2015/2016 budget development update...• budget update incorporating input from leadership...
TRANSCRIPT
Board of Education March 5, 2015
2015/2016 Budget Development Update
Agenda
National and State Economy School Finance Jeffco Funding Budget Process Community Engagement
► Forums ► Survey
Board Discussion and Direction
National/State Economy
Middle Phase of this Business Cycle ► Business-led Recovery ► Labor Market Healthy and Improving ► Households and Banks in Better Shape ► Broader Economy Offers Support for Real Estate Markets
Few Reasons for Concern ► Fed will Tighten the Money Supply ► Global Economy ► Oil Prices and Capital Investment
employment Colorado Outpacing U.S.
98
100
102
104
106
108
110
Colorado
Nation
Source: U.S. Bureau of Labor Statistics. Seasonally adjusted three-month moving averages. Shaded area indicates recession. Data through November 2014. Colorado data includes revisions expected by LCS.
Index July 2009 = 100
measures of unemployment Colorado Outpacing U.S.
Source: U.S. Bureau of Labor Statistics. Underemployment rates are 12-month moving averages. Shaded area indicates recession. Data through November 2014.
income Colorado Outpacing U.S.
95
100
105
110
115
120
125
130
2008
Q1
2008
Q3
2009
Q1
2009
Q3
2010
Q1
2010
Q3
2011
Q1
2011
Q3
2012
Q1
2012
Q3
2013
Q1
2013
Q3
2014
Q1
Personal Income Index Base 2009 Q2 = 100
Colorado
U.S.
95
100
105
110
115
120
125
130
2008
Q1
2008
Q3
2009
Q1
2009
Q3
2010
Q1
2010
Q3
2011
Q1
2011
Q3
2012
Q1
2012
Q3
2013
Q1
2013
Q3
2014
Q1
Wages & Salaries Index Base 2009 Q2 = 100
Colorado
U.S.
Source: U.S. Bureau of Economic Analysis. Data through the third quarter of 2014. Shaded area indicates recession.
percent change employment Second Quarter 2013-2014
Source: U.S. Bureau of Labor Statistics, QCEW. Data through second quarter 2014
8
quote
State General Fund Revenue Outlook
$6.6
$5.5$5.5$5.8
$6.1
$7.0$7.5$7.7
$6.7$6.4$7.1
$7.7
$8.5$9.0
$9.6$10.2
$11.1
$4
$5
$6
$7
$8
$9
$10
$11
$12B
illi
on
s o
f Do
llar
s
Bars represent LCS ForecastDots represent OSPB Forecast
Source: Colorado State Controllers Office, LCS and OSPB projections based on the December 2014 forecast.
9
TABOR Refunds Structural Issues Demographics
State Tight Budgets Will Persist
State TABOR – A Simile
Income and Sales Taxes
Fees TABOR Refund
TABOR Limit
$0
$2
$4
$6
$8
$10
$12
$14
Referendum C Timeout Period
Referendum C Cap Current TABOR Limit
Original TABOR Limit
Bars Show Revenue Subject to TABOR
White bars = Referendum C time out; Darker bars = years revenue exceeded or is expected to exceed the limit
Source: Colorado State Controllers Office and Legislative Council Staff December 2014 Forecast.
State TABOR Referendum C
K-12 Education
38%
Higher Education
8% Corrections
8%
Judicial 5%
Health Care 25%
Human Services
9% Other 7%
FY 2014-15 General Fund
Operating Budget
$8.9 billion
State FY 2014-15 General Fund Budget
Sources: Colorado Department of Education, U.S. Census Bureau, & Bureau of Labor Statistics, and JBC Staff.
