WASBO Annual Conference

Tacoma

Budget Extensions:

Do’s and Don’ts

May 8, 2008

Presented by Mike Dooley, CSBO Supervisor School District / ESD Budgeting

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ACKNOWLEDGEMENT

Yogi Berra is perhaps one of the most quoted personalities of our time. From media icons to Presidents, Yogi's sayings have crept into our lives and surround us. Some of his utterances that created the phrase " Yogi-isms" are included in this presentation.

Presented by Mike Dooley, CSBO Supervisor School District / ESD Budgeting 2

FY 2007–08 Budget Extensions

• Budget Extension Reminder:We know all of you are busy preparing your new year budgets, but don't forget any remaining current year budget extensions. August is the final month to file your F-200 budget extensions with OSPI. Depending on when you submitted your current year F-200 for approval and when you printed your new year F-195 budget document, you may need to update your new year budget with state data after OSPI approval. This will allow your current year budget extension to be accurately displayed in the middle column of your new year F-195.

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SD F-200 Budget Extension System Update

• Based on the recommendations from the SDAAC and on legislative action, the F-200 budget extension system is updated and released for school district use (usually) in October or November.

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SD Budget Extension Preparation

• RCW 28A.505.170• RCW 28A.505.180

Yogi’s budget tip...

• “When you come to a fork in the road, take it.”

• If SD needs to increase the amount of appropriation, SD board of directors, before incurring expenditures in excess of appropriation, is to adopt a resolution stating estimated amount needed.

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SD Budget Extension Availability/Notice

• RCW 28A.505.170• RCW 28A.505.180

(continued)

Yogi’s

budget tip...

• “Ninety percent of the game is half mental.”

• Each SD is to publish a notice stating the board of directors will hold a public hearing.

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SD Budget Extension Requirements

• WAC 392-123-071• WAC 392-123-072• WAC 392-123-115

Yogi’sbudgettip...

• “If you can’t imitate him, don’t copy him.”

• Every SD budget extension is to:– be prepared, submitted

and adopted in the format prescribed by OSPI; and

– have attached a copy of the SDs latest budget status report.

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SD Budget Extension Hearing/Adoption

• RCW 28A.505.170• RCW 28A.505.180

(continued)

• On the hearing date, the SD board is to meet to introduce and pass the additional appropriation resolution by a majority of the board.

• Upon conclusion of the hearing, the SD board is to file the adopted resolution with the ESD.

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ESD Review Process

• WAC 392-123-072• WAC 392-123-078• WAC 392-123-079

• All 1st and 2nd class SD budget extensions are to be reviewed by the ESD prior to submission to OSPI.

• The ESD is to notify each district of any problems noted during the review process.

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ESD Review Process

• WAC 392-123-078• WAC 392-123-079

(continued)

Yogi’s budgettip...

• “I don’t want to make the wrong mistake.”

• Review is to include revenues and reserved and unreserved FB and expenditure appropriateness.

• The ESD is to notify the SD of all problems noted in the review.

• The ESD is to attempt to correct all problems before submission to OSPI.

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2nd Class SD Budget Extension Adoption

• WAC 392-123-072 • The ESD is to submit approved 2nd class SD budget extension requests to OSPI by the close of business on August 31 or the last business day prior to August 31 if August 31 occurs on a nonbusiness day.

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OSPI & ESD Budget Extension Approval for 2nd Class Districts

• WAC 392-123-072 (continued)

Yogi’s

budget

tip...

• “A nickel isn’t worth a dime today.”

• Any request for budget extension is not to be approved by the ESD or OSPI to the extent that the current appropriation has been exceeded prior to the request for budget extension.

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1st Class District Budget Extension Adoption and Filing

• WAC 392-123-071

Yogi’s

budgettip...

• “It isn’t over ‘till it’s over.”

• The budget extension must be adopted in 1st class SDs by the close of business on August 31st or the last business day prior to August 31 if August 31st occurs on a nonbusiness day.

• 1st class SDs is to then file two copies of their adopted resolutions with the ESD.

