Budget Planning Update FY 2015-2016

January 6, 2015

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SUMMARY OF PAST BUDGETS

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PROJECTED REVENUE INC./(DEC.): FY 2008-20091 Changes FY 2014-152

State 54,267,715$ (4,010,024)$ 50,257,691$ State Fiscal Stabil ization Funds (SFSF) 3,221,940 (3,221,940) - Federal 4,021,910 (5,160) 4,016,750 County 35,331,515 6,748,864 42,080,379 Recordation Tax 186,658 38,342 225,000 Local 356,000 112,500 468,500

TOTAL PROJECTED STATE & FEDERAL REVENUE 97,385,738$ (337,418)$ 97,048,320$

1 Fiscal Year 2008-09 state revenue was based on ADM of 9,518.2 Fiscal Year 2014-15 state revenue was based on ADM of 9,475.

SCHOOL BOARD FY 2009-15 BUDGET DESCRIPTION FTE COST TOTAL

INC./(DEC.) FY 2008-2009 BUDGET 1,551.43 $ 97,385,738 Subtotal Base Budget Adjustments (3,236,161) Subtotal Compensation 7,870,969 Subtotal Staffing Requests (91.17) (4,972,226) Total Budget Changes (91.17) (337,418) TOTAL BUDGET 2014-15 1,460.26 $ 97,048,320 Percent Change in Budget -0.35%

According to the Center on Budget and Policy Priorities revised May 20, 2014 (Most States Funding Schools Less Than Before the Recession), Virginia is spending 11.5% less per student in fiscal year 2014 than it did in fiscal year 2008. This percentage has been adjusted for inflation.

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BUDGETED EXPENDITURES FY 2014-15

Total Budget $97,048,320

88.5%

4.7%

6.7%

SALARIES & FRINGES

UTILITIES AND FIXEDCHARGES

SERVICES, SUPPLIES,MATERIALS, & EQUIP.

Continued 4

EXPENDITURE SUMMARY BY MAJOR CATEGORY

DESCRIPTION BUDGET

FY 2013-14 PERCENT BUDGET

FY 2014-15 PERCENTPERSONNEL:

SALARIES 62,716,424$ 66.23% 64,016,589$ 65.96%BENEFITS 20,711,313$ 21.87% 21,914,011$ 22.58%

SUBTOTAL PERSONNEL 83,427,737$ 88.11% 85,930,600$ 88.54%

UTILITIES AND FIXED CHARGESELECTRIC 1,742,593$ 1.84% 1,800,393$ 1.86%HEATING 912,000$ 0.96% 974,500$ 1.00%WATER, SEWAGE, GARBAGE 457,711$ 0.48% 457,711$ 0.47%POSTAL SERVICES 70,809$ 0.07% 70,809$ 0.07%TELECOMMUNICATIONS 233,695$ 0.25% 233,695$ 0.24%INSURANCE PROPERTY 96,915$ 0.10% 96,915$ 0.10%INSURANCE LIABILITY 108,734$ 0.11% 108,734$ 0.11%INSURANCE VEHICLES 82,813$ 0.09% 82,813$ 0.09%VEHICLE FUELS 754,091$ 0.80% 754,091$ 0.78%

SUBTOTAL UTILITIES & FIXED CHARGES 4,459,361$ 4.71% 4,579,661$ 4.72%

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EXPENDITURE SUMMARY BY MAJOR CATEGORY Continued

