Guilford County Schools

Budget for 2011-12

Board of Education Retreat

October 2, 2010

Presented by

Sharon Ozment, CFO

2009-10 BUDGET DEVELOPMENT PHILOSOPHY

2

Use Board of Educations Mission, Core Values and Strategic Plan

Achieving Education Excellence to guide budget development

process

Reflect current and projected economic conditions

Use Governors Proposed Budget as a baseline for state funding

2009-10 BUDGET DEVELOPMENT PHILOSOPHY

3

Honor request from County Commissioners to submit 2009-10

budget that reflects flat or hold-the-line local funding

(a no increase budget)

Fund strategic plan initiatives through budget reductions,

redirections or by seeking outside funding

Fund other sustaining operations cost increases through

budget reductions or redirections

Provide flexibility to incorporate federal stimulus funds when those

funds and the guidelines regarding their use are available to GCS

Limit impact of budget reductions on existing personnel

2009-10 BUDGET DEVELOPMENT PHILOSOPHY

4

Board Mission

Guilford County students will graduate as responsible citizens prepared to

succeed in higher education, or in the career of their choice.

Board Core Values

Diversity

Empathy

Equality

Innovativeness

Integrity

2009-10 BUDGET DEVELOPMENT PHILOSOPHY

5

Strategic Plan

Major themes:

Academic excellence

Character development

Excellence

Eight areas:

Improving academic achievement

Supportive parent and community involvement

Strategic human resource management

Respectful and responsive service

Safe schools and character development

Optimal operations

Transformational technology

Clear baseline and equitable standards

2009-10 BUDGET DEVELOPMENT PHILOSOPHY

6

Strategic Plan

SMART (Specific, Measureable, Attainable, Results-Oriented, Time-Based)

goals developed for each of the eight areas

Implementation strategies developed for the goals

Plan launched in January 2009

Plan endorsed by Board of Education in March 2009

STRATEGIC PLAN INITIATIVES

7

Strategic plan initiatives with major 2009-10 budgetary implications:

Reorganization of Academic Services/Regionalization

Balanced Literacy and DIBELS

(Dynamic Indicators of Basic Early Literacy Skills)

Elementary Math Textbook Adoption

Character Education

Teacher Recruitment

Respectful and Responsive Service

Volunteer Screening

Energy Management

Business Improvement Plans

Developing Baseline Standards

STUDENT ENROLLMENT

8

2009-10 ADM (Average Daily Membership) = 71,079

(per NC Department of Public Instruction 2009-10 State Planning Allotment )

Projected 2009-10 ADM numbers were impacted by a change in the

NC kindergarten cut-off age/date (NCGS 115C-364)

Date by which child must have reached age 5

Up through 2008-09, date was October 16th

Effective 2009-10, date is August 31st

Approximately 15,000 children impacted by change

REGIONALIZATION/REORGANIZATION

9

WHAT DID IT COST?

+ PERSONNEL (Regionalization) $3.3M(includes +39 positions)

+ PERSONNEL (Reorganization) $0.5M

(includes +6.0833 positions)

+ NON-PERSONNEL (Regionalization) $0.4M

Subtotal $4.2M

HOW DID WE FUND IT?

- PERSONNEL (Regionalization/Reorganization) ($5.2M)

(includes -63 positions)

- NON-PERSONNEL (Regionalization) ($0.1M)

Subtotal ($5.3M)

NET SAVINGS ($1.1M)

MAJOR BUDGET IMPACTS TO SCHOOLS

10

PERSONNEL ($3.2M)

90 positions

Media Assistants (-64 positions)

ESOL (-7.5 positions)

(English for Speakers of Other Languages)

HS Testing Coordinators (-7.5 positions)

Instructional Technology Facilitators (-11 positions)

