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CCOC REBASING WORKSHOP

CCOC REBASING WORKSHOP. Sheraton Suites Orlando May 31, 2007. AGENDA. I. Welcome and Workshop Agenda Objectives II. What’s “Rebasing?” A Review. The requirements Law. The required methodology and rationale. The relationship of “rebasing” to setting “Expenditure Caps.”

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CCOC REBASING WORKSHOP

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  1. CCOC REBASING WORKSHOP Sheraton Suites Orlando May 31, 2007

  2. AGENDA I. Welcome and Workshop Agenda Objectives II. What’s “Rebasing?” A Review. • The requirements Law. • The required methodology and rationale. • The relationship of “rebasing” to setting “Expenditure Caps.” III. What’s happened because of “Rebasing” and “Expenditure Caps?” • Rebasing results: for FY 2005-06 and FY 2006-07. • Rebasing impacts on FY 2006-07 “Expenditure Caps” and trends. • Trends in court related expenditures, revenues and workloads and their implications. • Rebasing impacts on FY 2007-08 “Expenditure Caps” and “Expenditure Cap” trends. IV. What are budget problems caused by “Rebasing” and “Expenditure Caps?” • A. Rebasing results that reduce FY 2006-07 Budget Caps. • B. Shrinking “FY 2007-08 Expenditure Caps” due to rebasing and FY 2007-08 revenue projections. • C. Local revenue collection trends less than expenditure trends. • D. Possible negative impacts on meeting performance standards. V. What are budget problem solution options: within current law and requiring changes in law? Such as: • Budget Request changes. • Increasing revenues. • Court policy changes. • Trust Fund flexibility. • Expenditure cap method changes. VI. Next Steps

  3. What’s Rebasing: A Review The Requirements of Law: F.S. 28.36 (5a) For county fiscal year 2007-08, the rebased budget for CFY 2005-06 shall be adjusted for the actual % change in revenue between the two 12 month periods ending June 30, 2006 and June 30, 2007. This result is the rebased budget for county FY 2006-07. The rebased budget for county fiscal year 2006-07 shall be adjusted by the projected percentage change in revenue between the county fiscal years 2006-07 and 2007-08. This result shall be the maximum annual budget amount for the standard list of court-related functions of the clerks of court in s.28.35(4)(a) that may be funded from fees, service charges court costs, and fines retained by the clerks of the court for CFY 2007-08 State Rationale: The State assumes that more cases produce more revenues to pay for the more work required; if the output measure “# of cases” goes up, then additional revenues come in to pay for the effort required to work them. If cases go down then there is less work and less revenues are needed. The Required Methodology See CCOC Rebasing Template How are “Rebasing” and “Expenditure Cap Setting” Related? 1. Assume: RebasedFY 2006-07Revenues went up +5%(vs. original est. of + 3%) 2. Multiply 5% X Rebased FY 2005-06 Budget = Rebased FY 2006-07 Expend. Cap 3. Multiply the Rebased FY 2006-07 Expend. Cap X your projected FY 2007-08 revenue growth rate = FY 2007-08 Expenditure Cap!

  4. REBASING IN SUMMARY Each Clerk’sFY 2005-06 Expenditure Cap was “rebased”last year. That “rebased” FY 2005-06 Expenditure Cap X a projected revenue growth rate in FY 2006-07 resulted in a FY 2006-07 Expenditure Cap for each Clerk. (However, a Clerk’s “CCOC Budget Request” could be under the Cap) The FY 2006-07 Expenditure Capis now being preliminarily “rebased” and the result will be multiplied X a Clerk’s projected FY 2007-08 over FY 2006-07 revenue growth rate to get a FY 2007-08 EXPENDITURE CAP.

  5. REBASING IN DETAIL SINCE FY 2004-05 In FY 2007-08, an Expenditure Cap is being calculated by (1) “rebasing” the FY 2006-07 over FY 2005-06 revenue growth rate (from estimated to projected actual) and (2) multiplying that growth rate X the “rebased” FY 2005-06 Expenditure Capto determine the “rebased” FY 2006-07 Expenditure Cap, and (3) multiplying that rebased Cap X the Clerk’s estimated FY 2007-08 revenue growth rate over FY 2006-07. AND THE CLERK WILL SUBMIT A FY 2007-08 BUDGET REQUEST (which may be below his/her “Cap.” InFY 2004-05 there was a 3% Expenditure Cap imposed on each Clerk’s Budget ……..as required in law. AND A FY 2004-05 BUDGET WAS APPROVED. In FY 2005-06, an Expenditure Cap was calculated based on (1) multiplying each Clerk’s estimated % revenue growth rate from FY 2004/05 through FY 2005-06 X the FY 2004-05 Appr. Budget. AND A FY 2005-06 BUDGET WAS APPROVED. (could be lower than the “Cap”) In FY 2006-07, an Expenditure Cap was calculated based on (1) “rebasing the FY 2005-06 revenue growth rate (from estimated to actual) X the Approved FY 2004-05 budget = the “rebased” FY 2005-06 Expenditure Cap which was (2) multiplied X the Clerk’s estimated FY 2006-07 revenue growth rate over FY 2005-06. AND A FY 2006-07 BUDGET WAS APPROVED (could be lower than the “Cap”)

