Transcript Budget Methodology - Charlotte Chamber

CMS 2010-2011 Budget
Update
March 10, 2010
What is the CMS
operating budget?
CMS 2010-11Budget Update
2
Revenue Sources
2%
28%
56%
14%
State
Federal/Special Programs
Local
Other Local
2009-10 Adopted Current Expense Budget
$1.14 Billion – Operating Funds
134,448 Projected K-12 Student Enrollment
$8,483 Budgeted Cost Per Pupil (K-12)
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Revenue Uses (Expenditures)
5%
1%
10%
0%
18%
66%
Salaries
Benefits
Supplies & Materials
Other
Purchased Services
Furniture & Equipment
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CMS Budget Trends
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Sources of Revenue Trend
100%
1.1%
4.5%
1.1%
5.0%
1.9%
2.4%
2.8%
1.9%
7.9%
7.7%
8.2%
8.5%
58.3%
59.0%
59.9%
60.2%
90%
1.9%
14.6%
80%
70%
60%
62.4%
58.9%
55.7%
50%
40%
30%
20%
32.0%
35.0%
31.9%
30.9%
29.1%
29.4%
27.8%
1999-00
2001-02
2003-04
2005-06
2007-08
2008-09
2009-10
10%
0%
History
Recent Trend
County
State
Federal
Other Local
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Expenditure Trend by Purpose
100%
90%
80%
70%
7.6%
7.3%
7.2%
7.1%
19.2%
18.8%
19.9%
19.4%
1.4%
1.8%
1.5%
1.5%
71.8%
72.1%
71.4%
72.0%
60%
50%
40%
30%
20%
10%
0%
06-07
07-08
Instructional
Instructional Support
08-09
Operations
09-10
Leadership
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Since 2006-07, CMS has:
•
•
•
•
•
•
Cut $161.3 million through reduction and
redirections
Opened 19 new and/or replacement schools
Added more than 2.4 million additional square
feet
Grown to more than 5,031 acres
Added more than 4,600 students
Increased student achievement in 24 of 25
areas tested
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Summary of Reductions Since 2006-07
2009-10
Budget
Reductions
% of State
& Local
Budget
2008-09
Budget
Reductions
% of State
& Local
Budget
2007-08
Budget
Reductions
% of State
& Local
Budget
2006-07
Budget
Reductions
% of State
& Local
Budget
Superintendent &
Operations Division
% of total reductions
(23,163,051)
10.14%
(7,347,516)
3.31%
(4,202,863)
2.14%
(6,527,258)
3.58%
Academic Services
Division
% of total reductions
(27,889,959)
Schools Division
% of total reductions
(55,626,298)
52.14%
8.66%
(7,054,883)
36.65%
1.11%
(8,318,787)
40.88%
1.45%
(7,566,092)
50.40%
1.48%
Total
(106,679,308)
9.97%
(19,248,811)
1.84%
(20,351,481)
2.17%
(15,011,123)
1.77%
21.72%
38.17%
14.01%
(4,846,412)
26.14%
20.65%
2.58%
25.18%
(7,829,831)
43.49%
4.64%
38.47%
(917,773)
0.60%
6.11%
Since 2006-07 over $161.3M in reductions/redirections have been made in the CMS budget.
State Reductions since 2006-07 - $40.9 million
Local Reductions since 2006-07 - $120.4 million
Note: Reductions are reflected by area in which the expenditure is budgeted; many expenditures are budgeted centrally
and then expended at the school level.
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How are we planning for
the 2010-2011 budget?
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Framework for Budget Development
•
Align resources to support Strategic Plan 2014
•
Keep strong academic focus coupled with data driven decision making
•
Recognize and plan for the impact of the economic environment and
employ sound fiscal management – respond to signals from state and
local sources that funding may be limited
•
Acknowledge uncertainty regarding expected funding levels from all
sources, but be prepared for the worst
•
Request funding from County for growth, sustaining operations and
opening new schools
•
Pay for Strategic Plan 2014 initiatives through budget reductions or
redirections
•
Establish flexibility in the budget to allow for various reduction levels
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Local Budget Outlook
Excerpts from earlier memo to County Department/Agency Directors (1/5/10) 


Anticipate that there will be limited or no growth revenue for FY2011
Greatest challenge will continue to be juggling competing needs for
county, debt and education services
Possibility that departments/agencies will be asked to use existing
resources to fund increased service demands
Excerpts from more recent county budget update (2/16/10) 



Best case scenario presented was no growth in revenues
At best, departments can expect some services to be funded at current
levels
However, departments are planning for reductions ranging from 5-15%
- not across the board cuts
Departments and services will receive different reductions based on
service priority and performance
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State Budget Outlook
In the February 2010 General Fund Revenue Report and Economic
Outlook, the Fiscal Research Division reported –
•
Revenues through January are $35 million short of forecast of
$11 billion
•
Near the budget target due to $472 million of one-time
collections from corporate taxpayers ($272 million more than
budgeted)
•
Final quarter of the fiscal year contains the majority of the
forecast risk – unpredictability in corporate income tax
payments and non-withholding personal income tax payments
•
At this stage of the recovery economic signals remain mixed,
yet most economist believe a sustainable recovery is
underway
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State Budget Outlook