DESCRIPTION BUDGET

FY 2013-14 PERCENT BUDGET

FY 2014-15 PERCENTSERVICES, SUPPLIES, MATERIALS, & EQUIPMENT

TEXTBOOKS 712,827$ 0.75% 712,827$ 0.73%INSTRUCTIONAL SUPPLIES 1,174,540$ 1.24% 949,353$ 0.98%INSTRUCTIONAL EQUIPMENT 463,103$ 0.49% 446,088$ 0.46%TECHNOLOGY GRANT 709,985$ 0.75% 709,985$ 0.73%PURCHASED SERVICES 1,054,000$ 1.11% 1,149,696$ 1.18%MAINTENANCE CONTRACTS 399,344$ 0.42% 394,581$ 0.41%TUITION 127,010$ 0.13% 127,010$ 0.13%TRAVEL 189,839$ 0.20% 163,953$ 0.17%MISCELLANEOUS 39,688$ 0.04% 38,347$ 0.04%CUSTODIAL SUPPLIES 143,449$ 0.15% 120,357$ 0.12%OFFICE SUPPLIES 165,887$ 0.18% 165,764$ 0.17%BLDG MAINTENANCE SUPPLIES 380,912$ 0.40% 319,594$ 0.33%VEHICLE MAINTENANCE SUPPLIES 171,168$ 0.18% 171,168$ 0.18%EQUIPMENT 330,845$ 0.35% 330,845$ 0.34%FURNITURE REPLACEMENT 17,469$ 0.02% 17,469$ 0.02%TECHNOLOGY SOFTWARE 65,784$ 0.07% 65,784$ 0.07%TECHNOLOGY EQUIPMENT 239,643$ 0.25% 239,643$ 0.25%SCHOOL BUS REPLACEMENT 181,525$ 0.19% 181,525$ 0.19%VEHICLE REPLACEMENT 29,670$ 0.03% 29,670$ 0.03%CAPITAL IMPROVEMENTS 204,400$ 0.22% 204,400$ 0.21%

SUBTOTAL SERVICES, SUPPLIES, MATERIALS, & EQUIP. 6,801,088$ 7.18% 6,538,059$ 6.74%

TOTAL BUDGET $ 94,688,186 $ 97,048,320

* Periodically the budget is realigned to more acturately reflect actual expenditures.

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HISTORY OF BUDGETED STATE AND COUNTY REVENUE

State Revenue, $50,257,691

County Revenue, $42,080,379

25,000,000

30,000,000

35,000,000

40,000,000

45,000,000

50,000,000

55,000,000

60,000,000

65,000,000

FY 02-03

FY 03-04

FY 04-05

FY 05-06

FY 06-07

FY 07-08

FY 08-09

FY 09-10

FY 10-11

FY 11-12

FY 12-13

FY 13-14

FY 14-15

Amou

nt R

ecei

ved

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HISTORY OF BUDGETED REVENUE ALL SOURCES

YEAR STATE FEDERAL LOCAL COUNTY

STATE RECORDATION

TAX RESERVE FROM PRIOR BUDGET

TOTAL REVENUE NET INC INC (DEC)

FY 14-15 50,323,798 4,016,750 468,500 42,080,379 225,000 - 97,114,427 2,426,241 2.64%

FY 13-14 47,846,814 4,067,493 468,500 42,080,379 225,000 - 94,688,186 2,719,006 2.96%

FY 12-13 47,146,655 4,386,636 468,500 39,742,389 225,000 - 91,969,180 688,377 0.75%

FY 11-12 48,447,862 5,548,831 420,000 36,414,191 186,658 263,261 91,280,803 2,663,983 3.01%

FY 10-11 47,637,702 4,118,941 356,000 35,714,191 148,467 641,519 88,616,820 (7,807,904) -8.10%

FY 09-10 56,781,036 3,997,050 356,000 35,103,980 186,658 - 96,424,724 (961,014) -0.99%

FY 08-09 57,489,655 4,021,910 356,000 35,331,515 186,658 - 97,385,738 7,644,042 8.52%

FY 07-08 51,999,063 3,652,999 290,000 33,612,976 186,658 - 89,741,696 3,323,348 3.85%

FY 06-07 50,362,611 3,528,020 210,000 32,026,203 291,514 - 86,418,348 7,352,057 9.30%

FY 05-06 43,973,234 3,510,714 210,000 31,080,829 291,514 - 79,066,291 3,966,339 5.28%

FY 04-05 41,337,066 3,402,812 210,000 29,858,560 291,514 - 75,099,952 6,226,647 9.04%

FY 03-04 36,436,148 3,065,330 210,000 28,870,313 291,514 - 68,873,305 1,618,418 2.41%

FY 02-03 35,422,442 2,538,485 490,080 28,512,366 291,514 - 67,254,887

AVERAGE DAILY MEMBERSHIP (ADM)

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TOTAL ADM, 9,480

9,250

9,300

9,350

9,400

9,450

9,500

9,550

31-Mar-10 31-Mar-11 31-Mar-12 31-Mar-13 31-Mar-14 31-Mar-15 31-Mar-16

ACTUAL ACTUAL ACTUAL ACTUAL ACTUAL PROJECTED PROJECTED

ADM

Governor’s Proposed Budget FY 2015-2016

• No additional cuts or program reductions for elementary and secondary education.

