Fiscal Regulations December 2004-June 2005

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Fiscal RegulationsDecember 2004-June 2005

• N.J.A.C. 6A10A-7 8

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7.1 Discretionary Education Opportunity Aid
Governance Mid-year Awards

• Fiscal and Program Standards for DEOA
  Disbursements
• Mid-year Award Application Procedures

No Significant Changes
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6A10A-7.2 Cost Efficiency in 2005-2006 Budgets

• Department Efficiency Study (DES)
• Review of Administrative Cost Limits
• Presumptive Budget Calculation
• Incremental Cost of Opening a New School Facility
  
• Education Opportunity Aid (EOA) in 2005-2006

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Department Efficiency Study

• Compares Median per Pupil Spending in 9 Cost
  Areas with Other School Districts
• Compares Median per Pupil Spending in 6 Groups

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DES Cost Reductions Applied in Priority Order

1. Spending for more effective instruction
2. Spending for greater efficiency
3. Funding for inflation
4. Reductions in the school districts request for
   DEOA.

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Administrative Cost Limits

• Administrative costs may not increase by more
  than 2.5 or the cost of living, whichever is
  greater.

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Presumptive Budget Calculation

• The Department will calculate the presumptive
  budget as the 2004-2005 base budget (including
  DEOA) increased by 2.5 or CPI, whichever is
  greater, plus the incremental new school facility
  costs approved by the Department.

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Base Budget Includes

• 2004-2005 statutory formula aids
• DEOA
• Education Opportunity Aid (EOA)
• General fund tax levy
• Budgeted general fund balance
• Miscellaneous unrestricted revenues
• Less adjustments for capital outlay and capital
  reserve

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Statutory Formula Aids Used in Base Budget
Calculation

• Core curriculum standards aid
• Supplemental core curriculum standards aid
• School choice aid
• Transportation aid
• Special education aid
• Bilingual education aid
• Stabilization aid
• Supplemental stabilization aid
• Consolidated aid
• ECPA
• DEPA

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Miscellaneous Unrestricted Revenue Used in Base
Budget Calculation

• Transfers from other funds
• Unrestricted revenues from other local
  governmental units
• Non-resident tuition fees
• Unrestricted miscellaneous revenues
• Unrestricted revenues from intermediate sources.

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Incremental Cost of Opening a New School Facility

• Requests were due to the Department by November
  30, 2004.
• Requests will be reviewed by the Department and a
  determination will be made on the amount
  necessary to meet the incremental new facility
  cost.

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Education Opportunity Aid (EOA) in 2005-2006

• EOA will be calculated as the greater of
• EOA formula funding (parity)
• OR
• EOA using the presumptive budget formula pursuant
  to N.J.A.C. 6A10A-7.2(g).

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6A10A-7.3 Application for DEOA in 2005-2006

• Abbott School Districts May Apply for DEOA in
  2005-2006 through the process outlined in the
  code (N.J.A.C. 6A10A-7) and summarized here.

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DEOA Eligibility Criteria

• School district must have met all the conditions
  for disbursement of DEOA in FY 05 and must
  continue to maintain minimal, customary and
  statutory standards for efficient financial
  management and business operations and continue
  to follow customary, basic and required
  instructional standards, policies and practices
  as set forth in
• N.J.A.C. 6A10A-7.1.

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DEOA Eligibility Criteria

• Foundational education program
• Aligned preschool -12 curriculum
• Documented use of a student-level database to
  evaluate student performance and to adjust
  instruction
• A system of evaluation and assistance that is
  tied to the instructional priorities and
  curriculum and are reflected in the professional
  improvement plans
• Provide a safe and clean school environment and
  ensure timely service and delivery to schools of
  instructional supplies and materials and other
  goods and services required to operate an
  efficient school system.

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DEOA Consider All Available Resources,
Reallocations Potential Efficiencies

• Consider the following before submitting a
  request for DEOA (only changes are highlighted
  here)
• Costs in excess of the efficiency measures
  established by the DES
• All expenditures not evaluated by the DES shall
  be reviewed for efficiency
• Salary appropriations for vacant positions in
  excess of step one of the school districts
  salary scale for position/title except for
  positions that are difficult to fill

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DEOA Consider All Available Resources,
Reallocations Potential Efficiencies

• Consider the following before submitting a
  request for DEOA
• Undesignated general fund balance in excess of 2
• Under-budgeted miscellaneous unrestricted
  revenues
• ECPA and DEPA projected carryover balances
• Salary breakage for replacement of retiring staff

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DEOA Consider All Available Resources,
Reallocations Potential Efficiencies (contd)

• Instructionally ineffective positions, programs
  and services Appropriations in excess of the
  documented needs
• Tuition reserves, capital reserves and all other
  reserves that are not required by the Department
• Proper allocation of costs eligible for funding
  under the EFCFA

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DEOA Consider All Available Resources,
Reallocations Potential Efficiencies (contd)

• Aides that are not mandated for preschool,
  kindergarten and special education
• Non-recurring costs
• Equipment
• Full integration of State, local and Federal
  funds at the classroom level and school staffing
  levels that meet the Department standards for
  effective and efficient delivery of instructional
  and
• supplemental services

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Requests for DEOA shall include

