Transcript Overview of Fiscal Year 2010-11 Oakland Schools Proposed Budgets Property Tax Forecast Property Tax decreases Fiscal Year 2008-09 Fiscal Year 2009-10 Fiscal Year 2010-11 Fiscal Year.

Overview of Fiscal Year 2010-11
Oakland Schools Proposed Budgets
Property Tax Forecast
Property Tax decreases
Fiscal Year 2008-09
Fiscal Year 2009-10
Fiscal Year 2010-11
Fiscal Year 2011-12
Fiscal Year 2012-13
Fiscal Year 2013-14
Fiscal Year 2014-15
-0.5% - $ 0.4M
-4.5% - $ 11.7M
-13% - $ 38.4M
-12% - $ 59.8M
-5.0% - $ 67.6M
-0.0% - $ 67.6M
2.0% - $ 64.7M
Annual Property Tax Collection has declined from FY 2009 to FY 2014 by 31%
Accumulative loss from FY 09 to FY 15 is $310.3m
FY 2008 base year tax levy is $216.9m
Oakland Schools Property Tax Revenue
221.0
211.0
201.0
191.0
181.0
171.0
161.0
151.0
141.0
131.0
121.0
111.0
101.0
91.0
81.0
71.0
61.0
51.0
41.0
31.0
21.0
11.0
1.0
FY 2007-08 Property Tax Level
FY 0 9
F Y 10
F Y 11
F Y 12
F Y 13
F Y 14
F Y 15
GEF
12 .9
12 .2
10 .6
9 .3
8 .9
8 .9
9 .0
SEF
16 3 .6
155.0
13 4 .9
118 .7
112 .8
112 .8
115.0
C F EF
4 0 .0
3 8 .0
3 3 .0
2 9 .1
2 7.6
2 7.6
2 8 .2
T o t al ( F lat F Y 0 8 )
2 16 .9
2 16 .9
2 16 .9
2 16 .9
2 16 .9
2 16 .9
2 16 .9
Lo ss ( C Y vs F Y 0 8 )
( 0 .4 )
( 11.7)
( 3 8 .4 )
( 59 .8 )
( 6 7.6 )
( 6 7.6 )
( 6 4 .7)
A ccumulat ed Lo ss
( 0 .4 )
( 12 .1)
( 50 .5)
( 110 .3 ) ( 177.9 ) ( 2 4 5.5) ( 3 10 .2 )
T o t al C Y T ax R ev.
2 16 .5
2 0 5.2
178 .5
Dollars in millions
157.1
14 9 .3
14 9 .3
152 .2
Fund Balance Target Setting Protocol
The proposed protocol for the development of each fund’s
year ending fund balance target will be predicated upon:


5 percent of the operating programs contained in said fund
Known economic liabilities or designated reserves of a specific
fund
The fund balance target setting protocol recognizes the following
economic realities:
–
–
The State of Michigan’s economic environment
The economic status of the LEAs that comprise the Intermediate
School District.
Oakland Schools Board of Education approved the Protocol on 6/15/2009
Practice for the Special Education Fund is to distribute the amount in
excess of the target unreserved fund balance.
Oakland Schools
Total Revenue Summary
29%
1%
6%
6%
FY 2011 $323.9 Million
3%
55%
Property Tax Revenue - $178.6
State Revenue - $9.0
Other Local Revenue - $20.7
Other Financing Sources - $1.9
New Grant Award Funding - $94.5
Est. Grant C/O - $19.2
Dollars in millions
Revenue Assumptions





Property tax revenue decrease of 13%
Expected investment rate of return is 1.5% on available
resources
Increased local district utilization of our Finance, Human
Resource application, Benchmark & Inform system and
Novanet fee-based software system.
General Education Section 81 reduced by 14.5%
All other State Aid held flat
Oakland Schools Fiscal Year 2011
Total Expenditure Budget by Type
5.7%
0.3%
3.2%
3.4%
20.5%
$351.7 Million
2.8%
0.8%
Transfers to LEAs - $222.6
Salaries & Benefits - $72.2
Cash to LEAs
Purchase Services - $20.0
Utilities - $1.2
Supplies, Materials, Dues & Fees - $11.3
JobLink Program - $11.8
Capital Outlay & Other - $9.9
63.3%
Transfers to Other Funds - $2.7
Dollars in millions
Difference between Revenue & Expenditures
Total Difference: $27.8 million




