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Board of Education December 11, 2014
2015/2016 BUDGET
Enrollment and Statewide
Funding Update
2014/2015
Enrollment Impact
Membership
Enrollment
FTE
Funded Count
2014 Student Count
13/14 14/15 Change
District-Managed School Membership
78,416 78,487 71
Charter School Membership 7,595 8,084 489
Total District Membership 86,011 86,571 560
2014 Student Membership
• Losing the calculation benefit of averaging for declining enrollment
• Will not see growth in funding equal to growth in membership
Enrollment Impact
2015/2016 Statewide
Funding Update
2015/2016 Statewide Funding Update
All estimates are based on the Governor’s Budget Request for 2015/2016 and the estimated funding impact per CDE.
2014 October count has not been
incorporated into the CDE estimates at this time.
For clarity, the current projection matches CDE’s data release in both funding amounts and the current enrollment estimates being used.
2015/2016 Statewide Funding Update
We do have enrollment increases. Once new enrollment numbers are included, then funding will change.
Most of Jeffco’s enrollment growth is with charter schools.
Funding will be adjusted for growth, but as required, the funding tied to charter school growth will flow through to the charter schools.
2015/2016 Statewide Funding Update
Funding amounts will change throughout the legislative session.
Final funding is typically available in late spring.
2015/2016 Statewide Funding Update
Proposed Increased Statewide Funding for K-12 Education of $480M
Inflation: 2.8% Growth in students: 10,453
The increase is split between one-time funding and ongoing funding
2015/2016 Statewide Funding Update
$480M K-12
Education
Increase in the average statewide per pupil of $475
$480M
ONE TIME
$200M
ONGOING
$280M
2015/2016 Statewide Funding Update
One-time Negative Factor Statewide
The Governor’s Request proposed that the fund balance in the State Education Fund be spent down.
The amount of the negative factor is proposed to improve by $200M from ($894M) to ($694M)
This translates to an improvement from 13.1% to 9.8% that will be deducted from the fully funded total program.
**This reduction in the negative factor is for one year only.
2015/2016 Jeffco
Funding Update
$465 Per
Pupil
Revenues
$37M
2015/2016 Jeffco Funding Update
$37M
ONE TIME
$19.8M
ONGOING
$17.2M
2015/2016 Jeffco Funding Update
Numbers will change once enrollment is updated.
Charter schools have an increase in funded pupils
of ~400 which approximates to an additional $3M.
Amounts in millions Ongoing One-time Total
Governor’s Request 17.2 19.8 37.0
Pass through to charter (1.4) (1.6) (3.0)
General Fund 15.8 18.2 34.0
General Fund Projection
2015/2016 Assumptions
REVENUE Ongoing One time Total
School Finance Act 17,260,000 19,770,000
Flow Through to Charter of state PPR plus 79% of MLO PPR (1,400,000) (1,550,000)
Specific Ownership Tax 1,300,000
Move kindergarten to the General Fund from the Child Care Fund 4,000,000
Investment Earnings, fees, and other (100,000)
Total Change in Revenue 21,060,000 18,220,000 39,280,000
EXPENDITURES
Legislated PERA AED 0.3% 1,215,000
Legislated PERA SAED 0.5% 2,025,000
Estimated Retirement and Turnover Savings (4,000,000)
Affordable Care Act 3,000,000
Move kindergarten to the General Fund 4,000,000
Salary Accrual, Utilities 1,500,000
Increase in GF transfers (Capital Reserve, Transportation, Insurance Reserve) 487,600
General Increase Placeholder TBD 12,000,000 18,000,000
Total Change in Expenditures 20,227,600 18,000,000 38,227,600
Change in General Fund Reserves 832,400 220,000 1,052,400
JEFFCO GF Reserve Balances
General Fund Balance
State Accreditation
Bond Ratings
Sound Financial Management
State Auditor’s Fiscal Health Indicators
TABOR – 3%
Board Policy – 4%
Definitions
Fund Balance – The difference between the assets and liabilities reported
in a governmental fund, similar to the working capital of a private-sector
business. Components of fund balance:
Nonspendable – portion of fund balance assets that will never convert to cash. (e.g. prepaid items and inventories)
Restricted – portion of fund balance that reflects resources subject
to externally enforceable legal restrictions. (e.g. creditors, state laws
and regulations and grantors)
Committed – portion of fund balance that represents resources
whose use is constrained by limitations that the government imposes
upon itself at its highest level of decision making and remain binding unless removed in the same manner.
Assigned – portion of fund balance that reflects a governments intended use of resources. Authority to change assigned balances can be delegated to other officials and does not require formal action to change.
Unassigned – portion of fund balance in excess of other components.
