proposed preliminary 19-20 presentation - new hope-solebury … · 2019-01-03 · sy 2019‐2020...

PreliminaryBudgetSY2019‐2020

NewHope‐SoleburySchoolDistrict

2019‐2020Preliminary

BudgetPresentation

• BudgetGoals• SchoolDistrictBudgetBasics• 2019‐2020BudgetProcess• 2019‐2020BudgetHighlights• BudgetTimeline

Offerthebestqualityeducationpossibleforourcommunity’schildrenOffer

IncreasestudentachievementandgrowthIncrease

ProvidecomprehensiveservicestostudentsProvide

AligntoclasssizeguidelinesAlign

EncourageprofessionaldevelopmentandprofessionalgrowthEncourage

DevelopashortandlongtermplanforcapitalprojectsDevelop

SY2019‐2020

BudgetaryGoals

Act1of2006

• Establishes a set index by which property taxes cannot be raised beyond• 2019 – 2020 index is set at 2.3%

• Districts can apply for exceptions to increase property taxes beyond the index• Increases in Retirement, Special Education• Fund Balance below required threshold

• Budget approval can take 1 of 2 paths• Adopt a resolution to remain within the Act 1 Index

• Adopt a resolution authorizing proposed preliminary budget display and advertising

Act1of2006Recommendation

• Adopt a resolution authorizing proposed preliminary budget display and advertising

• Apply for exceptions allowing for a tax increase up to 2.75% (estimate)

• Review, Refine and Adjust until final form in June• This path does not set a final property tax rate – just the basis for approval of exceptions

• Allows for the most flexibility and opportunity

FundBalance

• Fund Balance – Difference between assets and liabilities• Equate it to your savings account• Unsustainable to pay your mortgage with savings – eventually run out of money

• Fund Balance should be used strategically, not to pay for recurring expenses.• Pre‐planned purposes, one‐time expenditures, unexpected items

• Not – Increases in salaries and benefits• Fund Balance is also essential for cash flow purposes.

2019‐2020BudgetProcess

• October2018• BeganbudgetdiscussionswithLeadershipTeam

• NeedsBasedbudgetphilosophy.

• November2018• Budgetsreviewedinternallywithbuilding/departmentowners

• December2018• Afirstlookwaspresentedtothefinancecommittee

• December2018• Boardapprovaltomoveforwardwithadvertisingpreliminarybudgetnoticeforpublicinspection.

• SY2011‐2012toSY2015‐2016• Totalexpenditureincreaseof20%or4%peryear

• TaxRateincreaseof8.8%or1.76%peryear

• SY2016‐2017toSY2018‐2019• Totalexpenditureincreaseof3.29%or1.10%peryear

• SY2019‐2020• Bringtheseincreasesbackinline.• Ideallyexpenditureincreaseshouldbebelowtaxrateincreaseaspropertytaxesareonlyonerevenuelineitemmakingup70%ofrevenue.

BudgetHistory

PreliminaryBudgetHighlightsBudgetaryAreas 2018‐2019 2019‐2020 Change

Expenditures 41,054,823 42,123,332 2.60%

Revenues 41,054,823 42,029,140 2.37%

UseofFundBalance 0 94,192

EndingUncommittedFundBalance

3,268,811 3,174,619

FundBalanceasa%ofExpenditures

7.96% 7.54%

SY2019‐2020Revenues

RevenueComparison– Increaseof$975,000 TaxIncrease– 2.3%generates$745,000innewrevenue

ReferendumExceptionsgenerateanadditionalestimatedamountof$134,000(2.75%taxincrease) OtherLocal– Increaseof$50,000forinterestearnings StateRevenue– Increaseof$197,000

EducationFunding– Flatto17‐18finalPDEbudget– Increaseof$20,000 RetirementandSocialSecuritySubsidy– Increaseof$165,000

FederalRevenue– Decreaseof$150,000 StillworkingonusageofSBAPfunds– Equaloffsetofrevenuesandexpenses– Noimpacttobudget

