birmingham public schools board presentation february 2, 2010

Birmingham Public Schools

Board PresentationFebruary 2, 2010February 2, 2010

Budget Development Guiding Principles

1. Prioritize Classroom Instruction2. Support the Implementation of the Strategic Plan3. Adapt/Restructure Instructional Support Programs4. Ensure the Financial Stability of the District

School Funding Update

2009-2010 State School Funding Update :1. On October 20, 2009, the Governor formally signed the State School Aid Act which

included a mid-year budget reduction of $165/pupil in foundation allowance ($1.3M for Birmingham Pubic Schools).

2. The Governor also line-item vetoed Section 20j funding for Hold Harmless School Districts ($1.0M additional for Birmingham Public Schools).

3. On October 22, 2009, the Governor notified the legislature of an additional $127/pupil reduction in foundation allowance to balance the budget, delayed implementation, then rescinded officially on January 11, 2010.

Stay tuned for the May 2010 Revenue Estimating Conference!

BIRMINGHAM PUBLIC SCHOOLSBOARD OF EDUCATION

FEBRUARY 2, 2010

Mid-Year Budget Actions…

1. Implement a hiring freeze for all vacant positions2. Freeze all spending on District purchases, except those

necessary for safety and functionality3. Eliminate all non-emergency staff overtime4. Restrict all capital outlay projects, except those funded

with remaining bond proceeds5. Continue to aggressively implement energy

management policy, including “pay to plug” program6. Continue to implement travel and conference

guidelines, including new pre-approval form

2010-11 2011-12 2012-13 2013-14FUND BALANCE JULY 1 12.3% 4.5% (8.3%) (24.7%)

ANNUAL SURPLUS(DEFICIT) ($8,076,021) ($14,001,927) ($18,920,213) ($22,824,170)

FUND BALANCE JUNE 30 4.5% (8.3%) (24.7%) (43.3%)

PROJECTION ASSUMPTIONS:STAFF COMPENSATION

AUTOMATIC STEP INCREASES

RETIREMENT

HEALTH-PERCENT INCREASE

PERCENT EMPLOYEES PAY

EVERYTHING ELSE

TEACHER FTE CALCULATION -4.0 -2.0 -1.0 0.0

TEACHER STAFF CHANGES

ENROLLMENT SCENARIO

ENROLLMENT CHANGE (95) (53) (21) (10)

STATE AID FOUNDATION BASE INCREASE ($435) $0 $0 $0

FOUNDATION AMOUNT $11,644 $11,644 $11,644 $11,644

FOUNDATION % INCREASE -3.60% 0.00% 0.00% 0.00%

"BIG PICTURE"BIRMINGHAM CITY SCHOOL DISTRICT

0.00% 0.00% 0.00% 0.00%3.00% 3.00% 3.00% 3.00%0.70% 0.70% 0.80% 0.90%5.00% 5.00% 5.00% 5.00%4.00% 4.00% 4.00% 4.00%0.00% 0.00% 0.00% 0.00%

0.0 0.00.0 0.0MOST LIKELY MOST LIKELY MOST LIKELYMOST LIKELY

$(600) $- $- $-

2010-11 BUDGET SENSITIVITY DATAGENERAL FUND

Sensitivity ExamplesBase Change Amount

      1 FTE = $ 8,600

Enrollment 8,053 FTE'S 10 FTE = $

86,000          

      $50/pupil = $

402,650 State Aid Foundation Grant $ 11,644 $100/pupil =

$ 805,300

      0.5% = $

367,700

Salary Changes $

58,694,980 1.0% = $

735,400          

     17.74%

(0.80%+) = $ 58,700Retirement Rate Changes

17.64%(0.70%+)

17.94% (1.00%+) =

$ 176,100

      1% = $

137,250

Health Insurance $

14,410,711 2% = $

274,500          

      1% = $

46,400

Utilities $

4,643,850 10% = $

464,400         

Budget Development Plan

Expense Reductions

Total Instructional Support

2002-03 $ 721,550 $ 276,500 $ 445,050

2003-04 $ 3,854,786 $ 2,078,750 $ 1,776,036

2004-05 $ 3,381,390 $ 2,551,500 $ 829,890

2005-06 $ 2,939,572 $ 2,189,462 $ 750,110

2006-07 $ 2,659,950 $ 1,760,000 $ 899,950

2007-08 $ 2,317,494 $ 1,503,250 $ 814,244

2008-09 $ 3,869,582 $ 237,872 $ 3,631,710

2009-10 $ 3,063,675 $ 1,702,044 $ 1,361,631

TOTAL $ 22,807,999 $ 12,299,378 $ 10,508,621

2009-10 Budget $ 105,147,340 $ 81,860,416 $ 23,186,924

% Cut 22% 15% 45%

Feedback from ….

Community Conversations

1. Consolidation of services or programs2. Concessions in compensation and benefits3. Reducing or eliminating transportation4. Pursuing sponsorships and advertising5. Strengthening energy management6. Expansion of pay to participate to extra-curricular

activities

Faculty, Staff and Retirees

1. Use of fund equity2. Reduce or eliminate transportation3. Increase rental of facilities4. Increase and expand pay to participate fees5. Investigate sponsorships and advertising6. Expand open enrollment options7. Provide more tuition based programs

Faculty, Staff and Retirees

8. Add a sinking fund ballot proposal9. Investigate 4-day work week, shorter school year10. Reduce administrative levels and costs11. Investigate and lower costs of programs12. Eliminate secondary classes with small enrollment13. Review cost and use of substitute teachers14. Review delivery of professional development

Work Areas to Review….