• $75 million will be allocated from the Literary Fund to be used for school construction loans ($50 million) and interest rate subsidies on loans through the Virginia Public School Authority ($25 million).

• $150 million will be allocated from the Literary Fund to be used to reduce the unfunded liability of the teacher retirement fund.

• $572,976 for five additional positions at the Department of Education to strengthen the Department's support of academically struggling school divisions.

• $200,000 for expedited retakes of Standards of Learning assessments for students in grades three through eight.

• $732,000 of one-time funding to transition the grade seven and grade eight Standards of Learning mathematics tests to a computer adaptive testing (CAT) format. Currently, only the grade six mathematics assessment is available in a CAT format.

• $713,000 to establish a program of professional development to increase the capacity of principals in under-performing schools. The funding amount covers training for 40 principals at schools which have failed to meet accreditation standards.

• $537,297 for school divisions for innovative methods of serving breakfasts to unserved or underserved children.

• Budget language in the second year of the biennium that authorizes the transfer of allocated Preschool slots that have not been used by school divisions to other divisions that have fully utilized their state allocated slots. The additional slots will allow divisions with full participation to offer preschool programs to children on waiting lists.

• $500,000 for broadband planning grants to localities, pursuant to budget language change.

9 Bullet Points from VSBA

These key areas of the Governor’s proposed budget are reflective of K-12 state changes, not just Montgomery County.

Governor’s Proposed Budget FY 2015-2016

Continued 10

PROJECTED REVENUE PROJECTED REVENUE NETSTATE FY 2014-15 STATE FY 2015-16 CHANGE

DESCRIPTION ADM 9475 ADM 9480SOQ PROGRAM:

1 BASIC STATE AID 25,831,641$ 25,596,059$ (235,582)$ 2 STATE SALES TAX 10,215,457 10,572,990 357,533 3 TEXTBOOKS 446,525 207,131 (239,394) 4 VOCATIONAL ED 680,254 680,359 105 5 GIFTED ED 273,264 273,307 43 6 SPECIAL ED 3,331,500 3,332,013 513 7 REMEDIAL ED 715,139 715,249 110 8 RETIREMENT 3,250,102 3,157,562 (92,540) 9 SOCIAL SECURITY 1,587,259 1,587,504 245

10 GROUP LIFE 110,469 98,856 (11,613) 11 REMEDIAL SUMMER 62,534 17,480 (45,054) 12 SUBTOTAL 46,504,144 46,238,510 (265,634) 1314 INCENTIVE PROGRAMS:15 eBACKPACK - 213,600 213,600 16 TECHNOLOGY INITIATIVE 570,000 570,000 - 17 SUBTOTAL 570,000 783,600 213,600

Governor’s Proposed Budget FY 2015-2016

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Continued

PROJECTED REVENUE PROJECTED REVENUE NETSTATE FY 2014-15 STATE FY 2015-16 CHANGE

DESCRIPTION ADM 9475 ADM 948019 CATEGORICAL ACCOUNTS:20 SP ED HOMEBOUND 58,824 57,131 (1,693) 21 SP ED HOSPITAL 372,767 390,455 17,688 22 ADULT ED-STATE 9,781 - (9,781) 23 SPEC ED IN JAIL 3,146 - (3,146) 24 SUBTOTAL 444,518 447,586 3,068 2526 LOTTERY FUNDED PROGRAMS:27 FOSTER CARE 94,452 113,823 19,371 28 AT RISK 522,558 522,186 (372) 29 AT RISK 4 YR OLDS 585,374 662,472 77,098 30 READING INTERVENTION 192,609 176,987 (15,622) 31 MENTOR TEACHER PROGRAM 6,132 6,551 419 32 REDUCE K-3 CLASSES 812,456 757,900 (54,556) 33 SOL ALGEBRA READINESS 95,732 85,878 (9,854) 34 ALTERNATIVE ED 140,982 140,034 (948) 35 ISAEP/GED FUNDING 15,717 15,717 - 36 VOCATIONAL EDUCATION 85,764 86,545 781 37 ESL 140,449 145,189 4,740 38 TEXTBOOKS 112,911 352,391 239,480 39 SUBTOTAL 2,805,136 3,065,673 260,537 40 TOTAL 50,323,798$ 50,535,369$ 211,571$

