KATONAH-LEWISBORO SCHOOL DISTRICT Enrollment data, demographics, and enrollment projections

Executive Summary •  The current enrollment level is roughly equal to enrollment

levels from 1990s •  The current projected enrollment from does not take in to

account net student inflows from existing home sales • Projected enrollment, adjusted for an average level of

existing home sales, suggests enrollment will grow again in the future

• Closing an elementary school has a minimal impact on projected per pupil operating expenses

•  The current budget & balance sheet of KLDS is healthy

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Total Enrollment • Current total enrollment in 2013-2014 is 3,374

•  Total enrollment is 9.5% less than the 20 year historical

average •  Total enrollment is 17% higher than total enrollment of

2,883 in 1993 •  The enrollment today is roughly the same as the average

enrollment throughout the 1990s •  The system of 6 schools has existed throughout a wide

range of student enrollment levels

Enrollment Data Source: KLSD Twenty Year Enrollment Data by School and Grade http://klschooldistrict.org/news_and_media/school_closure_task_force

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Projecting Enrollment • Demographic projections by their nature are speculative

and very sensitive to assumptions • Current demographic forecast being used is primarily

driven by a birth rate projection •  The current forecast assumes births for the next 5 years

are 25% lower than the prior 10 year average •  The current forecast excludes the impact from existing

home sales: “None of the forthcoming enrollment projection calculations account for home resales as this was beyond the scope of our analysis.” – Pages 22 and 26 of Statistical Forecasting’s Demographic Study, August 2012

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Enrollment Projection Excluding Existing Home Sales

3,366

3,202 3,073 2,965

2,825 2,686

2,589 2,506 2,405

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

2013-2014 2014-2015 2015-2016 2016-2017 2017-2018 2018-2019 2019-2020 2020-2021 2021-2022

Projected Enrollment

Projected Enrollment

Source: Statistical Forecasting Demographic Study, August 2012 http://klschooldistrict.org/news_and_media/school_closure_task_force

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State, County & District Demographics

Observations

•  Katonah-Lewisboro has a very different demographic age mix when compared to NY State & Westchester County

•  KLSD has a high percentage of people that will reach retirement age within 10 years

•  KLSD has 10% more people under 20 years of age when compared to the County; Does this suggest KLSD may be a more desirable location to raise a family than Westchester County as a whole?

•  KLSD has 11% fewer people over 59 years of age when compared to the County; Does this suggest KLSD may be a less desirable location for retirement than Westchester County as a whole?

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Source: 2010 U.S. Census (http://factfinder2.census.gov)

%  difference  

Age  Group   NY  State   Westchester  County   Katonah  -­‐  Lewisboro   from  County  

Under  20  Years   25.3%   26.5%   29.4%   10.8%  

20  -­‐  29  Years   14.4%   11.2%   6.1%   (45.8%)  

30  -­‐  39  Years   13.1%   12.3%   7.8%   (36.5%)  

40-­‐49  Years   14.5%   15.5%   18.9%   21.9%  

50-­‐59  Years   13.7%   14.2%   19.8%   39.6%  

60  &  Older   19.0%   20.3%   18.0%   (11.2%)  

Existing Home Sales •  The Demographic Study conducted by Statistical Forecasting is

primarily driven by birth data from the past 5 years and a projection for the next 5 years that is substantially lower than the historical average

•  Average annual sales of existing homes between 1993 and 2007 were 313; From 2008-2011, they have averaged only 161

•  Existing home sales are finally recovering •  Statistical Forecasting’s study does not attempt to estimate the

impact from this dip in existing home sales

Source: Statistical Forecasting Demographic Study, August 2012 http://klschooldistrict.org/news_and_media/school_closure_task_force

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KLSD’s skewed demographic distribution dramatically impacts birth rate models and the impact from existing home sales

Existing Home Sales, cont’d • YTD 2013, existing home sales in Lewisboro are 27.6%

higher than in the same period in 2011 •  For comparison, neighboring Bedford saw existing home

sales increase 19.3% in the same period •  The demographic impact from increased existing home

sales should be estimated using a variety of assumptions • According to Jim Renwick, President of Renwick

Sotheby’s Realty: "The sellers in all the towns [in and around Lewisboro] are for the most part older and the buyers for the most part younger, the basic turnover. The buyers, for the most part, come from lower Westchester and NYC."

