Proposed Budgets for K12 Funding

1
Proposed Budgets for K-12 Funding

• 2005-07 Biennium
• 2005-06 and 2006-07 School Years

2
Big Picture

• Delayed Budget
• Court Decisions (lost 274.8 million)
• Revenue Forecast (gained 438.3 million)
• 1.8 billion deficit
• Summary of Gov., House, Senate Responses
• Taxes Increased
• Transfers from Other Funds
• Program Cuts
• Program Adds

3
Big Picture - Continued

• New Revenue Forecast was up 163 million from
  December, net of Estate Tax change
• Budgets are balanced using combinations of cuts
  and revenue adds, as shown below.

4
K-12 Budget Overview not including Student
Achievement Fund/I-728

• Total General Fund-State increased
• 2003-05 biennium 10.2 billion
• 2005-07 Gregoire 10.8 billion
• Senate 10.9 billion
• House 10.9 billion
• Per Pupil funding increased
• 2003-05 biennium 5,274
• 2005-07 Gregoire 5,569
• Senate 5,623
• House 5,636

5
Special Education Comparison
6
Special Education continued
7
Learning Assistance ProgramComparison
8
I-728 Proposal

• 2004-05 per pupil 254
• 2005-06 per pupil 300
• 2006-07 per pupil 375
• Total for 2005-07 biennium 629 M (138 M new
  funding)
• Gov Senate fund 2005-07 amounts in excess of
  the 254 base with new taxes (estate and
  cigarette). House uses property tax funding and
  adds cigarette.

9
Gov Senate I-728 Funding Source

• Estate and Tobacco taxes
• 138 million dedicated to 2005-07 I-728 step-up
• Excess revenue in 2005-07 biennium is transferred
  to other uses
• 64 M in Gov, 165 M in Senate
• Cigarette tax escalates in 2007-09 in order to
  fund the next step-up of I-728 (450 per pupil)
• If new revenues do not cover the I-728
  obligations, GF-S is automatically triggered to
  fully fund the obligation

10
House I-728 Funding Source

• Increases cigarette tax by 60 cents/pack.
• Continues the property tax funding for I-728
  base.
• In the 2005-07 biennium, the 174 million in
  cigarette tax revenue is deposited into the SAF
  and then transferred to the State General Fund.

11
Employee Compensation
12
Employee Compensation

• Health Benefits
• K-12 average rate
• Governor 654.00
• Senate 658.84
• House 654.32

13
Employee Compensation

• State Employee Health Benefits

14
Employee Compensation

• Pension Rates

15
Pension Rate Concerns

• Earlier projections by State Actuary were that
  2005-07 rates would dramatically increase.
• Gregoire, Senate and House proposed budgets with
  lower than anticipated rates and corresponding
  policy changes.
• Gregoire proposes changing gain sharing for plan
  3 and altering actuarial funding of plans.
• Senate proposes changing gain sharing for plans 1
  and 3 and doesnt fund the unfunded liabilities
  in plan 1.
• House proposes changing gain sharing and doesnt
  fund the unfunded liabilities in plan 1.

16
Levy Equalization
17
Pupil Transportation

• 2004-05 bidding language remains in place.
• Districts able to purchase any bid on state
  quote, reimbursed at low bid price
• Depreciation methodology changed to 5-year
  rolling average, assumed savings6.5 M from ML.
• Senate and House include language to allow OSPI
  to develop methodology that is least disruptive
  to districts.

18
Pupil Transportation (contd)

• Current (2004-05) depreciation 33.7 M
• Gov, Senate and House amounts
• 2005-06 30.3 M
• 2006-07 33.2 M
• Purpose of new methodology is to even out
  depreciation. For example 2001-02 13.8 M,
  2002-03 30.7 M, and 2003-04 19.8 M
• Currently working on forecasting tool to estimate
  impacts on districts.

19
Other ItemsNot Previously Mentioned
20
Governors Capital ProposalSchool Construction
Highlights

• Increase of 28 million in proposed expenditures
• Area Cost Allowance Enhancement of 10/sq.ft. to
  139.81
• Additional 167 million in General Obligation
  bonds
• Increase of 30 million in Lottery Revenue
• Decrease of 20 million in Trust Land Transfer
  Revenue

21
Senate Capital Budget Highlights

• Increase of over 100 million in proposed
  expenditures
• Enhancement to area cost allowance from 129.81
  to 141.95 in FY 2006 and 154.22 in FY 2007
• Increase in student space allocation up to the
  first step in the State Boards six-year plan
• Skill Centers funding at 17.9.
• Change in the trust land transfer program to the
  state granted lands lease program and increase in
  revenue of 26 million

22
House Capital Budget Highlights

• Increase of over 200 million in proposed
  expenditures
• Enhancement to area cost allowance from 129.81
  to 142.67 in FY 2006 and 155.54 in FY 2007
• Increase in student space allocation up to the
  first step in the State Boards six-year plan
• Increase in state assistance for modernization
  projects from 80 to 100 of the area cost
  allowance
• Additional funding for High Performance Schools
  of 6.5 million
• Skill Centers funding at 3.9 million

23
School Construction Proposals Comparison
24
School Construction Proposals Comparison
25
Thank you!

• www.k12.wa.us