NORRISTOWN AREA SCHOOL DISTRICT 2020-21 ANNUAL BUDGET€¦ · • will work with pasbo/psba, legal counsel, state representatives, tax collectors, etc to prepare budget for presentation

NORRISTOWN AREA SCHOOL DISTRICT

2020-21 ANNUAL BUDGET

April 15, 2020

2020-21 Budget

• Topics:

– 2020-21 Staffing

– Financial Impacts of COVID-19

– Legislative concerns; potential budget

impacts

– Next steps

2020-21 STAFFING

RECOMMENDATIONS

2020-21 Staffing Recommendations• Early Budget Goal = Maintain Current Staffing Levels

– No furloughs/reductions

– Position shifts necessary

– Economic downturn presenting new challenges;

may need to revisit staffing in May and/or next fall

when revenues can be projected more accurately

PROGRAM / BLDG RECOMMENDATION RATIONALE

REGULAR EDUCATION:

ELEMENTARY SCHOOLS

CM (1) MSS (1) PF (1) WES (2) (- 5.0) TEACHERS

ENROLLMENT BUBBLE CONTINUES TO

ADVANCE THROUGH OUR SECONDARY

SCHOOLS; WE HAVE BEEN SHIFTING STAFF

FROM ELEMENTARY TO SECONDARY AS

NEEDED TO MANAGE THIS MOVEMENT AND

WILL CONTINUE TO DO SO FOR THE NEXT FEW

YEARS

MIDDLE SCHOOLS

ESTLA +1, STEWART +2,

ENMS WILL CONVERT A VACANCY

+ 3.0 TEACHERS

ENROLLMENT & NEW RELATED

ARTS COURSE – GLOBAL

LEADERSHIP

NAHS

(-0.60) TEACHER -

COMMUNICATION

NAHS + 0.60 TEACHER -SPANISH

NAHS +2.0 TEACHERS - MATH

NAHS +1.0 TEACHER - ART

SPECIAL EDUCATION:

MIDDLE SCHOOLS

ENMS (1) STEWART (2) ESTLA (1) (-4.0) TEACHERSENROLLMENT AND PROGRAM CHANGES BOTH

CONTRIBUTE TO RECOMMENDED CHANGES IN

SPECIAL EDUCATION STAFFINGNAHS +1.0 TEACHER

ELD PROGRAMMING:

SCHOOL(S)-TBD +1.O TEACHER

CONTINUED GROWTH IN NON-ENGLISH

SPEAKING POPULATION; NEWCOMER

PROGRAM EXPANSION

OTHER TEACHER/PROFESSIONAL:

ASSIGNMENT / LOCATION – TBD +1.0 TEACHER

AFTER STAFFING CHANGES IDENTIFIED

ABOVE, 1.0 TEACHING POSITION REMAINS

AVAILABLE. POSITION ONLY TO BE FILLED IF

ENROLLMENT/PROGRAMMING WARRANTS

NEED

TEACHER/PROFESSIONAL RECOMMENDATIONS ARE BUDGET NEUTRAL +/- 9.6 POSITIONS

2020-21 PROFESSIONAL STAFF RECOMMENDATIONS

PROGRAM / BLDG RECOMMENDATION RATIONALE

NEW FAMILY SERVICE CENTER

ROOSEVELT+ 1.0 COMMUNITY LIAISON

BILINGUAL POSITION NEEDED TO SUPPORT

STUDENT REGISTRATION & FAMILY SUPPORT

INITIATIVES

SECURITY MONITOR

ROOSVELT

REPLACE CURRENT STAFF

MEMBER UPON RETIREMENT

WITH CONTRACTED SECURITY

NO REDUCTION IN SERVICE/SUPPORT TO

BUILDING

NEW MODEL PROVIDES AN OPPORTUNITY TO

REDUCE COSTS

SUPPORT RECOMMENDATIONS ARE NOT COST NEUTRAL

2020-21 SUPPORT STAFF RECOMMENDATIONS

OVERVIEW OF COVID-19

FINANCIAL IMPLICATIONS

IMPACT ON LOCAL REVENUES

LOCAL REVENUE SOURCE CHALLENGES / CONCERNS

PROPERTY/REAL ESTATE TAXES

- DECREASE IN COLLECTION RATES; ABILITY OF

TAXPAYERS TO PAY SHORT TERM & LONG

TERM

- INCREASE IN DELINQUENCIES

- IMPACT ON MARKET VALUE/ASSESSED VALUE

- INCREASE IN ASSESSMENT APPEALS

- ECONOMIC DOWNTURN LIKELY TO

NEGATIVELY IMPACT ACT 1 INDEX IN NEXT

FEW YEARS

2018-19 COLLECTION RATE = 96.26%

2019-20 COLLECTION RATE = 95.80% (Estimated)

2020-21 COLLECTION RATE = ?