WSF (Weighted Student Formula) dollars

Initially allocated 50% of $11.5M in discretionary funds

Usually allocate 75% initially and adjust based on 20-day

student numbers

BOE restored WSF dollars to 100% on 8/11/09

Budget included $1.1M to restore WSF if actual budget $2.2M

reductions < anticipated reductions + $1.1M for a maximum

of 20 additional teachers for 10th/20th day adjustments

2009-10 BUDGET REDUCTIONS/REDIRECTIONS

11

2009-10 = $21.9M Improving Student Accountability (2,349,689)$

Literacy Coaches (GCS allotted 7 positions in PRC 052 in 2008-09) (421,204)$

Non-Instructional Support Personnel (@ 2.5% reduction) (1,033,049)$

Transportation (approximately 3.9% reduction) (870,357)$

Limited English Proficiency (107,185)$

Mentors (109,167)$

School Technology (466,474)$

Textbooks (2,522,731)$

Textbooks - Freight (10,570)$

Staff Development (@ 100% reduction) (420,674)$

Staff Development - Finance Officers (250)$

LEA Discretionary/Flexibility Reduction (Negative Reserve) (10,917,800)$

SUBTOTAL (19,229,149)$

Central Office Administration

(@ +/- 18% reduction for LEAs with more than 30K in ADM) (587,304)$

Eliminating state funding of application fees for NBPTS (125,000)$

Children with Disabilities (headcount adjustment) (775,786)$

TOTAL (20,717,240)$

Cuts to offset losses in state funding 20,717,240$

PLUS: Increase in employer's hosp ins rate (2008-09 = $4,157/FTE; 2009-10 = $4,527/FTE) 569,329$

PLUS: Increase in employer's retirement rate (2008-09 = 8.14%; 2009-10 = 8.75%) 584,727$

21,871,296$

2009-10 BUDGET REDUCTIONS/REDIRECTIONS

12

Schools54%

AdministrativeSupport Services

46%

SUMMARY OF BUDGET

REDUCTIONS/REDIRECTIONS

Schools $ 11,837,702

Administrative

Support Services 10,033,594 Total $ 21,871,296

2009-10 BUDGET

13

2009-10 Budget Resolution = $642,017,714

Funding sources:

State ($357.5M)

Local ($192.6M)

Federal ($49.9M)

Capital Outlay ($4.0M)

Enterprise Funds

Child Nutrition ($30.7M)

ACES (After School Care Enrichment Services) ($7.4M)

2009-10 BUDGET

14

2009-10 Operating Budget = $599,970,699

Funding sources:

State ($357.5M)

Local ($192.6M)

Federal ($49.9M)

Excluded projected economic stimulus package dollars:

$17,030,000 in additional Title I funds

$15,859,000 in additional IDEA dollars

(IDEA = Individuals with Disabilities Education Act)

$466,475 in Education Technology Program funds

2009-10 BUDGET

15

State60.59%

Local32.09%

Federal8.31%

2009-10 BUDGET

16

Salaries64.46%

Employee Benefits15.84%

Purchased Services12.29%

Supplies & Materials6.93%

Transfers to Charter Schools0.48%

2009-10 BUDGET

17

Schools80%

AdministrativeSupport Services

20%

ECONOMIC STIMULUS PACKAGE

18

ARRA (American Recovery and Reinvestment Act) Funds:

State Fiscal Stabilization Funds = $18.5M Fund school-based custodians, treasurers, NC WISE data managers,

office support (guidance/attendance/registrar) positions

Title I = $7.8M

Title I School Improvement = $315.8K Fund positions in Title I schools (schools most impacted by poverty

as measured by % of students receiving free or reduced priced meals)

IDEA VI-B = $7.9M

IDEA Pre-School = $$309.6K Fund positions serving children with special needs

Education Technology = $376.1K Improve student academic achievement through use of technology in

schools; assist students in becoming technologically literate by end

of eighth grade

ENTERPRISE FUNDS

19

Child Nutrition Fund

Actions implemented to generate sufficient revenues to cover expenses

including assessment of indirect cost:

Reduce menu/food choices (i.e., offer two versus four entrees; use 25% less whole grain products)