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Lewisboro real estate is priced comparably to peer districts and the county

Source: Eliman Report; Renwick Sotheby’s Newsletter

Single  Family  ResidenDal  Real  Estate  Sales  

Area               Average  Sales  Price  

Westchester  County  Average   $639,613  

Bedford   $1,145,444  

Pound  Ridge   $1,001,673  

North  Salem   $755,890  

Mt.  Kisco   $653,417  

Somers   $566,559  

ManhaSan   $1,410,759  

Lewisboro   $642,367  

Lewisboro  Premium  to  Westchester  County  Avg   0.4%  

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Estimating the Impact from Increased Existing Home Sales •  If existing home sales return to the pre-downturn average

over the next 5 years, the projected enrollment changes dramatically

•  If a majority of home buyers are young families as Renwick Sotheby’s suggests, then young children will return to Lewisboro and the cycle will repeat

•  In Westchester County, the average family has 1.98 children (source: 2010 US Census Bureau)

•  If the average new young family also has 2 children, this adds over 1,000 new students to the system over the next 5 years when compared to the Enrollment Projection Excluding Existing Home Sales

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Projected Enrollment with Average Historical Existing Home Sales and Normal Transaction Trends

Note: This projection adds the enrollment impact from home resales to the existing study conducted by Statistical Forecasting, as the existing study did not include it.

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3,366

3,252

3,210

3,230 3,266

3,363

3,399

3,449 3,479

3,050

3,100

3,150

3,200

3,250

3,300

3,350

3,400

3,450

3,500

2013-2014 2014-2015 2015-2016 2016-2017 2017-2018 2018-2019 2019-2020 2020-2021 2021-2022

Projected Enrollment

Assumptions for Adjusted Projected Enrollment •  Existing home sales grow at 12% per year for the following 5 years from a

base that is 10% lower than the 20 year historical average •  Existing home sales peak at a level 10% lower than prior peak •  Annual enrollment growth averages 32 students per year. In the 1990s,

enrollment grew by an average of 171 students per year. •  Assumes the majority (2/3) of buyers are young families. Renwick Sotheby’s

observes that “The sellers in all the towns [around Lewisboro] are for the most part older and the buyers for the most part younger, the basic turnover.”

•  The average young family will have 2 children, in line with the average in Westchester County, and these children will attend schools in the KLSD District (current demographics from US Census support this)

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Conclusions •  The current student enrollment level is within the normal

historical range • Given annual savings of $1.7M, the incremental cost to

defer a decision on closing one or two elementary schools for an extra two years is $3.4M

•  This amount appears to be inconsequential to the overall budget and current financial situation

•  The future stability of KLDS enrollment depends on existing home sales to young families

• Does closing a school make the area less attractive to prospective young family home buyers?

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Conclusions, cont’d •  The Board of Education and School Closure Task Force has

done an excellent job involving the community •  Four public hearings scheduled for community feedback •  The community has reciprocated, and turnout at public

hearings has been high

•  The community seems confused about the BOE’s goals and objectives

•  Is the BOE trying to reduce our district’s relatively high expense per pupil?

•  Is there an academic benefit from school closure? •  Current enrollment is 17% higher than the early 1990’s, how

has capacity changed since then?

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APPENDIX A: EXPENDITURES

KLSD Budget Overview •  KLSD maintains a balanced budget, and it has been able to pay down

debt and increase its cash reserves over the past 3 years •  Outstanding serial bonds stood at $34.1M at June 30, 2012,

representing an average debt paydown of $4.3M per year from the balance of $47.0M at June 30, 2009

•  General fund balance is $14.3M as of June 30, 2012 and was $13.7M at June 30, 2009

•  There does not appear to be a current budget shortfall, nor does there appear to be a current need to raise cash

•  The expense projections, however, suggest the budget will become imbalanced in the coming years