AT THIS POINT – IT IS LIKELY THAT WE WILL NEED TO TAX TO INDEX AT

3.30% AND WE STILL MAY NOT HAVE ENOUGH REVENUE TO SUSTAIN

PROGRAMMING






TERM






FEW YEARS

REAL ESTATE TRANSFER TAX

- SALE TRANSACTIONS ESSENTIALLY ENDED

DURING CLOSURE

- MARKET CONDITIONS MOVING FORWARD

2018-19 REVENUE = $ 2,428,677

2019-20 BUDGETED REVENUE = $ 1,350,000

2019-20 REVENUE @ 3/31/20 = $ 1,404,494

2020-21 REVENUE (EARLY PROJECTION) = $ 750,000






TERM






FEW YEARS



DURING CLOSURE


EARNED INCOME TAXES

- EXTENDED 2019 FILING DEADLINE

- RISING UNEMPLOYMENT / LESS TAXABLE

EARNINGS IN OUR COMMUNITY

2018-19 REVENUE = $ 7,467,304

2019-20 BUDGETED REVENUE = $ 7,550,000

2019-20 REVENUE @ 3/31/20 = $ 4,965,999

2020-21 REVENUE = PROJECTIONS UNDER DEVELOPMENT






TERM






FEW YEARS



DURING CLOSURE


EARNED INCOME TAXES

- EXTENDED 2019 FILING DEADLINE

- RISING UNEMPLOYMENT / LESS TAXABLE

EARNINGS IN OUR COMMUNITY

INTEREST EARNINGS

- MARKET CONDITIONS / INTEREST RATE DROP


INTEREST RATES CONTINUE TO PLUMMET

APRIL 2018 = 1.82% APRIL 2019 = 2.52% APRIL 2020 = .90% AND FALLING

2018-19 REVENUE = $ 1,023,462

2019-20 BUDGETED REVENUE = $ 600,000

2019-20 REVENUE @ 3/31/20 = $ 733,558

2020-21 REVENUE (EARLY PROJECTIONS) = $ 100,000

IMPACT ON STATE REVENUES

STATE REVENUE SOURCE CHALLENGES / CONCERNS

BASIC EDUCATION FUNDING /

SPECIAL EDUCATION FUNDING

- IFO ESTIMATES THAT IF PA STATEWIDE

SHUTDOWN LASTS MORE THAN 6 WEEKS, THE

STATE WILL BE FACING$ 3.7 BILLION IN LOST

REVENUES

- MIXED MESSAGES ABOUT WHAT THAT MEANS

FOR 2020-21 SUBSIDES, BUT WE CAN’T

EXPECT INCREASED SUSBIDIES

2020-21 PROPOSED STATE BUDGET INCLUDES INCREASES IN BOTH LINE ITEMS

BASIC ED - $590,000

SPEC ED - $ 125,000

IMPACT ON STATE REVENUES

STATE REVENUE SOURCE CHALLENGES / CONCERNS

BASIC EDUCATION FUNDING /

SPECIAL EDUCATION FUNDING

- IFO ESTIMATES THAT IF PA STATEWIDE

SHUTDOWN LASTS MORE THAN 6 WEEKS, THE

STATE WILL BE FACING$ 3.7 BILLION IN LOST

REVENUES

- MIXED MESSAGES ABOUT WHAT THAT MEANS

FOR 2020-21 SUBSIDES, BUT WE CAN’T

EXPECT INCREASED SUSBIDIES

TRANSPORTATION SUBSIDY

- ALWAYS ONE YEAR IN ARREARS

- REIMBURSEMENT BASED ON MILES DRIVEN;

CLOSURE REDUCED COSTS, BUT ALSO

REDUCES SUBSIDY

2020-21 TRANSPORTATION SUBSIDY IS BASED ON 2019-20

PROJECTED REDUCTION IN SUBSIDY = $ 300,000

(EARLY PROJECTION)

IMPACT ON FEDERAL REVENUES

FEDERAL REVENUE SOURCE CHALLENGES / CONCERNS

CARES ACT STIMULUS FUNDING

(Coronavirus Aid, Relief, and

Economic Security)

