Transcript Financial Strategies – An Update

Loveland City Schools
Financial Forecast Update
April 16, 2013
Public Finance Resources, Inc.
“Serving the Public’s Financial Leaders”
Agenda
• Comparison of current revenue and expenditure
projections to October, 2012.
• Updated simplified forecast statements.
• Key revenue and expenditure assumptions.
• Conclusion
• Per Pupil Expenditure Update
2
October Vs. April Revenue Projections
Forecast Compare - Compares Previous Forecast to Current Forecast
For Fiscal Year: 2013
Forecasted as of: 10/31/2012
4/15/2013
Fiscal Year
Fiscal Year
Revenue:
2013
2013
1.010 - General Property Tax (Real Estate)
23,952,473
24,187,229
1.020 - Tangible Personal Property Tax
973,855
772,586
1.030 - Income Tax
1.035 - Unrestricted Grants-in-Aid
10,393,840
10,547,359
1.040 - Restricted Grants-in-Aid
59,376
19,376
1.045 - Restricted Federal Grants-in-Aid - SFSF
1.050 - Property Tax Allocation
3,499,509
3,509,504
1.060 - All Other Operating Revenues
1,059,238
939,738
1.070 - Total Revenue
39,938,292
39,975,794
2.070 - Total Other Financing Sources
198,000
230,000
2.080 - Total Revenues and Other Financing Sources
40,136,292
40,205,794
LOVELAND CITY SCHOOL DISTRICT - - HAMILTON COUNTY
Percentage
Variance
0.98%
-20.67%
0
1.48%
-67.37%
0
0.29%
-11.28%
0.09%
16.16%
0.17%
1.01 Real Estate revenue beat estimates for the 1st half.
However, this is believed to be a timing issue (half paid)
rather than ongoing revenue. The 2nd half settlement in
July will confirm the longer term direction.
1.02 Public Utility Personal Property estimates of the
Duke Energey refund were not met.
1.035 Unrestricted is increased for Casino Revenue
Cash flow cross-check?
(posting change).
1.06 Other revenue is decreased for Casino Revenue
(posting change).
Current revenue estimates vary
by only 0.17% from October’s
forecast.
3
October Vs. April Expenditure
Projections
Forecast Compare - Compares Previous Forecast to Current Forecast
For Fiscal Year: 2013
Forecasted as of: 10/31/2012
4/15/2013
Fiscal Year
Fiscal Year
Expenditures
2013
2013
3.010 - Personnel Services
26,054,580
26,230,580
3.020 - Employees' Retirement/Insurance Benefits
9,168,815
9,317,987
3.030 - Purchased Services
2,918,763
3,154,701
3.040 - Supplies and Materials
1,452,676
1,422,676
3.050 - Capital Outlay
3.060 - Intergovernmental
4.010 - 4.060 - Principal, Interest & Fiscal Charges
4.300 - Other Objects
867,136
883,136
4.500 - Total Expenditures
40,461,970
41,009,080
5.040 - Total Other Financing Uses
70,000
70,000
5.050 - Total Expenditures and Other Financing Uses
40,531,970
41,079,080
M
6.010 - Rev Surplus/(Shortfall) - Line 2.080, Less 5.050
7.010 - Cash Balance at Beginning of Year
7.020 - Cash Balance End of Year [Line 7.01 +/- Line 6.01]
(395,679)
4,196,366
3,800,687
(873,286)
4,196,366
3,323,080
LOVELAND CITY SCHOOL DISTRICT - - HAMILTON COUNTY
Percentage
Variance
0.68%
1.63%
8.08%
-2.07%
0
0
0
1.85%
1.35%
0.00%
1.35%
0
120.71%
0.00%
-12.57%
3.01 Salary estimates were exceeded with less than
projected savings for employee degree changes,
replacement costs.
3.02 Health insurance costs exceeded estimates.
3.03 Purchased services reflect additional tuition and
services.
Expenditures are trending 1.35% higher than October
estimates.
M
Expenditures vary 1.35% less than
October’s estimates.
4
Simplified Forecast Statement
Income and Expense Simplified Statement - Projected Fiscal Years
Fiscal Year
2013
Beginning Balance
LOVELAND CITY SCHOOL DISTRICT - - HAMILTON COUNTY
Fiscal Year
2014
Fiscal Year
2015
Fiscal Year
2016
Fiscal Year
2017
4,196,366
3,775,687
2,643,344
1,312,572
40,136,292
(40,531,970)
(395,679)
39,987,755
(41,120,099)
(1,132,344)
40,312,572
(41,643,344)
(1,330,772)
40,736,365
(42,723,589)
(1,987,224)
41,156,736
(43,851,567)
(2,694,831)
Ending Balance
3,800,687
2,643,344
1,312,572
(674,652)
(3,369,484)
Revenue Surplus or Deficit w/o Levies
Ending Balance w/o Levies
(395,679)
3,800,687
(1,132,344)
2,643,344
(1,330,772)
1,312,572
(1,987,224)
(674,652)
(2,694,831)
(3,369,484)
+ Revenue
+ Proposed Renew/Replacement Levies
+ Proposed New Levies
- Expenditures
= Revenue Surplus or Deficit
District’s cash balance
continues to reflect cost of
services that exceed revenue.
(674,652)
District’s cash balance will hold
through 2014 as promised in the
2011 levy campaign.