Mounting budget pressures for remainder of 2009-10 and beyond as
prolonged weaknesses in the economy affect revenue collections
 Budget included a 1 cent increase in the State’s sales tax rate
 Expenditures for Medicaid and other income assistance
programs may exceed budgeted amounts
 A looming issue on the horizon will be the FY 2011-12 revenue
picture
DPI recently reported to State Board of Education

Expecting an announcement lowering growth revenue projections for
2010-11 (budget anticipated a 3.2% revenue growth)
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What does this mean for CMS?
•
Our crystal ball used to forecast revenue is extremely cloudy and
uncertain
•
We are facing another austere budget for 2010-11
•
Revenue growth from taxes and fees are slow to recover from the
recession – at state level and locally –our two primary funding
sources
•
County is signaling that funding may not be available to cover
growth, sustaining operations and opening new schools and may
require a reduction in funding
•
Reductions will be required to cover a $7.3 million increase in the
state “discretionary reduction” planned in 2010-11
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What does this mean for CMS?
•
Lagging state revenues may require additional cuts in addition to
those originally planned for 2010-11 – another 5% cut would
equate to $31.8 million for CMS
•
Preparations to address funding cliff anticipated in 2011-12 of
$47 million must begin
•
Budget alignment to Strategic Plan 2014 and employing the
strategic use of resource strategies gleaned from ERS work will
be essential
•
Emphasis must be on making education a priority at all levels
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2010-11 Budget Scenarios 1-2 ($ in millions)
Scenario 1 – BUDGET REQUEST = New dollars for growth from state and county
•State will fund growth. No reduction beyond the increase in the discretionary cut and textbooks
•County will fund growth/sustaining/new schools
$ (7.3) Discretionary State Cut
(8.5) New Initiatives
$ (15.8) Total Reductions
Possible cuts include:
•$3.5 million for a central office reorganization
•$2.6 million in building services
•$1.7 million by reducing signing bonuses and tuition reimbursement
•$2.3 million in transportation
Scenario 2 - FLAT funding from County (growth funded by state per state formula)
•State will fund growth. No reduction beyond the increase in the discretionary cut and textbooks
•County will provide FLAT funding (requiring us to cover growth, etc)
$ (7.3) Discretionary State Cut
(8.5) New Initiatives
(19.0) Growth/Sustaining/New Schools (Estimate)
$ (34.8) Total Reductions
Possible cuts include:
•$14 million by eliminating teacher positions added back in 2009-2010
•$2.3 million by implementing magnet school transportation shuttle stops
•$1.4 million by reducing building services staffing
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2010-11 Budget Scenarios 3-4 ($ in millions)
•Scenario 3 - FLAT funding from County; 3% reduction from State (after growth funded)
•State will fund growth. Impose a 3% reduction beyond the increase in the discretionary cut and textbooks
•County will provide FLAT funding (requiring us to cover growth, etc)
$ (19.1) State Reduction of 3%
(7.3) Discretionary State Cut
(8.5) New Initiatives
(19.0) Growth/Sustaining/New Schools (Estimate)
$ (53.9) Total Reductions
Possible cuts include:
•$1.3 million by eliminating middle school athletics
•$8.2 million by increasing class by one in grades 4-12 and eliminating K-3 FOCUS ratio of 1:17
•Scenario 4 – 3% reduction from County; 3% reduction from State (after growth funded)
•State will fund growth. Impose a 3% reduction beyond the increase in the discretionary cut and textbooks
•County will impose a 3% reduction in funding (requiring us to cover growth, etc)
$ (19.1) State Reduction of 3%
(9.5) County Reduction of 3%
(7.3) Discretionary State Cut
(8.5) New Initiatives
(19.0) Growth/Sustaining/New Schools (Estimate)
$ (63.4) Total Reductions
Possible cuts include:
•$8.6 million by increasing class by two or more in grades 4-12 and eliminating K-3 FOCUS ratio of 1:17
•$1.9 million by eliminating district paid cost for employee dental coverage
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2010-11 Budget Scenarios 5 ($ in millions)
•Scenario 5 – 5% reduction from County; 5% reduction from State (after growth funded)
•State will fund growth. Impose a 5% reduction beyond the increase in the discretionary cut and textbooks
•County will impose a 5% reduction in funding (requiring us to cover growth, etc)
$ (31.8) State Reduction of 5%
(15.9) County Reduction of 5%
(7.3) Discretionary State Cut
(8.5) New Initiatives
(19.0) Growth/Sustaining/New Schools (Estimate)
$ (82.5) Total Reductions
To-be-determined possible cuts include:
•Eliminating magnet school transportation
•Closing and consolidating small schools
•Delaying the opening of the new high schools
•Changing weighted student staffing weight from 1.3 to 1.2
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2010-2011 Budget Calendar Key Dates
March 16
Board Budget Work Session @ 2:00 pm
March 23
Board Budget Work Session @ 2:00 pm
March 30
Board Budget Work Session @ 3:00 pm
April 13
Formal budget presentation made to Board of
Education by Superintendent at regularly scheduled
board meeting
April 27
Public Hearing on the FY 2010-11 Operating Budget
April 27
Board Budget Work Session @ 6:00 pm
May 11
FY 2010-11 Board of Education’s Budget Request of
the County Commissioners approved at Board of
Education meeting
May TBD
Board of County Commissioners’ 2010-11 Budget
Workshop for CMS and CPCC
June TBD
FY 2010-11 County Operating Budget and 3-year
CIP adopted at regular meeting of Board of County
Commissioners
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Questions?
Conclusion
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