($94,627,596) Total Gross Shortfall ($ 3,235,777) Recommend Use of GF Balance

• - TBD--

Net Shortfall with FB use ($ 3,235,777)

87

SHORTFALL AS OF FEBRUARY 11, 2013

88

86 88 90 92 94 96 98 Shortfall

REVENUES $91,391,819 EXPENDITURES $ 94,627,596

MILLIONS SHORTFALL IS $3,235,777

TONIGHT’S BOTTOM LINE February 11, 2013

Calculation for Real Estate Tax increase Total Net Shortfall as of February 11, 2013 ($3,235,777) One mill estimated to equal $2,049,500* Equals total millage equivalent increase of 1.58 mills to 30.82 mills This is a 5.399% increase over 12-13 tax bill

*Value of a Mill is estimated as of January 2013

89

90

PRELIMINARY BUDGET TAX RATES FOR 2013-14 FISCAL YEAR

The tax rates associated with this proposal are: Real Estate Tax 30.82 mills

(Partial Payment Plan Offered for Homestead/Farmstead Approved Properties

• nly)

Sec 679 Per Capita Tax $ 5.00 Act 511 Per Capita Tax $10.00 Occupation Assessment Tax 0 mills Act 511 Wage Tax 1.4% to 1.65%

(.9% to school district- net varies to municipality)

Real Estate Transfer Tax 1%

(.5% to school district and .5% to municipality)

Impact of tonight’s presentation on taxpayers February 11, 2013

91

Assessed Current Proposed Annual Monthly Value 0.02924 0.03082 Increase Increase 150,000.00 4,386.00 4,622.82 236.82 19.74 180,000.00 5,263.20 5,547.39 284.19 23.68 225,000.00 6,579.00 6,934.23 355.23 29.60 280,000.00 8,187.20 8,629.27 442.07 36.84 325,000.00 9,503.00 10,016.11 513.11 42.76 380,000.00 11,111.20 11,711.15 599.95 50.00

TONIGHT’S BOTTOM LINE February 11, 2013 Net “true shortfall” presented

Net shortfall as presented ($ 3,235,777 ) Minus Act 1 Index at 2.0% $ 1,192,700 Net true shortfall for strategic purposes ($ 2,043,077) To be eliminated by recognizing more revenues or reducing expenditures

92

 Things we need to review to help eliminate deficit

 Use of General Fund Balance  Review of possible retirements  Further reductions or revenue enhancements if possible  Exclusions- if palatable

Constant Review and Alternative Options Considered

93

Current Fund Balance

Fund Balance (Audited) as of June 30, 2012 $ 6,231,175 This would be split between: Unreserved/Undesignated $ 4,838,230 Reserved for PSERS $ 1,000,000 Prepaid Items $ 392,945 Combined Total as of June 30, 2012 $ 6,231,175

94

Current Fund Balance for 13-14 Amount available after use for 12-13 fiscal

The final approved General Fund Budget for 2012-13 used $1,000,000 in Unreserved Funding to help create a balanced budget Therefore, the Current Fund Balance available for 13-14 consideration is split as follows: Estimated Unreserved** $ 3,838,230 PSERS Reserved $ 1,000,000 Prepaid Items $ 392,945 Estimated Fund Balance $ 5,231,175 **Unreserved amount is about 4.24% of proposed 2013-14 budgeted expenditures

Recent Fund Balance History

1,000,000 2,000,000 3,000,000 4,000,000 5,000,000 6,000,000 7,000,000 8,000,000 6/30/07 6/30/08 6/30/09 6/30/10 6/30/11 6/30/12 PSERS Reserved Unreserved

More Fund Balance Discussion

• 200,000

400,000 600,000 800,000 1,000,000 1,200,000 1,400,000 1,600,000

6/30/2007 6/30/2008 6/30/2009 6/30/2010 6/30/2011 6/30/2012 6/30/2013 Budgeted 1,002,245 307,500 1,000,000 1,500,000 1,068,000 1,155,500 1,000,000

Budgeted Use of Available Fund Balance (Reserved and Unreserved)

97

Unreserved Fund Balance as a % of Expenditures

7.49% 7.90% 6.78% 5.44% 5.62% 5.54% 4.24%

• 1,000,000

2,000,000 3,000,000 4,000,000 5,000,000 6,000,000 7,000,000 8,000,000

Unreserved Fund Balance as a % of Expenditures

Fund Balance

98

Fund balance recommendation 13-14

 A general discussion on the use of Fund Balance needs to

take place for direction

 Historically speaking, the Board/Finance Committee

typically has provide for direction by the time of Proposed Preliminary Budget approval

 Discussion is welcomed at any time

99

Wise Use of Fund Balance

 We must carefully evaluate all issues pertaining to Fund

Balance use

 It is a one time use of money and will create an automatic

shortage the following budget year

 The trend has been to use Fund Balance under tightening

economic strains or to meet Act 1 Index

9 YEAR PROJECTED EMPLOYER CONTRIBUTION RATES (Presumes a 7.5% rate of return)

Fiscal Year Ending June T

• tal Employer

Contribution Rate % Projected T

• tal

PV Employer Contribution $$’s

12/13 12.36 $5,412,384 13/14 16.93 $7,500,000 14/15 21.25 $9,313,901 15/16 25.56 $11,203,692 16/17 26.26 $11,509,553 17/18 26.80 $11,808,801 18/19 27.53 $12,130,000 19/20 28.04 $12,736,500 21/22 27.76 $12,609,135 Presumes Salary at current rates (no increases)

Future Fund Balance stress

 Savings are attributed to Refunding Bonds with good

rating (AA+) built upon a healthy Fund Balance

 We have saved $44,000 for each of our last three

refunding opportunities as the AA+ rating means no additional bond insurance is required

Referendum Exceptions

103

 The Referendum Exception System (RES) has produced

the following information for the district to consider:

 Special Ed Exception

$ 179,432

 Retirement Exception

$ 895,780

 Debt Service Exception (still working on it)

TBD Total known Exceptions $1,075,212 Worth an additional 1.02 mills at this count. This is equal to a total increase of about 5.4% as it currently stands without referendum

3.40% 4.40% 4.10% 2.90% 1.60% 2.00% 2.22% 0.285% 4.02% 6.71% 3.27% 1.67% 3.00% 2.55% 0.00% 2.00% 4.00% 6.00% 8.00% 10.00% 12.00% 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 Exceptions not used Exceptions used Base Index

Total Act 1 Index and Tax Impact via Percentage Increases (through 2012-13 fiscal year)

104

9.64% 11.11% 7.37% 4.57% 4.60% 5.62%

PV only used Exceptions in 2007-08 budget year and 4 consecutive years at Act 1 Index

AR

2.285% 4.83%

 Total Act 1 Approved Exceptions value in dollars

$ 12,417,245

 Total Act 1 Approved Exceptions Used in $$**

($ 1,244,071)

 Total Act 1 Approved Exceptions Not Used in $$

$ 11,173,174 ** 2007-08 is only year Exceptions were used Information provided from inception of Act 1 Index (07-08) through this fiscal year (12-13) 2013-14 total dollar Exceptions as approved by PDE is $1,075,212

Total Act 1 Index and Tax Impact Review in dollars

(through 2012-13 fiscal year)

105

SUMMARY OF KEY BUDGET DATES

106

 February 20, 2013- Proposed Preliminary Budget deadline  May 29, 2013- Proposed Final Budget approval deadline  June 28, 2013- Final Budget approval deadline

See www.pvsd.org for more information

NEXT PRESENTATION

107

 The next presentation will be April 8, 2013  Continued update on Budget process throughout