Local Finance Update

1. Local Finance Update Spring Fiscal Workshop Pickwick Landing State Park April 16-18, 2013

2. Year End Information What you need to know for year-end

3. Commodity Reporting(Refresher) • Commodity Reporting – Centralized • Revenue code 47112 USDA – Commodities • Expenditure code 71300-469 USDA – Commodities • Value of commodities received only • Transportation and processing expensed separately • No separate eReporting requirements

4. Commodity Reporting(Refresher) • Commodity Reporting – Non-Centralized • Report on AFR Non-Centralized Cafeteria Report • Separate line item on report – 84100 • Commodity Report is eliminated in eReporting

5. Growth Funds • Estimated payment made in January • Will be recalculated in June • Final payment by June 30 • Growth over .55% funded in January • May change in June • $31 million available for growth funds in FY13 • To fund 100% growth - $39 million

6. Growth Funds • How is estimated growth calculated? • ADM’s from months 2 and 3 used • BEP formula for current fiscal year is re-run with current year ADM’s • Funds generated compared to January Revised • Additional funds generated are “growth funds” • Not simple per pupil multiplied by additional students

7. BEP Reserve • Determined by MOE test after FY13 AFR and FY14 Budget are completed in eReporting • Equals amount local revenues collected fell short of budgeted amount • May be cumulative • Equity account number 34555 – Restricted for Education with a cost center (e.g. BEP) • Other reserves designated BEP should be re-classified as assigned, committed, etc. per Comptroller’s office • Use for non-recurring expenditures • Send Trial Balance showing the BEP reserve to Brenda Pursley with a comment re: adjustment

8. Career Ladder • Career Ladder Reserve used to determine Career Ladder payments • 34560 Restricted for Instruction • Verify beginning balance – adjust if necessary • Journal entry out any other amounts in that reserve – reclassify to other accounts • Automatically pulls into Career Ladder Report in eReporting

9. Career Ladder • Career Ladder eligibility determined from December 1 PIRS report • Negative reserve will be added to next year’s payment • Positive reserve will be deducted from next year’s payment

10. Extended Contract • Final payment for FY13 – week of May 6 • Track extended contract funds received and payments made • Establish a reserve if necessary • 34655 Restricted for Education – add a cost center (e.g. EXT) • Extended Contract now under Erin Ohara’s group – Data Quality • Karen Daniels – Karen.Daniels@tn.gov 615-532-1254 • Laquisha Oliver – Laquisha.Oliver@tn.gov 615-532-6280

11. Deferred Compensation • Differentiated or performance-based pay plans • Earned in one fiscal year, payable in the following • Performance –based bonus • Retention payments • 34655 Committed for Education – add a cost center (e.g. DEF)

12. eReporting Changes • New revenue code(s) • 46810 Flood Control • New expenditure codes • 188 Bonus payments • 211 Local retirement (non-TCRS contributions)

13. EIS, ADM’s and Funding • ADM’s for funding taken directly from EIS • Growth payments caused a number of LEA’s to review ADM’s • Look at April estimate – check ADM’s • Regular • Special Education • CTE • Must be approved by June 15 for final BEP allocaions and growth

14. Miscellaneous Items • Close all Purchase Orders in federal funds prior to June 30 • TCA 8-27-303 and Appropriations Bill prescribe portion of health insurance premium that must be paid for non-certified employees –minimum of 10% in calendar year 2013 • Federal budget amendments do not have to be approved by County Commission – as long as no local match required • PIRS report must be completed and certified by June 15

15. ePlan Grants Management System

16. Federal Projects - ePlan • Prepare for transition to ePlan for FY14 • ESEA and IDEA formula grants in FY14 • Title I-A • Title I-D • Title II-A • Title III-A • Title VI • IDEA – Part B • IDEA – Preschool • Other grants in FY15 and beyond

17. Federal Projects - ePlan • Transition to ePlan from FACTS • No open purchase orders at June 30 • FACTS “locked” on June 30 • Reimbursement requests for expenditures prior to June 30 will be approved by your fiscal consultant or Local Finance (Nashville), then released through FACTS • After all reimbursements for expenditures in FY 13 paid, remaining funds will transfer to ePlan as carryover

18. Federal Projects - ePlan • July 1 • All reimbursements requests for expenditures after July 1 will be through ePlan • Carryover expenditures should be included in FY14 budget – particularly for July through September • Budget amendment will be necessary when carryover determined

19. Federal Projects - ePlan • Special Notes for ePlan transition • Reimbursement requests are by line item • Budget must be accurate • Plan ahead for amendments • Payroll must be requested like all other reimbursements – no automatic payroll requests

20. First to the Top

21. First to the Top • End date is July 27, 2014 • Work completed by July 27, 2014, paid out by October 27, 2014

22. FY14 State Budget

23. FY14 Education Budget • Proposed budget based on governor’s original recommendation – amendments not reflected here • Total budget - $5.6 billion • Federal funds - $1.2 billion • State Funds - $4.4 billion • BEP - $4 billion • Other state expenditures - $.4 billion • 96% passed through to LEA’s • 934 pre-K classrooms – no inflationary increase for FY14

24. BEP • Formula funded as calculated • Total addition to BEP in FY14 - $126,000,000 • Increases to FY13 - $43,200,000 • ADM’s • Unit cost increases • Square footage cost • Travel • Transportation

25. BEP • Salary unit cost • 1.5% increase to unit cost • New salary unit cost - $40,447 • Included in April estimate • Cost - $35,800,000 • State minimum salary schedule • 1.5% likely NOT to be added to schedule • No requirement for across the board raise if approved • Additional funds must be spent in instructional category • Flexibility in how additional salary funds expended – LEA discretion

26. BEP • Capital outlay • Inflationary growth from 2010 restored • $33.7 million additional funds • Included in April estimate • Health insurance • Funded at 10 months • Additional 6 months of 9.2% increase (from January 1, 2013) • Cost - $13,500,000 (included in April estimate) • Estimated increase in premium January 1, 2014 - $11,300,000

27. Technology Funds (PARCC) • One-time appropriation of $51 million • Distributed outside of the BEP • Allocated per LEA share of non-classroom component of the BEP • Revenue code 46590 – with a cost center (e.g. TEC) • Funds not expended by June 30, 2014 may be carried over in 34555 Restricted for Education - with a cost center (e.g. TEC)

28. Technology Funds (PARCC) • Tentative process • LEA’s complete new version of technology readiness survey • Identify specific testing-area needs in LEA • State will provide template for the technology plan • How funds will be spent to address a known PARCC deficiency • May be able to use planning document for E-Rate filings • State will review and approve technology plans • Funds then released to LEA’s – method TBD

29. Core Services

30. Other Programs

31. Legislative Update

32. State Charter Authorization • Creates state charter authorizer to which charter operators may appeal if refused at LEA level

33. Centralized Finance • Centralize all county finance activities under county finance office • Vote of county legislative body required to enact • Likely not going forward this year

34. From last year • Kindergarten age – 5 years old by August 15, 2013

35. Contacts

36. CORE Offices

37. Fiscal Consultants

38. Local Finance/Local Disbursements

39. Questions?