WESTMONT HILLTOP SCHOOL DISTRICT

Budget WorkshopMarch 19, 2012

WELCOME

Westmont Hilltop Budget Workshop Overview

Why we continue to seek a subsidy adjustment for Westmont Hilltop

Brief history of the state education funding formula

1980’S

Based on the Number of Students and District Wealth School districts were paid education subsidy based on the number of students (Weighted Average Daily Membership WADM) and their relative wealth (measured by a district’s  Aid Ratio) multiplied by a dollar amount known as the Factor for Educational  Expense (FEE).  The FEE was determined by the State each year.

WEIGHTED AVERAGE DAILY MEMBERSHIP

Weighted Average Daily Membership (Number of Students)

Half time Kindergarten  .50 Elementary (Grade 1‐6) 1.00 Secondary (Grades 7‐12) 1.36

Westmont Hilltop 1983‐1984‐WADM =2,382

AID RATIOThe Aid Ratio is a factor used to determine the state’s share of instructional costs. 

The Market Value –Personal Income Aid Ratio (MV/PI AR) was used in the formula.  The MV/PI AR measures the relationship of the district estimated market value of properties and the district total personal income as a proportion to the number of students in the state. The formula is weighted 60% on property and 40% on income. 

Westmont Hilltop 1983‐1984 Aid Ratio = .2941

FACTOR FOR EDUCATIONAL EXPENSE (FEE)

Factor for Educational Expense (FEE) ‐ The FEE was a pre‐set dollar amount determined by the State.

All Schools’ FEE for 1983‐1984 = $1,405/Student

1980’S SUBSIDY CALCULATION

State Formula 1983‐1984WADM (# Students) X Aid Ratio X FEE

Westmont Hilltop State Subsidy Calculation 1983/1984: 2,382 X .2941 X $1,405 = $984,557

1990’S – 2005/2006 FORMULA SHIFTThe subsidy is no longer based on the number of students and comparable wealth of school districts.   The state subsidy was a combination of a base amount (based on 

the 1980’s formula) plus supplemental funding to assist schools with growing student populations, high percentages of students in poverty, and additional aid for small and poor school districts. The parameters were changed from year to year by the state legislature. 

With the exception of a state subsidy freeze in 1996/1997, Westmont Hilltop received minimum increases averaging 2% each year during this period. Because our base was low, our annual subsidy increases were minimal and falling progressively each year since it was calculated by a percentage of a low base.

2007-2008 SUBSIDY ADJUSTMENT FOR WESTMONT HILLTOP!Through the local legislative lobbying efforts of the Board, an adjustment to the subsidy was inserted which resulted in a subsidy adjustment of $105,992 to the district. Westmont Hilltop was one of the 35 schools that received this adjustment. The total adjustment for the 35 schools was 3.5 million dollars.

The subsidy adjustment was for school districts with:

Less than 10% increase in Market valueResidential assessed value greater than 87%Westmont Hilltop Received - $105,992

2008-2009 TO PRESENTCosting‐out study, Stimulus Funding, and Reduction in State Commitment In 2008‐2009, a state “costing‐out study” was undertaken to develop a fair and equitable formula to provide “the funding necessary for all students to receive a quality education.” This was approved as a six year plan. In 2009‐2010 and 2010‐2011 the Commonwealth used stimulus money to supplant the basic education subsidy to school districts. The 2011/2012 state budget abandoned the costing out formula and school district Basic Education Subsidies were reduced.

STATE COMMITMENT FURTHER REDUCED

WHSD 2008-2009 2009-2010 2010-2011 2011-2012 2012-2013

State Share $3,166,870 $3,021,067 $3,091,153 $3,443,209 $3,443,803

Stimulus 0 $   406,056 $   681,173 0 0

Total $3,166,870 $3,427,123 $3,777,326 $3,443,209 $3,443,803

The state share of Basic Education Funding for our district has decreased by $422,736 since 2009-2010

HISTORY OF WHSD’S MARKET VALUE, PERSONAL INCOME, AID RATIO COMPARED TO THE STATE

1983-1984 1992-1983 2001-2002 2011-2012

Westmont MV/PI Aid Ratio .2941 .3850 .3939 .5182

Westmont Market Value 157,521,700 243,712,100 386,916,700 547,102,700

Westmont PersonalIncome 148,253,482 240,514,100 287,456,824 350,393,642

Westmont WADM 2,382 1,943 1,948 2,061

MARKET VALUE PER STUDENT (WADM)

1983-1984 1992-1983 2001-2002 2011-2012

Westmont Market Value/WADM 66,136 125,419 198,592 265,438

State Personal Income /WADM 55,782 141,419 193,404 347,646

Westmont Percent of State 119% 89% 103% 76%

MARKET VALUE PER STUDENT (WADM)

PERSONAL INCOME PER STUDENT (WADM)

1983-1984 1992-1993 2001-2002 2011-2012

Westmont Personal Income /WADM 62,244 123,773 147,542 170,000

State Personal Income /WADM 37,899 70,958 99,024 134,551

Westmont Percent of State 164% 174% 149% 126%

PERSONAL INCOME PER STUDENT (WADM)

WHY A SUBSIDY ADJUSTMENT IS NEEDED

The current subsidy formula does not address the change (decline) in the district demographics

1983/1984

2,382 X .2941 X $1,405 = $984,557

1983/1984 with current aid ratio

2,382 X .5182 X $1,405 = $1,734,000 (76%)

CONSIDERATION OF A SUBSIDY ADJUSTMENT FOR WHSD SHOULD INCLUDE:

High personal and property taxes on district residents

Pennsylvania Personal Income Tax -$11,000,000

School Real Estate Tax -$10,846,200

The change in the district’s aid ratio as compared to the state

CONSIDERATION OF A SUBSIDY ADJUSTMENT FOR WHSD SHOULD INCLUDE:

Low spending per student

2009-2010 491 out of 500 public school districts

2008-2009 491 2007-2008 489 2006-2007 493 2005-2006 462 2004-2005 4582003-2004 432

CONSIDERATION OF A SUBSIDY ADJUSTMENT FOR WHSD SHOULD INCLUDE:

Low State Aid – 30%High Percentage of Residential Property –

96% Increase in Student Population High percentage of population over the

age of 65 Increase in the number of students

eligible for free and reduced price lunches

LEGISLATIVE ADVOCACY

Legislative advocacy is only one avenue the district is exploring. It is imperative that we continue to advocate for a subsidy adjustment for Westmont Hilltop based on changing demographics and district wealth.

While this is not the only solution, it is important because without legislative advocacy, the Westmont Hilltop School District will continue to be unfairly funded.