Capital Projects Funds $(10.9m)
Debt Service payments $(5m)
Special Education Fund $(11.0m)
All other funds $(.9m)
Oakland Schools
Financial Impact of Benefit Plan Changes
Savings Over Five Years = $ 5,387,820
Data Source:
McGraw Wentworth
Analysis of Actual Results
$ 6,764,089
$ 6,093,774
$ 5,491,541
$ 4,948,988
$ 4,524,888
$1,348,655
$ 1,628,613
$ 4,656,274
Oakland Schools
Annual Savings
$ 1,240,573
$ 238,637
$ 931,342
Oakland
Schools
Annual Cost
$ 4,250,968
$ 4,417,109
$ 4,017,646
Enrolled
405
Enrolled
397
Enrolled
400
Enrolled
405
2005
2006
2007
2008
$ 4,524,888
Annual Cost
If No Changes
$ 4,465,160
$ 5,415,434
Enrolled
402
Enrolled
388
2009
2010
Note: 1. Enrollment is noted at the bottom of each bar with 2010 cost at 1/1/2010 level (anticipated to change in June 2010)
2. Cost with no changes based on 11% annual rate of increase (most projections range from 7% to 13%)
3. 2010 savings based on actual 2010 BCBS rate renewal (no credit / adjustment for Risk Related Fund)
Budget Highlights






Continued health insurance premium share
FY 2010 & 2011 salary freeze
Five (5) unpaid furlough days for all employees
(approx. 2% wage decrease)
Salary reduction in 2012 by 3%
Attrition, Voluntary Employee Sick Leave Program
(VESLPP) and workforce reductions – 105.5 FTE
reductions
Continued planned spend down of fund equity to 5%
Budget Highlights
•
•
•
•
MPSERS retirement rate budgeted at the weighted
average rate of 18.79% (19.41% effective October 1,
2010)
Non union & union healthcare cost budgeted at
annual increase of 13%
Purchase Services, Supplies & Materials, Dues &
Fees reduced by aggregate 10%
Utilities reflect a 6% decrease from the prior year
Budget Highlights
FY 2011 proposed non-union salary & wage changes
A wage freeze was implemented on January 1, 2010 for
non union staff. Non-union wages follow the calendar
year.
5 unpaid furlough days for 12 month staff (2% decrease)
Continuation of employee premium share based on pay
level (up to 4.5%)
The progression increment movement with in the market
ranges plus the longevity stipends account for an average
of 0.5% annually.
Budget Highlights
FY 2011 proposed union salary & wage changes
The union & Board of Education approved a one year
extension on the existing contract, expiring June 30, 2011.
The contract includes a wage freeze implemented on July 1,
2010.
3 unpaid furlough days for 10 month staff (2% decrease)
Continuation of the 6% health insurance cap.
Step increases are provided by contract for an average of
1.2% annually.
Allocation of costs
General Allocation
50% GE, 25% SE, 25% CFE
Activity Based Cost Allocation–FTE based
23% GE, 25% SE, 52% CFE
Abraham & Gaffney – sq footage based
50% GE, 26% SE, 24% CFE
Cost Based Allocation – Transportation
73% GE, 25% SE, 2% CFE
Reference Enterprise Wide Summary Document
General Education Fund Summary


Total Revenue: $17.5 Million
– Property tax – $10.6 M (60% of total revenue)
– Other local revenues – $3.5 M
– State sources revenues – $2.9 M
– Other financing source revenues – $.5 M
Total Expenditures: $17.7 Million
– General administration – $1.7 M
– Finance and operations – $7.2 M
– Instructional services – $8.7 M
– Plant and fixed charges, transfers to LEAs – $.1 M
Note: Medicaid Revenue now reflected in Fund 273
General Fund Overview
$35
$30
$25
$20
$15
$10
$5
$0
2002
Actual
Revenue
2003
Actual
Expense
2004
Actual
2005
Actual
2006
Actual
2007
Actual
Unreserved Fund Balance
Dollars in millions
2008
Actual
2009
Actual
2010
2nd
Amend
Proposed
2011
Reserved Fund Balance
Fiscal Year 2011
General Education Fund Balance
END OF YEAR:
Unreserved:
$ 3,392,200
Reserved:
Prepaid, Inventory and Deposits
$
35,000
Total Budgeted Ending Fund Balance
$ 3,427,200
_______________________________________________________
5% of GEF operating expenditures ($17.7 m):
State Aid exposure (sec 81):
Fund Balance Protocol Target:
$
$
$
0.9 m
2.9 m
3.8 million
Pending Legislation limits General
Education Fund to 15% fund balance
Current Operating Expenditures (COE) - MDE defined
Total Current Operating Expenditures do not include:
•
•
•
Capital Outlay
Community Services
Transfers outs (includes Medicaid transfers to districts)
Fiscal Year 2011 District Debt
Amount
GEF Debt Principal:
$ 5,165,000
CFEF Debt Principal:
$44,770,000
QSCB Debt Principal (funds): $14,800,000
Total OS Bonded Debt:
$64,735,000
Average Annual
Payment
$ 750,000
$ 3,100,000
$ 850,000
$ 4,700,000
NOTE: Debt Service for the Administration Building
Project Bond (2003) and QSCB issue is pre-funded in Debt Service
Fund 310 & 313 and Debt Service for the campus renovations bond
(2007) is pre-funded in Debt Service Fund 312 through FY 2014
General Fund Five-Year Forecast
Proposed
2010-11
Projection
2011-12
Projection
2012-13
Projection
2013-14
Projection
2014-15
Revenue:
17,485,300
16,438,850
17,525,423
16,266,017
17,496,124
Expenditures:
17,673,000
17,520,690
17,419,037
17,578,308
17,746,829
Operating Excess (Deficit)
(187,700)
(1,081,840)
106,386
(1,312,291)
(250,705)
Reserved: Prepaid, Inventory
and deposits
34,900
0
0
0
0
Unreserved/Designated
3,614,900
2,345,360
2,451,745
1,139,454
888,749
Total
3,392,300
2,345,360
2,451,745
1,139,454
888,749
End of Year Unreserved FB
as % of Expenditures
19.19%
13.39%
14.08%
6.48%
5.01%
End of Year Fund Balance:
ISD Budget Resolution
Revised School Code 380.624 - Overview
1.
Not later than May 1 of each year, the ISD shall submit
proposed budget for next fiscal year to the board of each
constituent district for review
2.
Not later than June 1 of each year, the board of each
constituent district shall review the proposed ISD budget,
shall adopt a board resolution expressing its support for or
disapproval of the proposed budget
3.
Mail copy of resolution indicating support or disapproval (with
rationale) to the Oakland Schools Board of Education
General Education Fund

