2014-2015 PROPOSED FINAL BUDGET

State College Area School DistrictMay 5, 2014

Budget Process• Board passed an Accelerated Budget Opt Out Resolution on January 13, 2014 • Certified the tax rate to be within the 2.1% Act 1 index for 2014-15

• Proposed final budget presented for adoption – May 5, 2014

• Budget Hearing – June 2, 2014 at 131 West Nittany Ave (7:00 p.m.)

• Final budget presented for adoption – June 9, 2014• Reopen budget after passage of the State Budget, if necessary

General Fund Budget

• Accounts for the expenses related to general operations of District

• Supports other funds• Debt service • Capital reserve

• General Fund Budget must be adopted by June 30th

Act 1

• Limits school district tax increases to an inflationary index (Act 1 Index)

• Act 1 Index is 2.1% for 2014-15• Exceptions available to tax above the index for increases in certain expenses

• Exceptions available for PSERS (pension) cost only• No exceptions were requested for 2014-15

Proposed Tax Increase

• Proposed tax increase 1.95%• Second lowest tax increase since 1998-1999• Lowest proposed tax increase compared to cohort and other Centre County School Districts

• Maintains lowest tax rate of all districts in Centre County

• Millage rate would increase from 38.75 to 39.5056 • Impact of tax increase for average residential homeowner - $54

Cohort and Centre County School Districts Real Estate Tax

2014-15 Projected Tax

Increase Exceptions Act 1 Index2013-14

Millage Rate2014-15

Proposed Rate

Bellefonte 2.38% 0.00% 2.70% 47.4107 48.5392

Bald Eagle 3.96% 1.06% 2.90% 50.5500 52.5500

Penns Valley 4.20% 1.60% 2.60% 43.2348 45.0489

State College 1.95% 0.00% 2.10%   38.7500 39.5056

           

Tredyffrin-Easttown 3.20% 1.10% 2.10%   

Cumberland Valley 2.10% 0.00% 2.10%   

Parkland 2.10% 0.00% 2.10%   

Lower Merion 4.11% 2.01% 2.10%   

North Allegheny 9.56% 7.46% 2.10%   

Abington 4.53% 2.43% 2.10%   

           

Fund Balance

• Proposed Final Budget includes: • Use of PSERS Fund Balance of $598,424• Use of Legal Liability Fund Balance of $550,000• Addition to Capital Reserve Fund of $4,656,500• Increase in Unassigned General Fund Balance of $324,123• Brings General Fund percentage of operating expense to 7.8%• Within allowed limit of less than or equal to 8%

Revenue

• Local• District primarily locally funded

• State• Projected level funding with exception of PSERS reimbursement

• Federal• Projected level with small decrease in Title funds

2014-15 Revenue by Source

LOCAL SOURCES 104009000 83%

STATE SOURCES 20502507 16%

FEDERAL SOURCES 645000 1%

Local Revenue

$82,900,000

$15,560,000

$1,500,000 $1,100,000 $2,949,000

REAL ESTATE TAX

EARNED INCOME TAX

REALTY TRANSFER TAX

DELINQUENT REAL ESTATE TAX

OTHER

Historical Real Estate Tax Percentage Change

'99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 Proposed

-1.00%

0.00%

1.00%

2.00%

3.00%

4.00%

5.00%

6.00%

7.00%

5.25%

3.13%

4.89% 4.99%

4.10%

6.17%

3.50%

5.60%

3.80%

-0.50%

3.70%

3.30%3.00%

2.65%2.40%

2.70%

1.95%

2014-15 Proposed BudgetExpense By Category

Salaries 57,930,679 46%

Health Insurance 12,359,179 10%

PSERS 12,230,840 10%

Other Benefits 5,961,928 5%

Professional Services 4,170,202 3%

Purchased Property Services 2,062,916 2%

Charter Schools 5,095,152 4%

Other Purchased Services 5,120,408 4%

Supplies/Equipment 5,739,856 5%

Minor Capital Projects 2,055,717 2%

Other Uses of Funds 13,253,931 10%

Total 125,980,808

Total Salaries and Benefits 88,482,626 70%

Expense Increase

• Total change in expense - $4.7 million increase• PSERS - $2.7 million • Health Insurance - $1.3 million• Salaries - $764,000 • Debt Service – ($904,000)• Other Net Increases- $840,000

PSERS

• Percentage of salary paid for employees’ pensions• Rates have increased from 5.64% of qualifying salary expense in 2010-11 to 21.4% for 2014-15

• District has established a fund balance to offset a portion of PSERS costs beginning with the 2014-15 budget year

• Board elected not to utilize exceptions for PSERS available for 2014-15

State Budget

• Supposed to be passed by June 30 each year• District must pass budget by June 30• Possible reopening after state budget is passed

2014-15 Budget

• For more information on the budget process including all handouts that are related to the budget go to

www.scasd.org/page/23254