WASDA New Administrator's Workshop March 20 & 21, 2007

1. WASDA New Administrator's Workshop March 20 & 21, 2007 Everything You Need to Know About School Finance....Right Now!!!!

2. Agenda • 9:00 - 9:10Who we are; What we do; How we can help you. • 9:10 - 10:30 The Revenue Limit and What It Means for Your Budget Development Activities • 10:30 - 10:45 Break

3. Agenda • 10:45 - 12:00Equalization Aid – How It Works, How to Explain Changes, How to Project Aid – Fund 80, Short Term Borrowing, OPEB • 12:00 - 12:45Lunch • 12:45 - 2:00Counting Kids, Days & Hours of Instruction, WUFAR, Special Education, Cost Comparisons

4. Finance Team….Who We Are

5. Finance Team….What We Do • Collect data reports from districts in order to distribute over $5.8 billion in State Aid and Credits in 2006-07, including $5.3 billion in General and Categorical Aids • Provide data to individuals, organizations, state and federal agencies • Provide consultation services as needed • Provide a website and training opportunities to help people help themselves

6. Finance Team….How We Can Help You • Web Page Publications & Tutorials • Phone calls, e-mail • Provide information via our listserv (we recommend you subscribe – see information under “Mailings/List Serve” on the green scan bar on our website) • New Admin. Workshop - March 20 & 21

7. How We Can Help You • New Business Manager/Bookkeeper Workshop - TBD • Spring Finance Workshops - April • State Superintendent’s Workshop - Sept. • “Getting It Right” Workshop - Oct. • January WASB/WASDA/WASBO Convention • Various WASBO and WASDA Seminars throughout the year

8. How We Can Help You Bookmark this page !!!!! http://dpi.wi.gov/sfs/index.html

9. Let’s Look at the Handouts… • Roadmap of the School Financial Services Website • SAMPLE 06-07 Revenue Limit Worksheet • District-Specific 06-07 Revenue Limit Worksheet (not final) • District-Specific 07-08 Estimated Revenue Limit Base • District-Specific 06-07 Percentage Method Equalization Aid Worksheet • District-Specific 06-07 Oct 15 General Aid Cert • 06-07 Equalization Aid Executable Worksheet for Projections • Fund 10 SAMPLE Planning Budget • Budget Timeline Model • Slides from Power Point Presentation

10. Our Website: Get it On Your Radar

11. REVENUE LIMIT: THE BASICS …what a new administrator needs to know to calculate the revenue limit…

12. The “Big Picture” Revenue Limit Calculation - the Revenue Limit computation controls from 70-90% of your budget, having a direct effect on budget development activities. - districts begin to develop their new-year Revenue Limit estimates in January as they begin to develop the budget for the upcoming fiscal year. - remember to update your Revenue Limit Calculation and budget planning documents as you receive new information throughout the year. Budget Planning Papers

13. REVENUE LIMIT: DEFINITION The revenue limit is a limit (or control) on the revenue a school district is entitled to receive from: 1.) General State Aid (Equalization Aid) 2.) Local Levies (10, 38, 41) 3.) State Computer Aid It is not an expenditure control or spending limit.

14. REVENUE LIMIT: THE BASICS 1. Build Base from Prior-Year Data: Sum (+): Prior-Year Oct 15 General Aid Prior-Year Computer Aid Prior-Year Levies for 10, 38, & 41 Minus (-): Revenue Limit Penalty Non-Recurring Exemptions 14 1 2 13 3 12 4 11 5 Example: (+) Prior-Year Oct 15 Aid = $5,889,472 (+) Prior-Year Computer Aid = $2,186 (+) Prior-Year Levy, Fund 10 = $1,399,134 (+) Prior-Year Levy, Fund 38 = $96,803 (-) Prior-Year Penalty = $8,273 (-) Prior-Year Non-Recurring = $315,000 (-) Prior-Year Decl Enroll = $66,176 $6,998,146 10 6 7 9 8

15. REVENUE LIMIT: THE BASICS 2. Base 3-Year Membership Average: - Current Year (year you are computing) - Previous Year - 2nd Previous Year Base Average - 3rd Previous Year (3rd Friday in September FTE, plus 40% of Summer School FTE) 14 1 2 13 3 12 4 11 5 6 10 7 9 8 Example: Fall 2003=857, Fall 2004=848, Fall 2005=834 Average = 846