  6. Rebasing Template

  7. What’s Happening because of Rebasing and Expenditure Caps?

  8. FY 2005-06 and FY 2006-07 Rebasing Trends

  9. FY 2005-06 and FY 2006-07 Rebasing Trends

  10. What are important “stats” to review to determine whether “Rebasing” and “Revenue Growth Rate-based Expenditure Caps”are working? For All 67 Clerks’ Offices FY 2004-05 FY 2005-06 FY 2006-07 growth rate growth rate Actual Revenue Growth Rates Rebased Rev. Growth Rates Actual Expenditure Growth Rates CAP Growth Rates Actual Workload Growth Rate

  11. ACTUAL REVENUE GROWTH RATESFOR 67 CLERKS’ OFFICES CFY 2005-06 to CFY 2006-07 TREND w/5 months to go CFY 2004-05 to CFY 2005-06 Negative Growth 7 14 0 – 5% Growth 15 19 5.1% to 10% 21 18 10.1 % to 20% 13 20 20.1% to 30% 1 3 Above 30% 1 2

  12. REBASED REVENUE GROWTH RATESFOR ALL 67 CLERKS’ OFFICES SFY 2004-05 to SFY 2005-06 = 12.2 % average SFY 2005-06 to SFY 2006-07 = 12.85% average Growth Rate Average Over the 2 Fiscal Years: Negative Growth 4 Clerks’ Offices 0 – 5% Growth 5 Clerks’ Offices 5.1% to 10% 20 Clerks’ Offices 10.1 % to 20% 28 Clerks’ Offices 20.1% to 30% 8 Clerks’ Offices 2 Clerks’ Offices Above 30%

  13. ACTUAL EXPENDITURE GROWTH RATESFOR 67 CLERKS’ OFFICES CFY 2004-05 to CFY 2005-06 CFY 2005-06 to CFY 2006-07 Negative Growth 9 0 – 5% Growth 12 Unreliable trend based on 4 months to go in CFY 5.1% to 10% 22 10.1 % to 20% 22 20.1% to 30% 1 Above 30% 1

  14. ACTUAL CAP GROWTH RATESFOR 67 CLERKS’ OFFICES FY 2005-06 to FY 2006-07 TREND CFY 2004-05 to FY 2005-06 Negative Growth 6 6 0 – 5% Growth 21 5 5.1% to 10% 28 5 10.1 % to 20% 25 8 20.1% to 30% 20 4 Above 30% 0 6

  15. ACTUAL CRIM. DEFENDANT/CIVIL CASE GROWTH RATESFOR 67 CLERKS’ OFFICES CFY 2004-05 to CFY 2005-06 CFY 2004-05 to CFY 2005-06 Negative Growth 0 – 5% Growth 5.1% to 10% 10.1 % to 20% 20.1% to 30% Above 30%

  16. Clerks’ Budgets and the Operations Trust Fund CFY 2004-05 CFY 2005-06 CFY 2006-07 Receiving $ from the Trust Fund 27 22 29 Sending $ to the Trust Fund 40 38 45

  17. What Are Rebasing & Expenditure Cap RelatedPROBLEMS 1. FY 2006-07 revenue collections may be less than projected at the beginning of the Fiscal Year for some Clerks’ budgets, causing a “rebasing” of the FY 2006-07 Expenditure Cap DOWNWARD…..which may cause the FY 2007-08 Expenditure Cap to be less than expected. 2. Some Clerks’ Expenditure “caps” may be growing but at a lower rate than basic expenditure increase rates (e.g. to cover workloads not producing revenues, insurance benefit increases, low cost of living raises for employees)….. especially affecting smaller counties. 3. For some Clerks’ budgets, Expenditure “caps” may be less than expected due to the need to lower projections for FY 2007-08 local revenue growth rates over FY 2006-07. 4. For some Clerks’ Offices, if Expenditure Caps decrease below certain levels, it may be difficult to keep staff workloads at a reasonable level which could affect the ability to meet “Timeliness” and “Collection Rate” performance standards.

  18. Where are rebasing related “Problems” most likely? Preliminary indications: there are 5 smaller counties with potentially severe problems due to their size (e.g. limited staff with many different duties) EXAMPLES: County 1: 2 yrs. of cuts in actual revenues collected; 2 yrs. with expend. cuts; 2 years of revenue rebasing cuts; receives $ 20,000 month from Trust Fund; 14% cut in Expenditure Cap for FY 2006-07 over FY 2005-06. County 2: 2 years of double digit cuts in actual revenues; - 14% revenue rebasing for FY 1006-07 over FY 2005-06; while expenditures are up from previous year; contributes almost $ 17,000 a month to the Trust Fund

  19. What are budget problem solution options? • Review budget preparation strategies: re-allocations, spending cuts, operating efficiencies to curtail cost increases? 2. Find ways to increase revenues to increase “expenditure cap” potential? 3. Give CCOC flexibility to supplement especially small court budgets when revenue growth rates cannot provide minimum “expenditure cap” funding need levels (e.g. for retaining a minimum number of staff necessary to operate the office)? 4. Request a change in the rebasing/ expenditure cap setting policies (e.g. an expenditure cap “floor”)?

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