Xenia Community SchoolsDistrict Financial Update 2.0

What events have occurred that have effected the financial picture of the District since last board meeting?•On February 13 & 14 ODE conducted a fiscal

analysis for Xenia Community Schools•As I reported at last month’s board meeting the

1st February Foundation payment had an annual decrease in state aid of $576,952.93

•On the 2nd Foundation Payment we had an annual increase in state aid of $321,543.27 but had an additional reduction of $221,187.35 for negative open enrollment and a reduction of $46,752.67 for positive open enrollment

History of General Fund & how we got here

FY08 FY09 FY10 FY11Revenue $45,917,746 $46,409,607 *$45,584,043 **$47,693,011

Expenditures $44,634,090 $46,859,071 $49,458,238 $49,847,752

Excess (Shortfall) $ 641,199 ($ 344,047) ($ 3,724,544) ($ 2,113,393)

Unenc. balance $ 7,729,046 $ 7,372,007 $ 3,442,450 $ 1,409,476

* In FY10 we received $1,223,057 for Federal Stimulus monies.

** We elected to book an advance of real estate tax collection of $887,975 for FY12, in FY11. We also received $1,488,020 for federal stimulus monies.

FY08–FY11 Actual & FY12-FY13 projected surplus (deficit)

FY08 FY09 FY10 FY11 FY12 FY13

($4,000,000.00)

($3,000,000.00)

($2,000,000.00)

($1,000,000.00)

$0.00

$1,000,000.00

$2,000,000.00

General Fund estimated cash balance current year & projections for future years.

FY12 FY13 FY14 FY15 FY16

($12,000,000.00)

($10,000,000.00)

($8,000,000.00)

($6,000,000.00)

($4,000,000.00)

($2,000,000.00)

$0.00

$2,000,000.00

Review of Cuts:

In FY 2011: cut $2.2 million

In FY 2012: cut $6.4 million

Total= cut $8.6 million

Major Consolidations and Restructuring • 7 Elementary Buildings consolidated into five

buildings • Students returned to “home schools” resulting in

significant transportation cuts

• 56 teacher positions cut (15.5%)

• 5 administrative positions cut (17.9%)

• 32 classified positions cuts (12.9%)

The district has frozen, trimmed, and cut whenever possible

• Reclaiming the operation of pre-school

• Zero percent pay increase (base pay) for all employees FY ‘11

• Absolute Pay freeze for teachers, classified, and administrators for two years, NO raise, NO step increase

• Health care concessions from teachers, classified, and administrators; all pay at least 15% of health care

• Removed most spouses from the district health care plan

• All staff have significant, increased out-of-pocket costs for health care. This is a substantial savings to the district.

Further Reductions in FY ‘12

• Reduction of the Elementary Curriculum Supervisor for the remainder of the year

• Reduction of one School Nurse

• Principal substitute at Spring Hill for the remainder of the year • Eliminated Personnel Specialist (unclassified)

• Eliminated EMIS/Book-keeper position (unclassified)

• Eliminated Technology Specialist for the remainder of the year

Further Reductions in FY ‘12

•Bus routes; redrawn (more positions eliminated)

• Interim Transportation Coordinator•Substitute Drivers on routes •Custodial: Interim Coordinator•Any open positions: subbing for 90 days

(per contract)•Utilize ground crews in lieu of paying subs•Examining contracts and switching

vendors

The “rainy day” fund is depleted as of 06/30/12

•We have to cut or raise approximately $2.1 million before 06/30/2013.

•As you can see, the District deficit has not occurred overnight.

•Despite cutting over $8.6 million from the District budget for last two years, we are still looking at a $2,100,000 shortage at 06/30/2013.

Stop the Negative trendXenia Community Schools has three options:

1. Place a levy on the ballot to raise additional monies.

2. Drastically cut expenditures that have not

already been reduced.

3. A combination of raising new monies by passing a levy and reducing additional

expenses.

Current Estimated Deficit Spending

FY13 FY14 FY15 FY16

($4,000,000)

($3,500,000)

($3,000,000)

($2,500,000)

($2,000,000)

($1,500,000)

($1,000,000)

($500,000)

$0

Projections with levy approval

FY13 FY14 FY15 FY16

($6,000,000.00)

($4,000,000.00)

($2,000,000.00)

$0.00

$2,000,000.00

$4,000,000.00

$6,000,000.00

ExpendituresRevenueSurplus/Deficit

There are currently two levy dates available for Xenia Community School in the 2012 calendar year:

August 7, 2012

November 6, 2012

Possible Future Levy Dates

August 7, 2012 Facts & Deadlines

To go on the August ballot it could cost the District approximately $31,500 ($750 for 42 precincts)

Income tax Levy Emergency Levy1st resolution 04/27/2012 05/04/20122nd resolution 05/09/2012 05/09/2012

November 6, 2012 Facts & Deadlines

Less cost for election expenses due to the fact this it is a regular election

Income tax Levy Emergency Levy

1st resolution 07/27/2012 08/03/20122nd resolution 08/08/2012 08/08/2012

•Additional School District Traditional Income Tax Levy

•Replacement of current School District Traditional Income Tax Levy with a School District Earned Income Tax Levy

•Additional millage from an Emergency Levy•Combination of two of the above mentioned

options

Possible Levy Options

Emergency Levy• Is a fixed dollar property tax levy. This means

that the monies collected do not increase with inflation.

•Levy collection would not start until after 01/01/2013.

•Can be levied for 10 years or less.

What is a Mill, how much do we need & when will it be collected?

•A mill is estimated to collect approximately $675,000.

•We will need to run a 6.75 mill levy to eliminate the current projected deficit.

•For a home owner whose home value is $50,000 this would calculate to a $77.52 increase, annually.

•Collection will not begin until after January 1, 2013 whether the levy is passed in August or November.

Income Tax Levy• Income tax is separate from federal, state and

municipal taxes that are specifically used to support the school district.

•The income tax must be approved by residents of the school district and it can only tax those residents.

•There are two types of tax bases for school income tax: Traditional & Earned Income.

•The tax can only be collected in quarter (0.25%) percent increments.

Traditional Income Tax Levy

•Uses the same income base as the state’s income tax. (This is the tax that Our District currently collects at a .5% rate.)

•All income is taxed other than the following: social security; disability & survivor benefits; railroad retirement; welfare; child support; property received as a gift; bequest or inheritance; & workers compensation.

Traditional Income Tax Levy (cont.)

•To collect the dollars needed to sustain the current services that we provide, we would need to place an additional 0.75% traditional income tax levy on the ballot.

•This amount is currently estimated to collect an additional $4,749,712 per year when fully collected.

Earned Income Tax•Collection of this form of tax would include only

earned income & self-employment income of the residents of the School District.

•This tax excludes all other types of income that would be taxable under the traditional income tax.

•This tax also excludes certain adjustments to income; IRA contributions, self-employment health insurance deductions, alimony payments & does not allow personal exemptions.

Earned Income Tax (cont.)•To replace the amount that we collect with our

traditional income tax and collect the additional needed funds, we would need to replace our .50% traditional income levy with a 1.50% earned income tax levy.

•This amount is currently estimated to collect a total of $7,924,358 per year when fully collected.

The time is now

•When do we go on the ballot?

•What type of levy do we want on the ballot?

•What can we do to keep the District solvent?

Let’s remember we are here for the kids.

•Our decisions highly impact the learning process for our students.

•Our community and children are depending on us.

• “When you confront a problem you begin to solve it.” – Rudy Giuliani