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Capital Reserve Funding. Douglas County School District Presented to the Board of Education Thursday, February 7, 2008. Capital Reserve Program Agenda. History of Capital Reserve Program - DCSD Insights learned from 20 years Hypothesis and options for future Test hypothesis. - PowerPoint PPT Presentation
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Capital Reserve FundingDouglas County School District
Presented to the Board of Education
Thursday, February 7, 2008
Capital Reserve Program Agenda
History of Capital Reserve Program - DCSD Insights learned from 20 years Hypothesis and options for future Test hypothesis
Capital Reserve FundThe Capital Reserve fund is a revenue account
that can be used to account for the acquisition of land, construction of new facilities, alterations and improvements to existing structures and the acquisition of school buses and/or other equipment.
History - DCSD Capital Reserve Fund DCSD has always funded cap reserve at the
minimum legal level State determines per student allocation
operational monies to be spent on capital reserve projects annually
Minimum funding level allows for more money available to be spent on other operational expenses
2006 bond package included $11.6M in capital reserve projects, but $17M had been requested
History – DCSD Per Pupil Allocation for Capital Reserve Fund
Per Pupil Allocation Enrollment
Capital Reserve Funding
2000-01 $236 31,666 $7,473,058
2001-02 $248 33,914 $8,410,756
2002-03 $263 35,732 $9,397,547
2003-04 $262 40,048 $10,492,445
2004-05 $268 39,783 $10,661,736
2005-06 $271 42,347 $11,476,121
2006-07 $299 41,467 $12,398,621
2007-08 $292 46,653 $13,622,676
2008-09 $303
Capital Reserve Program History - Allowable Expenditures O&M - Facility improvements & equipment Vehicles – buses, white fleet Technology – software & equipment Security support – cameras, radios, equipment Mobile classrooms – purchase & relocation Risk Management - insurance
Annual School Finance Act required Transfers from General Fund to Capital Reserve Fund
Student Enrollment
Per Pupil Allocation
Capital Improvements
Insurance Reserve Total
2000-01 31666 236$ 5,731,320$ 1,741,738$ 7,473,058$ 2001-02 33914 248$ 6,536,591$ 1,874,165$ 8,410,756$
2002-03 35732 263$ 6,815,441$ 2,582,106$ 9,397,547$ 2003-04 40048 262$ 6,992,445$ 3,500,000$ 10,492,445$
2004-05 39783 268$ 7,961,308$ 2,700,428$ 10,661,736$ 2005-06 42347 271$ 8,476,037$ 3,000,084$ 11,476,121$
2006-07 44493 279$ 9,248,621$ 3,150,000$ 12,398,621$ 2007-08 46653 292$ 10,315,176$ 3,307,500$ 13,622,676$
303$
History – DCSD Capital Reserve Fund Capital Reserve exclusively utilized for building maintenance
& improvements, insurance reserve, buses, vehicles, and mobile classrooms
Late 1990’s technology equipment started to erode Capital Reserve funds
Early 2000’s security communication equipment began being funded from Capital Reserve
2006 first bond election to transfer Capital Reserve Funding needs to bond revenue stream $11.7M was moved, but $17M worth of needs 2006 - Charter Schools promised $2.6M of Capital Reserve Funds
over 3- year period
History – DCSD Capital Reserve Fund Distribution
2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08Mobiles/Leases/COP 1,608,750$ 925,874$ 1,319,959$ 1,683,002$ 772,300$ 1,049,133$ 1,060,000$ 1,832,371$ Vehicles 1,250,000$ 1,384,000$ 1,719,000$ 1,916,000$ 2,150,000$ 1,170,867$ 1,709,000$ 2,675,000$ Contingency 379,436$ 380,000$ 400,000$ 400,000$ 840,000$ 272,000$ 400,000$ 400,000$ Insurance Reserve 1,741,738$ 1,874,165$ 2,582,106$ 3,500,000$ 2,700,428$ 3,000,084$ 3,150,000$ 3,307,500$ Facilities 2,417,000$ 3,120,000$ 2,672,000$ 2,001,000$ 2,237,700$ 2,508,000$ 2,156,000$ 2,316,000$ Technology 1,980,511$ 2,564,213$ 2,939,400$ 3,764,850$ 5,766,600$ 6,048,315$ 6,352,288$ 7,636,025$
History – DCSD Capital Reserve Fund Distributions
$-
$2,000,000
$4,000,000
$6,000,000
$8,000,000
$10,000,000
$12,000,000
$14,000,000
$16,000,000
$18,000,000
$20,000,000
2000-012001-022002-032003-042004-052005-062006-072007-08
Technology
Facilities
Insurance Reserve
Contingency
Vehicles
Mobiles/Leases/COP
Includes:
•Schools
•Mobiles
•Leased space
•Support Facilities3,51
2,45
4
3,90
4,34
0
3,97
2,68
6
4,53
5,95
2
4,81
1,81
5
4,94
7,86
2
5,27
2,22
9
5,58
9,40
8
5,97
0,32
4
2000
-01
2001
-02
2002
-03
2003
-04
2004
-05
2005
-06
2006
-07
2007
-08
2008
-09
History – DCSD Growthin Facilities Square Footage
829.71
951.48
961.43
1,021.32
1,112.32
1,134.14
1,179.54
1,231.94
1,301.94
200
0-01
200
1-02
200
2-03
200
3-04
200
4-05
200
5-06
200
6-07
200
7-08
200
8-09
History – DCSD Growthin Acreage (grounds to maintain)
History – DCSD Building Modification Team Formerly Capital Reserve Committee
Cross Functional team – wide representation Meets quarterly to review and prioritize building
modification requests Authorizes emergency expenditures Maintains priority list of capital improvement needs
as required for E.L. 1.8 Protection of Assets Meets in the spring of each year to determine
which projects will be funded from capital reserve for the following year
History – DCSD Capital Asset Mitigation Capital Asset mitigation are revenues
collected from Developers to mitigate the impact of growth on DCSD.