Best Practices - GFOA
For governments that compare “unassigned fund
balance” to revenues:
A minimum balance of no less than 5–15 percent
of regular general fund operating revenues.
For governments that compare “unassigned fund
balance” to expenditures:
A minimum balance of no less than 8–17 percent
(one to two months) of regular general fund operating
expenditures.
June 30, 2014 Reserves
Reserve Category Amount %
Exp Best
Practice
TABOR Reserve $ 16,494,681
Board of Education Policy Reserves (plus other Unassigned) $ 32,260,251 5% 8%-17%
School Carryforward Reserves $ 9,600,000
Utility Reserve $ 2,000,000
Nonspendable $ 942,951
Total Year End Reserve Balance $ 61,297,883
Perspective and Context
2014/2015 planned ending total reserves
$64M total – 36 days of operations
$35M unassigned – 20 days of operation
*Numbers rounded for simplicity
(total budget/365 days = $1.7M/day)
Perspective and Context
Fund Balance/Reserves
are just one piece
of Strategic Budget
Development and
Budget Management.
Fund Balance decisions
should be strategically considered
as part of the overall budget process.
Recommendations
Staff Recommendations
Positive Undesignated Fund Balance
Do not use reserves for on-going expenditures (compensation, operations, etc.)
$71M – 40 days of operations
Recommendations
Financial Oversight Committee (FOC) Recommendations Incorporate strategic priorities into reserve policies
including:
• preservation of bond ratings
• reserve levels adequate to mitigate impacts
of unanticipated financial crisis
• include GFOA best practices as target ranges
for unassigned reserve balances
Do not consider pledging district buildings in place
of TABOR cash reserves.
Timeline
Aug 2014
•23rd – Board Retreat
•Preliminary Direction on Budget Development Process
•High Level presentation on Student Based Budgeting (SBB)
Sept 2014
•Board Study Session
•Student Based Budgeting (SBB)
•Comprehensive Direction on Budget Development Process
•Community Outreach Framework
•Financial Oversight Committee
•SBB
•Reserves
Oct 2014
•Board Study Session
•Early BOE direction on compensation placeholders, charter funding, fees, etc.
•SPAC
•SBB
•Budget Development Process
•SAC
•SBB
•Budget Development Process
Nov 2014
•6th - Board Regular Meeting
•Staff Recommendations Department Budgets based on service/program review and prioritization
Dec 2014
•11th - Board Study Session
•Early Budget Forecast
•BOE Direction on budget
•October Count & Gov Budget Proposal
•SPAC
•Early Budget Forecast
•October Count & Gov Budget Proposal
Timeline
Jan 2015
•Board Community Forums
•SAC/DAC
•School level accountability groups meet
•District level accountability group meets
•Open Citizen Budget tool for two weeks
Feb 2015
•Board Study Session
•SAC/DAC/ FOC, Community input presented to BOE
•BOE Direction on budget
Mar 2015
•19th - Board Regular Meeting
•Final BOE direction on 2015/2016 Proposed Budget before Spring Break
Apr 2015
•4 weeks to develop Proposed Budget for May 7 BOE meeting
May 2015
•7th - Board Study Session
•Presentation of Proposed Budget 1st Public Hearing (will include a revised forecast if any legislation is final.)
•Proposed budget must be presented to the BOE no later than June 1 per C.R.S. 22-44-108(1)
•BOE Final Revisions to Proposed Budget
•June 11th - Board Regular Meeting
•2nd Public Hearing
•Budget Adoption
Timeline
December
Projection #1 based on Governor’s Budget Request and CDE’s data run
BOE direction on any priorities or placeholders
Timeline
January
All forms of feedback will be provided to the Board including: School Accountability Committee’s (SAC) priorities Strategic Planning and Advisory summary of SAC
priorities Feedback from community budget forums Results from community engagement survey,
if available Reports from Center for Priority Based Budgeting
(CPBB) Leadership priority recommendations for:
• New funding
• Any priorities that can be addressed by repurposing
funds identified through the CPBB process.
Timeline
February
BOE budget discussion about all feedback provided BOE requests for additional information BOE priorities including direction for placeholders
or identified items to be funded Budget office will incorporate all BOE direction
into a revised projection to be presented in March March
BOE meeting March 19, 2015 present Projection #2 inclusive of BOE direction on priorities and placeholders
Timeline
April
Budget office builds the proposed budget May
BOE meeting May 7, 2014, first public hearing to present the 2015/2016 Proposed Budget including Projection #3
BOE direction on any revisions to be incorporated into the adopted budget
June
BOE meeting June 11, 2014, for second public hearing for 2015/2016 budget adoption
Board Direction
Board direction on priorities for proposed budget development and/or budgetary placeholders
Recommended