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School District of Cadott Community

School District of Cadott Community. Preliminary Budget Hearing August 18, 2014 Budget Summary. The 2014-2015 Proposed Budget is based upon:. BALANCE. Balanced Initiatives. Elementary Building Renovation HORNET Pride Technology Updates

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School District of Cadott Community

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  1. School District of Cadott Community Preliminary Budget Hearing August 18, 2014 Budget Summary

  2. The 2014-2015 Proposed Budget is based upon: BALANCE

  3. Balanced Initiatives • Elementary Building Renovation • HORNET Pride • Technology Updates • The needs of the students with communities ability to pay • Health Insurance Rate Cumulative Reductions of more than 15% from 3 years ago • Past Security Initiatives – Cameras, Door Entry Access, etc. within existing District funds • Refinancing of District Debt (2014-15) – Taxpayer Savings • Taxing Under Allowable Revenue Limit • Cost Per Student lower than Surrounding School Districts, CESA 10, and State

  4. The purpose of the Annual Budget is to achieve educational objectives that will impact the future.

  5. The Annual Budget Is a financial plan based upon budget priorities throughout the year Annual Budget adjustments are made for the final certification of general aid The property tax levy to support the budget is submitted for consideration at the Budget Hearing

  6. Budget Priorities Focus on balancing the needs of all stakeholders: students, staff, and community members to continue to deliver the best education possible. Continue to assess health insurance cost in conjunction with the Health Insurance Committee to reduce costs. Implement policies and procedures that ensure fiscal responsibility. Continue to support our excellent food service that continues to offer nutritious quality meals and ensure those qualifying for free & reduced meals are provided with them. Continue district exploration of energy conservation methodologies

  7. Budget/District Priorities Provide financial solvency by continuing to prioritize budget priorities that are in the long-term best interest of students and taxpayers. Maintain buildings and grounds using the district’s soon to be created ten year maintenance schedule as a repair timeline tool. Address annual transportation replacement needs to ensure children’s safety Continue to provide necessary Professional Development to teachers and support services. Continue evaluation of enrollment trends and develop long-range budget plans for the school district.

  8. Budget Assumptions District enrollment was estimated to remain flat from last year using the Revenue Limit September Third Friday Count methodology calculation Initial registration numbers (8/15/14) indicate a decline in enrollment It is assumed the district will have a net loss of 8 students to open enrollment No significant program changes will be made in 2014-2015. Health Insurance cost will increase by approximately 10%. No significant increases in Fuel Costs No significant increases in Utilities No significant increases in Operating Expenses

  9. Budget Assumptions • In January 2014, the school board directed administration to develop a budget capped by a 5.0% tax levy increase of which $54,000 will go to increased debt service payments and $139,732 will go into funds 10, 38, 39, & 80. • Although we expect to balance the budget during the school year, we are currently projecting a deficit of $574,688to be covered by Fund Balance Reserve • Changing enrollment and unanticipated expenses may require some additional use of fund balance.

  10. Fund Balance Reserve • The fund balance reserve is built up from years when there is more revenue than expenditures often a result of cutting staff or underspending the budget. • The fund balance is important for cash flow and unanticipated expenditures • A healthy fund balance is 15%-20% of total expenditures allowing the district to cover 2 months of Operating Expenses and an emergency. • In the past, it was not enough to cover the cash flow in our district during the school year resulting in Short term borrowing up to $1 million and a Line of Credit with Citizens State Bank in Cadott costing over $10,000 • Our current 2013-14 fund balance reserve is $1,664,418 million (about 13.5% of our total expenditures). • Our projected 2014-15 fund balance reserve will be $1,089,730 Million (about 8.7% of our total expenditure)

  11. Historical Fund Balance Reserve Trend

  12. Total Budget • The total budget includes over 14 major funding categories and hundreds of “line items”. • The total budget for the school district in 2014-2015 is expected to be over $10,000,000.