Questions & Comments
Special Education Fund Summary

Total Revenue: $142.0 Million
– Property tax – $134.9 M (95% of total revenue)
– Other local revenues – $1.4 M
– State sources revenues – $5.7 M

Total Expenditures: $153.0 Million
– Program supervision and direction – $2.3 M
– Program operations – $7.5 M
– Plant and fixed charges – $5.7 M
– LEA transfers and program subsidies – $137.5 M
Special Education Fund Overview
$180
$160
$140
$120
$100
$80
$60
$40
$20
$0
2002
Actual
Revenue
2003
Actual
2004
Actual
Expense
2005
Actual
2006
Actual
2007
Actual
2008
Actuals
Unreserved Fund Balance
*FY 2004 contains “one time” operating adjustment for prior years
2009
Actual
2010 2nd Proposed
Amend
2011
Reserved Fund Balance
**Dollars in millions
Fiscal Year 2011 Special Education
Program Support & Subsidies
PA-18 Base Distribution
Start-up Contingency
Extraordinary Contingency
Section 24 subsidy
Group Homes
Havenwick
SEI Regional Day Treatment
Michigan Rehab Services Cash Match
Total
$ 134,332,100
$
850,000
$
250,000
$
100,000
$ 1,200,000
$
150,000
$
450,000
$
180,000
$ 137,512,100
PA-18 Base Distribution $(8.8m) decline from FY 2010
Oakland Schools Special Education
Expenditure Budget Comparison
Transfers to LEAs
OS Operations
180
160.7
160
145.8
120
143.4
137.8
140
157.03
148.18
137.5
134.7
110.09
106.9
100
80
60
40
27.4
23.4
18.5
16.9
16.02
20
18.6
17.66
19.37
18.9
15.5
10
20
20
1
d
Pr
op
os
e
A
m
2n
d
09
20
*External services with offsetting revenue not included in FY 2010 OS Operations
1
en
d
ua
l
A
ct
ua
l
20
08
A
ct
ua
l
FY
20
07
A
ct
ua
l
FY
FY
20
06
A
ct
ua
l
A
ct
20
05
FY
FY
20
04
-A
ct
u
al
ua
l
A
ct
20
03
FY
FY
20
02
A
ct
ua
l
0
Dollars in millions
PA-18 Base Distribution
FY 2003-2015
Trend Line: Red
After Property Tax Decline: Blue
180
$174.0
$171.0
$167.0
$160.0
160
$155.0
$148.0
$142.1
140
$141.9$142.4 $143.1
$128.4
$134.3
$133.7
$130.9
120
$112.0
$109.5
$108.7
$105.6
$103.2
100
FY
2003
$103.2
FY
2004
FY
2005
FY
2006
FY
2007
FY
2008
FY
2009
FY
2010
Dollars in millions
FY
2011
FY
2012
FY
2013
FY
2014
FY
2015
Fiscal Year 2011
Special Education Fund Balance
END OF YEAR:
Unreserved:
Reserved:
Future SE Center Facility Renovations
$
755,200
$
286,000
Total Budgeted Ending Fund Balance
$ 1,061,200
5% of SEF operating expenditures ($15.5 m):
State Aid exposure (sec 51a, 51a.8)
Fund Balance Protocol Target:
$ .775 m
$ 3.9 m
$ 4.675 million
Special Education Five-Year Forecast
Proposed
2010-11
Projection
2011-12
Projection
2012-13
Projection
2013-14
Projection
2014-15
Revenue:
142,044,900
125,951,499
120,248,596
120,541,458
123,130,206
Expenditures:
153,016,800
125,868,753
120,153,830
120,432,549
123,021,792
Operating Excess (Deficit)
(10,971,900)
82,746
94,767
108,909
108,415
Reserved Center Program
Facility Renovation
286,000
386,000
486,000
586,000
686,000
Reserved/Designated
0
0
0
0
0
Unreserved/Designated
775,200
757,946
752,712
761,621
770,036
Total
1,061,200
1,143,946
1,238,712
1,347,621
1,456,036
End of Year Unreserved
FB % net of LEA O.T.
5.00%
5.00%
5.00%
5.00%
5.00%
End of Year Fund Bal:
Special Education Fund

