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2018-19 PROPOSED PRELIMINARY BUDGET
Norristown Area School District
2018-19 Budget
Act 1 of 2006 requires: Proposed 2018-19 Preliminary Budget must be on “public display” before
adoption, specifically by January 25, 2018.
We are complying with the “public display” requirement by presenting our
2018-19 Preliminary Budget tonight. We will also make sure that our budget
document is available on our website, in our buildings, and in the offices of our
local municipal partners.
2018-19 Preliminary Budget must be adopted by February 14, 2018
We will hold a brief Special Meeting on February 12, 2018 for adoption
2018-19 PROPOSED PRELIMINARY BUDGET
Norristown Area School District
2018-19 Budget
As identified at our November Budget Kick-Off Meetings:
Primary Budgetary Challenge
Balancing the needs of our students with the needs of our taxpayers
2018-19 BUDGET RECOMMENDATIONS
Norristown Area School District
2018-19 Budget
• As a result, at the School Board’s request, we will be using the next few months to
explore the development of a 2018-19 Budget with no tax increase
• Closer review of our traditional priorities will be needed; Maintain full-day kindergarten program; including maintaining Musselman as a kindergarten center
Providing adequate instructional materials & textbooks
Maintain strong range of music, arts, and foreign languages courses
Maintain manageable class sizes
Maintain adequate staffing to support growing ELL student population
Maintain adequate staffing to support our Special Education programming
Maintain School Resource Officers
Adequately plan for facilities management, maintenance, repairs, and facility upgrades
• REVENUE OVERVIEW:
– NASD Adjusted Act 1 Index = 2.90%
• @ 2.90% = $ 135 to avg taxpayer
– Estimated Maximum Allowable Tax Increase = 3.81%
• With Special Education Exception
• Will submit to PDE for approval in March 2018
– (Recognize that we may not use the exceptions, but our intent is to apply
for them in case they would be needed)
– Proposed Preliminary Budget Tax Increase = 0.00%
• Difficult decisions will be needed in order to achieve this
Norristown Area School District
2018-19 Budget
• REVENUE OVERVIEW:
• Local revenues sources:
– Limited growth in local real estate economy
• State revenue sources:
– Commonwealth facing est. $1 billion shortfall
– Election year
– Governor Wolf’s budget address scheduled for February 6, 2018
– Bare bones budget expected
• Federal revenue sources:
– Much uncertainty – program details will not be available until late Spring
Norristown Area School District
2018-19 Budget
We do not expect to see any new pro-public education policies adopted
at either the state or federal level.
Level funding has been projected at this point,
but there are concerns that some of our funding may actually be cut.
SCHOOL TAX = OUR LARGEST REVENUE SOURCE
Norristown Area School District
2018-19 Budget
Based on assessed value
$1,000,000,000
$1,500,000,000
$2,000,000,000
$2,500,000,000
$3,000,000,000
2013-14 2014-15 2015-16 2016-17
RELATIVELY FLAT MARKET =
NO NEW REVENUE
2017-18
CURRENT YEAR
BUDGETED REVENUES $ 150,120,650
PROJECTED REVENUES (Jan 2018) $ 151,008,300
VARIANCE $ 887,650
0.59%
Norristown Area School District
2018-19 Budget
REVENUE SNAPSHOT
2018-19
NEXT YEAR
BUDGETED REVENUES $ 151,333,300
VARIANCE (Compared to 2017-18 Projected) $ 325,000
0.21%
No Tax Increase
REVENUE SNAPSHOT
Norristown Area School District
2018-19 Budget
71%
24%
5%
Local State Federal
2018-19
71%
24%
5%
Local State Federal
2017-18
• EXPENSE OVERVIEW:– Wage Increases – Negotiations On-Going (EANA Professional, EANA Support)