All revenues collected funnel through Capital Reserve Fund Cash in lieu of land Voluntary impact fees collected Land dedication
History – DCSD Cash-in-Lieu
Castle RockHighlands
Ranch Parker District2003-04 $249,880 $804,018 $950,884 $2,004,7832004-05 $677,542 $13,950 $526,538 $3,222,813
-$400,000 $2,822,8132005-06 $0 $324,057 $1,229,036 $4,375,906
-$400,000 $3,975,9062006-07 $1,500 $103,490 $1,048,100 $5,128,9962007-08 $5,120 $639 $496,621 $5,631,376Total $934,042 $1,246,154 $3,451,179 $5,631,375
Transfers made to General Fund
History – DCSD Impact Fees 1984 Town of Parker began collecting fees as a condition of annexation
Collected $1M Not subject to later court ruling because contractual
agreement 1992 Douglas County Trust Fund Foundation established & voluntarily
contributed $10.5M to mitigate impact of development on DCSD July 1992 – Intergovernmental Agreement between Douglas County and
DCSD established Douglas County would collect impact fees on behalf of DCSD to mitigate the impact of development on school facilities
$.42 - $.83 sf – max. of $3,486 for home more than 4,201 sf.
$21.5M collected (but DCSD had to pay back $11.5M after Court Ruling in 1996)
History – Impact Fees October 1993 – Builders sued Douglas County, stating one
governmental entity could not collect funds for the benefit of another governmental entity
July 1994 – District court ruled in favor of builders March 1996 – DCSD appealed court decision January 1997 – Colorado Supreme Court ordered DCSD to
refund fees ($10.5M)
Refunds begin May 1997 March 1997 – Builders sued for interest
History – Impact Fees January 1998 – Supreme court orders payment of
interest on impact fees January 1998 – DCSD appeals court decision on
payment of interest February 1999 – Board of Education resolves to
begin payment of interest District still was able to keep $10M voluntarily
contributed by the Douglas County Facilities Trust Fund
Insights we have learned . . . Capital Reserve Fund Industry norm = 2% of building
replacement value In 2007-08, industry norm for DCSD equaled $19.5M DCSD capital reserve budget was $7M ($12.5 short)
4 track, year round calendar reduces time available for capital improvement projects to be completed
Emergency Capital Reserve contingency funds have not increased proportionately
When Capital Needs project load exceeded available funding, some bond interest was shifted to Capital Reserve Fund
Insightswe have learned . . . Increased Legal Code Requirements
Fire In 2007-08, $450k was expended to bring fire alarms
into compliance with new codes
Building codes In 2007-08, mobile decking and ramp inspections and
expectations increased costs (estimated $100k) Materials Labor
Insights we have learned…. In 1984, HB1006 addressed rapid growth
counties Allowed County Commissioners to authorize additional tax revenues
for School District Capital Reserve
2% additional capital reserve, if two conditions met: 3% over 3 years in DCSD enrollment growth 2% growth in Douglas County building permits DCSD only District to receive these funds in Colorado
2007 DCSD enrollment meets 3% growth threshold, but County building permit growth does not Loss in DCSD capital reserve revenue estimated at $1.7M
for the 2008 calendar year
Insights we have learned…. Support Space Needs Analysis was conducted in June, 2004
Little has been done to mitigate these needs Resulted in need for more leased space
SITE 2004 needs 5-year 10-yearWilcox Building -21,769 ft2 -30,069 ft2 -31,519 ft2Purchasing/Warehouse -1,331 -5,370 -13,496HR North -327 -898 -1,079Cantril -2,391 -3,172 -3,143UC Chaparral -349 -912 -1,021Trans West -4,930 -4,930 -5,081Trans North -10,370 -11,035 -11,035Trans East -297 -448 - 24,269TOTAL -41,764ft2 -56,834ft2 90,643ft2
Insights we have learned . . . Capital Reserve Requirements have increased exponentially
in last 10 years Increased need for mobile classrooms (118 for schools) Increased leased space (nearly 40,000 sf) at an annual cost over
$600,000 Two Certificates of Participation (COP) which are paid by C.R.
Lone Tree Elementary DC Oakes Castle Rock
Technology – now accounts for 60% of Capital Reserve expenditures Security – did not exist prior to 2003 Buses and white fleet vehicles
Hypothesis - Future Needs
Increase the amount of funds transferred to the Capital Reserve Fund in future bond packages
A “fixed mil” budget authorization will provide additional operational revenue eliminating the need for future mil levy override elections Increases as Douglas County assessed valuation increases Additional operational $ could be used to support Capital Reserve Fund
All proceeds from disposal of District assets should be used to support the Capital Reserve Fund
Reduce dependence on leases as prudent O&M East Stadium #3 – multi purpose
Hypothesis – Test Questions Would the Superintendent and Board of
Education endorse policies predicated upon the hypotheses?
What other questions does the BOE have?