Budget Planning Calendar

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BUDGET PLANNING CALENDARFY 2015-16

DATE DESCRIPTION LOCATION

July - August 2014 Closeout prior year 2013-14; Distribute budget for current year 2014-15; Prepare Annual Report 2013-14.

September 16, 2014 Annual Report FY 2013-14 due to DOE.

September, 2014 Preliminary budget planning FY 14-15. Discuss outlook with Directors and Leadership.

October 1, 2014 Begin update of the Base Budget for FY 15-16.October 21, 2014 School Board meeting. Adopt budget planning calendar. County Government CenterDecember 17, 2014 Gov's proposed budget to General Assembly. January 6, 2015 School Board meeting. Discussion of budget and revenue forecast. County Government CenterJanuary 15, 2015 Special Meeting for Budget Discussion County Government CenterJanuary 20, 2015 School Board meeting. Adopt budget for public hearing. County Government CenterJanuary 27, 2015 Special Meeting for Public hearing on proposed budget. County Government CenterFebruary 3, 2015 School Board meeting. Approve initial budget request. County Government CenterFebruary 6, 2015 School Board budget request forwarded to County Administration.February 28, 2015 General Assembly adjusts the 2014-2016 Biennium State Budget.April 17, 2015 State revenue FY 2014-15 updated based on Mar 31 ADM.April 30, 2015 Initial projection of year-end closeout FY 2014-15.

April, 2015 School Board budget request updated based on actions of the General Assembly and the Board of Supervisors.

April 23, 2015 Special Meeting. Budget Work Session. County Government CenterApril 28, 2015 Special Meeting. Public hearing on proposed budget. (Optional) County Government CenterMay 5, 2015 School Board meeting. Approve final budget for FY 2015-16. County Government Center

May 8, 2015 Cutoff for submission of PO's for FY 2014-15. PO's must be entered, received, and approved in Munis. Finalize 2015-16 budget documents.

May 19, 2015Project closeout revenue and expenditures FY 2014-15. Proposed year-end closeout plan presented.

June 30, 2015 Close out fiscal year 2014-15.

Note: Items in bold are School Board meeting dates.

Proposed Budget Goals FY 2015-2016

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The identified budget goals are under the following five categories: 1. Enhance Student Programs 2. Salary 3. Safety 4. Fiscal Responsibility through Community Engagement 5. Instructional Expenditures State goals are as follows: 1. To design and adopt a budget that preserves the programs for MCPS students to

the greatest extent possible. 2. To adjust compensation for all employees using a long-term salary plan that

includes a competitive benefits package. 3. To pursue proper funding allocations to ensure we maintain a safe and orderly

environment for all staff and students in all MCPS facilities and transportation modes.

4. To design and adopt a budget that reflects the fiscal reality for Montgomery County residents and maximizes available resources and fully engages the community for public education.

5. Increase the percentage of expenditures for classroom teaching, teaching support, technology, and instruction materials.

What’s Next??

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Tentative Key Budget Dates for the State

•January 14, 2015 – General Assembly convenes

•February 1, 2015 – Budget bill crossover occurs

•February 21, 2015 – General Assembly adjourns

•April 15, 2015 – Reconvened General Assembly session occurs

The 2015-2016 Budget Planning website will be updated with this presentation and any additional information received. Last year, the 2014-2015 Budget Planning website received the Award of Excellence from Chespra, the highest award given by this organization. The new 2015-2016 website has additional features and a more visual interface than last year's, providing our citizens with even more information in an easy-to-read format.

Questions

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