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1st Class SD Budget Extension Filing with OSPI

• WAC 392-123-071 (continued)

• Any appropriation resolution adopted after the current appropriation level has been exceeded shall be null and void to the extent that the current appropriation level has been exceeded.

Yogi’sbudget tip...

•“This is like déjà vu all over again.”

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SD Budget in Noncompliance

• RCW 28A.505.140• WAC 392-123-080

Yogi’sbudgettip...

• “It’s tough to make predictions, especially about the future.”

• If OSPI determines any SD does not comply with budget procedures established by RCW or OSPI regulations, written notice from OSPI to the SD board is to be given.

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SD Revised Budget Submittal

• RCW 28A.505.140 (continued)

• WAC 392-123-095• WAC 392-123-100

• The SD board is to within 30 days of receiving notice, submit a revised budget to OSPI.

• If the SD fails or refuses to submit a budget within 30 days, OSPI may withhold the SD apportionment.

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Budgeting Receivables

• RCW 28A.505.110

Yogi’s

budgettip...

• “You got to be careful if you don’t know where you’re going, because you might not get there.”

• If a district is unable to submit a budget or budget extension when revenues and fund balance do not exceed expenditures, they must request in writing to include receivables, collectible in future periods, to balance the budget.

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Budgeting Receivables

• WAC 392-123-060• WAC 392-123-065

Yogi’sbudgettip...

• “You can observe a lot just by watching.”

• When a SD budgets receivables, OSPI places the SD under binding conditions which is intended to have the SD recover from its deficit budget situation and move to a stable financial position. This usually places the ESD in an oversight position of the SD financial operations.

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BUDGET EXTENSION DOCUMENT

STATUTORY CITATION: RCW 28A.505.090, 28A.505.170, 28A.505.180, WAC 392-138-040, 392-123-071 through 392-123-074, WAC 392-123-078 and 392-123-079 PURPOSE: Form F-200 is the official document used to modify, increase, or reduce the school district's annual budget. This form must be submitted to OSPI. All school districts must prepare, adopt, and file their budget extensions in the following format as included in this section of the handbook. Budget extensions not in compliance with Form F-200 must be resubmitted in whole or in part. The procedure for submitting school district budget extensions to OSPI for review, approval, or filing is similar to the budget submittal process. ESDs are able to print this document from the F-200 OSPI Budget computer menu suboption entitled "F-200 PRINT/LOCK OPTION BY FUND." This option will print and lock the extension by each fund as requested. Upon passage of a school district board resolution to extend the budget of any fund, school districts are to submit the following for ESD review: 1) Form F-200, Request for Budget Extension. 2) Form F-200 detail page(s) for the appropriate fund. 3) The latest budget status report for the appropriate fund. 4) The school board's resolution extending the budget. The ESD shall notify the district of problems and the due date when corrective action is to be completed. Should the district fail to meet the corrective action due date, the ESD shall notify OSPI. When the budget extension passes the ESD's review process, the ESD will forward the following documents to OSPI School Financial Services: 1) Three copies of Form F-200, Request for Budget Extension (certification page only). 2) One copy of the latest budget status report. 3) One copy of the school board's resolution. OSPI will perform a final review of the school district budget extension(s) before filing and/or approval. Form F-200 (certification page) will be signed by OSPI and two copies will be returned to the ESD as official notification of filing and/or approval. The ESD will then forward a signed Form F-200 to the school district. The budgeted beginning fund balance must be adjusted to reflect the actual September 1 fund balance. Revenues must be updated to reflect the most recent estimates. This includes, but is not limited to enrollment changes, annual salary allocation changes, state and federal grants, and other revenue increases or decreases. WAC 392-138-040 requires associated student body fund budget revisions first be reviewed by the associated student body. Therefore, an extension of the associated student body fund budget should occur prior to school closing to secure the necessary student involvement.