Reduce or eliminate breaks in serving time schedules

Reduce number of serving lines where appropriate/possible

(determine number of lines based on participation)

Defer computer equipment replacement at elementary schools

Limit computer equipment replacement at middle/high schools

Allow replacement only of small wares(i.e., serving utensils, food thermometers, pans)

ENTERPRISE FUNDS

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Child Nutrition Fund

Purchase uniforms for new employees only(i.e., postpone purchasing additional set of uniforms for existing employees)

Reduce number of van rentals (schedule meal delivery for early/middle colleges and academies based

on existing Child Nutrition schedules for traditional/satellite sites)

Discontinue printing/distributing menus (menus will be available on-line or in newspapers)

Increase in school-lunch prices by $0.50 at ES and by $0.30 at MS/HS

ES = $1.80 + $0.50 = $2.30

MS = $2.10 + $0.30 = $2.40

HS = $2.20 + $0.30 = $2.50

ENTERPRISE FUNDS

21

ACES (After School Care Enrichment Services) Fund

Cost saving and revenue enhancement initiatives implemented in

2009-10 include:

consolidate programs with low enrollment at cluster sites

eliminate positions

establish an enrollment fee ($15 per student)

establish an ACES All-Day activity fee ($8 per child per All-Day)

increase weekly tuition fee from $40 to $46

2010-11 BUDGET DEVELOPMENT PHILOSOPHY

22

Use Board of Educations Mission, Core Values and Strategic Plan

Achieving Education Excellence to guide budget development

process

Use State Superintendent Dr. June Atkinsons March 1, 2010

information highlighting the states current revenue collections and

budget cuts for 2009-10 and 2010-11 as a baseline for state

funding

Total FY 2010-11 State Cuts in State adopted budget for 2009-11 ($29.790M)

Additional FY 2010-11 State Cuts @ +3% ($10.394M)

Additional FY 2010-11 State Cuts @ +4% ($13.858M)

Reflect current and projected economic conditions and plan for

various potential funding scenarios

2010-11 BUDGET DEVELOPMENT PHILOSOPHY

23

Fund strategic plan initiatives and magnet revisioning through budget reductions,

redirections or by seeking outside funding ($892K)

Limit request for additional funds from County Commissioners to sustaining

operations cost increases not covered by other significant reductions or

redirections ($3.423M = 1.95% increase)

Retirement rate increase (8.75% to 10.51% = $1.535M)

Hospitalization insurance rate increase ($4,527/FTE to $4,929/FTE = $682K)

Growth in student enrollment (+301 students = $721K)

District software licensing fees ($165K)

Increase in IB membership/dues/exam fees ($42K)

Increase in Section 504 nursing costs ($110K)

Start-up costs for Jamestown MS and Haynes-Inman Educ Ctr ($162K)

Increase in property insurance for additional square footage ($6,500)

2010-11 BUDGET DEVELOPMENT PHILOSOPHY

24

Request $7M from County Commissioners for capital outlay

Include federal stimulus funds available to GCS

State Fiscal Stabilization Funds ($18.086M)

Title I funds ($7.815M)

IDEA (Individuals with Disabilities Education Act) funds ($5.823M)

Limit impact of budget reductions on the employment of existing

personnel

2010-11 BUDGET DEVELOPMENT PHILOSOPHY

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Strategic Plan

21 strategies scheduled for implementation during 2010-11

Strategic plan strategies reprioritized due to economic situation

GCS will proceed with strategies related to various areas including:

Character Development

One Million Books

Advantage Model Middle School

Parent University Now Guilford Parent Academy

Parent Assistant

Expansion of Positive Behavior Support

Low Performing School Strategies

Develop 10-Year Enrollment Projections and Capacity Needs

Develop Baseline Standards for Facilities

GCS will also proceed with magnet revisioning

2010-11 BUDGET

26

Total 2010-11 Budget = $651,945,431

Funding sources:

State ($342.6M)

Local ($186.4M)

Federal ($82.2M)

Capital Outlay ($3.2M)

Enterprise Funds

Child Nutrition ($30.9M)

ACES (After School Care Enrichment Services) ($6.6M)

2010-11 BUDGET

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State56.1%

Local30.5%

13.4%

Total 611,237,420$

Federal 82,245,397

2010-11 Operating Budget

Revenues/Sources

Where The Money Comes From

State 342,643,112$

Local 186,348,911

Salaries65.0%

EmployeeBenefits18.1%

PurchasedServices11.5%

Supplies &Materials

4.1%Transfers to

Charter Schools0.7%

Reserve for Operational Expenses

0.6%

2010-11 BUDGET

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2010-11 BUDGET

29

Schools77.7%

AdministrativeSupport Services

22.3%

FEDERAL FUNDS

30

ARRA (American Recovery and Reinvestment Act) Funds:

State Fiscal Stabilization Funds = $20.7M Fund school-based custodians, treasurers, NC WISE data managers,

office support (guidance/attendance/registrar) positions

Title I Funds = $9.6M Fund positions in Title I schools (schools most impacted by poverty

as measured by % of students receiving free or reduced priced meals)

VI-B Funds = $5.8M Fund positions serving children with special needs

Education Technology = $38,126

School Improvement Grant (SIG) = $2,864,207 Fund turnaround strategies @ Oak Hill ES

FEDERAL FUNDS

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Education Jobs Fund (EduJobs) = $14.2M (estimate) Funds must be expended by September 2012

TBD when/how GCS funds will be spent

Race to the Top (RTTT) Funds Competitive federal grant funds earmarked to pay for large-scale education

improvement efforts that focus on bolstering academic standards, teacher

quality, data systems, and low-performing schools

National total = $4.35 billion

$350 million carved out for separate summative assessment fund

NC to receive approximately $400 million

50% of the grant award amount to be retained by NCDPI

50% of the grant award amount to be allocated to participating LEAs

via the Title I formula

Funding spread over four year timeframe (2010-11 through 2013-14)

2010-11 BUDGET REDUCTIONS/REDIRECTIONS

32

2010-11 = $17.7M (in addition to 2009-10 reductions/redirections)

Losses in State funding = $10.415M

-$9.073M LEVEL A state funding reductions

+$1.662M driver training funds reinstated in final budget

-$3.004M LEVEL B state funding reductions

Increase in employers hosp ins rate = $1.535M

2009-10 = $4,527/FTE; 2009-10 = $4,929/FTE

Increase in employers retirement rate = $682K

2009-10 = 8.75%; 2010-11 = 10.51%

Strategic plan implementation/magnet revisioning = $892K

Increase in sustaining operations costs = $475K

Possible addl 1% state reduction in January 2011 = $3.678M

2010-11 BUDGET LEVEL A

33

-20.717 FY 2009-10 State Cuts

-9.073 Additional FY2010-11 State Cuts

-29.790 SUBTOTAL

-0.579 FY 2010-11 Strategic Plan implementation costs

-0.313 Magnet revisioning costs (if GCS does not receive MSAP grant)

-30.682 SUBTOTAL

20.717 GCS reductions/redirections to address FY 2009-10 State Cuts

-9.965 SUBTOTAL

5.896 LEVEL A FY 2010-11 Admin reductions/redirections

-4.069 SUBTOTAL

0.876 One-time FY 2009-10 $ for Oak Ridge Elementary School Indoor Air Quality (IAQ) issues

0.306 Additional Dental Insurance savings (implement 7/1 versus 10/1 in FY 2010-11)

1.662 Driver Training funds not included in State FY2010-11 budget (program eliminated)

0.031 Decrease mileage reimbursement rate by 5 cents per mile (change from $0.50/mile to $0.45/mile)

1.194 FY 2009-10 reserves for operational expenses

0.000 TOTAL

LEVEL A STATE BUDGET REDUCTIONS/REDIRECTIONS:

(covers 2010-11 identified State Budget Cuts & certain Strategic Plan Initiatives)

2010-11 BUDGET LEVEL B

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-13.858 GCS share of additional +4% or $285.3M reduction

1.806 FY 2009-10 reserves for operational expenses

3.378 Furlough/salary reduction (2 days) - for all GCS employees earning >= $25K/year

3.224 LEVEL B Admin reductions/redirections

5.920 50% of WSF funds currently held in abeyance

14.328 GCS reductions/redirections to address additional FY 2010-11 State Cuts

3.423 Sustaining Operations (funds to be requested from BOCC)

LEVEL B STATE BUDGET REDUCTIONS/REDIRECTIONS:

(covers potential additional 2010-11 State Budget Cuts)

2010-11 LEVEL A - SUMMARY

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LEVEL 3A STATE REDUCTIONS/REDIRECTIONS:

PERSONNEL - ADMIN:

SALARY +

FTE BENEFITS

DIRECTORS+ (3.00) (306,391.21)$

INSTRUCTIONAL SUPPORT (10.15) (806,483.37)$

SPECIALISTS (3.00) (229,023.43)$

ADMINISTRATORS (4.50) (249,393.16)$

OFFICE SUPPORT (3.00) (141,681.53)$

FACILITIES/MAINTENANCE (2.00) (113,101.63)$

(25.65) (1,846,074.32)$

NON-PERSONNEL - ADMIN:

OBJECT CODE

PURCHASED SERVICES 300 (2,042,165.26)$

SUPPLIES AND MATERIALS 400 (1,155,724.02)$

CAPITAL OUTLAY (EQUIPMENT) 500 (331,701.37)$

CONSOLIDATION OF BUS STOPS (173,549.28)$

REDUCE HFA TRANSPORTATION (347,156.00)$

(4,050,295.93)$

LEVEL 3A STATE REDUCTIONS/REDIRECTIONS:

PERSONNEL - ADMIN (1,846,074.32)$

NON-PERSONNEL - ADMIN (4,050,295.93)$

(5,896,370.25)$

2010-11 LEVEL B - SUMMARY

36

LEVEL 3B STATE REDUCTIONS/REDIRECTIONS:

PERSONNEL - ADMIN (2,609,586.80)$

NON-PERSONNEL - ADMIN (614,254.58)$

(3,223,841.38)$

MAJOR BUDGET IMPACT TO SCHOOLS

37

WSF (Weighted Student Formula) dollars ($3.678M)

Initially allocated 50% of $11.8M in discretionary funds

Usually allocate 75% initially and adjust based on

20-day student numbers

BOE approved allocating an additional 19% or $2.2M

of the WSF on 8/10/10

The remaining 31% or $3.678M in WSF dollars to be held

until impact of FMAP (Federal Medical Assistance Percentage)

funds is known.

CAPITAL OUTLAY

38

$-

$2

$4

$6

$8

$10

$12

03-04 04-05 05-06 06-07 07-08 08-09 09-10 10-11

$10,170,000 $11,514,935 $10,000,000 $7,000,000 $7,000,000 $7,000,000 $4,000,000 $3,200,000

Mil

lio

ns

Years

Annual GCS Capital Outlay BudgetFiscal Years 2003-04 thru 2010-11

WHAT WE COULD BE FACING IN 2011-12

39

Potential State Revenue shortfalls

1% reduction = $3.678M

5% reduction = $18.39M

10% reduction = $36.78M

15% reduction = $55.17M

Federal Stimulus Funding Cliff

$36M in ARRA funds in 2010-11 GCS budget (excluding SIG funds)

$36M = equivalent of approximately 720 teachers @ $50K/teacher

$14M in EduJobs = equivalent of approximately 280 teachers @ $50K/tchr

POSSIBLE ACTIONS TO BE TAKEN IN 2011-12

40

Questions,

Answers and

Next Steps