finance-final exam 1

7/31/2019 Finance-Final Exam 1

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Saturday, December 10, 2011


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R.S.U. #64

BackgroundRSU #64 is a rural district in the State of Maine made

up of five different towns including: Corinth,

Kenduskeag, Hudson, Bradford and Stetson. There arearound 1,300 students enrolled in the district and atotal of 88 teachers and 40 instructional aides. The

overall local and state revenue for the district is

$10,241,607.00



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R.S.U. #64

Budget Overview - RevenuesLocal Revenues

Local EPS Tax Assessments = $3,035,310.00

Additional Local Tax Assessments = $427,060.00Interest on Checking = $12,000.00Income from Secondary Admission = $4,000.00

Rental-Facilities = $250.00Rent on Land = $1,280.00

Misc. Revenue = $1,000.00Sales and Refunds = $100.00Gas Tax Refund = $800.00

Fund Beginning Balance = $450,000.00Adult Education Revenue = $900.00

TOTAL : $3,932,700.00Saturday, December 10, 2011


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R.S.U. #64

Budget Overview - RevenuesState Subsidy

Foundation Allocation = $6,283,707.00

Adult Education State Subsidy = $200.00TOTAL : $6,283,907.00

Other State RevenueSpec.ED State agency Client-Sec, = $25,000.00

TOTAL : $25,000.00



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R.S.U. #64

Budget OverviewTotal Expenditures for the

district:$10,241,607.00The total amount of expenditures is figured through

subtotals including: regular instruction, special education,career & technical education, other instruction(Summer/Extra Curr.), student and staff support, system

administration, school administration, transportation,

facilities maintenance, food and adult education.



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R.S.U. #64

Budget OverviewRegular Instruction = $4,521,347.00

Special Education = $1,486,006.00

Technical Education = $248,201.00



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R.S.U. #64

Budget Overview

Student/Staff Support = $536,029.00

System Administration = $303,322.00

Other Instruction = $261,116.00



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R.S.U. #64

Budget Overview

Transportation = $1,074,983.00

Maintenance = $967,957.00

School Administration = $815,440.00



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R.S.U. #64

Budget Overview

Adult Education =$2,829.00

All Other Expenditures(Including Food Services) =

$40,000.00



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Budget Analysis

Regular Instruction = $4,521,347.00

The regular instruction portion of the budget is made up of a variety of line items. Theseline items include expenditures like general school supplies, books, classroom equipment,

technology equipment, instructional materials and staff salaries. Staff salaries account forthe majority of the total of regular instruction expenditures. The budget breaks down staff

salary into teacher and Educational Technician salary within each school of the district.With the break down of schools, it is very evident of which schools have more students and

teachers. The high school and middle school teacher salary totals are $970,700.00 and$734,159.00 respectfully which are much higher than the elementary schools in the district.The largest of the elementary schools, Morison Memorial School, has a total teacher salary

of $472,851.00 while the rest of the elementary schools are as follows: Kenduskeag -$242,993.00, Stetson - $137,480.00, Hudson - $134,115.00 and Bradford - $126,107.00. Whentallied, teacher salaries total $2,818,405.00, which accounts for 62% of regular instruction

expenditures without counting for Educational Technicians and substitute teachers.



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Budget Analysis

Special Education = $1,486,006.00

Within the budget there is a total of $1,486,006.00 allocated toSpecial Education. Line items specific to Special educationinclude instructional supplies, Special Education teacher and

support staff salaries, contracted services for the high school,Stetson Ranch and each elementary school as well as

transportation for Special Education students. Contractedservices total $18,750.00 while transportation for students to

various location accounts for $10,750.00.



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Budget Analysis

Technical Education = $248,201.00

Funds needed for Technical Education accounts foronly 2% of the overall budget. The Vocational Region

No. 4 assessment costs the district $195,130.00. Thistotal accounts for 79% of the Technical Education

portion of the budget.



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Budget Analysis

Other Instruction = $261,116.00

Summer school accounts for a great deal of theexpenditures from the Other Instruction category.Salary for Summer School teachers, support staff

and specialists including Physical, Occupational andSpeech therapists make up a majority of the

$261,116.00.