- EDUCATION STABILIZATION FUND

- NASD ALLOCATION EST @ $ 2,000,000

- WILL LIKELY NEED TO SHARE ALLOCATION

WITH NON-PUBLIC SCHOOL

MANY QUESTIONS ABOUT USE

SUPPLANT – VS- SUPPLEMENT

DETERMINING ALLOWABLE USE WILL BE FOCUS OVER COMING WEEKS

(NEED CLEAR GUIDANCE TO DEVELOP OUR PROPOSED FINAL BUDGET)

IMPACT ON SPENDING

EXPENSE CATEGORY CHALLENGES / CONCERNS

WAGES

- IMPACT OF ACT 13 / EMERGENCY SCHOOL CODE

BILL WHICH REQUIRES FULL COMPENSATION IN

2019-20

- WHAT HAPPENS IN 2020-21?

- IMPACT OF FFCRA LEAVES THAT EXTEND INTO 2020-

21?


WAGES



2019-20



21?

MEDICAL / PRESCRIPTION DRUG

- WILL WE SEE A LAG IN CLAIMS FOR CLOSURE

PERIOD AND SPIKE WHEN NORMAL OPERATIONS

RESUME?

- ARE CHRONIC CONDITIONS BEING HANDLED

APPROPRIATELY DURING CLOSURE, OR WILL

CLAIMS SPIKE BECAUSE CARE IS BEING DEFERRED?

- WHAT WILL MENTAL HEALTH CLAIMS LOOK LIKE AS A

RESULT OF COVID-19?

IMPACT ON SPENDING


WAGES



2019-20



21?




RESUME?





RESULT OF COVID-19?

PSERS (RETIREMENT)- HOW WILL MARKET CONDITIONS IMPACT EMPLOYER

CONTRIBUTION RATE IN THE FUTURE?

IMPACT ON SPENDING


WAGES



2019-20



21?




RESUME?





RESULT OF COVID-19?



SPECIAL EDUCATION - UNCERTAINTY ABOUT CHALLENGES TO FAPE

IMPACT ON SPENDING


WAGES



2019-20



21?




RESUME?





RESULT OF COVID-19?




CLEANING COSTS - CONTINUAL CHANGES TO CDC GUIDANCE

IMPACT ON SPENDING


WAGES



2019-20



21?




RESUME?





RESULT OF COVID-19?




CLEANING COSTS - CONTINUAL CHANGES TO CDC GUIDANCE

FOOD SERVICE FUND - WILL GF NEED TO COVER 2019-20 LOSS

IMPACT ON SPENDING

GROWING CONCERN ABOUT THE NEED TO USE FUND

BALANCE AS A REVENUE SOURCE IN 2020-21

AND THE ABILITY TO SUSTAIN FUND BALANCE OVER THE

NEXT FEW YEARS

IMPACT ON FUND BALANCE

LEGISLATIVE CONCERNS

POTENTIAL

2020-21 BUDGET IMPACT

LEGISLATIVE CONCERNS

• PASBO & PSBA ACTIVELY ENGAGED IN HARRISBURG

o PROPERTY TAX FREEZE PROPOSAL

o Could be devastating for NASD

o PROPERTY TAX FLEXIBILITY PROPOSALS

o Extension of payment periods (school property taxes)

o Likely to create cash flow challenges

o CRAZY CONVERSATIONS IN HARRISBURG RELATED TO

PREPARING AND ADOPTING TWO SIX-MONTH BUDGETS FOR

2020-21

o Unprecedented territory

NEXT STEPS

• REQUIRED TO ADOPT 2020-21 PROPOSED FINAL

BUDGET IN MAY 2020 & 2020-21 FINAL BUDGET IN

JUNE

– Will tax collectors be able to mail bills and accept

payments in July ?

• RECOGNIZE THAT THERE A LOT OF UNKNOWNS AT

THIS POINT

• WILL WORK WITH PASBO/PSBA, LEGAL COUNSEL,

STATE REPRESENTATIVES, TAX COLLECTORS, ETC

TO PREPARE BUDGET FOR PRESENTATION AT OUR

MAY MEETING

NEXT STEPS

Documents

NORRISTOWN AREA SCHOOL DISTRICT 2020-21 ANNUAL BUDGET€¦ · • will work with pasbo/psba, legal counsel, state representatives, tax collectors, etc to prepare budget for presentation