• Roughly 45% of our spending is being negotiated currently
– PSERS (Retirement) contribution rate increasing from 32.57% to 33.43%
• Net budget impact = + $ 500k
– Health Care
• “First Look” at 2018-19:– Medical – 14.52% rate increase
– Prescription Drug – 11.30% rate increase
• Budget Impact = + $ 1.9 million
• May be impacted by labor negotiations
– Debt Service
• 2018-19 payments drop as a result of our refinancing in 2016
• Budget Impact = ( $ 395k )
– Central Montgomery Technical High School - TBD
Norristown Area School District
2018-19 Budget
Rates expected to drop
2nd look – late February
3rd - Final look – late March
• EXPENSE OVERVIEW:– Staffing
• Proposed Preliminary Budget includes the following staffing changes:
Norristown Area School District
2018-19 Budget
BUILDING PROPOSED STAFFING CHANGE RATIONALE
Cole Manor Eliminate 2 kindergarten teachers • Enrollment decline
• Students in CM boundary
will attend Musselman
• EXPENSE OVERVIEW:– Staffing
• Proposed Preliminary Budget includes the following staffing changes:
Norristown Area School District
2018-19 Budget
BUILDING PROPOSED STAFFING CHANGE RATIONALE
Cole Manor Eliminate 2 kindergarten teachers • Enrollment decline
• Students in CM boundary
will attend Musselman
Paul Fly Eliminate 1 Reg Ed & .50 Spec Ed teachers • Enrollment driven
• EXPENSE OVERVIEW:– Staffing
• Proposed Preliminary Budget includes the following staffing changes:
Norristown Area School District
2018-19 Budget
BUILDING PROPOSED STAFFING CHANGE RATIONALE
Cole Manor Eliminate 2 kindergarten teachers • Enrollment decline
• Students in CM boundary
will attend Musselman
Paul Fly Eliminate 1 Reg Ed & .50 Spec Ed teachers • Enrollment driven
Marshall St Eliminate .50 Spec Ed teacher • Enrollment driven
• EXPENSE OVERVIEW:– Staffing
• Proposed Preliminary Budget includes the following staffing changes:
Norristown Area School District
2018-19 Budget
BUILDING PROPOSED STAFFING CHANGE RATIONALE
Cole Manor Eliminate 2 kindergarten teachers • Enrollment decline
• Students in CM boundary
will attend Musselman
Paul Fly Eliminate 1 Reg Ed & .50 Spec Ed teachers • Enrollment driven
Marshall St Eliminate .50 Spec Ed teacher • Enrollment driven
Gotwals Eliminate 2 Reg Ed teachers • Enrollment driven
• EXPENSE OVERVIEW:– Staffing
• Proposed Preliminary Budget includes the following staffing changes:
Norristown Area School District
2018-19 Budget
BUILDING PROPOSED STAFFING CHANGE RATIONALE
Cole Manor Eliminate 2 kindergarten teachers • Enrollment decline
• Students in CM boundary
will attend Musselman
Paul Fly Eliminate 1 Reg Ed & .50 Spec Ed teachers • Enrollment driven
Marshall St Eliminate .50 Spec Ed teacher • Enrollment driven
Gotwals Eliminate 2 Reg Ed teachers • Enrollment driven
Eisenhower Add 1 Reg Ed teacher • Enrollment driven
Stewart Add 1 Reg Ed teacher • Enrollment driven
ENMS Eliminate 2 Reg Ed teachers & 1 Spec Ed teacher • Enrollment driven
• EXPENSE OVERVIEW:– Staffing
• Proposed Preliminary Budget includes the following staffing changes:
Norristown Area School District
2018-19 Budget
BUILDING` PROPOSED STAFFING CHANGE RATIONALE
Cole Manor Eliminate 2 kindergarten teachers • Enrollment decline
• Students in CM boundary
will attend Musselman
Paul Fly Eliminate 1 Reg Ed & .50 Spec Ed teachers • Enrollment driven
Marshall St Eliminate .50 Spec Ed teacher • Enrollment driven
Gotwals Eliminate 2 Reg Ed teachers • Enrollment driven
Eisenhower Add 1 Reg Ed teacher • Enrollment driven
Stewart Add 1 Reg Ed teacher • Enrollment driven
ENMS Eliminate 2 Reg Ed teachers & 1 Spec Ed teacher • Enrollment driven
Middle Schools – Net Impact:No change in total # of Regular Ed Teachers