RevenueType2017‐2018Actual

2018‐2019Budget

2019‐2020Preliminary Change

%ofTotalRevenue

6000Local 34,634,549 34,191,554 35,121,128 929,574 84%7000State 6,365,485 6,489,370 6,686,063 196,693 16%8000Federal 86,906 373,899 221,950 (151,950) 1%Total 41,086,940 41,054,823 42,029,140 974,317

SY2019‐2020Preliminaryvs18‐19FinalBudgetSummaryofChanges– SalaryandBenefits

ExpenditureReduction/(Increase)

Increase(Decrease)

Description

Salary 390,000 NHSEAincreasespercontract– July1,2017 toJune30,2021SupportStaffincreasespercontract– July1,2018toJune30, 2022Act93increasespercontract– July1,2018toJune30,2023Nochangestostaffinginthepreliminaryversionofthebudget

Medical/Rx 105,000 NHSDparticipatesintheBucksandMontgomeryHealth Carebenefits consortiumwith11otherschooldistricts.Firstlookofbenefitsrates– 7%increase

Dental 20,000 DentalratesarecompletedinApril– 10%placeholder

PSERS 300,000 PSERSrateiscertified at34.29%andtheprojectionwas34.69%.Current is33.43%.PSERSexpensefor2018‐2019isestimatedtobe$6.4Mor15%oftotaloperatingbudget

• MedicalRenewalrateshavebeentrendingpositively• Renewalrateaveragelast3years–2.75%

• Includesmedicalandprescription• Firstlookratestendtotrendhigherthanthefinalrates:• 21monthsoftrend– 8%trendrate• Finallookwillhavemoreactualdata

• Finalrates‐ April18th.• PlanCostsforMedical/Prescription

• SinglePlanCost– $8,750• FamilyPlanCost‐ $25,500• Premiumsharerangesfrom10%‐13.5%

BucksandMontgomeryHealthCareConsortium

PSERSImpact

 ‐

 1,000,000

 2,000,000

 3,000,000

 4,000,000

 5,000,000

 6,000,000

 7,000,000

 8,000,000

10/11 11/12 12/13 13/14 14/15 15/16 16/17 17/18 18/19 19/20 20/21 21/22 22/23

PSERS ‐ Employer Costs

Employer Cost Net of State Reimbursement

SY2019‐2020Preliminaryvs18‐19FinalSummaryofChanges– OtherFunctionsExpenditureReduction/

(Increase)Increase(Decrease)

Description

Electricity (60,000) Consortium Pricing– Ratereductionfor2019‐2020Ratefor19‐20is.072perkWhdownfrom.083perkWh

1:1ProgramDevicePurchase 150,000 300,000 budgetedforreplacementofHS/MS1:1devices.150,000 in2018‐19budgettotransfertoatechnologycommittedfundforthepurchasein19‐20.

SpecialEducationCosts 100,000 BCIU– Increaseof$200,000forstudentplacementsOutofDistrictTuition– Reductionof$100,000

CharterSchoolTuition 40,000 1additionalcharterschoolstudent– SpecialEducation

Transportation 0 Contract endsJune30,2018Increaseincludedfornewagreement– reductionof1busfromcurrentbudgetimplementedthisyear.

CapitalImprovement Placeholder 0 2018‐2019 budgetis$243,000andthepreliminarybudgetincludesthesameamountforpotentialcapitalprojectneeds.

BudgetaryReserve 0 100,000forgeneralbudgetaryunknownitems50,000fordonations

2019‐2020PreliminaryBudgetScenarios19‐20 20‐21 21‐22 22‐23

Beginning Fund Balance 5,728,811         4,806,687         3,602,332         1,833,971        

Total Revenue ‐ 0.00% Tax Increase 41,201,209       41,948,079       42,709,147       43,511,652      Total Expenditures 42,123,332       43,152,434       44,477,509       45,600,963      Surplus / (Deficit) (922,124)           (1,204,355)       (1,768,361)       (2,089,311)      

Ending Fund Balance 4,806,687         3,602,332         1,833,971         (255,340)          

19‐20 20‐21 21‐22 22‐23Beginning Fund Balance 5,728,811         5,499,133         5,001,072         3,953,131        

