Shaker Heights City School District FINANCE FACTS 2006

1
Shaker Heights City School DistrictFINANCE
FACTS2006
2
The District An Overview

• People
• 5600 students PreK-12
• 800 FTE employees
• Teachers average 16 years of experience
• Physical Plant Operations
• 12 buildings (8 schools, 4 support)
• 900,000 square feet in buildings, 95 acres of
  grounds
• 50 buses transport 4000 public private
  students/day
• General Fund Budget
• 82.1 million FY2006

3
(No Transcript)
4
General Fund Expenses 2004-05
Total 77.2 million
5
Program Allocation of Budget
INSTRUCTION, PUPIL TEACHER SUPPORT 67
SCHOOL BUILDING ADMINISTRATION 7
CENTRAL SUPPORT SERVICES 2
GENERAL ADMINISTRATION 1
CO-CURRICULAR ACTIVITIES 1
COMMUNITY OTHER 1
BUSINESS SERVICES (includes physical plant
operations, transportation treasury) 21
6
Detrimental Impacts on Revenue

• House Bill 920
• Erosion of Tax Base
• Tax Delinquencies
• Phantom Revenue
• House Bill No. 66

7
Revenue House Bill 920

• Eliminates growth in school revenue from property
  taxes,
• even when property values rise.
• Consequently, the Districts
• income remains flat.

8
Revenue Tax Base Erosion

• Deregulation of the Electricity
• Natural Gas Industries (starting FY02)
• Reduction of assessed value from 88-100 to 25
• Assessed valuation loss of 6.6 million
• 946,000 in revenues lost per year
• State reimbursement for 5 years (15 in some
  districts)

9
Revenue Tax Base Erosion

• House Bill No. 66
• Repeal of Tangible Personal Property Tax
  (starting FY06)
• Phase-out over 4 years
• Loss of 2 million/year in current dollars
• Partial reimbursement for 4 yrs, then phased out

10
Revenue Tax Base Erosion

• Repeal of Inventory Property Tax (starting FY01)
• Phase-out period accelerated from 25 to 13 years
• Loss of 500,000/year in current dollars
• No reimbursement
• Repeal of Exempt Personal Prop.Tax(start FY04)
• Reduction over 10 years
• Loss of 300,000/year in current dollars
• No reimbursement
• Current year loss about 30,000

11
Revenue State Support Decline

• House Bill No. 66
• Elimination of Cost of Doing Business Factor
  (starting FY06)
• 6.26 supplement per pupil (324/pupil in F06)
• Phase-out over 2 years
• Loss of 2 million/year in current dollars when
  fully implemented
• Current Biennium Guarantee

12
Primary Cost Pressures

• Salaries Benefits
• Unfunded Underfunded Mandates
• Energy Costs

13
Cost Pressures Salaries Benefits

• Education is people-intensive vs.
  capital-intensive
• Districts largest single expense
• Negotiated contracts
• Cost-of-living adjustments
• Insurance

14
Cost Pressures Mandates

• Special Education
• IDEA Individuals with Disabilities Education
  Improvement Act
• Out-of-District Tuition
• Transportation
• Tutors Aides
• No Child Left Behind
• Testing
• Recordkeeping and reporting
• Intervention

15
Cost Pressures Energy

• Natural Gas
• Supply Demand Drive Price
• Severity of Winter Drives Consumption
• Monthly Bill Increase from 52,000 to 108,000
• Bus Fuel
• Prices Fluctuate
• Electricity
• Growing Use of Technology Increases Consumption

16
Revenues Expenses(without reductions)(millions
of s)
17
Alternative Revenue Sources
18
Operating Levy Cycles

• Since HB 920 was enacted in 1976, the District
  has passed 12 operating levies.
• From 1976 to 1983, the interval between levies
  was one or two years.
• Since 1983, a three-year levy cycle has been the
  norm.

19
Taxable Value per Pupil
127,000
Warrensville Heights
158,000
CH-UH
158,000
Shaker Heights
196,000
S. Euclid-Lyndhurst
211,000
Richmond Heights
230,000
Chagrin Falls
234,000
Solon
345,000
Mayfield
422,000
Orange
Beachwood
516,000
Source Ohio Department of Taxation
20
Millage Yield Comparison
3.3
158,000 516,000
Shakers Taxable Value per Pupil
Beachwoods Taxable Value per Pupil
3.3 mills are needed in Shaker to yield the same
amount of tax income per pupil as 1 mill
yields in Beachwood
21
How much will the levy cost?
25.25 per month or 5.83 per week per 100,000
of market value
22
Effective Millage
School taxes as a proportion of home values have
remained constant for 30 years
(Note-1977 through 1988 effective rates
approximated)
23
Housing Values

• Schools are the 1 reason people move to Shaker
  Heights
• Since 1990, housing values have increased by 90

24
Responsible Stewardship

• Consistently clean annual audits
• Numerous awards for excellence in financial
• reporting practices
• Spending capped by Board since 1995
• All financial targets achieved through cost
  containment reduction efforts
• Aggressive pursuit of outside funding
• Grants averaging 2.2 million/year
• E-Rate funds 500,000 cumulative
• Special education reimbursements 500,000/year

25
Cost Containment Measures

• Cooperative Purchasing
• Buses, supplies, food products, utilities, fleet
  insurance, vehicle fuel, computers
• Energy Management
• Window replacements, temperature controls, boiler
  improvements
• Technology
• Electronic distribution of data documents,
  shift to fiber network, switch to state software
  for financial and student data
• Efficient Operations
• Ongoing savings from right-sizing in 1987,
  consortia for special and vocational education
• Workers Comp Health Insurance
• Contingent premium Option 1,100,000 savings
• Implementation of PPO Health Insurance Plan
• Workers Comp Retro Plan 1,400,000 savings

26
Shaker Heights Households
27
Resources

• www.shaker.org/2006levy
• Finance Audit Report
• Auditor of States Report
• FAQs
• E-mail a question or report a rumor to
  levyinfo_at_shaker.org