As we begin a New Year, we are once again faced with a projected budget shortfall for the 2012-13 school year. Along with the Board of Education, I invite you to participate in a Budget Engagement Process. The purpose of this budget engagement process is to gather input from you, the stakeholders, to help define what we as an educational learning community value most. The input gathered from all stakeholders will then be used to create options for budgetary reductions and/or enhancements as we address the district budget shortfall for 2012-13.
Balancing the budget is always challenging. We have defined our budget priorities and agree to take the following budget strategies into consideration as we define what we value. The budget strategy for 2012-13 include: (read bulleted items on slide)
Everyone’s voice is important. The first step of the decision making process is the gathering of input from the all the stakeholder groups. This slide identifies 3 groups - the Choice-makers who are those responsible for the implications of the choice; the Option Creators – those with specific expertise, experience or knowledge concerning the choice, and the Stakeholders- those who will be most affected by the choices made. The Option Creators will take the input from the stakeholders and create options for consideration. Before going to the Board, the group who will make the final decision, there will be another opportunity for stakeholders to respond to the options created . Following engagement of the stakeholders for a second time, the Option Creators will refine the options and present them to the Board of Education for final approval. The Board will select the options that align with the district mission and vision and best reflect the community values while balancing the budget 2012-2013.
Let’s examine our current realityHow did we arrive at an $8 million budget shortfall for the 2011-12 school year? First, it is important to recognize that budget deficits occur when State revenues are reduced to school districts. Our budget deficit in 2011-12 actually began in 2010-11 when the revenue limit increase per student was reduced by $69 per student. We went from $269 per student to $200 resulting in a loss of $1.4M in revenues. In 2011-12, we saw a reduction of $734 per student. We went from $200 per student to a minus $534 per student resulting in a loss of $15M in revenues. Overall our budget deficit for 2011-12 was $20M. $12M of the deficit was addressed using employee contributions to both retirement and health benefits. The remaining $8M deficit was addressed using revenue enhancements and expenditure reductions including the use of $3.6M from the Federal Education Jobs Fund.
As we look forward to the 2012-13 school year, we are projecting a budget shortfall of $9M. Here are the 2012-13 budget assumptions: We are anticipating revenuesto decrease per student by $2.1M or .8%The revenue limit increase of $50 per student will generate an additional $1M inrevenueState categorical aids are expected to increase $.5MFederal revenues will decrease by $3.6M due to loss of Education Jobs Funding We are also anticipating expenditures to increase by $6.5M or 2.8%Health insurance is expected to increase by $2.9M Open enrollment expenditures are expected to increase by $2M Transportation costs are expected to increase by $.3M Non-referendum debt costs are expected to increase by $.7MOther expenditures are expected to increase by $.6M
So what is next? Our first step will be to gather input from you, the stakeholders, in an effort to define what you value most. We will ask a series of questions and collect your responses. At the same time, we will reexamine all departments, programs and services for efficiencies. From the data gathered, we will create options for potential revenue enhancements and expenditure reductions.
Once options are created, we will evaluate them with the following budget priorities:
In an effort to identify what we value most, we will be asking all stakeholder groups to respond to the following questions:
Budget Presentation 2012
Budget Engagement Process JANUARY 2012
Budget Strategy 2012-13 Results in the development of a balanced budget for the 2012-13 school year Reflects the district goals for literacy, mathematics and student engagement Results in the development of a budget that emphasizes revenue enhancements and expenditure reductions while minimizing the use of fund balance Developed following a review of current programs and services for effectiveness and efficiencies Places the district in a position to move toward our vision of becoming the district of choice Provides the board with a carefully thought out prioritized list of recommendations for potential reductions Requests stakeholder input from district staff and the public Be discussed in an open and transparent process
Decision Making Process Map for the Budget Engagement ProcessStakeholder Input• Create a shared reality of data, trends, needs and brainstorm new ideas, opportunities, etc.• Assess options and provide feedback to options for refinementCreating Options• Create multiple options for consideration for presentation to the choice makersDecision (Choice) Making• Selection of a preferred option(s) Choice Makers Option Creators Stakeholders Those responsible for the choice Those with specific Input expertise, experience or Those who will be most affected knowledge by the choice School Board + District District Leadership Representative group of Administration stakeholders • Superintendent Learning Support Team Parents • Assistant Superintendents: Principals Building Staff Curriculum and Instruction, Human District Administrators Community Resources, Business and Finance Additional input Additional input GBEA GBEA AFSCME groups AFSCME groups Community
Current Reality $8 million budget deficit in 2011-12 Budget deficits occur when State revenues are reduced to school districts 2010-11 reduction of $69 per student ($269 to $200) loss of $1.4M in revenues 2011-12 reduction of $734 per student ($200 to a -$534) loss of $15M in revenues 2011-12 –overall deficit was $20M $12M increase in employee contributions to both retirement and health benefits 2011-12- remaining $8M deficit revenue enhancements and expenditure reductions including the use of $3.6 M from the Federal Education Jobs Fund
Current Reality $9 million budget shortfall for 2012-13 projected Revenues Revenues are expected to decrease by $2.1M or .8% The revenue limit increase of $50 per student will generate an additional $1M in revenue State categorical aids are expected to increase approximately $.5M Federal revenues will decrease by $3.6M due to loss of Education Jobs Funding Increased Expenditures Expenditures are expected to increase by $6.5M or 2.8% Health insurance is expected to increase by $2.9M Open enrollment expenditures are expected to increase by $2M Transportation costs are expected to increase by $.3M Non-referendum debt costs are expected to increase by $.7M Other expenditures are expected to increase by $.6M
What steps will we take to address the projected budget shortfall for 2012-13? We will ask stakeholders to define what they value We will reexamine all departments, programs, and services for efficiencies We will create options for potential revenue enhancement and expenditure reductions in order to best support instructional programs
Budget Priorities Priority 1 : Adjustments to spending will impact students significantly Priority 2: Adjustments to spending will impact students moderately Priority 3: Adjustments to spending will impact students minimally
What Do We Value? Data collection from Stakeholders
Knowing $9M Must be Cut… What programs and services are you most concerned about losing?
Looking at Our Current Reality… Are there programs that can be scaled down or eliminated?
Looking to the Future… What programs and/or services should the schools be providing that would improve student achievement and/or student engagement even if it means reducing elsewhere?
Cost Savings/Revenue Enhancements/Innovation What cost savings, revenue enhancements and/or innovations would result in increased funding for the district? e.g. (cost savings) Energy projects e.g. (enhancement) Advertising
Next Steps All input will be considered as options are created All stakeholder groups will be invited to respond to options created Refined options will be presented to the Board of Education for approval