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KLSD Expenditure per Pupil •  Total expenditures per pupil in the district was 21.4%

higher than the comparable school districts, and over 35% higher than the NY State average

•  The current budget is not out of balance, but its current spending relative to comparable districts is very high

•  Total expenditures per pupil are projected to grow substantially

• Closing a school does not meaningfully improve the projected total expenditures per pupil

Source: 2013-2014 Boad of Education’s Budget http://klschooldistrict.org/boe/budget_information

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Expenses per Pupil

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            2010-­‐2011   2011-­‐2012   2012-­‐2013   2013-­‐2014   2014-­‐2015   2015-­‐2016   2016-­‐2017  A   Projected  Expenses   106,611,674   105,105,784   112,996,167   116,358,554   120,513,265   124,035,751   126,033,618  B   Less:  Debt  service   (6,806,451)   (6,464,793)   (6,595,894)   (6,444,646)   (6,522,281)   (5,738,570)   (3,201,463)  C   Opera\ng  Expenses   99,805,223   98,640,991   106,400,273   109,913,908   113,990,984   118,297,181   122,832,155  

D   Enrollment  (number  of  Pupils)   3,774   3,557   3,486   3,374   3,202   3,073   2,965  

E   Opera\ng  Expenses  /  Pupil   26,445   27,732   30,522   32,577   35,600   38,496   41,427  

Adjustments  for  Closure  of  Lewisboro  Elementary  School  

F   Current  Opera\ng  Expense  Projec\on   99,805,223   98,640,991   106,400,273   109,913,908   113,990,984   118,297,181   122,832,155  G   Less:  Annual  Savings  from  LES  Closure   (1,717,894)   (1,717,894)   (1,717,894)  H   Pro  Forma  Opera\ng  Expenses   99,805,223   98,640,991   106,400,273   109,913,908   112,273,090   116,579,287   121,114,261  

I   Pro  Forma  Opera\ng  Expenses  /  Pupil   35,063   37,937   40,848  

Source:  Katonah-­‐Lewisboro  School  District  Expenditure  Forecast,  Presented  to  the  Board  of  Educa\on,  December  2012  Savings  from  LES  Closure  sourced  from  School  Closure  Task  Force  Presenta\on  on  November  6th,  2013  

Note:  Savings  from  LES  Closure  exclude  any  incremental  Transporta\on  costs  from  disloca\ng  current  students  in  Lewisboro  Elementary  school  

Closing Lewisboro Elementary School has a minimal impact on lowering the projected Operating Expenses per Pupil

Additional Transportation Expense from Closing an Elementary School

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Source: 2013-2014 Board of Education’s Budget http://klschooldistrict.org/boe/budget_information

Is it reasonable to assume relocating 10% of students adds 10% to the cost of Transportation? If yes, this will add nearly $500,000 per year in additional Transportation expenses

APPENDIX B: SUPPORTING DATA

Enrollment Projection excluding Existing Home Sales & Statistical Forecasting LLC Assumptions Used

This projection assumes the birth rate drops to less than 123 births per year, compared to a 10-year average of 165 and over 200 births per year in the early 2000s PopulaDon       2010  Census  Data  

Lewisboro   12,411  Katonah   1,679  Total  District  Popula\on   14,090  

2010  Student  Enrollment   3,773  2021  Student  Enrollment   2,405  Decline   (1,368)  

Percent  of  total  popula\on   9.7%  

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Year   Births  2002   219  2003   218  2004   192  2005   176  2006   138  2007   165  2008   152  2009   117  2010   138  2011   136  

Birth  Projec\on    2012   123  2013   123  2014   123  2015   123  2016   123  

If graduating students do not stay in the area, and new families do not move in, this implies the local population will decline by nearly 10%