Decrease of 1 Spec Ed Teacher
Middle School Boundaries under review –
may affect these recommendations
• EXPENSE OVERVIEW:– Staffing
• Proposed Preliminary Budget includes the following staffing changes:
Norristown Area School District
2018-19 Budget
BUILDING PROPOSED STAFFING CHANGE RATIONALE
Cole Manor Eliminate 2 kindergarten teachers • Enrollment decline
• Students in CM boundary
will attend Musselman
Paul Fly Eliminate 1 Reg Ed & .50 Spec Ed teachers • Enrollment driven
Marshall St Eliminate .50 Spec Ed teacher • Enrollment driven
Gotwals Eliminate 2 Reg Ed teachers • Enrollment driven
Eisenhower Add 1 Reg Ed teacher • Enrollment driven
Stewart Add 1 Reg Ed teacher • Enrollment driven
ENMS Eliminate 2 Reg Ed teachers & 1 Spec Ed teacher • Enrollment driven
NAHS Eliminate 1 Health/Phys Ed teacher • Program changes
• EXPENSE OVERVIEW:– Staffing
• Proposed Preliminary Budget includes the following staffing changes:
Norristown Area School District
2018-19 Budget
BUILDING PROPOSED STAFFING CHANGE RATIONALE
Cole Manor Eliminate 2 kindergarten teachers • Enrollment decline
• Students in CM boundary
will attend Musselman
Paul Fly Eliminate 1 Reg Ed & .50 Spec Ed teachers • Enrollment driven
Marshall St Eliminate .50 Spec Ed teacher • Enrollment driven
Gotwals Eliminate 2 Reg Ed teachers • Enrollment driven
Eisenhower Add 1 Reg EdTeacher • Enrollment driven
Stewart Add 1 Reg Teacher • Enrollment driven
ENMS Eliminate 2 Reg Ed teachers & 1 Spec Ed teacher • Enrollment driven
NAHS Eliminate 1 Health/Phys Ed teacher • Program changes
TBD Add 1 Community Liaison • Enrollment driven
NET IMPACT:
REDUCTION IN 8 TEACHING POSITIONS & ADDITION OF 1 COMMUNITY LIAISON
2017-18
CURRENT YEAR
BUDGETED EXPENSES $ 149,179,300
PROJECTED EXPENSES (Jan 2017) $ 151,832,000
VARIANCE $ 2,652,700
1.77%
Norristown Area School District
2018-19 Budget
EXPENSE SNAPSHOT
2018-19
NEXT YEAR
BUDGETED EXPENSES (Status Quo Programming) $ 155,183,000
VARIANCE $ 3,351,000
2.20%
2017-18
CURRENT YEAR
BUDGETED EXPENSES $ 149,179,300
PROJECTED EXPENSES (Jan 2017) $ 151,832,000
VARIANCE $ 2,652,700
1.77%
Norristown Area School District
2018-19 Budget
EXPENSE SNAPSHOT
2018-19
NEXT YEAR
BUDGETED EXPENSES (Status Quo Programming) $ 155,183,000
VARIANCE $ 3,351,000
2.20%
CHALLENGE:
PROJECTED GROWTH
IN REVENUES
(Without Tax Increase)
= 0.21%
Wages44%
Benefits29%
Professional Svc3%
Property Svc1%
Other Purch Svc (Tuition,
Transportation, etc)16%
Supplies1% Equipment
2%
Other (Primarily Debt)4%
2018-19 EXPENSES – BY MAJOR OBJECT
Reg Ed42%
Spec Ed18%
Voc Ed3%
Other Instruction1%
Pupil Svcs4%
Instruct Support1%
Admin Support7%
Health1%
Business1%
Operations9%
Transportation6%
Central Support (IT)1%
Other Support
0%
Student /Community1% Debt
4%
2018-19 EXPENSES – BY MAJOR FUNCTION
FUND BALANCE 7-1-17 $ 1,515,971
2017-18 PROJECTED REVENUES (Jan 2018) $ 151,008,300
2017-18 PROJECTED EXPENSES (Jan 2018) $ 151,832,000
FUND BALANCE 6-30-18 $ 692,271
Norristown Area School District
2018-19 Budget
FUND BALANCE 7-1-17 $ 1,515,971
2017-18 PROJECTED REVENUES (Jan 2018) $ 151,008,300
2017-18 PROJECTED EXPENSES (Jan 2018) $ 151,832,000
FUND BALANCE 6-30-18 $ 692,271
2018-19 PROJECTED REVENUES (No Tax Increase) $ 151,333,300
2018-19 PROJECTED EXPENSES (Status Quo Programming) $ 155,183,050
MINIMUM FUND BALANCE NEEDED 6-30-19 $1,000,000
2018-19 BUDGET SHORTFALL $ 4,157,479
Norristown Area School District
2018-19 Budget
FUND BALANCE 7-1-17 $ 1,515,971
2017-18 PROJECTED REVENUES (Jan 2018) $ 151,008,300
2017-18 PROJECTED EXPENSES (Jan 2018) $ 151,832,000
FUND BALANCE 6-30-18 $ 692,271
2018-19 PROJECTED REVENUES (No Tax Increase) $ 151,333,300
