Lathrop R-II State of the School

1. Lathrop R-II State of the School A Report on District Finances: Past, Current and Future.

2. Financial Past • Passed Bond Issue in 2006 to continue with the current levy to build new high school. • Increased construction costs meant we had to also do a lease-purchase agreement for part of the facility. • The ongoing recession has taken it’s toll • We reduced the tax levy for debt service, to be able to increase the operating levy, to not raise the overall levy, hoping the economy would rebound.

3. Financial Past • Overall tax levy has risen 17 cents in 7 years. • Despite falling revenues, we have kept our reserves high (28-30%) by decreasing spending. • Teachers have received a minimal take home salary increase of about a half of one percent for the past two years, and about 1.5% the year before.

4. Our Current Operating Budget is almost $900,000 dollars less than four years ago. That’s cutting almost 10% of our spending. • We are now paying about $670,000 per year on our high school ($500,000 on the bonds and $170,000 on the lease purchase). Current Finances

5. Our Assessed Valuation of the district dropped about 5% from the previous year. Back to lower than it was in 2008-2009. • We raised our operating levy to the maximum voter approved rate, $4.39, and our debt service to .4725, making the total levy 4.8625. Current Finances

6. We increased our debt service levy 5 cents to .4725, due to increasing payments. We could have legally raised it to $1.11. • We are projecting a carryover figure of about 26%. That means we’re spending about 5% more than we’re expecting to receive. • We have 68 new students this year, an increase of about 8%. Current Finances

7. We get about 50% of our revenue from the state. • We’re hoping for that number to be no less than we received this year. No promises there. Financial Future

8. We receive about 5-10% of our funds from the federal government. Right now we don’t know what to expect for next year. • We receive the remaining 40% from our local taxes. Financial Future

9. Locally, I would not expect our Assessed Valuation to increase. • If we keep our current levy, we would expect to receive about the same amount of funds as well. Financial Future

10. Last year our payments on the high school were about $600,000. This year (and next) will be about $670,000. • We did not plan for the current recession, so we planned for the payments to begin increasing, keeping pace with the economy. Financial Future - Debt

11. We cannot refinance those bonds until about 2016. We will have to get our debt service levy up to 85 or 90 cents. • Difference between operating and debt service. • Current debt service levy is .4725. Planning to make this increase over the next three years. • (See debt service spreadsheet) Financial Future

12. Current and Past Levies • Year Operating Debt Total • 2012 $ 4.39 $ 0.4725 $ 4.8625 • 2011 $ 4.3175 $ $ 0.4225 $ 4.7400 • 2010 $ 4.2102 $ - $ 0.5209 $ - $ 4.7400 2009 $ 4.2414 $ - $ 0.4486 $ - $ 4.6900 2008 $ 4.2414 $ - $ 0.4486 $ - $ 4.6900 2007 $ 3.8400 $ - $ 0.8500 $ - $ 4.6900 2006 $ 4.3900 $ - $ 0.3000 $ - $ 4.6900

13. Looking out a little further… • The first opportunity we would have to pass a bond issue to build new athletic facilities would be 2016. • That would be about a 3 million dollar project. Financial Future

14. I’ll try to answer any questions. If I don’t know, I’ll get back to you. Questions