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2014-15 Final Budget

2014-15 Final Budget. September 9, 2014. Agenda. State Budget Highlights Peralta’s 2014-15 Final Budget Funding Sources Unrestricted General Fund Parcel Tax Fund 2014-15 Budget Allocation Model Summary. 2014-15 State Budget. 4 th Consecutive Year the budget passed on time

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2014-15 Final Budget

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  1. 2014-15Final Budget September 9, 2014

  2. Agenda • State Budget Highlights • Peralta’s 2014-15 Final Budget • Funding Sources • Unrestricted General Fund • Parcel Tax Fund • 2014-15 Budget Allocation Model Summary

  3. 2014-15 State Budget • 4thConsecutive Year the budget passed on time • Includes a reserve of $1.4 billion • Based on the Governor’s conservative forecast • Progress made toward paying down deferrals • Down to $94 million from $592million before passage of Prop 30 • Governor has clearly laid out his path • Protect against boom and bust cycles • Retire Debt • Focus new money on education • Includes a Rainy Day Fund

  4. 2014-15 State Budget • Wall of Debt • Budget eliminates $10 Billion in debt • Mid year positive trigger would further reduce deferrals to schools and colleges • Rain Day Fund on November Ballot • When capital gains exceed 8% of GF revenues, a deposit to the RDF is required • Half used to pay off debt and liabilities for the first 15 years • Allows for withdrawal for disasters or if spending is at or below highest level of spending of the prior 3 years • CalSTRS – 30 Year obligation of $74.4 billion • State GF contribution increase from 3% to 6.3% in 2016-17 • Employee rate increase from 8% to 10.25% as of 2016-17 • Employer rate increase from 8.25% to 19.1% as of 2021

  5. 2014-15 State Budget The Budget Bill contained the following community college provisions: • Access funds (growth) of $140.4 million (2.75%) • Cost of Living Adjustment (COLA) of $47.3 million (.85%) • $100 million for Student Success and Support (SSSP) • Match of 2:1 on entire amount • $30 million increase for DSPS • $70 million increase for Student Equity Plans • $50 million one time increase for the Economic and Workforce Development program • $49.5 million to pay down mandates • $148 million for deferred maintenance and instructional equipment. Flexible locally and specified as one-time.

  6. COMMUNITY COLLEGE what’s new • Technical Assistance for Chancellors Office • $1.1 million and 9 positions for goal setting and monitoring of institutional effectiveness • $2.5 million for technical assistance to support implementation of effective practices at college • State funding for Career Development and College Program (CDCP) Rate per FTES to be increased to be equal to Credit Rate as of 2015-16 • Positive Trigger – • Department of Finance can pay down deferrals during the year if Proposition 98 guarantee is higher than estimated • New formula for Growth allocation is effective in 15-16 • Proposal to be out late summer/early fall

  7. Cautions and concerns • Proposition 30 is temporary • Sales tax increase terminates at the end of 2016 • (Approximately 21% of Prop 30 revenues) • Income tax increase terminates at end of 2018 • STRS obligation • Deficits • Continued exposure to shortfalls in property taxes and fees

  8. Our district - PCCD • Access funds (growth) $2.2 million (increase in funded FTES of 430) • Cost of Living Adjustment (COLA) $846,989 (.085%) • Categorical increases – awaiting on allocations from the State Chancellors Office • $2,366,996 for scheduled maintenance/instructional equipment • Flexible locally and specified as one-time • No match except if the funds are used for Architectural Barrier Removal • State Retirement increases to employer rates: • STRS .63% increase ; $198,600 • PERS .329% increase ; $73,563 • Increase in Medical Premiums $979,893 • Kaiser 0%; • Traditional PPO 26% • Lite PPO 24.9% • Traditional PPO (Local 39) 22.1% • Lite PPO (Local 39) 17.5% • Increase in Workers Compensation rate of .1% estimated cost of $54,500 • Increase in OPEB Debt service payment of $1,642,666

  9. Additional assumptions used to develop the budget • FTES – Target of 19,355 Residence FTES with funded FTES from the state of 19,055 • Productivity level of 17.5 • Unrestricted Lottery dollars funded at $124.25 per funded FTES • State Apportionment deficit factor of 2% • Parcel Tax revenue estimated to be $8,053,385

  10. 2013-14 Unrestricted General Fund final budget Summary

  11. General Fund Revenue Sources

  12. Computational revenue sources

  13. 2013-14 General Fund expenditures

  14. Measure B – Parcel Tax

  15. Implementation of the budget allocation model • In August of 2010, the Planning and Budgeting Council began working on the creation of and recommendation to the Chancellor a Budget Allocation Model (BAM) • Purpose to: • Move from the existing model to a model that would better serve the Colleges and District • Fully respond to previous Accreditation recommendations • Core Principles: • Provide financial stability • Consistent with the State’s SB361 funding model • Simple and easy to understand • Provide for a reserve in accordance with Peralta’s Board Policy • Maintain autonomous decision making at the college level • Responsive to the District’s and Colleges’ planning processes

  16. Budget Allocation Model

  17. Thank you for your time! Questions

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