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APPORTIONMENT REDIRECTIONS (TRANSFERS) STATUTORY CITATION: RCW 28A.150.270, WAC 392-121-445 PURPOSE: Provide school districts with samples of a school board resolution and OSPI response to facilitate a transfer (redirection) of apportionment monies from the general fund to the capital projects fund and/or debt service fund. Any transfer (except those noted below) from the school district’s general fund to any other school district fund is considered to be a transfer of apportionment monies and needs OSPI approval. The redirection of apportionment is considered to be such a transfer. A school district board of directors may request approval from OSPI to transfer (redirect) the district's general fund apportionment monies to the district's capital projects fund and/or debt service fund by a properly executed board resolution. Such board resolutions shall specify the reason(s) for the transfer and the dollar amount(s) to be transferred. Once apportionment monies are transferred (redirected) to any school district fund, they subsequently cannot be transferred to the credit of another fund. Exceptions: Transfers that may be made without OSPI approval are transfers from the general fund to the transportation vehicle fund, transfers from the general fund to the debt service fund to meet debt service requirements on bonds issued by the general fund, and transfers of voter approved local funds or federal forest or impact aid funds to any fund. A school district is not required to submit a separate request to OSPI for approval of an apportionment transfer if (1) the reason(s), month(s) and amount(s) are specifically addressed in the budget hearings and this information is included in the board resolution approving the initial budget. When apportionment transfer requests are submitted subsequent to the initial budget submission, which requests OSPI approval of general fund apportionment to the capital projects fund and/or the debt service fund, the request must be received by this office on or before the tenth day of the month when the transfer is to begin. After OSPI has approved the transfer, the district contacts the county treasurer to redirect or transfer the monies. Resolutions are to be sent to School Financial Services, Office of Superintendent of Public Instruction, Old Capitol Building, PO BOX 47200, Olympia, WA 98504-7200. If the general fund budget would be out of balance after the transfer of apportionment, by filing a budget extension the school district must revise its general fund budget to the point of being in balance. Resolutions requesting approval for the transfer of a portion of the district's basic education allocation to another fund will not be approved by OSPI if the loss of general fund revenue to the district will result in an out-of-balance general fund budget. A budget extension may also be necessary for the capital projects fund and/or the debt service fund.

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F-200 Budget Extension Worksheet for FY 2007-2008

General Information: School District: District #: ESD# Class: ( ) 1st ( ) 2nd Fund: ( ) GF ( ) ASBF ( ) DSF ( ) CPF ( ) TVF Has OSPI been notified of any district financial concerns by ESD? ( ) YES ( ) NO Final Lock and Print Copy? ( ) YES ( ) NO Certification Page Submitted signed and dated by school district? ( ) YES ( ) NO Signed by Educational Service District? ( ) YES ( ) NO Edits Attached and Reviewed? ( ) YES ( ) NO Has the extension cleared all error edits? ( ) YES ( ) NO Check figure the same on edit as the signature page? ( ) YES ( ) NO Resolution Date: Is resolution correct and matches F-200 signature page? ( ) YES ( ) NO Original Appropriation (Expenditure) Amount: $ Total Appropriation (Expenditure) Amount: $ Difference Between Adopted and Extended Total Appropriation: $ Month/Year of Budget Status Report: Is the budget status date the same month or one month previous of board date? ( ) YES ( ) NO Is the total actual YTD expenditure on budget status less than the original budget? ( ) YES ( ) NO

On-Line Review: Has the electronic file been checked for correct data? ( ) YES ( ) NO Does the F-200 match what is communicated through the resolution? ( ) YES ( ) NO Increase in Revenue? ( ) YES ( ) NO If YES, can it fund the extension? ( ) YES ( ) NO Is the District Using Fund Balance? ( ) YES ( ) NO If YES, can it fund the extension? ( ) YES ( ) NO Has the district changed transfers, if so, are they reasonable? ( ) YES ( ) NO Requested Expenditure has not been reduced by ESD? ( ) YES ( ) NO Requested Expenditure has not been reduced by OSPI? ( ) YES ( ) NO If a reduction is required, date mail message sent to ESD to adjust the file: If a reduction is required, date electronic file reviewed for adjustment: DATE and COMMENTS OF REVIEW: rev. 10.18.05

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Curtain Call

• That’s all folks!!!

• Questions, anyone??

• Thanks for coming!22