16. REVENUE LIMIT: THE BASICS 14 1 3. Base Per-Member: Divide the Base by the 3-year membership just computed to get a Base Per Member. 2 13 3 12 4 11 Example: $6,998,146 ÷ 846 = $8,272.04 5 6 10 7 9 8

17. REVENUE LIMIT: THE BASICS 14 1 4. Allowable Per-Member Increase: The Per-Member increase is determined by the State and applies to all districts. 2 13 3 12 4 11 Example: For the 2006-07 Revenue Limit, this number was $256.93 5 6 10 7 9 8

18. REVENUE LIMIT: THE BASICS 14 1 5. New Maximum Revenue Per Member: Allowable Per-Member Increase is added to the Base Per-Member. 2 13 3 12 4 11 Example: $8,272.04 + $256.93 = $8,528.97 5 6 10 7 9 8

19. REVENUE LIMIT: THE BASICS 6. Current 3-Year Membership Average: - Current Year (year you are computing) - Previous Year - 2nd Previous Year - 3rd Previous Year (3rd Friday in September FTE, plus 40% of Summer School FTE) 14 1 2 Current Average 13 3 12 4 11 5 6 10 7 9 8 Example: Fall 2004=848, Fall 2005=834, Fall 2006=815 Average = 832

20. REVENUE LIMIT: THE BASICS 14 1 • New Revenue Limit, No Exemptions: • New Maximum Revenue Per Member is multiplied by the Current 3-Year Membership Average. 2 13 3 12 4 11 5 Example: $8,252.97 x 832 = $7,096,103 6 10 7 9 8

21. REVENUE LIMIT: THE BASICS 14 1 8. Recurring Exemptions: - Prior Year Carryover (100%) - Transfer of Service - Transfer of Territory - Federal Impact Aid Loss - Recurring Referendum to Exceed 2 13 3 12 4 11 5 6 10 7 9 8 Example: $89,964

22. REVENUE LIMIT: THE BASICS Transfer of Service New costs related to new transfer-in pupils in specified special education and limited English proficient programs may be eligible for a revenue limit exemption. - Student has moved into your district from another Wisconsin Public School or county Birth to 3 Program - Complete form on website: http://www.dpi.state.wi.us/sfs/transerv.html - Involves getting verification of enrollment from transfer district - Keep track of eligible students – get verifications throughout the year - Submit all verifications in one packet to DPI by July 1

23. REVENUE LIMIT: THE BASICS 14 1 9. New Limit with Recurring Exemptions: 2 13 3 Example: $7,096,103 + $89,964 = $7,186,067 12 4 11 5 6 10 7 9 8

24. REVENUE LIMIT: THE BASICS 14 1 10. Non-Recurring Exemptions: - Non-Recurring Referendum to Exceed - Declining Enrollment Exemption - Other 2 13 3 12 4 11 5 Example: $408,819 10 6 7 9 8

25. REVENUE LIMIT: THE BASICS 14 1 11. New Revenue Limit with All Exemptions: 2 13 3 12 4 Example: $7,186,067 + $408,819 = $7,594,886 11 5 10 6 7 9 8

26. REVENUE LIMIT: THE BASICS 14 1 12. October 15 Certification of General Aid: Shortly before each October 15, the State certifies to each district an aid amount that must be used in the Revenue Limit computation at this point. 2 13 3 12 4 11 5 Example: $5,853,198 10 6 7 9 8

27. REVENUE LIMIT: THE BASICS 14 1 • Allowable Limited Revenue to Come From the Sum of: • - Fund 10 Levy • - Fund 38 Levy • - Fund 41 Levy • - Computer Aid 2 13 3 12 4 11 5 10 6 7 9 8 Example: $7,594,886 - $5,853,198 = $1,741,688

28. REVENUE LIMIT: THE BASICS 14 1 14. At This Point, the District Determines the Amounts for the Following: - Fund 10 Levy (General Operations) - Fund 38 Levy (Non-Referendum Debt) - Fund 41 Levy (Capital Expansion) - Computer Aid 2 13 3 12 4 11 5 10 6 7 9 8 Example: Sum Must not Exceed $1,741,688

29. REVENUE LIMIT: THE BASICS …technically, we are done with the revenue limit levies; however, we are not done with determining the total levy to be apportioned to the municipalities… 15. District Determines the Amounts for the Following Non-Controlled Levies: - Fund 39 Levy (Referendum Debt) - Fund 80 Levy (Community Service) - Fund 10 Levy Chargeback

30. REVENUE LIMIT: THE BASICS Total Levy - Fund 10 Levy (Operations) - Fund 38 Levy (Non-Referendum Debt) - Fund 41 Levy (Capital Projects) - Fund 39 Levy (Referendum Debt) - Fund 80 Levy (Community Service) - Fund 10 Levy Chargeback Computer Aid is NOT included in the total levy amount apportioned to the municipalities. It is an aid payment from the State.