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Budget Analysis

Student/Staff Support = $536,029.00

Expenditures from the student and staff support category come from various areas.These line items include contracted professional services for the high school, middleschool and elementary schools totaling $20,500.00. Support staff is also broken intoindividual item lines for each school and are as follows for each school: Central HighSchool - $28,617.00, Central Middle School $21,287.00, Bradford Elementary School -

$9,245.00, Hudson Elementary School - $23,279.00, Kenduskeag Elementary School -$25,499.00, Morison Memorial School - $42,321.00 and Stetson Elementary School -$5,547.00. Wages for Ed-Techs alone total $155,795.00 and makes up 29% of the

total funds of the student and staff support category. Included in this category aswell is guidance counselors and director at the middle and high school levels.



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Budget Analysis

System and School Administration = $1,118,762.00System and school administration is made up of the salaries and benefitsof the Superintendent, principals, assistant principals, secretarial staff

and other system administrators. Also included in this category ispurchased services and supplies necessary at the district level. Salaries

in the system and school administration category include: theSuperintendent - $87,519.00, Central High School Principal & Assistant

Principal - $153,980.00, Central Middle School Principal - $74,666.00,Bradford Elementary School Supervisory Principal - $22,817.00, Hudson

Elementary School Principal - $14,794.00, Kenduskeag Elementary SchoolSupervisory Principal - $44,963.00, Morison Memorial School

Supervisory Principal - $56,449.00 and Stetson Elementary School

Teaching Principal - $5,380.00.Saturday, December 10, 2011


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Budget Analysis

Transportation = $1,074,983.00

The transportation category of the budget incorporatescosts for everyday pupil transportation, school field trips

and fuel costs. Within the budget, the bus contract is$836,374.00 per fiscal year with an additional $43,200.00fuel adjustment.



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Budget Analysis

Maintenance = $967,957.00

Maintenance includes a very wide category of line items toallow for each school in the district to operate correctlyand safely. These line items include: general supplies, staff

salaries, waste removal, heating costs, electricity andregular cleaning. Heating cost alone for the school

district total $139,219.00 with Central High School beingthe highest at $67,778.00. Electricity costs for the

district add another $128,553.00.



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Budget Analysis

All Other Expenditures =$40,000.00

Food services makes up the bulk of the AllOther Expenditures category. Food services

includes the salaries of food servicepersonnel and coordinator as well as thepurchase of food and cooking products.



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Budget Variances

There were a number of variances betweenthe proposed budget and actual budget for

RSU #64. There were some line items thatwere only different by a small amount butthere were others that were much more

substantial.Saturday, December 10, 2011


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Budget Variances

Books for Elementary Schools

There was a total of $76,213.00 budgeted for thepurchase of books for the elementary schools in the

district. The actual amount for purchased books forthe elementary schools was $89,162.00. A varianceof

$12,949.00Saturday, December 10, 2011


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Budget Variances

Purchased Repair/Maintenance Service

There was a total of $83,220.00 budgeted forpurchased non-technology repairs/maintenance

service budgeted out for the year. The actualamount used for non-technology repairs andmaintenance was $44,183.00. A variance of



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Budget Variances

Central Middle School Heating Oil

There was a total of $27,725.00 budgeted for thepurchase heating oil for Central Middle School. The

actual amount required for heating the school was$39,044.00. A variance of

$11,319.00



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Budget Variances

Teacher Salary/1A Reading Recovery

There was a total of $113,138.00 budgeted for thesalary of the Title 1 Reading Recovery specialists

within the district. The actual amount used forsalary for Title 1 Reading Recovery was $62,567.00.

A variance of



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Budget Variances

Food Service Manager

There was no money budgeted for the Food ServiceManagers salary. The actual amount used for the

salary of the Food Service manager was$34,736.00. A variance of

$34,736.00



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Budget Variances

Employee Training and Development

There was a total of $18,000.00 budgeted for the

training and development of the employees of RSU#64. The actual amount used for training anddevelopment was $3,965.00. A variance of

$14,035.00



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Budget Variances

Guidance Director Salary

There was a total of $62,382 budgeted for the

salary of the Guidance Director for the district. Theactual amount used for salary of the GuidanceDirector was $82,936.00. A variance of

$20,554.00


B d t V i


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Budget VariancesReasons for Variances

When trying to develop a budget, often a well calculated guessing game ensues to predicthow much money will be needed to cover various portions of the budget. As I stated, therewere many small variances within the budget and I included many of the larger ones. For

instance, predicting how much heating oil will cost for each school has a lot of variablesthat come into play. It depends on if the costs of heating oil rises, how cold/long the

winter is and what temperature teachers are keeping their classrooms. The same could besaid for the need for repair or maintenance, you never truly know when something mightstop working and need expensive repairs. In this case, it is a great idea to have an over

estimate of how much you will budget to suffice those needs.