Total Revenue ‐ 2.30% Tax Increase 41,893,654       42,654,374       43,429,568       44,246,481      Total Expenditures 42,123,332       43,152,434       44,477,509       45,600,963      Surplus / (Deficit) (229,678)           (498,061)           (1,047,941)       (1,354,482)      

Ending Fund Balance 5,499,133         5,001,072         3,953,131         2,598,650        

19‐20 20‐21 21‐22 22‐23Beginning Fund Balance 5,728,811         5,634,619         5,274,754         4,367,772        

Total Revenue ‐ 2.75% Tax Increase 42,029,140       42,792,569       43,570,527       44,390,260      Total Expenditures 42,123,332       43,152,434       44,477,509       45,600,963      Surplus / (Deficit) (94,192)             (359,865)           (906,981)           (1,210,703)      

Ending Fund Balance 5,634,619         5,274,754         4,367,772         3,157,069        

Scenario 1 ‐ 0.00% Tax Increase

Scenario 2 ‐ 2.30% Tax Increase ‐ Act 1

Scenario 3 ‐ 2.75% Tax Increase ‐ Act 1 plus Exceptions

 33,000,000

 35,000,000

 37,000,000

 39,000,000

 41,000,000

 43,000,000

 45,000,000

 47,000,000

12‐13 13‐14 14‐15 15‐16 16‐17 17‐18 18‐19 19‐20 20‐21 21‐22 22‐23

Expense to Revenue Gap continues to Trend Apart

Revenue Current Expense Current

 ‐

 1,000,000

 2,000,000

 3,000,000

 4,000,000

 5,000,000

 6,000,000

 7,000,000

 8,000,000

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

Fund Balance Projections

Final 18‐19 Prelim ‐ 19‐20

NewHope‐Solebury MillageHistoryFiscalYear TaxRate Change AverageTax

BillAverageIncrease

%Increase Act1Index

2009/2010 79.84 3.14 4,316 170 4.09% 4.10%

2010/2011 82.15 2.31 4,441 125 2.90% 2.90%

2011/2012 83.30 1.15 4,503 62 1.39% 1.40%

2012/2013 84.72 1.42 4,579 76 1.70% 1.70%

2013/2014 86.16 1.44 4,657 78 1.70% 1.70%

2014/2015 87.96 1.81 4,755 98 2.10% 2.10%

2015/2016 89.64 1.67 4,845 90 1.90% 1.90%

2016/2017 93.94 4.30 5,078 233 4.80% 2.40%

2017/2018 97.69 3.76 5,279 201 4.00% 2.50%

2018/2019 100.04 2.34 5,420 141 2.40% 2.40%

2019/2020 102.79 2.75 5,569 149 2.75%* 2.30%

*Final tax increase is not approved until the final budget in May/June

BudgetaryUnknowns

• Staffing/Enrollment• State/FederalRevenues• MedicalBenefitsrate• MBITenrollment• MBITCapitalProjectsFinancing• CharterSchoolEnrollments• TransportationContract

Summary

• FinancialPositionofthedistrictisstable• RecommendingapprovalofthisPreliminaryBudgettobeputonpublicdisplaytoapproveatJanuaryBoardmeeting

• Applyforreferendumexceptionsforflexibility• Thisisnotafinalbudgetandyouarenotsettingataxratetonight.• Thisisthefirststepalonga6monthprocesstotheadoptionofafinalbudget.

• Thispresentationonlyincludesthebudgethighlights• Supplementaldataandreportsareincludedinthebudgetpacket• IncludingformPDE‐2028whichistheofficialbudgetdocumentsubmittedtoPDE

Timeline

• December 20 – Approval to display and advertise preliminary budget.

• January Board Meeting• Approve Preliminary Budget• Authorize the District to file for referendum exceptions

• February – April/May• District continues to review and update budget and provides monthly updates at the Finance Committee meetings.

• May Board –Proposed Final Budget Adoption Resolution• Authorize Proposed Final Budget Advertising and Public Inspection

• June Board – Final Budget Adoption Resolutions

QUESTIONS?