5
2013 through 2017 Key Revenue
Assumptions
• Five year average real estate tax collection rate
of 99.07%.
• State revenue increases are 6.61% in 2014,
5.81% in 2015, and 1.22% each subsequent year.
– State budget process will be monitored and
significant variances reported to Loveland BOE.
• Overall revenue increases average 2.33% per
year.
6
2013 through 2017 Key Expenditure
Assumptions
• Average salary increase is 0.97% annually.
• Fringe benefits increase annually 3.98% on
average.
• Overall expenditure average increase of 1.97%
annually.
7
Forecast Conclusion
• Cash balance continues decline since 2011 levy.
• Cost of services provided exceeds revenue
provided.
• 2011 Levy will last until 2014 as promised.
• Future Levy Considerations:
– Academic and Program Goals
– Financial Stability
– Levy Cycle
8
Per Pupil Expenditure Comparison
(All Funds)
9
2012 Per Pupil Expenditure Comparison
to Most Similar Average
10
Cost Change Relative to CPI-U
11
Per Pupil Expenditure Summary
• Loveland spend nearly $3,000 less per pupil than
its neighboring school districts.
• Loveland spends less in every expenditure
category.
• Loveland’s increase in costs have trended lower
than its neighboring school districts.
12
Allocation of Daily Cost to Educate a Child - Loveland City , 2012
The annual per pupil cost serves as the basis for the daily cost calulations presented below. The calculations are
based upon a 180 day school year. Instructional PPE and Pupil Support are combined for this analysis
Classroom support - Special
Needs Aides and Teacher
Training & Licensure, $0.88
Building Principals &
Secretaries, Central
Office, Printing,
Technology, Data
Processing, $6.01
Building Operating Systems,
Cleaning, Maintenance,
Transportation, Food
Service, Etc., $9.83
Teachers, Counselors,
Librarians, Media, Aides,
Textbooks, Computers, Etc.,
$37.96
$54.68 Per Pupil
Per Day
Public Finance Resources, Inc.
“Serving the Public’s Financial Leaders”
Public Finance Resources Employee Bios
Debra Hoelzle, Chief Operations Officer of Public Finance Resources, provides direct services to clients, and oversees the day-to-day
operations of PFR. She brings with her operational experience from both the public and private sectors, including a school district and
multiple corporations in the financial services industry. Debra holds her Masters of Business Administration from Ohio University, and
her Bachelors of Science in Business Administration from The Ohio State University.
Stacy Overly, Consultant, provides direct financial services to clients. He has over 20 years of experience serving as school district
treasurer, including 15 plus years of developing financial forecasting tools, and providing instruction and training opportunities attended
and used by over two hundred of Ohio’s public school treasurers. Stacy works with clients to analyze trends and review local economic
data to help determine a long-term operating strategy for the organization. He holds his Masters of Business Administration and his
Bachelors of Business Administration in Finance from Ohio University.
Ernie Strawser, Consultant, provides direct services to our public finance clients. He has over 30 years of public finance experience as a
CFO, consultant, and developer and instructor of financial forecasting techniques and tools which have been used by over two hundred
Ohio school district CFOs. Ernie works with clients to facilitate their understanding of local financial results , trends, and strategies. He
holds both a Masters of Science in Administration from Central Michigan University and a Bachelor of Science in Finance from Ohio
University.
Matt Bunting, Consultant, has over 25 years of experience in the public finance sector. This includes 15 plus years as a school district
treasurer, and 11 years with the Auditor of State where he led financial, legal compliance, and Federal single audits of government entities.
Matt has served as interim school treasurer several times, as well as worked with Ernie and Stacy to test their forecasting software and
instruct at their yearly seminars. He holds an Associates Degree in Accounting from Hocking College, and is a Certified Government
Financial Manager.
Mike Sobul, Consultant, brings 30 years of experience in public finance and tax analysis. Currently a school district treasurer, Mike spent
nearly 25 years with the Ohio Department of Taxation where he led revenue forecasting efforts and provided analysis , training, and fiscal
services to schools and local governments. Mike holds a Masters Degree in Public Policy from the University of Michigan and a Bachelors
Degree in Economics and Political Science from Wittenberg University.
Ryan Ghizzoni, Consultant, began his career with the Auditor of State’s Office and has served as a school district treasurer for the past 10
years. During his career, he has been the recipient of six Association of School Business Officials International Meritorious Budget Awards
and was the recipient of the Ohio Association of School Business Officials 2011 Outstanding Treasurer of the Year Award. Ryan holds a
Bachelors of Business Administration from the Youngstown State University, and is a Certified Administrator of School Finance and
Operations.
Public Finance Resources, Inc.
“Serving the Public’s Financial Leaders”
14
PFR Contact Information
Ernie Strawser
Consultant
Public Finance Resources, Inc.
PO Box 1822
Columbus, OH 43216
[email protected]
Phone: 614-732-5948
Debra Hoelzle
Chief Operating Officer
Public Finance Resources, Inc.
PO Box 1822
Columbus, OH 43216
[email protected]
Phone: 614-732-5948
www.PFRCFO.com
Ernie Strawser
Matt Bunting
Stacy Overly
Ryan Ghizzoni
Public Finance Resources, Inc.
“Serving the Public’s Financial Leaders”
Mike Sobul
Debra Hoelzle
15