Budget Status Update

Presented by:Mark Mathers, Chief Financial Officer

Mike Schroeder, Budget DirectorNovember 12, 2019

Attachment A

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Review of FY19 Results

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FY19 General Fund ResultsOriginal Adjusted Actual Variance VarianceBudget Budget (Audited) Adj to Actual %

RevenuesProperty Taxes 110,388,289$ 110,388,289$ 111,149,894$ 761,605$ 0.7%Sales Tax (LSST) 204,138,121 206,830,042 206,998,152 168,110 0.1%Gov't. Svcs Tax (GST) 18,701,868 19,751,868 19,711,982 (39,886) -0.2%Other Local 5,881,000 6,531,000 6,956,835 425,835 6.5%State/Federal 124,309,721 122,873,122 122,013,693 (859,429) -0.7%

Total 463,418,999 466,374,321 466,830,556 456,235 0.1%

ExpensesSalaries 271,953,927 268,713,079 267,789,753 (923,326) -0.3%Benefits 112,698,588 112,262,004 112,380,759 118,755 0.1%Operating Costs 41,694,664 44,507,516 40,886,584 (3,620,932) -8.1%Transfers Out 44,574,479 45,494,381 44,940,238 (554,143) -1.2%

Total 470,921,658 470,976,980 465,997,334 (4,979,646) -1.1%

Surplus/(Deficit) (7,502,659)$ (4,602,659)$ 833,222$ 5,435,881$

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• Revenues exceeded the FY19 adjusted budget by $456,235 (+0.1%). • In total, revenues were 2.3% higher than FY18.

FY19 General Fund Revenues

5.3%

9.4% 10.0%

7.2%

-11.1%-15.0%

-10.0%

-5.0%

0.0%

5.0%

10.0%

15.0%

Property Taxes Sales Tax (LSST) Gov't. Svcs Tax (GST) Other Local State/Federal

Major General Fund Revenues - FY19 Compared to FY18

Includes $8.2 mil. of special appropriations

Factors in $9.8 mil of AT&T refund in FY18. Otherwise,

this revenue increased 4.5%.

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• Expenses, excluding encumbrances and carry-over of supplies of $1.65 million, were $4.98 million under the Adjusted Budget (-1.1%).

• Overall, expenses increased only 0.9%, compared to FY18.• Comparison to Original Budget

o Salaries and Benefits were $4.49 million under budget due to continued salary savings (i.e., vacancies).

o Operating expenses (again excluding encumbrances and carry-over) were $808,079 under budget.

o Transfers Out were $365,759 over budget.

FY19 General Fund Expenses

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• Revenueso Property tax revenues (+5.3%) and GST revenues (+10.0%) showed strong

growth over FY18. o Sales tax (+4.5% after excluding AT&T refund) grew moderately.

• Expenseso Continued to experience salary savings due to vacancies.

• General Fund revenues exceeded expenses by $833,222. This is the first time the General Fund has been “in the black” in four years, since FY15.o However, if you include $1.65 million of encumbrances and carry-over of

supplies, we would have had a deficit of $820,082.o Also, WCSD was aided by receiving an additional one-time $1.6 million in

special appropriations (for FY18).

Summary of FY19 Results

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Fund Balance for General Fund• Board’s fund balance goal is that the available (unrestricted) General

Fund balance is within 8% to 10% of actual expenses and transfers out.• Total fund balance as of 6/30/19 is $41.7 mil., or 9.0% of expenses. • Available fund balance is $40.5 million, or 8.7% of expenses.

13.9%13.0%

14.1% 14.3%

12.1%

9.8%8.8% 9.0%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

16.0%

2012 2013 2014 2015 2016 2017 2018 2019

Total Fund Balance as a Pct. of Actual Expenses

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Fund Balance for General Fund• Fund balance is sufficient to cover cash flows (payroll, etc.)

57,763,921 53,102,845

58,709,668 61,206,550

53,291,732 43,304,157

40,882,706 41,715,928

-

10,000,000

20,000,000

30,000,000

40,000,000

50,000,000

60,000,000

70,000,000

2012 2013 2014 2015 2016 2017 2018 2019

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Initial Trends for FY21 Budget

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Preliminary Revenue & Cost Trends for FY21(From September Budget Workshop)

Ad Valorem + 5% $2.34 Gov’t Services Tax +5% $1.08 DSA Per Pupil (+$50) - Flat Enrollment $2.94 Special Education Revenue $0.90

Total New Revenue $7.26 New Schools (1 Middle, 1 Elementary) ($2.80)Salary Rollup Cost ($9.20)Health Insurance (5%) ($1.31)Textbooks ($2.00)Property Insurance ($0.75)Position Contingency $0.24 S&B Basis Adjustment $2.00 Add'l Cost Savings Related State Grants $2.30

Total New Expenditures ($11.52)FY21 – Current Estimated Gap ($4.26)

Note: These are early estimates only and are not projections of where we will actually end up by the time the FY21 budget is finalized.

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• Enrollment trends• Salary Negotiations (including ESIP)• Health Insurance• Utilities Costs

‒ Electricity rates‒ Gas prices

• Recession ‒ Could negatively affect our local revenues such as the

Government Services Tax and investment earnings‒ Sales tax is guaranteed by the State in the current Nevada Plan‒ Property tax is buffered for awhile by abatements

Uncertain Cost/Revenue Factors for FY21(From September Budget Workshop)

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• Incline Village Property Tax Lawsuit• District Court’s Order on October 21, 2019• Decision Today by County Board of Commissioners regarding Appeal

Uncertain Cost/Revenue Factors for FY21(New Issues)