Projected  Enrollment  by  Grade,  excluding  ExisDng  Home  Sales       K   1   2   3   4   5   6   7   8   9   10   11   12   SE   Total   Change  2014-­‐2015   150   205   202   203   227   283   268   247   261   299   268   276   292   21   3,202   (164)  2015-­‐2016   177   158   206   204   202   229   277   266   246   257   297   263   271   20   3,073   (129)  2016-­‐2017   174   186   159   208   203   204   224   275   265   242   255   292   259   19   2,965   (108)  2017-­‐2018   157   154   187   161   207   205   200   222   274   261   241   251   287   18   2,825   (140)  2018-­‐2019   157   165   155   189   160   209   201   199   221   270   259   237   247   17   2,686   (139)  2019-­‐2020   157   165   166   157   188   162   205   200   198   218   268   255   233   17   2,589   (97)  2020-­‐2021   157   165   166   168   156   190   159   204   199   195   217   263   251   16   2,506   (83)  2021-­‐2022   157   165   166   168   167   158   186   158   203   196   194   213   259   15   2,405   (101)  

Adjusted Enrollment Projection with Average Historical Existing Home Resales

The Adjusted Projection with Average Historical Existing Home Resales may be conservative, and projects substantially less growth than experienced in the 1990’s

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    K   1   2   3   4   5   6   7   8   9   10   11   12   SE   Total   Change  Pro  Forma  Enrollment  2014-­‐2015   165   220   217   208   227   283   268   247   261   299   268   276   292   21   3,252  2015-­‐2016   212   193   241   229   207   229   277   266   246   257   297   263   271   20   3,210   (42)  2016-­‐2017   235   247   220   259   228   209   225   276   265   242   256   292   259   19   3,230   19  2017-­‐2018   249   246   279   243   257   230   205   223   274   261   241   251   287   18   3,266   37  2018-­‐2019   288   296   286   310   242   260   226   204   222   270   260   237   247   17   3,363   97  2019-­‐2020   288   298   298   289   308   244   255   224   203   219   269   255   233   17   3,399   36  2020-­‐2021   288   298   300   301   287   311   240   253   223   200   218   264   251   16   3,449   50  2021-­‐2022   288   298   300   303   299   290   305   238   252   220   198   214   260   15   3,479   31  

Average  Enrollment  Growth   32  

    IM  Elem   Katonah  Elem   Lewisboro  Elem   Meadow  Pond   John  Jay  Middle  School   John  Jay  High  School   Total   Change  1993   422   336   374   321   682   748   2,883  1994   473   372   412   329   721   772   3,079   196  1995   516   412   406   357   735   821   3,247   168  1996   571   429   425   355   744   880   3,404   157  1997   621   454   469   349   791   934   3,618   214  1998   562   511   537   404   833   938   3,785   167  1999   549   518   532   411   903   993   3,906   121  2000   535   511   533   422   983   1,000   3,984   78  

Enrollment can grow very quickly in a period of high existing home sales

Existing Home Sales & Estimates for Adjusted Projection

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ExisDng  Home  Sales  Katonah-­‐Lewisboro  

Year   Unit  Sales  1993   205   Average  1993-­‐2007   322  1994   289  1995   286   Average  2008  -­‐  2011   161  1996   295  1997   349   Average  for  20  year  period   284  1998   345  1999   448   EsDmated  Sales  of  ExisDng  Single  Family  Homes  2000   371   Year   Unit  Sales   %  Growth  2001   319   2014   255  2002   343   2015   286   12.0%  2003   335   2016   320   12.0%  2004   352   2017   359   12.0%  2005   369   2018   402   12.0%  2006   247  2007   277   Cumula\ve  Homes  Sold,  2008-­‐2012   843  2008   179  2009   137   Cumula\ve  Homes  Sold,  2014-­‐2018   1,622  2010   170  2011   157   Incremental  Exis\ng  Home  Sales   779  2012   200  

Source:  NYS  Office  of  Real  Property  Services  Note:  Es\mates  and  projec\ons  are  NOT  from  NYS  Office  of  Real  Property  Services  

Questions for Dr. Grip •  1) Can we compare projections made in 1995 to the

actual data 10 years later? •  2) Can we compare projections made in 2005 to actual

data today? •  3) How was the birth rate of 123 births per year for the

next five years chosen? •  4) What does the enrollment forecast imply for the future

population of Katonah & Lewisboro? •  5) How does the demographic distribution of Katonah-

Lewisboro compare to districts studied in previous enrollment projections?

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