  13. Where does the Money Come From? Wisconsin School finance regulations specify the amount of dollars the district is permitted to raise from property taxes and general state aid. This amount is called the revenue limit.

  14. Major Revenue • Revenue is controlled by the state imposed revenue cap (1993). • Revenue primarily consists of: • Tax Levy (school property taxes) • State Aid (general and categorical) • Federal Aid (categorical) • Fund Balance Reserve (unspent designated dollars from previous years)

  15. Revenue Limit • The revenue limit is based on a variety of factors with the greatest weight placed on student enrollment. • According to the state law, our school district could generate revenue of $10,773,298 million for funds under the revenue limit. • Despite the recent reductions in state aid, we are one of the few districts in the state that consistently spends below the revenue limit ($3,142,711 million under projected in 2014-15).

  16. 2013-14 Top and Only School DistrictsTaxing Under the Allowable Revenue LimitBy at least 1 Million Dollars

  17. State Aid • State Aid is mostly dependent on enrollment, district property valuation and spending from the previous year. • 2014-15 state aid (estimated) = $5.6 million • State aid for our district in 2014-15 was projected to be higher than 2013-14, but due to declining enrollment and unspent 2013-14 budget allocation it is anticipated our state aid will be corrected by DPI to less than last year. • A higher percentage of state money continues to be directed to schools through levy credits (not equalized) and vouchers.

  18. The School District of Cadott receives 94% of its money from two sources.

  19. Where is the Money Spent?Two different perspectives Expenditures by Function Is the purpose for which the expenditure is made. Expenditures by object Is the type of goods and services purchased.

  20. Expenditures by Function

  21. Division of Expenditures by Object Wages and Benefits 67% Non-Salary 33%

  22. Reducing Expenditures • Previous expenditure reductions include: • Higher employee contributions for retirement and health insurance. • Health insurance plan design changes. • Reduction/elimination of Post Retirement Benefits • Reorganization/reduction in maintenance, administrative and special education staffing • Carrier change for school district insurances (auto, work comp, liability, property, etc.) • Elimination of short-term borrowing • Hiring less experienced teachers • Refinancing Callable Debt

  23. Other Expenditures • Fund 73- Post Retirement Benefit Fund

  24. Other Expenditures

  25. What is a Levy Rate vs. a Mill Rate The District sets a percentage rate for taxes, called a levy rate, which is then calculated against the assessed equalized value of each homeowner’s property. Mill rate is the amount of tax payable per dollar of the assessed value of each homeowner’s property.

  26. Cadott’s School District’s Proposed Mill Rate The property tax levy required to support the 2014-15 budget is estimated at $2,061,503.

  27. Increasing the Levy • If the Board increases the school tax levy by 5.0%, the levy amount will increase $138,732. • Assuming no increase in property valuation, the mill rate will increase from $9.02 to $9.47 (per $1,000 of property valuation). • $100,000 of property = $45/year, $3.75/month, 12.5 cents/day school tax increase

  28. Mill Rate Analysis 2000 – 01 = $9.20 2001 – 02 = $7.86 2002 – 03 = $7.78 2003 – 04 = $7.30 2004 – 05 = $6.99 2005 – 06 = $6.95 2006 – 07 = $6.50 2007 – 08 = $6.57 2008 – 09 = $6.31 2009 – 10 = $6.81 2010 – 11 = $7.13 2011 – 12 = $7.49 2012 – 13 = $8.73 2013 – 14 = $9.02 Projected 2014-2015 = $9.47

  29. Mill Rate Analysis

  30. Surrounding Area Mill Rate Comparisons

  31. What Meaning Can we draw from the Mill Rate Comparison? • Actually, very little. Unless we compare student membership, Levi Amounts, Tax Valuation, Under Levy Amount, Mill Rate, etc. over several years

  32. Projected tax impact for a home valued at $100,000 Last years mill rate was $9.02 per $1000 of property value This years mill rate projection is $9.47 per $1000 of property value. Annual Impact = increase of $45.00

  33. Annual Property Valuation Tax Impact

  34. Questions?

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