Questions & Comments
Career Focused Education Fund
Summary

Total Revenue: $34.1 Million
– Property tax – $33.0 M (96% of total revenue)
– Other local revenues – $0.6 M
– State sources revenues – $.4 M
– Other financing source revenues – $0.1 M

Total Expenditures: $32.9 Million
– Campus and other program administration – $21.8 M
– LEA transfers and direct program operations – $5.1 M
– Facility and technology maintenance/renovations – $0.1 M
– Plant and fixed charges – $5.9 M
Career Focused Education
Fund Overview
$70
$60
$50
$40
$30
$20
$10
$0
Dollars in millions
2002
Actual
2003
Actual
Revenue
2004
Actual
2005
Actual
Expense
2006
Actual
2007
Actual
2008
Actual
Unreserved Fund Balance
2009
Actual
2010
Proposed
2nd
2011
Amend
Reserved Fund Balance
Fiscal Year 2011
Career Focused Education Fund Balance
END OF YEAR:
Unreserved:
$
8,069,800
Reserved:
Prepaid, Inventory and Deposits
$
67,200
Total Budgeted Ending Fund Balance
$ 8,137,000
_______________________________________________________
5% of CFEF operating expenditures ($32.9):
State Aid exposure (sec 61a.1, 61a.2):
Fund Balance Protocol Target
$ 1.6 m
$ .4 m
$ 2.0 million
Career Focused Education
5-Year Forecast
Proposed
2010-11
Projection
2011-12
Projection
2012-13
Projection
2013-14
Projection
2014-15
Revenue:
34,195,900
30,312,556
28,917,591
28,985,006
30,100,462
Total Expenditures:
32,910,900
32,087,848
30,524,315
30,949,980
31,323,685
Operating Excess (Deficit)
1,285,000
(1,775,292)
(1,606,724)
(1,964,974)
(1,223,224)
Unreserved
8,137,000
6,361,708
4,754,985
2,790,011
1,566,787
End of Year Unreserved
FB as % of Expenditures
24.72%
19.83%
15.58%
9.01%
5.00%
End of Year Fund Balance
Career Focused Education Fund

Questions & Comments
Proposed Grants and Funded Projects
Summary

Total dollar award value of all current grants and
funded projects: $113.7 Million




New Awards
Carry Over
$94.5 Million
$19.2 Million
Direct transfer to districts: $88 Million
ISD administered grants and projects: $25.7 Million
(Includes JobLink $11.8M)
Other Funds







Cooperative Activities Fund 270 – Collaborative Program
Development Initiative (CPDI)
Cooperative Activities Fund 271 – Oakland Network for
Education (ONE)
Cooperative Activities Fund 272 - Alternative Education High
School ( Under Study)
Cooperative Activities Fund 273 – Medicaid
Debt Service Fund 310 – Administrative Building Bond 2003:
15 years, ending 2018
Debt Service Fund 312 – CFE Campus Renovations Bond:
29 years, ending 2036
Debt Service Fund 313 – Qualified School Construction
Bond:17 years, ending 2027
Other Funds





Capital Projects Fund 404 - CFE Technical Campus Renovations
Phase II Project
Capital Projects Fund 406 – Admin Bldg Renovation & Maintenance
Capital Projects Fund 408 – Qualified School Construction Bond
Production Print Fund 710 – Enterprise Fund (subsidy eliminated)
Risk Related Activity Fund 810 – Internal Service Fund
(unemployment pre-funded)
Questions & Comments