60
110
160
210
260
310
360
FY01
FY02
FY03
FY04
FY05
FY06
FY07
FY08
FY09
FY10
FY11
FY12
FY13
FY14
Ind
ex F
Y 0
1 =
10
0
Medicaid Caseload
State Share School Finance
Higher Education Enrollment
Inflation
CO Population
K-12 Enrollment
General Fund Operating Appropriations
General Fund Revenue
State Medicaid Caseload Growth / General Fund Budget
During the next 15 years, the aging of the population will: ► change the housing mix, likely dampening
growth in housing values and the property tax base;
► change income and spending patterns, likely dampening growth in the income and sales tax bases; and
► increase demand for government services, applying further budget pressure on governments.
State Demographics Matter
Even with state revenues increasing, limits on funding for programs Reducing the State Education Fund
causes concern TABOR refunds Maintaining the negative factor
as required
State Caution at the State Level
Amounts by Source
Public School Finance FY12-FY17 Amendment 23 Target vs. Funded State
$479M
ONE TIME
$198M
ONGOING
$281M
$38M
ONE TIME
$16.6M
ONGOING
$17M
$19.5M $18.4M
($2.5M) ($1.8M)
Governor’s Proposal Jeffco’s Estimates
Amounts in millions Ongoing One-time Total
Governor’s Revised Request 19.5 18.4 37.9
Pass Through to Charters (2.3) (1.6) (3.9)
Pass through to Child Care (0.2) (0.2) (0.4)
General Fund 17.0 16.6 33.6
2015/2016 Assumptions REVENUE Ongoing One time Total
School Finance Act 19,465,700 18,437,700
Flow Through to Charter of state PPR increase (2,316,200) (1,555,900)
Flow through to Child Care fund of state PPR increase for Preschool (CPP) (186,400) (183,200)
Move kindergarten to the General Fund from the Child Care Fund 4,000,000
Investment Earnings, fees, and other (40,900)
Total Change in Revenue 20,922,200 16,698,600 37,620,800
EXPENDITURES
Legislated PERA AED 0.3% 1,215,000
Legislated PERA SAED 0.5% 2,025,000
Estimated Retirement and Turnover Savings (4,000,000)
Affordable Care Act 3,000,000
Move kindergarten to the General Fund 4,000,000
Salary Accrual, Utilities 1,500,000
Increase in GF transfers (Capital Reserve, Transportation, Insurance Reserve) 487,600
General Increase Placeholder TBD 12,000,000 18,000,000
Total Change in Expenditures 20,227,600 18,000,000 38,227,600
Change in General Fund Reserves 694,600 (1,301,400) (606,800)
Point of Reference Approx. Costs Associated with Decisions
One hour per day additional interventionist at each school - $1.3M Priority one facility deficiencies - $16.9M 1 percent increase to all staff - $5.2M Add or eliminate $10 per pupil technology fee
across all students - $.8M Equalizing charter school mill levy override –
$2.5M at current enrollment assumptions, $3.0M with additional potential growth Reduce class size in first through third grades
by one student - $2M
Per Pupil Funding
7,070
6,637
6,309 6,317 6,482
6,850
7,307 7,081
$5,000
$6,000
$7,000
$8,000
**2014/2015 - CDE has based Total Program and Per Pupil funding numbers on the adoption of the supplemental. **2015/2016 - CDE has based Total Program and Per Pupil funding numbers on projected enrollment and adoption of the Governor's Revised Budget Request **2016/2017 assumes the negative factor remains at the 2014/2015 level of $894M, and enrollment stays flat compared to 2015/2016
General Fund Projection 12/2014
General Fund - Reserves
$0
$10,000,000
$20,000,000
$30,000,000
$40,000,000
$50,000,000
$60,000,000
$70,000,000
$80,000,000
$90,000,000
Ending Fund Balance Total Required Reserves
SBB – Student Based Budgeting Schools
► Finished allocating their budgets to line items
Achievement Directors and Budget Office ► Reviewed budget for required items
and reasonableness HR is in process for filling positions Next Steps
► Budget tool is open for principals to continue making changes.
► Information will be pulled as of March 20 for development of the 2015/2016 Budget.
► Changes after won’t be adjusted until after June 30.
x
26
Programmatic review of central departments Review will provide evaluation of
activities meeting goals. Resource constraints in financial
services has revised the timeline of this work. Planned completion is August 2015.
