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2014-15 Proposed Final Budget Presentation (May 12, 2014)

2014-15 Proposed Final Budget Presentation (May 12, 2014). Selinsgrove Area School District. GENERAL FUND FINANCIAL STATEMENT (Current financial position). 2013-14 BUDGET SAVINGS (Current Yr.). Adopted budget balance $ 0

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2014-15 Proposed Final Budget Presentation (May 12, 2014)

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  1. 2014-15 Proposed Final Budget Presentation (May 12, 2014) Selinsgrove Area School District

  2. GENERAL FUND FINANCIAL STATEMENT(Current financial position)

  3. 2013-14 BUDGET SAVINGS (Current Yr.) Adopted budget balance $ 0 Personnel Salary Savings (2.5%) $ 450,000 Fringes/Benefit Savings $ 125,000 Medical insurance savings $ 95,000 Unemployment comp savings $ 63,000 All other department savings (net) $ 4,000 Revenues over budget (EIT) $ 176,000 Not using budgetary reserve $ 187,000 Total Savings (projected surplus) 3% $1.1 million

  4. TOTAL FUND BALANCES AT 6-30-14

  5. FUTURE CAPITAL RESERVE PROJECTS – Importance of maintaining a healthy Capital Reserve Fund Other expenses: annual summer maintenance projects for carpeting, paving, vehicle replacement. Middle school HVAC system replacement (possible performance contract), stadium track surface replacement. Fund used to offset any unforeseen major equipment replacement.

  6. 2014-15 BUDGET SUMMARY FLOW OF FUNDS – GENERAL FUND

  7. REVENUE HIGHLIGHTS • Moderately growing local economy • 1.66 mill real estate tax increase (2.7%) and a 0.5% growth in the overall real estate base • Earned Income Tax collection budgeted with a 2% increase from proj 13-14 collections • Basic education subsidy increase of 1.8% (state funding is uncertain at this point) • Special education subsidy level funding • Accountability Block Grant level funding • Reduction in federal funding (Keystone Literacy Grant & Title I) • Transfer in from educational resources reserve $125,000

  8. 2014-15 REVENUE BY SOURCE $1.6 M $13.7 M $23.6 M State averages: Local 54%, State 41%, Federal 3%, Other 2%

  9. HISTORICAL REVENUES BY SOURCE millions

  10. EXPENDITURE HIGHLIGHTS • Nine teacher retirements at end of 13/14 school year (not replacing one elementary position) • Salary increases per personnel contracts – teachers 3.9% salary plus 2.3% steps, administrators 3.5%, classified 3.9% • PSERS rate increase from 16.93% to 21.40% • Medical insurance premium increase of 7% and move to tiered rates instead of composite rate • Building and technology budgets level funded (4th year at reduced funding)

  11. EXPENDITURE HIGHLIGHTS • Transfer out to debt service fund reduced by $400,000 (debt service reserves to be used) • Capital reserve transfer of $96,000 reflects Jackson-Penn rental income • New K-5 reading textbook series ($125,000) • Total budget of $39.17 million – overall increase of $1.4 million or 3.7% from 13/14 original budget and $2.3 million or 6.3% from 13/14 projected actual ending budget

  12. MAJOR EXPENDITURE INCREASES

  13. 2014-15 EXPENDITURE ANALYSIS Supplies, textbooks, equipment ,repairs, travel Personnel costs, student tuition, transportation, utilities, debt service

  14. HISTORICAL USE OF FUNDS Personnel costs make up 75% of total budget

  15. FUTURE BUDGET CONCERNS • Modest economic recovery producing inadequate local and state revenue growth • Act 1 index will remain low • Limited state subsidy increases • Reductions in federal revenue • PSERS rate increases to reach 30% • Teacher contract increases over the next 2 years • New Federal Healthcare Legislation (increase costs and administrative burden)

  16. PROJECTED PSERS RATE Fiscal Year

  17. NET PSERS COST TO DISTRICT10 Year Analysis

  18. BUDGET RESTRUCTURING: ACTIONS TAKEN SINCE 2010-11 • Reduced 27 professional staff (12.7%) • Reduced 2.4 administrative staff (18.6%) • Reduced 29 support staff positions (18.6%) • Salary freeze in 2011-12 for all personnel • Reduced pay increase for administrative staff in 2012-13 • Eliminated indemnity health insurance plan • Refinanced 4 bond issues • Cut building and technology budgets by 30%

  19. BUDGET RESTRUCTURING: ACTIONS TAKEN SINCE 2010-11 • Leased Jackson-Penn for rental income • Long term energy contracts for natural gas & electricity • Strategic use of federal funds to offset costs • Four day work weeks in the summer • TOTAL FOUR YEAR CUMULATIVE BUDGET SAVINGS OF $14.3 MILLION

  20. FUTURE BUDGET PROJECTIONS

  21. GENERAL FUND PROJECTED ENDING FUND BALANCE

  22. PROPOSED FINAL BUDGET SUMMARY“THE BOTTOM LINE”

  23. PRESENTATION SUMMARY(POINTS TO REMEMBER) • Financial reserves (fund balance) – very strong position in the short term • State funding is uncertain • Significant budget challenges remain for the future – PSERS, Healthcare, teacher contract increases • NEW FISCAL REALITY • Importance of long-term budgeting decisions and forecasting

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