• Evidence of student instructional needs
• Evidence that proposed intervention to address
  documented needs can be expected to be effective
  in improving instruction
• Documentation that the findings of the DES have
  been applied
• Demonstration that costs that exceed the midpoint
  average median in the DES are necessary and
  justifiable

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Requests for DEOA shall include

• Evidence that current programs, services,
  practices, materials or positions in the area
  funds for new programs, services, practices,
  materials or positions are requested are
  essential to student achievement or that they
  will be eliminated and the funds generated from
  their elimination will be available to support
  the new or expanded programs, services or
  positions
• Evidence that continued implementation of current
  programs or services can be justified as
  efficient and effective

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Requests for DEOA shall include

• A detailed listing of all new or expanded
  programs, services, contracts and positions that
  are included in the 2005-2006 budget that were
  not part of the approved budget for 2004-2005,
  and the program or service it is designed to
  replace
• A listing by program and associated cost of all
  ineffective or inefficient programs, services and
  contracts and positions that were included in the
  2004-2005 budget that are not part of the
  proposed budget for 2005-2006 to demonstrate the
  elimination of all ineffective and inefficient
  programs

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Requests for DEOA shall include

• The school districts certified payroll records
  submitted electronically
• Detailed analysis of salary information including
  substitutes, overtime and stipends
• All 2005-2006 school-based budgets

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6A10A-8.2 District and school-level transfers
during the budget year

• The Abbott regulations mirror the Finance
  regulations for district-level transfers except
  the requests for approval of Abbott
  district-level transfers shall be submitted to
  and approved by the Assistant Commissioner for
  Abbott Implementation.

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Line-Item Transfers

• Line-item transfers from any general fund
  appropriation account gt10, on a cumulative
  basis, require approval of the Assistant
  Commissioner of Abbott Implementation
• Appropriation of surplus or other unbudgeted or
  underbudgeted revenue is restricted to April 1
  thru June 30 and requires Commissioner approval
• All require 2/3rds vote of authorized membership
  of the board

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Line-Item Transfers General Fund Appropriation
Account

• General fund appropriation account means the
  required advertised appropriation accounts
  pursuant to N.J.S.A. 18A22, except where
  consolidated as follows
• 1. Basic skills, bilingual and special education
  instruction, including other related and
  extraordinary services
• 2. Student activities, student athletics and
  other student instructional services
• 3. Student support services, including,
  attendance, health, guidance, child study team,
  and media
• 4. Improvement of instruction and staff training
  and
• 5. Special programs (fund 13).
• Includes rollover of prior year encumbrances.

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Line-Item Transfers (From)

• 10 Department working day approval deadline or
  automatically approved
• Districts need to keep documentation of
  Department receipt of transfer request if
  approved under automatic provision

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Line-Item Transfers (To)

• Transfers TO Administration over 10 require
  approval
• Transfers TO Capital Outlay are restricted
  pursuant to EFCFA

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Appropriation of Unbudgeted/ Underbudgeted Revenue

• Regulations identify revenue sources that do not
  require Commissioner approval to increase
  spending above approved budget. (N.J.A.C.
  6A10A-8.2(c))
• 1. Additional state aid when approval is granted
  in the award letter (extraordinary aid, DEOA, EOA
  adjustments)
• 2. Tuition revenue generated from a
  district-specific program, which is not part of a
  formal sending-receiving relationship pursuant to
  N.J.S.A. 18A38-19 and 18A46-21
• 3. Unrestricted federal revenue (Impact aid,
  SEMI) and
• 4. Surplus generated from revenue allowed to be
  excluded from the excess surplus calculation in
  the pre-budget year (extraordinary aid).

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Appropriation of Unbudgeted/Underbudgeted Revenue
April 1 June 30

• Requests allowed between April 1 and June 30 and
  approval authority delegated to the Assistant
  Commissioner for Abbott Implementation (8.2(a))
• Documentation of approval of 2/3s affirmative
  vote of the authorized membership of the board
• Transfers to be approved for items necessary to
  achieve the efficiency and effectiveness
  standards for the current year
• All districts must first transfer from available
  balances prior to requesting an increase in
  spending above approved budget.
• Requests submitted to the Assistant Commissioner
  for Abbott Implementation must include the latest
  board secretary report as documentation that
  appropriation balances are or will be
  expended/appropriated.

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Appropriation of Unbudgeted/Underbudgeted Revenue
Prior to April 1

• Districts may petition the Commissioner prior to
  April 1 for an increase in spending for an
  emergent circumstance and include in such
  submission(8.2(b))
• Board certification necessary for emergent
  circumstance
• Document additional revenue is necessary or
  circumstance will render peril to health and
  safety to students and staff or force the
  district into an operating deficit as a result
  of the required implementation of the CCCS and
  the Abbott rules
• Latest board secretary report as documentation no
  other line item balances are or will be available

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6A10A-8.2 District and school-level transfers
during the budget year

• Transfer the full amount on Local Contribution
  Transfer to Special Revenue in the 2004-2005
  approved budget to the special revenue fund
• Any amount included in the approved 2004-2005
  budget on that line that is not transferred to
  the special revenue fund as of December 31, 2004
  will result in a direct reduction of the
  2004-2005 DEOA

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Questions ??????