When it comes to budget there are always negotiations being made between the districtand its employees. The negotiations can last for quite sometime and sometimes overlap thetime when budgets need to be submitted. This in turn can lead to having under or over

estimates of how much salary a certain employee may be receiving. Also, the hiring of newstaff after the beginning of the school year can also drastically change the salary that is

budgeted for.



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Reflections

I learned such a great deal during this project on the sheer complexity of themakings of a budget from the revenues schools receive to the calculation of

expenditures the district will face. Going through my districts budget with such a

fine tooth comb really was an eye-opener to what it takes to keep this districtoperating. I now have a much better understanding of why there is a lack ofresources available to teachers within my school and around the district.

Expenditures in schools go far beyond the purchase of paper and pencils for theclassroom. There are so many tangibles needing to be taken into account long before

the school year starts to be prepared for what is to come.


R fl ti


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ReflectionsLine Items

The amount of line items alone accountedfor in the budget was very surprising.With over 1,200 items to account for I

can see why this is such a demandingpart of the job and takes so long toaccomplish. When you need to predicthow much each item may need usingprevious years data and projected

student enrollment it can certainlybecome a very slow and stressfulprocess, especially in these economic

times.



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Reflections

State vs. Local RevenuesThe difference between state and

local revenue was larger than Ianticipated. As stated earlier, RSU#64 received $6,283,907.00 fromstate revenue, while only receiving

$3,932,700.00 from local revenues.I expected state funding to becloser to 40-45%, instead it is 61%.



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Reflections

Per Pupil Spending$8527.56

The amount of spending per student is truly

astonishing. Growing up in this rural area andnow teaching in it, it is surprising how much istruly spent per pupil knowing property valuesand total family income is not that high. This

amount is found by calculating the total spendingon all school functions(with the exception of

school construction and building purchases) andthen dividing it by the average number of students

enrolled in the district. The total spending onschool functions includes but is not limited to the

following: teacher/administration salary, foodservices, maintenance, heating and transportation.



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Reflections

Per Pupil SpendingThe national average cost of per pupilspending is $10, 591. In comparison, theR.S.U. #64 per pupil spending $8,527

is slightly lower than the nationalaverage. This is understandable whentaking into account the demographicsof this rural area in addition to theeconomic problems we are facing atthis time throughout the state and

country.

$0

$3,000.00

$6,000.00

$9,000.00

$12,000.00

R.S.U. #64National Average

Per Pupil Spending Comparison

The National per pupil spending average was found at:

http://nces.ed.gov/fastfacts/display.asp?id=372

http://nces.ed.gov/fastfacts/display.asp?id=372http://nces.ed.gov/fastfacts/display.asp?id=372http://nces.ed.gov/fastfacts/display.asp?id=372


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ReflectionsReal Cost

Until you really take a detailedlook at a school budget, youtend to not realize how much

things really cost and how fastthey can add up. I would bewilling to bet a large number

of residents within this districtdo not know that $4,521,347.00

is set aside for regularinstruction purposes alone andeven with that large amount itis not enough to be considered

adequate.



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Reflections

Common PracticeThe most predominate practice/strategy

throughout the budget that I noticed wastrying to over-estimate on what funds

may be needed for the unknown. Theseunknowns include repair and maintenance

costs, heating oil, gasoline costs andinsurance costs. This obviously can bevery tricky because you only have so

much money to begin with but you wantto make sure you are prepared for the

unknown. It is an unfortunate evil but attimes you must make cuts to assure youare ready for any unforeseen issues that

could arise during a school year.



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REFERENCES

Odden, A., & Picus, L. (2008). School Finance: A Policy Perspective.New York: McGraw-Hill Companies, Inc.

Behrman, T., & Terman. D. (1997) Financing schools: analysis andrecommendations. The future of children

Institute of Education Sciences.(2011). National Center for EducationStatistics. Retreived from http://nces.ed.gov/fastfacts/

display.asp?id=372
http://nces.ed.gov/fastfacts/display.asp?id=372http://nces.ed.gov/fastfacts/display.asp?id=372http://nces.ed.gov/fastfacts/display.asp?id=372http://nces.ed.gov/fastfacts/display.asp?id=372http://nces.ed.gov/fastfacts/display.asp?id=372

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