2016-17

Budget Development v1.0

Preliminary Discussion

January 11, 2016

January OWG Goals

• Present overview of budget model v1.0

• Seek input on key issues to guide

development of budget model v2.0 for

February OWG

• Define next steps and due dates

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Budget Goals Close alignment to Strategic Framework- In our vision to make every

school a thriving school that prepares every student to be ready for

college, career and community, these budget resources support the

district’s goals and priorities as defined in our Strategic Framework.

Support recruiting and selection – Timely decision-making in the budget

process will facilitate personnel recruiting and selection efforts by

announcing and acting on vacancies earlier in the hiring season.

More equitable use of resources – More in-depth reporting on how and

where resources are allocated will improve awareness and help inform

the process to more equitably distribute resources.

Greater transparency in budget development- Presenting the budget

document in a more accessible and reader-friendly format will improve

accountability.

Are these the right goals?

Are we missing any goals? 3

Guiding Principles

• Allocate resources for the greatest impact

on raising student achievement and

narrowing gaps

• Sustain the focus and momentum of existing

priority actions, being mindful of the various

phases of work

• Maintain a multi-year perspective to ensure financial sustainability and accountability

Are these the right guiding principles?

Are we missing any guiding principles? 4

Gathering Budget Input

• From February-April, we will gather input

from our community and staff as the

budget is being developed

• Similar to last year, we will invite input on

priorities that should be preserved in the

budget, efficiencies to help balance the

budget, and other feedback related to

the budget process

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Budget Development Sequence

Goals &

Principles Create Budget Goals and Guiding Principles

Revenues Create Revenue Forecast based on State Budget

Priorities Fund Priority Actions to Support the Strategic

Framework Goals

Salaries Determine Salary Plan

Benefits Determine Benefits Strategy

Efficiencies Identify Cost Savings and Maximize Efficiencies

Staffing Plan Define Staffing Plan which Best Supports Instruction

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2016-17 Budget

Development

Financial Forecast: Budget Model version 1.0

Seeking Input for version 2.0

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Revenue Limit History for K-12

Gov. Thompson Gov. Doyle Gov. Walker

Revenues

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Revenue Limit History for K-12

Revenues

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Revenues

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State Budget Impact

2015-16: No Increase in Revenue per Pupil in 2015-16 Per Pupil Aid Increased by $75 per Pupil

No additional funding in the state equalization aid pool in 2015-16

2016-17: No Increase in Revenue per Pupil in 2016-17

Per Pupil Aid Increase by $100 per Pupil

Increase equalization aid pool $108 MM – for tax relief, not school

funding

2015-17 State budget contains freezes and cuts for K-12 , which forces local budget cuts

Revenues

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2016-17 Budget Development

Revenue strategy based on state budget

per version 1.0, recommend:

• Use “Full” Levy Authority

• Use $1.6 MM of Fund Balance

Generated this Year

= Projected Tax Levy Increase is Less

than 3%

Is this the right revenue strategy?

Revenues

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Recurring Budget Challenge

In a financial environment predicated on

minimal revenue growth, MMSD must be:

• Selective in priority actions

• Creative in repurposing resources

• Aggressive in finding cost saving efficiencies

• Strategic in creating a staffing plan

• Equitable in use of resources

NOTE: Revenue as defined here includes planned use of Fund Balance

Revenues

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Developing Priority Actions

Similar to last year, the February Board Retreat will provide an opportunity to

discuss specific priority actions

Priorities

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Budgeting for Salaries and Wages

Salary schedule recommendations in budget model v1.0

Step Advancement The employee handbook provides for ‘step advancement’ on existing

wage/salary schedules. The cost of ‘steps’ is estimated at 1.75% of total

wage/salary rates.

Lane Movement for Professional Learning The handbook provides for ‘lane movement’ on the existing salary

schedule. Lane movement is budgeted for as a lump sum estimate.

Base Wage Negotiations Budget version 1.0 includes funding for step and lane advancement.

The district must negotiate over base wage, and consult / confer over

other compensation elements.

Is this the right budget strategy?

