3 Phase I – Budget Planning Deliverables A. Budget Time Lines B. District-specific plan for budget work C. Essential budget data and information D. Identify Communication and Participation Needs E. Endorsed budget objectives
4 Some Phase I Issues… Understand current fiscal condition Develop project timeline that guides budget action work Introduce and apply Decision Analysis concepts for addressing budget decisions Introduce and apply communication and budget-related tools for district use
5 Budget Process Timeline What are the major milestones and deliverables we need to achieve in the budget process? Budget resolution to Board Communicate with district administrators Notify personnel of position reductions Complete risk analysis for implementation of budget actions Adoption of new budget What else?
6 Budget Planning Timeline (page 1)
7 Decision Making Excellence Quality-objectives (criteria) Quality-evaluation of options Quality-risk assessment Quality-involvement
8 Budget Reduction Work Session The Happy Valley School District has an enrollment of 3050 students. The district’s List of Possible Budget Actions to Obtain $350,000 in Reductions enrollment is stagnant and some prodicest a slight decrease over the next few years. A. Eliminate K-12 Curriculum Supervisor Position $ 92,000 SchoolEnrollmentCapacity B. Cut 3 Teachers (1 pre-k, 1 first, 1-second) $ 172,000 C. Cut 2 M. S.Teachers (Science and Lang Arts) $ 108, Happy Valley High1,1001,300 D. Cut 1 HS Social Studies Teacher $ 54,000 Grades 9-12 E. Cut 1 Newly created Tech Support $ 43, Happy Valley Middle School F. Cut 1 HS Art Teacher $ 54,000 Grades 6-8 G. Cut 1 Unfilled HS Industrial Arts Teacher $ 54, Madison Elementary H. Eliminate MS Basic Skills :Lab $ 54,000 Grade 1-5 I. Cut 2 World Language Teachers from K-4 $ 113, Lincoln Elementary J. Cut General Supplies Budget to level $ 62,000 Grades 1-5 K. Move Science instruction in K-4 to Regular Classroom $ 54, Washington Kindergarten Center L. Cut HS Equipment by 25% $ 21,000 Grades K M. Eliminate All School Psychologists $ 154,000 N. Cut 1 Instructional Aide per school $ 80,000 The District is developing its next year’s budget. The Board has given the administration O. Cut Operations and Maintenance by 3% $ 15,000 directions to develop a budget no larger than the current budget of $28, 000,000. P. Cut Athletic Supplies by 25% $ 30,000 The preliminary budget for next year is $28,350,000. You are part of a budget task who has beenQ. Cut Field Trips by 10% $ 5,000 charged with recommending cuts totaling $350,000 from the list of possible budget actions.R. Cut K-8 Student Activities by 20% $ 10,000 S. Close Washington Kindergarten Center $ 125,000 and move kids into Elementary Buildings T. Eliminate Part Time Nurse Position $ 19,000 U. Eliminate the 8th Grade Football Team $ 45,000 Total $ 1,364,000 (Page 2)
9 Decision Analysis Why:To help us make choices When:Situations where we need to choose among alternatives Pitfall:Jumping to Alternatives Key Steps: S tate the Decision E stablish and Classify Objectives L ist Alternatives E valuate Alternatives C onsider Risks T rust Your Work—Pick a Winner!
10 State the Decision Why:To provide focus How:Ask— “What are we trying to decide?” Decision Statement = “Choice” word (select, pick, choose) Plus:End Result/Purpose Plus:1 2 Key Modifiers
11 State the Decision—Budget For example: Choose best actions for closing $____ budget gap Happy Valley Simulation: Choose best actions to close $350,000 budget gap
12 Develop Objectives for Budget Actions What objectives might your districts need to take into consideration? Who should be involved? Role of the Board? Board Endorsement? “We prefer actions that…”
13 Establish and Classify Objectives Why:To identify what we want and need in a final choice How:To ESTABLISH objectives, ask— “What’s important for us to consider in choosing an alternative?” How:To CLASSIFY objectives, identify the one (es) that is most important and assign a weight of 10. Weigh the others in relation to the 10…range of 10—1.