Work Areas to Review….• Restructuring Programs and Services• Concessions from Staff• Use of Fund Equity• Lobbying Lansing• Partnering with BEF and Parent Groups• Energy and Asset Management• Generating Revenue

Preliminary Reductions and Restructuring...

Budget Development Plan (BDP) 2010/11Action Source Budget

AmountStaffing

Impact (FTE)

Restructuring Business Services Business $664,616 6.0

Reviewing Transportation routes for both public & non-public Transport. $166,000 -----

Eliminating Building & Site transfer from the General Fund Bldg & Site $1,064,000 -----

Transfer Cash Flow Stabilization interest CFS Fund $30,000 -----

Implement Energy Management program, including the “Pay to Plug” program

Facilities $ 250,000 -----

Elimination of one AD position and restructuring of secretarial support. Remainder of reductions based on Athletic Advisory Committee recommendations for reorganization of game/event management, reductions in equipment and transportation and changes in pay to participate fees

Athletics $277,000 3.0

Transferring Community Service Organizers (CSO) salaries to the local council funds

Community Education $ 250,000 -----

Budget Development Plan (BDP) 2010/11Action Source Budget

AmountStaffing

Impact (FTE)

Reduction in Unemployment Costs Human Resources $ 100,000 -----

Reduction in Workers’ Compensation Costs Human Resources $ 110,000 -----

Reduction in Administrative Team salariesExecutive

Administration

$51,624 -----

TOTAL $2,963,240 9.0

Budget Development Plan (BDP) 2010/11SUMMARY

SUMMARY OF REDUCTIONS & REVENUES Total Projected Deficit for 2010-2011 $8,076,021 Less Preliminary Reductions/Restructuring $2,963,240

REMAINING BUDGET DEVELOPMENT PLAN (BDP) $5,112,781

Pending Issues:

Remaining Budget Development Plans

Use of Fund Equity Contract Negotiations

Additional Reductions and Restructuring...

Budget Development Plan (BDP) 2010/11Action Source Budget

AmountStaffing

Impact (FTE)

Restructuring professional development Educational Services $25,000 -----

Reviewing High School staffing needs Educational Services $210,000 3.0

Reviewing Middle School staffing needs Educational Services $140,000 2.0

Reviewing BCS (Birmingham Covington School) staffing needs Educational Services $100,000 1.4

Restructuring Project 2000 program services Educational Services $ 40,000 1.0

Reviewing Elementary School staffing needs Educational Services $420,000 6.0

Instituting a “Pay to Participate” fee for student activities Educational Services $50,000 -----

Budget Development Plan (BDP) 2010/11Action Source Budget

AmountStaffing

Impact (FTE)

Restructuring Middle School administration Educational Services $140,000 1.0

Increasing the fee for BCS Choice Hour activities Educational Services $50,000 -----

Expanding the Tuition Enrollment Program (TEP) Educational Services $520,000 -----

Eliminating the Cable Playback Technician position Technology $45,000 1.0

Eliminating a Technology Operational Assistant position Technology $ 45,000 1.0

Increasing teaching time for Department Chairs Instruction $140,000 2.0

Consolidating services for Environmental Education Instruction $200,000 2.5

Budget Development Plan (BDP) 2010/11Action Source Budget

AmountStaffing

Impact (FTE)

Restructuring Elementary Support Services Instruction $315,000 4.5

Restructuring Instructional Department administration Instruction $100,000 1.0

Implementing Service Plans for Non-Public Schools Special Education $100,000 1.2

Contracting Noon Aide positions Human Resources $20,000 17.0

Contracting Paraprofessional Substitute positions Human Resources $10,000 TBD

Reviewing Substitute Teaching costs Human Resources $30,000 -----

TOTAL $2,700,000 44.6

Budget Development Plan (BDP) 2010/11SUMMARY

SUMMARY OF REDUCTIONS & REVENUES Total Projected Deficit for 2010-2011 $8,076,021 Less Preliminary Reductions/Restructuring Less Additional Reductions/Restructuring

$2,963,240$2,700,000

REMAINING BUDGET DEVELOPMENT PLAN (BDP) $2,412,781

Pending Issues:

Remaining Budget Development Plans

Use of Fund Equity Contract Negotiations

Budget Development Timelines

BIRMINGHAM PUBLIC SCHOOLSBOARD STUDY SESSION

FEBRUARY 2, 2010Date Activity

November 2009 - Collect financial data, staffing, finalize enrollment forecasts, etc.

December 2009 Continue to compile restructuring/repurposing information

January 2010-February 2010

Present final forecast; budget development targetsAmend current fiscal year results (June 30, 2010)Review preliminary budget reductions/revenue enhancements

January 2010 – March 2010

Prepare preliminary budget, review forecast assumptions Continue to gather feedback, restructure and repurpose budgets

Tentatively Community ConversationsMarch 23 and 25

BIRMINGHAM PUBLIC SCHOOLSBOARD STUDY SESSION

FEBRUARY 2, 2010Date Activity

March 2010 Review budget progress Release staff allocations based on enrollment, restructuring/repurposing

March 2010 - Disseminate preliminary budget and impact information toMay 2010 the staff and community

Receive feedback and modify where appropriate

May 2010 Update taxable value informationFinalize budget development process and review preliminary budgets

June 2010 Public Hearings on 2010-2011 budgets and millagesAdopt 2010-2011 budgets and millages

Budget Development Guiding Principles

1. Prioritize Classroom Instruction2. Support the Implementation of the Strategic Plan3. Adapt/Restructure Instructional Support Programs4. Ensure the Financial Stability of the District

Summary Points

• We have been good fiscal stewards.• We are facing a significant problem over the next

two years.• Although the financial problems will cause us to

restructure, we will continue to provide a first-class education