Salaries

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Budgeting for Employee Benefits

Benefits Strategy – Recommendation in Budget Model V1.0

• July 1, 2016 Health Insurance Premiums

- In budget model V1.0 employer health insurance premiums are

budgeted to increase by 0% effective July 1, 2016. This outcome

is an important element in the overall budget strategy.

- For 2015-16, the three HMO’s agreed to a 0% increase in

premium rates, without plan design changes or an employee

premium contribution.

- For 2016-17, it will require a combination of rate negotiation,

changes in plan design, and/or employee premium contribution

to achieve the same budget result.

- All work in this part of the budget will be coordinated with the HR

team’s Compensation Study, in consultation with employee

representatives.

Is this the right budget strategy?

Benefits

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Identify Efficiencies & Cost Savings

In a financial environment predicated on minimal

revenue growth, MMSD must be aggressive in finding

cost saving efficiencies through:

• Central Office departmental reviews

• Operational department review (Pflaum)

• Personnel and non-personnel allotments to schools and departments

Focus for February Meetings

Efficiencies

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Creating a Staffing Plan

• Budget decisions around revenues, salaries, benefits, etc.,

will help determine how many FTE the budget can support

• First, determine 2016-17 total staffing based on estimated

budget constraints

• Review logic behind central office department

allocations, with a focus on efficient services for schools

• Review logic behind school-based allocations, with a

focus on equity and excellence

• Coordinate budget timeline with HR goals for recruitment

and hiring, and continue process improvements

Focus for February Meetings

Staffing Plan

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Staff Type Regular Education Special

Education Student Services

BEP OMGE Title I Pflaum Total Schools Central

(A) Administration 75.00 46.90 6.00 2.00 - 2.00 0.80 9.00 141.70

(B) Specialist - 2.36 31.13 - - - - - 33.49

(C) Custodial - 2.00 - - - - - 214.25 216.25

(D) Trades - - - - - - - 33.00 33.00

(E) EA/Clerical 78.13 5.08 348.35 30.11 28.10 - 9.49 - 499.26

(F) Food Service - - - - - - - 94.37 94.37

(G) BRS - - 2.90 - - 77.97 - - 80.88

(P) NU Professional 3.00 86.50 1.00 3.00 - 3.00 - 7.00 103.50

(Q) Play & Learn - 8.75 - - - - - - 8.75

(S) Clerical/Technical 85.80 112.67 8.20 2.00 - 1.00 1.00 13.80 224.46

(T) Teacher 1,636.93 72.37 499.16 170.87 26.12 164.44 52.57 - 2,622.46

(Y) Security - 28.50 - - 0.77 - - - 29.27

1,878.86 365.12 896.74 207.98 54.99 248.41 63.86 371.42 4,087.38

• “Regular Education” also includes Doyle-based staff

• “Pflaum” includes food service, building services, transportation, and administrative services departments

• Student Services, OMGE, and Special Education receive a set number of FTE per year to distribute based

on schools’ needs. We are currently reviewing these assumptions.

• The actual number of Special Education staff shown here is higher than the fixed allocation because of

conversions within Special Ed, and conversions into Special Ed from Regular Ed.

Current Staffing Plan Per Budget Development Process – Staffing Segments

Staffing Steps: 1. Total FTE

2. FTE per Segment

3. FTE per School

Staffing Plan

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Budget Development Sequence

Goals &

Principles Create Budget Goals and Guiding Principles

Revenues Create Revenue Forecast based on State Budget

Priorities Fund Priority Actions to Support the Strategic

Framework Goals

Salaries Determine Salary Plan

Benefits Determine Benefits Strategy

Efficiencies Identify Cost Savings and Maximize Efficiencies

Staffing Plan Define Staffing Plan which Best Supports Instruction

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Early

Estimates

for Planning

Purposes

Only

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Immediate Next Steps

To create Budget v2.0 on February 1, 2016:

• Confirm goals and guiding principles per Board input

• Establish revenue forecast per Board input

• Establish salary and benefit strategy per Board input

• Define priority actions & costs at February meetings

• Define efficiencies and cost savings at

February/March meetings

• Direction on staffing plan at February meetings

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Confirm timeline in order to ensure HR

deadlines can be met.