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Budget & Finance
 

Budget & Finance

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    Budget & Finance Budget & Finance Presentation Transcript

    • BIDDING, BONDING, SCHOOL BUDGETS AND THE DEVELOPMENT OF A SOUND OPERATIONS & MAINTENANCE FINANCIAL PLAN December 2011 Presented by: Stanley W. Polmateer
    • BIDDING
      • 1. WHY DO WE BID?
      • To obtain lowest responsible costs
      • Required by NYS Finance Law at certain expenditure limit
      • Guarantees prudent expenditure of public funds
      • 2. EXPENDITURE LIMITS
      • $20,000/yr. per commodity on materials only
      • $30,000/yr. per commodity/service on material & labor
      • (if adopted by the local school district)
      • 3. STATE BIDS AND CONTRACTS
      • Can be used to any limit of expenditure as a district bid
    • BIDDING
      • 4. COUNTY BIDS AND CONTRACTS
      • Public schools are a subset of county
      • 5. BOCES COOPERATIVE BIDS
      • Must have District approval to enter one and approval of successful bid.
      • 6. INDIVIDUAL BIDS
      • Yearly and multi year bids
    • PERFORMANCE BONDS
      • 1. WHY DO WE NEED THEM?
        • To guarantee the public a job is completed and in a quality fashion
        • If District does not have a performance bond guarantee, they are totally liable for the successful completion of a job, in case of vendor/contractor failure
      • 2. WHO SUPPLIES THEM?
        • Bonding Companies (Ins. Companies)
    • PERFORMANCE BONDS
      • 3. HOW DO THEY WORK WHEN A JOB GOES BAD?
        • When contractor goes bankrupt or out of business
        • Bond company is called upon to hire and pay for all remaining work not yet completed or paid for
      • 4. HOW DOES THIS AFFECT CIP’S?
        • On Capital Projects SED must be notified of vendor change due to bond in affect for receiving proper
        • State Aid
    • KEY FACTORS IN BUDGETING 1. MUST HAVE CREDIBILITY 2. HAVE A SENSE OF REALISM 3. FOLLOWS A LONGER RANGE PLAN 4. EXHIBITS RESPONSIBLE PERFORMANCE 5. FOLLOWS GUIDELINES OF THE DISTRICT 6. IS CONSIDERATE OF CONDITIONS IN THE COMMUNITY 7. COMMUNICATION & COMMUNITY INVOLVEMENT
    • TWO KINDS OF BUDGETS
      • 1. ANNUAL OPERATIONS & MAINTENANCE
        • Based on previous year
        • Includes adjustments for justifiable increases and savings reductions
        • Allows for inflationary increases
        • Should offer detail to show what makes up the budget and what a cut will affect
    • TWO KINDS OF BUDGETS
      • 2. CAPITAL IMPROVEMENT PLAN (CIP)
        • Based on Five Year Plan
        • Based on Annual Bldg. Condition Survey
        • Should be reviewed with the Board of Education annually
        • Requires voter approval for funding
    • HOW DO YOU MAKE AN O & M BUDGET?
      • 1. Use indices from surrounding Districts to comparatively budget manpower by area
        • Custodial
        • Mechanics
        • Grounds
        • Security
        • Couriers
        • Supervision
      • 2. Use a budget template from past years and fill in
      • with current budget data.
    • HOW DO YOU MAKE AN O & M BUDGET? 3. Acct. 200 (Equipment) requires special justification (based on mileage, age, condition) 4. Don’t be afraid to compare contractual services cost vs. “in-house” services cost when justifying additional staff or supply inventory
    • HOW DO YOU MAKE A CIP BUDGET?
      • 1. Follow the Five Year Plan
      • 2. Be consistent in projects presented
      • 3. Timing is EVERYTHING
      • 4. Projects should be identified as:
        • Health, Safety or Environmental
        • Structurally required
        • Instructionally required
        • Cost savings justified (energy conservation)
        • Administrative request
    • 5. Be consistent with Building Condition Survey 6. Review annually with the Superintendent 7. Review annually with the Board of Education HOW DO YOU MAKE A CIP BUDGET?
    • VITAL BUDGET TOOLS IN YOUR TOOL BOX 1. The O & M Budget Template 2. Personnel Indices 3. The Five Year Plan 4. Building Condition Survey
    • THE O & M BUDGET TEMPLATE 1. Organized by account in numerical order (1620 & 1621 accounts) 2. Include sufficient detail (type of service, type of supply, quantity, etc.) 3. Compare to last years budget (by account) to show increase or decrease
    • THE FIVE YEAR PLAN 1. Review annually with key administration 2. Consider priorities of projects 3. Be very accurate for first 2 –3 years 4. Years 4 & 5 are not as well defined 5. Should be coordinated with Bldg. Condition Survey 6. Review with Supt. & Bd. of Ed. Annually 7. Publish document annually and distribute to all participants to the plan
    • BUILDING CONDITION SURVEY 1. Required by Commissioner’s Regulation 2. Review annually for updates with certified individual 3. Must be submitted annually to SED 4. Should be coordinated with 5 Year Plan 5. This is a basis for both O & M and CIP budgets
    • BUDGET TIMELINE October Annual Services Review Appoint Budget Advisory Committee Obtain Board of Ed Guidelines November Begin Budget Advisory Meetings 1 time/month December New Budget Proposal Submittals January Prepare Rollover Budget Review New Budget Proposals February Prepare 1st Draft of Proposed Budget for Board of Education review Review income side of the budget March Modify Original Draft Budget and formulate Final Draft for Board of Education submittal
    • BUDGET TIMELINE April Further modify budget proposal Budget Advisory Committee recommends to the Superintendent New Proposed Budget Board of Education adopts Final Budget Proposal for referendum (including separate propositions) Send out Proposed Budget and explanation to voting public May Voting public considers Budget Proposition and approves or disapproves June If disapproved, Board of Education adopts a Contingency Budget or modifies Original Budget and re-submits for voter approval July New school year budget begins
    • FUTURE COST FACTORS TO CONSIDER
      • Projected annual rate of inflation
      • Additive costs of contractual settlements
      • Projected overtime costs
      • Energy and utility cost increases
      • Health insurance increases
      • Cost additives for new building(s) or addition(s)
      • Additional duties or functions transferred in or out of the facilities area
      • Identification of new equipment needs
      • Special regulatory events, i.e., Building Condition Surveys, Asbestos 3 Year Surveys
      FUTURE COST FACTORS TO CONSIDER
    • BOCES CoSERS and E-Rate
      • BOCES CoSers are shared services and equipment offering state aid reimbursement, i.e., computers, health and safety services, oil tank testing, telephone service, E-rate consulting services, etc.
      • Generates income for the following year and is considered a bid item
      • E-rate is a governmental rebate on data and telephone services determined by district relative to their “Free and Reduced Lunch” rate. Example a F&R rate of 20% generates 50% rebate on data systems (not individual computers) phone and long distance costs for public, private and parochial schools and public libraries.
      • E-rate is generated monthly from individual phone bills and redistributed by district F & R formula.
    • IF A BUDGET IS DEFEATED
      • TWO OPTIONS:
      • The original budget can be modified by the Board of Education and one re-vote can take place for passage
      • and/or
      • Board can adopt a contingency budget
        •  Last year’s budget plus inflation (regionalized)
        •  No new equipment other than safety & health
        •  Includes new debt repayment approved by voters
        •  Does not include high rate increases for energy, etc.