PBB – Priority Based Budget
COMMUNITY ENGAGEMENT
Budget Forums Six forums – January 22, 24 & 28, 2015 194 Attendees Overall Summary
Ongoing – Compensation increases and facilities/capital One time – Facilities/capital and reserves
Evaluations Opportunity to voice opinions Liked small group discussion Earlier/more information on budget Heard about through social media, Chalktalk,
district website and other.
COMMUNITY ENGAGEMENT
Online Budget Survey Tool was open Jan. 28 through Feb. 18 (3 weeks) Available in English/Spanish/Russian/Vietnamese Outreach – Communications publicized through:
► Internal Media Channels (Leadership Memo, Messenger, website, dedicated parent email, customized text messages, customized district access points)
► Social Media and Media Relations (press release, Facebook, Twitter) ► Community Organizations (cities/municipalities/local organizations) ► Paid Advertisements
Response ► 13,671 visitors; 9,121 responses
Results ► Being compiled; will be communicated to the Board and
published on Jeffco’s website
COMMUNITY AND STAFF ENGAGEMENT
Other Input
SPAC/SAC Input Principal feedback Cabinet Recommendations
Jan 2015
•Board Community Forums – 1/22, 1/24 & 1/28
•SAC/DAC •School level
accountability groups meet
•District level accountability group meets
•Open Citizen Budget tool for two three weeks [opened on 1/28-2/18]
Feb 2015
•5th Board Study Session •SAC/DAC/
FOC, Community input presented to BOE
•Survey closes on 2/18
•Communicate Forum Feedback to BOE
•BOE Direction on budget
•Survey closes on 2/18
•SPAC to communicate input from SAC
Mar 2015
•5th - Board Regular Meeting •Budget
Update incorporating input from Leadership (Cabinet), SPAC/SAC, Student Based Budgeting, Budget Forums and Budget Survey
•19th - Board Regular Meeting •Final BOE
direction on 2015/2016 Proposed Budget before Spring Break
Apr 2015
•4 weeks to develop Proposed Budget for May 7 BOE meeting
May 2015
•7th - Board Study Session
•Presentation of Proposed Budget 1st Public Hearing (will include a revised forecast if any legislation is final.)
•Proposed budget must be presented to the BOE no later than June 1 per C.R.S. 22-44-108(1)
•BOE Final Revisions to Proposed Budget
•May 14th - Board Regular Meeting •2nd Public
Hearing; and •Budget Adoption
2015/2016 Budget Development
Timeline
March BOE priorities including direction for
placeholders or identified items to be funded Budget office will incorporate all BOE direction
into a revised projection to be presented in March BOE meeting March 19, 2015, present
Projection #2 inclusive of BOE direction on priorities and placeholders
April Budget office builds the proposed budget
2015/2016 Budget Development
Timeline
May BOE meeting May 7, 2015
First public hearing to present the 2015/2016 Proposed Budget including Projection #3
BOE direction on any revisions to be incorporated into the adopted budget
BOE meeting May 14, 2015 Second public hearing for 2015/2016
budget adoption
2015/2016 Budget Development
Timeline
Effectively allocate monetary resources to enhance student achievement;
Clearly communicate the financial state of the district to the public;
Comply with all state, federal, and local statutes and regulation as well as internal organizational controls;
Identify all budgetary changes from year to year; and
Set appropriations to ensure positive reserve balances in all funds.
2015/2016 Budget Development
Goals and Objectives
The budget will:
Meet specified deadlines while producing a comprehensive and accurate budget;
Provide opportunities for community and staff input to support Board budget direction;
Identify budget assumptions fused for the development process;
Use forecasting to anticipate future needs and resources; and
Review all programs and departments.
2015/2016 Budget Development
Goals and Objectives
The process will continue to:
Board Direction
Expense Placeholders Jefferson/Alameda Plan Early Compensation Decisions