31. Points to Remember About the Revenue Limit The revenue limit is a limit (or control) on the revenue a school district is entitled to receive from: 1.) General State Aid (Equalization Aid) 2.) Local Levies (10, 38, 41) 3.) State Computer Aid This is about 70% - 90% of your total Fund 10 budget.

32. Points to Remember About the Revenue Limit Does NOT control other sources of revenue such as: - Referendum Debt Levy (Fund 39) - Community Service Levy (Fund 80) - Categorical Aids - Grants - Fees - Gate Receipts - Donations

33. Revenue Limit Computation& Budgeting Certain numbers from the Revenue Limit computation, together with salary and other local expenditure and revenue budget estimates, serve as a guide for the district as it moves through budget development, in particular, Fund 10.

34. REVENUELIMIT

35. Using This Data for Budgeting Rev LimFund 10 Line 18 Src 211 Line 15C Src 212 Line 12 Src 621 Line 17 Src 691 (yellowed lines represent the amounts that come from the controlled portion of the Revenue Limit.)

36. The “Big Picture” BOE Votes on levies. Certify Levies via PI-401 & PC-401 (in portal) Revenue Limit Calculation 3rd Friday Count, Oct 1 Tax Values, October 15 Aid Annual Meeting? Budget Planning Papers Send tax bills. PI-1508 Budget Adjustments to BOE Budget Report PI-1504

37. REVENUE LIMIT: 2007-08 1 14 2 - Remember that any “new year” revenue limit computation begins by using the prior-year’s aid and levy data. - The district’s 2007-08 Revenue Limit begins with 2006-07 data. - To begin building your 07-08 Revenue Limit, start with step 1, using the 06-07 data as the “prior year.” 13 3 12 4 11 5 10 6 7 9 8

38. REVENUE LIMIT The most up-to-date Revenue Limit worksheets can be found on the School Financial Services website: http://www.dpi.wi.gov/sfs/index.html Under: Late Breaking Budget Development and Planning Worksheets DPI-Printed

39. BUDGET TIMELINE MODEL Adapt this timeline to your district’s activities. Use at your discretion!!!!! Make sure you know your contractual obligations with regard to layoff notices.

40. Let’s take a break! dpi finance team

41. EQUALIZATION AID CALCULATION

42. Equalization Aid • Why do you need to know how to calculate aid when DPI calculates it for you? • Because you will be asked by your board members, constituents and the media • So you can make sure it’s accurate and, if it changes, figure out why • Because you may want to do estimates and “what ifs”…

43. Equalization Aid - How It Works Congratulations, it’s your lucky day!YOU ARE ELIGIBLE FOR UP TO $10,000 IN COLLEGE SCHOLARSHIP MONEY!!!(Not really. We’ll eventually connect thisfake give-away to Equalization Aid.)

44. Equalization Aid - How It Works 20% 50% 80% 50%

45. How Did the College “Share” in the Tuition? What you could pay. $10,000 amount. Compare, then Compute actual scholarship amount.

46. Equalization Aid Formula • State “Shares” in District Cost • Aid is Based on a District’s Ability to Pay, as Measured by Property Wealth per Member Basic premise: The more property wealth per member a district has, the less state aid it will receive.

47. How Does the State “Share”in District Costs? District Value Per Member State Guaranteed Value Per Member Compare, then Compute Equalized Aid

48. 3 District Factors 1. Costs (“Shared Cost”) 2. Wealth/Property Taxbase 3. Pupils (“Membership”) * * * All Prior-Year Data (2005-06 data is used for 2006-07 aid.)

49. 1. District Factor – Costs(prior year) Total General Fund (Fund 10) Expendituresplus (+)Total Debt Service Funds (Funds 38 & 39) Expendituresminus (-)all local misc. revenue, grant revenue,and categorical aid. Known as “Shared Cost”

50. 2. District Factor - Wealth/Taxbase(prior year) Property Taxbase is Used to Determine Wealth and Ability to Support District Expenditures Uses Equalized Valuation or Fair Market Value (NOT Assessed Value)