14 Sample Budget Objectives (page 3) We will favor budget actions (cuts) that… Comply with state/federal mandates Minimize impact on Board/District Goal #1 (2, 3, etc.) Minimize impact on instructional programs Minimize impact on extra-curricular programs Minimize impact on safety Minimize disruption on schools Minimize disruption on families Minimize impact on district reputation Minimize resistance from community Minimize impact on the fewest numbers of students Minimize impact on classroom teaching and learning Minimize impact on student/ teacher ratios Minimize impact on upkeep of current facilities Minimize impact on district reputation or desirability in attracting teachers and/or families Minimize impact on ability to effectively manage programs. Minimize the impact on the fewest numbers of students Minimize impact on state test results Minimize impact on student learning/achievement Minimize impact on program effectiveness. Minimize the loss of personnel Minimize the impact on student health Minimize the impact on remaining employees
15 1 Establish Objectives (page 4) Objectives Minimize Impact on State Test Results Maintain Effective Management of Programs Maintain Maintenance of Facilities Minimize Impact on Class Size Minimize Impact on Instructional Program Minimize Impact on Instructional Tech Support Minimize Impact on Opportunity for Participation Minimize Impact on Professional Development Minimize Impact on Safety Comply with DPI/Legal Requirements
16 Weight (Classify) the Objectives Why:To determine the importance/ priority of each objective How:Ask— “Which objective (s) is the most important?” Give it a “10” Then ask— “Compared to these, how important is each other objective? Assign values of “10”–“1” for each objective
17 2 Classify (weight) the Objectives (page 4 a) Objectives Level of Importance or weight 1Comply with DPI/Legal RequirementsM 2Minimize Impact on Instructional Program10 3Minimize Impact on Safety10 4Minimize Impact on Class Size9 5Minimize Impact Effective Program Management8 6Minimize Impact on State Test Results8 7Minimize Impact on Maintenance of Facilities6 8Minimize Impact on Professional Development6 9Minimize Impact on Opportunity for Participation5 10Minimize Impact on Instructional Tech Support4
18 Board Communication (page 5) Assure Board that visual, rational approach was used for budget process Assure Board that accurate and relevant data were gathered and analyzed Get Board input and support on “tentative objectives” Get Board support on priority of objectives Identify next steps in budget process What else?
19 Phase II – Budget Actions Deliverables A. Proposed budget actions B. Prioritize list of budget actions C. Initial risk analysis D. Comprehensive communications plan
20 List Alternatives Why:To identify our possible actions for reducing budget gap How:Ask— “What actions are available to us?’
21 Budget Actions Every budget action has its own cost and benefit profile Dollars & cents One-time vs. Ongoing Political Capital Within school community (Parents/Students/Staff) Within community at large (Voters/Businesses/Political interests) Administrative/management burden Every district will have a different profile of management capabilities Facilities impact Expansion/Closure; Maintenance & Operations So districts must weigh their budget actions in a wider context than just fiscal
22 The LIST… (page 6) A. Eliminate K-12 Curriculum Supervisor Position$92,000 B. Cut 3 Teachers (1 pre-k, 1 first, 1-second)$172,000 C. Cut 2 M. Teachers (Science and Lang Arts)$108,000 D. Cut 1 HS Social Studies Teacher$54,000 E. Cut 1 Newly created Tech Support$43,000 F. Cut 1 HS Art Teacher$54,000 G. Cut 1 Unfilled HS Industrial Arts Teacher$54,000 H. Eliminate MS Basic Skills :Lab$54,000 I. Cut 2 World Language Teachers from K-4$113,000 J. Cut General Supplies Budget to level$62,000 K. Move Science instruction in K-4 to Regular Classroom$54,000 L. Cut HS Equipment by 25%$21,000 M. Eliminate All School Psychologists$154,000 N. Cut 1 Instructional Aide per school$80,000 O. Cut Operations and Maintenance by 3%$15,000 P. Cut Athletic Supplies by 25%$30,000 Q. Cut Field Trips by 10%$5,000 R. Cut K-8 Student Activities by 20%$10,000 S. Close Washington Kindergarten Center$125,000 and move kids into Elementary Buildings T. Eliminate Part Time Nurse Position$19,000 U. Eliminate the 8th Grade Football Team$45,000 Total $1,364,000
23 Evaluate Alternatives— Score Objectives Why:To see which alternatives best meet weighted objectives How: 1. Gather and record factual information and score using only 10, 5, or 1 If an action has a big impact on the objective, score it a 10. If an action has a moderate impact on the objective, score it a 5. If an action has a small impact on the objective, score it a Develop Weighted Score (weight x score = weighted score) 3. Total the weighted scores for each budget action. 4. Sort from low to high.
24 Evaluate Options Against Objectives (page 7)
25 Evaluate Options Against Objectives (page 8)
28 Sorted List-Least to Greatest Impact (page 10)
29 Consider Risks—Potential Problems (page 11) Why:To be clear on risks associated with an alternative How: 1. Ask— “If we implement this budget action, what could go wrong?” Be specific 2. Develop Action Plans to “protect” budget actions.
30 Identify Risks Identify possible risks with high-impact budget actions Identify actions to prevent or mitigate risks
31 Trust Your Work— Pick A Winner! Which choices best balance benefits and risks: Why: To commit to a choice
32 Using DA as Framework to Present Recommendations Why To ensure that there is: An understanding of the background for budget recommendations A clear picture of what you are recommending Awareness of the “thinking” that produced the recommendation
33 Making Recommendations Using Decision Analysis Steps (page 12) How to Make the Presentation: Review background Who was involved? Review objectives Arrange objectives in priority order Use words like “primary, secondary” Identify alternatives Discuss how key alternatives met objectives Discuss risks and what you will do to prevent/minimize Make recommendations
34 Phase III – Implement Budget Plan Deliverables 1. Risk analysis of proposed budget actions 2. Budget implementation plan 3. System for monitoring for results
35 Decision Analysis Process Sheet (page 13) Steps modified to budget reduction