200708 FINAL BUDGET PRESENTATION

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2007-08 FINAL BUDGET PRESENTATION

• INDEPENDENT SCHOOL DISTRICT NO. 719
• December 10, 2007

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Topics Of Discussion

• Budget Calendar Process
• 2007-08 Budget Assumptions
• Reserved Fund Balances
• 2007-08 Budget Graphs
• 2006-07 Revenue Expenditure Comparisons
  (Unaudited)

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Budget Calendar

• Long Range Plan Update December
• Budget Development January to February
• Cost Center Budget Reduction Proposals
• Establish building FTE, equipment, and supply
  allocations
• Budget Review Committee February
• Public Hearing March
• Board Approval of Budget Reductions - April
• Preliminary Budget Approval - June
• Proposed Levy Certification September
• Audit Report November
• Truth in Taxation and Final Levy Certification
  December
• Final Budget Approval December

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Budget Calendar Flow Chart
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General Education Funding FormulaHistory
Comparison of Actual Formula and Net Formula
Allowance (less shifts)
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General Education Funding FormulaHistory
Comparison if net formula had increased at the
same rate as the CPI percent change
Source MN House of Representatives, Fiscal
Analysis Department
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Enrollment (ADM) Projection Changes from June 2007

• Grades 1-5 are higher than projected
• Grades 6-8 are as projected
• Kindergarten and Grades 9-12 are lower than
  projected
• Grade 1 to 12 Dec 2007 projections align close to
  demographic study low Kindergarten and low
  migration projection

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Enrollment Projections
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K Enrollment vs. Grade 12
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07-08 Budget Assumptions

• Revenue Assumptions
• 2 basic formula increase
• Kindergarten projection 484
• New weighting factor of .612
• 7,817 Adjusted marginal cost pupil units
• Special education formula change
• Regular special ed 89 proration
• Excess special ed 80 proration
• One-time new capital funding
• Federal programs, interest and other local
  revenues

• Expenditure Assumptions
• April 07 Budget plan
• Cost center reductions
• Special education (MRVSEC) transition
• B-3, Life skills, Academic Alternatives, and
  itinerant staff
• Expenditures for one-time new capital funding
• Federal programs based on entitlements

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2007-08 Updates since June 2007

• Revenue Changes
• Decrease in pupil units projections and interest
  revenue
• Increase in special education revenue
• Increase in special education tuition revenue
• Expense Changes
• Increase in projected utility rates
• Long term subs, lane changes and new hire salary
  updates
• Decrease in interest expense
• Special Education
• Additional fall staffing to serve student needs
  as per IEP
• Increased MRVSEC costs
• Increased Special Ed Tuition
• Addition of site carryovers from 06-07

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Special Services Analysisaverage 48
contribution from general fund
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Reserved Fund Balances

• Learning Development
• Gifted and Talented
• Basic Skills - ELL Compensatory (Remedial)
• Staff Development
• Operating Capital
• Deferred Maintenance
• Safe Schools
• Health Safety

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Summary of Budgets - All Governmental Fund Types

• Three Sections
• Revenues
• Expenditures
• Fund Balances

• Summary of Four Funds
• General - Includes general, transportation,
  operating capital, and special services
• Special Revenue - Includes food service and
  community service
• Debt Service
• Capital Project

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Why maintain fund balance?(the District spends
4.8 million a month in the general fund)

• Sound fiscal management has a long term positive
  impact on the success of students
• Validates fiscal credibility with various
  reporting constituencies (I.e. taxpayers, staff,
  bond counsel, auditors, legislators, and state
  and federal agencies)
• Important to the establishment of a good credit
  rating for the District. Moodys recommends a
  fund balance between 5 and 10.

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Why is fund balance necessary?(a 5 fund balance
3 million)

• Necessary for unknown situations
• Irregular payments of state and local revenues
• State aid proration, metering of payments, and
  state shut down
• Provide service to students prior to receiving
  funding (Special Ed)
• Mandated but not funded programs
• Higher utility costs and/or other fixed costs
• Start Up costs for new buildings
• Greater than expected inflation
• Changes in enrollment and state funding
• Higher than anticipated contract settlements
• Unanticipated deficits in other operating funds
• Costs of defending and/or settlement of a lawsuit

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General Fund Revenue by Source
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2006-07 General Fund Revenue-State
SourcesUnaudited
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2006-07 General Fund Revenue-Local
SourcesUnaudited
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2006-07 General Fund Revenue-Federal
SourcesUnaudited
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2007-08 General Education Aid District Comparison
to State Average for 2007-08 Note Includes
Categorical and Referendum revenue
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District Levy Comparison Last year of current ISD
719 levy is 08-09
Note Grandfathered districts are allowed
to levy above the state cap (state cap
1,476/pu)
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General Fund Expenditure by Object
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General Fund Expenditure by Program
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2006-07 General Fund Expenditures by
Program-District School AdministrationUnaudited
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2006-07 General Fund Expenditures by
Program-District Support ServicesUnaudited
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2006-07 General Fund Expenditures by
Program-Regular Vocational InstructionUnaudited
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2006-07 General Fund Expenditures by
Program-Special Education InstructionUnaudited
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2006-07 General Fund Expenditures by
Program-Instructional Pupil SupportUnaudited
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2006-07 General Fund Expenditures by
Program-Site, Buildings EquipmentUnaudited
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2006-07 General Fund Expenditures by
Program-Fixed and Other CostsUnaudited
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Summary

• The plan is to incrementally move the District in
  a positive financial direction so that all
  available resources are used to provide
  educational opportunities to students

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Summary (cont.)

• This is accomplished by
• Long Range Planning
• Maintain systems that ensure the fiscal stability
  and integrity of the District
• Communicate with Legislators
• Continue to Balance Revenue to Expenditures
• Restore and maintain fund balance

• The major ways to improve the District financial
  position are
• Increased funding from the legislature
• Voter approved levy referendum
• Budget reductions
• A combination of all of the above