Alameda Unified School District

1. Alameda Unified School District Budget Development Building Blocks FY08/09 Communicating our budget and budget development process to our staff and our community

2. Purpose This presentation was created with two goals in mind – • To present basic information and an over-view of the AUSD’s budget development process • To inform the community about our district’s finances in a user-friendly format

3. The Checkbook What is a budget? A budget is a spending plan. School districts develop spending plans for every fiscal year (July 1 – June 30). Our spending plan has components similar to your checkbook. It includes estimates of anticipated revenues and planned spending.  Our budget is our best guess of the income we will earn and the checks we will write. It changes just like the needs in a house-hold change.

4. The Checkbook What is a multi-year projection? A multi-year projection is our best guess of the income we will earn and the checks we will write over an extended period of time (three years).

5. The Annual Budget Cycle At each period, we: • Update budget • Certify our financial condition • Present summary to Board of Education • Submit copies to County Office of Education and State

6. The Annual Budget Cycle

7. Certification Status At Interim Reporting Periods: • Positive – District will be able to meet its financial obligations for the current and two subsequent years • Qualified – District may not be able to meet its financial obligations for the current or two subsequent years • Negative – District will be unable to meet its financial obligations for the current or subsequent year

8. Our District’s Funds The district maintains a total of 12 different funds to record its financial transactions. Each fund is a separate financial entity with its own set of financial records. Most day-to-day financial transactions are recorded in the General Fund (Fund 01). Other funds have very specific purposes and are very limited in use. Consequently, transfers between funds are subject to strict legal limitations and Board policy.

9. Our District’s Funds

10. Fund 14 – Deferred Maintenance Fund Districts that participate in certain school facility programs are required by state law to establish restricted funds or accounts for facility maintenance purposes. Dollars are set aside in Fund 14 to maintain school facilities. The State makes a dollar for dollar match. Districts must establish a Deferred Maintenance Fund to receive deferred maintenance dollars. This fund is used to account for the State’s apportionment and the District’s contributions.

11. New District Fund – Fund 17 General Fund dollars can be accumulated in Fund 17 for various purposes. These dollars must be transferred into an appropriate fund before expenditures can be made. Fund 17 – Special Reserve for Other Than Capital Outlay Projects. Staff recommends transferring the Reserve for Economic Uncertainties to Fund 17. This transfer will clarify the portion of the General Fund ending balance that is available for other spending priorities and highlight the importance of maintaining our reserves.

12. New District Fund – Fund 17 How much is our Reserve for Economic Uncertainties? Our Reserve for Economic Uncertainties is 3.0% of all General Fund expenditures and other financing uses, or $2.5M. • What can $2.5M buy? • Two month’s payroll? • One month’s payroll? • One-half month’s payroll? Our 3.0% Reserve for Economic Uncertainties approximates 47% of the May 2008 payroll.

13. Building Our Budget Many of the items that impact the district’s budget are unknown until AFTER the district is required to adopt a budget. Thus, the district must use a series of assumptions about those items in order to develop the budget. Our district’s budget is only as good as the assumptions used in projecting revenues and expenses. The accuracy of the proposed budget is only as good as the assumptions used in its development. If the assumptions are faulty, the budget will be inaccurate. Accordingly, the initial assumptions are carefully considered and revised throughout the year as more information becomes available.

14. Major Assumptions - Included

15. Major Assumptions - Included

16. Major Assumptions - Excluded

17. Unrestricted General Fund Expenditures

18. Unrestricted General Fund Expenditures

19. Unrestricted General Fund Expenditures – Professional Services

20. Enrollment & School Site Staffing School site staffing is comprised of two types – 1.) Administrative staffing 2.) Enrollment-based staffing Enrollment projections prepared by Cabinet and Principals are used as the basis for staffing allocations. Administrative staffing consists of positions responsible for the operations of the site (e.g., management, clerical, and custodial staff). Enrollment-based staffing consists of positions responsible for instructional and student support at the site (e.g., classroom teachers and clerical staff).

21. School Site Staffing Administrative staffing Enrollment-based staffing

22. Mandatory and Employer-Provided Benefits

23. Mandatory and Employer-Provided Benefits

24. Enrollment & School Site Discretionary Funds School site discretionary funds are determined by grade-level enrollment projections and grade-level per pupil allocations. School site discretionary funds are used to support site operations, such as classroom supplies, office supplies, and copy costs. Approximately $485K is budgeted annually. Per Pupil Allocations

25. Enrollment & School Site Custodial Funds School sites are allocated funds for custodial supplies based on use, facility square footage and grade-level enrollment projections. While custodial supplies are budgeted by site, the dollars are managed by Maintenance, Operations and Facilities. Approximately $203K is budgeted annually. Per Pupil Allocations Additional Allocations… $59K Summer Cleaning $16K Emergency Supply Stock $40K Contingency

26. General Fund Revenues Our BRL is a specific dollar amount the state gives us based on the number of days students attend school. Our income is based on our average daily attendance (ADA) - not the number of students enrolled. Our primary source of revenue is the Base Revenue Limit (BRL).

27. AUSD Base Revenue Limit – County Comparison

28. Base Revenue Limit and ADA

29. Unrestricted General Fund Revenues Our primary source of unrestricted revenue is the Base Revenue Limit (BRL).

30. Loss of Federal Impact Aid

31. Variability of Interest Income

32. Restricted General Fund Revenues Our primary source of restricted revenue (i.e., categorical funds) is the State. These funds have restrictions on their use.

33. Contributions to Restricted Programs Restricted programs are like mini-funds and should be self-sustaining – expenditures should match revenues. When expenditures exceed revenues, a contribution is made to the restricted program.

34. Additional Information • Need additional information? Have suggestions about improving this presentation? Please share your thoughts. • Luz T. Cázares • Chief Financial Officer • 510-337-7067 • lcazares@alameda.k12.ca.us • Need prior presentations or budget information?Our budget documents are posted on our website.