Solanco School District Preliminary 2015-16 Budget

1. Solanco School DistrictPreliminary 2015-16 Budget January 26, 2015

2. Solanco Post-Recession: Where we are today is the result of significant efforts • It has taken multiple efforts on multiple fronts by our staff and departments...it has enabled us to maintain solid student program offerings....and in some cases expand them. • It required, and requires, on-going and difficult decisions by the board, administration, support and professional staff .....all within their roles and departments • It required and requires an informed and supportive community. • Post Recession, we are not out of the woods; the district has sustained a solid core of educational programs for our students via a supportive community, inclusive of staff culture and dedication, and Board direction to continually strive for improved educational opportunities and outcomes. • This Budget reflects a realistic and grounded expectation of low and modest economic growth, with continued expenditure growth pressures.

3. 2015-16 Budget Planning • Objective: To improve, maintain, and sustain educational program opportunities for our students and community • Includes: A proposed 2.5% tax rate increase to offset a 21% mandated Pension increase, and a portion of anticipated Special Education growth....this increase will require board action, and PDE approval, to exceed the Act 1 cap of 2.3% • It utilizes anticipated modest EIT growth, and continues to leverage expenditures within operations to balance the budget • It anticipates a modest anticipated increase in Basic Ed funding (1.3%)......beyond that the total State Budget Process is looking at a $2.5 Billion structural deficit • Options Matter: As proposed, the Preliminary Budget will provide the Board with tax rate options at Final budget in June, which otherwise will be lost

4. Recap:Recessional Years and Fiscal Reality;Follow the Money

5. NOTE: For Pension: For Every $1.00 the Board Must Spend, The State Provides 50 Cents.

7. Pension Reserve Draw downs:Allocated to phase out FY 2018 – Bottom Line; 3 more Years

10. Board has no control over: • Earned Income Tax Collections; The Rate of the tax; or the Underlying Economy creating Growth or Loss of Funds. • Property Assessment; the Underlying Environments impacting growth of the base; Township, County and State Laws (appeals, re-assessment (2017), development, codes, zoning). • Continued barrage of State Mandates applied with either none, temporary, or partial state funding. • The Act 1 Index and the indices measured.

13. Board Authority:Non-Mandated Expenditures And Property Tax Rate within the Act 1 Cap (2.3%)PDE will need to approve Use of Exceptions (Pension) to exceed the Cap at 2.5%

14. 2.3% [Solanco Act 1 Cap] times 39% [Solanco Property tax as a % of total Budget] = .90%Meaning, on the Revenue side, board authority for “control” is Less than 1% of the total budget.So, if a budget cost grows at or greater than 1% of the total budget....

15. Proposed Increase Covers Pension

16. For Four out of last Five years, the PA Act 1 Base has been less than 2%

17. January 26, 2015Solanco School DistrictProposed Preliminary Budget Summaries for 2015-16 (22 Months in advance of FY Closure)Submitted as per PA Requirements under Act 1 of 2006State Revenues unknown until mid-June or later; generally provided by the state after board final adoption

20. Budget Process & Key Dates • File Budget with PDE; PDE must Certify and rule on request for Exception(s) use by March 25th • March 3rd; Governor’s Budget address; Basic & Special Education funding proposed • April 15th Certification of slot money Revenues to off-set Property taxes • Late April, Budget review and advertise a Preliminary Final 2015-16 Budget • Early June, receive final County Assessment numbers and Adopt a Final 2015-16 Budget • June 30?.....State Adopts its Budget...Generally too late for us to adjust

21. Questions?