2018-19 PROJECTED EXPENSES (Status Quo Programming) $ 155,183,050
MINIMUM FUND BALANCE NEEDED 6-30-19 $1,000,000
2018-19 BUDGET SHORTFALL $ 4,157,479
Norristown Area School District
2018-19 Budget
NEED TO REDUCE COSTS AND/OR RAISE NEW REVENUE
IN THE AMOUNT OF $ 4,157,479
IN ORDER TO HAVE NO TAX INCREASE IN 2018-19
Closing 2018-19 Budget Gap:
Recommend using the spring months to evaluate the viability of the following options:
Norristown Area School District
2018-19 Budget
REVENUE GENERATING
Implementation of activity/athletic fee structure
Sale of Roosevelt Field
Sale of Burnside Property
Using proceeds as operating dollars rather than
targeted them for Athletic Project
Closing 2018-19 Budget Gap:
Recommend using the spring months to evaluate the viability of the following options:
Norristown Area School District
2018-19 Budget
REVENUE GENERATING COST REDUCING
Implementation of activity/athletic fee structure Repurposing space at Roosevelt to operate an
on-site alternative program
Sale of Roosevelt Field Eliminate some/all non-mandated programs
(including full-day kindergarten?)
Sale of Burnside Property
Using proceeds as operating dollars rather than
targeted them for Athletic Project
Identify/implement strategies designed to
attract charter school students back to NASD
Evaluate opportunities for outsourcing support
staff (can only be done as staff resign/retire)
Evaluate opportunities to eliminate
positions/programs (may result in staff
furloughs)
Closing 2018-19 Budget Gap:
Recommend using the spring months to evaluate the viability of the following options:
Norristown Area School District
2018-19 Budget
REVENUE GENERATING COST REDUCING
Implementation of activity/athletic fee structure Repurposing space at Roosevelt to operate an
on-site alternative program
Sale of Roosevelt Field Eliminate some/all non-mandated programs
(including full-day kindergarten?)
Sale of Burnside Property
Using proceeds as operating dollars rather than
targeted them for Athletic Project
Identify/implement strategies designed to
attract charter school students back to NASD
Evaluate opportunities for outsourcing support
staff (can only be done as staff resign/retire)
Evaluate opportunities to eliminate
positions/programs (may result in staff
furloughs)
THERE IS NO SINGLE
RECOMMENDATION THAT WILL CLOSE
OUR BUDGET SHORTFALL
SOLUTION WILL LIKELY NEED TO BE
SOME COMBINATION OF THESE
STRATEGIES
Closing 2018-19 Budget Gap:
Recommend using the spring months to evaluate the viability of the following options:
Norristown Area School District
2018-19 Budget
REVENUE GENERATING COST REDUCING
Implementation of activity/athletic fee structure Repurposing space at Roosevelt to operate an
on-site alternative program
Sale of Roosevelt Field Eliminate some/all non-mandated programs
(including full-day kindergarten?)
Sale of Burnside Property
Using proceeds as operating dollars rather than
targeted them for Athletic Project
Identify/implement strategies designed to
attract charter school students back to NASD
Evaluate opportunities for outsourcing support
staff (can only be done as staff resign/retire)
Evaluate opportunities to eliminate
positions/programs (may result in staff
furloughs)
As we evaluate these options
we will also continue to:
• Actively negotiate with EANA
• Quantify expected healthcare rate
reduction
• Monitor activity in Harrisburg &
Washington closely
THESE WILL ALL IMPACT THE BUDGET
SHORTFALL
• 2018-19 Preliminary Budget:• With no tax increase: $ 151,025,050
• Options to close shortfall to be vetted during
Spring
• Scheduled for Adoption: February 12, 2018
Norristown Area School District
2018-19 Budget
Questions ?