1. 2015 Joint State Education Convention January 21, 2015 08:00 am 103AB Wisconsin Center Milwaukee, WI 1 Presented by: Bob Soldner, Director Bruce Anderson, Consultant School Financial Services Team Department of Public Instruction

2. Community Programs and Services Agenda: Community Programs and Services (Fund 80) – Historical Administrative Rules PI-80: Community Programs and Services 2014-2015 Community Programs and Services Audit 2

3. Community Programs and Services (Fund 80) – Historical Establishment of a Community Service Fund: The School Board may establish a Community Service Fund pursuant to s. 120.13(19). A budget for the Community Service Fund must be adopted as required by s. 65.90. Any tax necessary to operate the Community Service Fund is considered an "operation" levy subject to the annual meeting [s. 120.10(8)] and school board duties [s. 120.12(3)]. 3

4. Community Programs and Services (Fund 80) – Historical General Outline of Community Service Activities: Access to Community Service Fund activities cannot be limited to pupils enrolled in the district's K-12 educational programs. Other funds, such as the General Fund and Special Projects Fund, carry out the day to day K-12 educational operations of the district. All activities associated with a well-rounded curriculum (curricular and extra-curricular activities) are to be accounted for in these funds ( General Fund and Special Projects Fund )and the Pupil Activity Fund (Fund 60). 4

5. Community Programs and Services (Fund 80) – Historical Excluded from a Community Service Fund are any academic subjects and extra-curricular activities available only to pupils enrolled in the district. Student activities such as inter-scholastic athletics and other extra-curricular activities, pupil clubs, dances, field trips, student seminars and symposiums also may not be funded through Fund 80 (Community Service). 5

6. Community Programs and Services (Fund 80) – Historical A school board may under s. 120.13 (17) grant the temporary use of school grounds, buildings, facilities or equipment, under conditions, including fees not to exceed actual costs as determined by the school board. A Community Service Fund should not be established for providing access to district property for organizations such as youth, theater, and other groups not under the control of the school board unless the district is incurring additional direct cost that will not be recovered through fees and therefore requires a tax levy subsidy. 6

7. Community Programs and Services (Fund 80) – Historical The levy for Fund 80 was removed from revenue limit control starting in the 2000-01 school year [s. 121.91(2m)(e)1.] The levy for Fund 80 was removed from revenue limit control starting in the 2000-01 school year [s. 121.91(2m)(e)1.] As a result, the Fund 80 levy is completely funded by local taxpayers. It has never been a factor in the equalization aid calculation. It has never been a factor in the equalization aid calculation. 7

8. Administrative Rules PI-80 - Community Programs and Services The Department is required to define ineligible costs for Community Programs and Services by administrative rule. PI-80 emergency rules took effect on July 1, 2014. 8

9. PI-80 Community Programs and Services Statutory authority: 120.13 (19) C OMMUNITY PROGRAMS AND SERVICES. Establish and maintain community education, training, recreational, cultural or athletic programs and services, outside the regular curricular and extracurricular programs for pupils, under such terms and conditions as the school board prescribes. The school board may establish and collect fees to cover all or part of the costs of such programs and services. The school board may not expend moneys on ineligible costs, as defined by the department by rule. Costs associated with such programs and services shall not be included in the school district's shared cost under s. 121.07 (6). 9

10. PI-80 Community Programs and Services (New Rule) Ineligible costs means school district costs that are not the actual, additional costs to operate community programs and services. First, costs are ineligible if they are not costs to operate community programs and services. Community programs and services do not include any program that is limited to only school district pupils or any program or service whose schedule presents a significant barrier for age-appropriate school district residents to participate in the program or service. Second, costs must not only be costs to operate community programs and services to be eligible but also must be actual, additional costs. Ineligible costs include costs that would be incurred by the school district if the community programs and services were not provided by the school district. 10

11. PI-80 Community Programs and Services (New Rule) PI 80.02 Definitions. In this chapter: “Community programs and services” does not include: Any program or service that is limited to only school district pupils. Any program or service whose schedule presents a significant barrier for age-appropriate school district residents to participate in the program or service. “Ineligible costs” means school district costs that are not the actual, additional costs to operate community programs and services under s. 120.13 (19), Stats. “Ineligible costs” includes costs that would be incurred by the school district if the community programs and services were not provided by the school district. 11

12. PI-80 Community Programs and Services (New Rule) Provides you with some basic information about the impact of transitioning from DPI guidelines, to criteria, and now to administrative rules. It is important to understand that an emergency rule has the power of law until the process has been completed. The legislature will review the rule and have the ability to modify the rule in the spring of 2015. 12

13. PI-80 Community Programs and Services (New Rule) What does “actual” and “additional” costs mean to a school district? A cost, that if the ability to operate the Community Service Fund (Fund 80) ended; a school district, would not have to move those costs to the General Fund (Fund 10) to continue the regular curricular and extracurricular programs for its students. A few examples: Before school and after school childcare open to any district resident. Adult technology classes held at the local public library. Adult literacy classes held at a township hall within the school district. 13

14. PI-80 Community Programs and Services (New Rule) What does “actual” and “additional” costs mean to a school district? A more complex example: The summer baseball program for all interested resident students uses the school district’s ball diamond for games, after the high school season is over. District employees do the mowing, mark the field, and clean up after the game. The field does not have lights and the concession stand is not operating. Each District employee logs their time related to this program and based on past records the total hours/game are determined and charged to Fund 80. The related costs for mower fuel and field paint is based on past years records and are charged to Fund 80. 14

15. PI-80 Community Programs and Services (New Rule) What does “actual” and “additional” costs mean to a school district? An example of an expense not meeting this standard: An adult ballroom dance class is held one night a week for 6 weeks in the middle school gym. It has the facility for a 3 hour period of time. The class instructor or a participant sweeps the floor before the class starts. The custodial staff do not clean the gym or restrooms in this part of the building until after everyone from the class has left the school. There can be no custodial time or related costs charged to Fund 80 for this class as there was no actual or additional cost incurred. 15

16. 2014-2015 Community Programs and Services (CPS) Audit 2013 Act 306 requires that Fund 80 expenditures be audited by the school district’s auditor. NOTE: Current law already directs DPI to exclude from Shared Costs (for General Aid purposes) any CPS expenditures. If a CPS expenditure audit determines that a district had inappropriately coded CPS expenditures to Fund 10, those expenditures would have to be removed from Fund 10 and would decrease the district’s Shared Costs for General Aid purposes. 16

17. 2014-2015 Community Programs and Services (CPS) Audit 2013 Act 306 requires DPI to determine if ineligible CPS expenditures exist If so, DPI must reduce the district’s allowable revenue limit authority the following year by the amount of the ineligible CPS expenditures; structured as a negative exemption rather than a reduction to the district’s base. This first applies to the Revenue Limit calculation for the 2015-16 school year, based on 2014-15 expenditures. The audit process will be more detailed than it was this past school year. After the Legislature has finalized PI 80, the school auditors will be given formal procedures after May 15, 2015. 17

18. 2014-2015 Community Programs and Services (CPS) Audit Preparing for an CPS audit; Each program or service will need to be classified as being (slide 9): Community Education and Training Recreational Cultural Youth Athletics Similar to what was collected last summer in the 2013- 14 Pre Audit Community Programs and Services (CPS) Data Collection form. 18

19. 2014-2015 Community Programs and Services (CPS) Audit Preparing for an CPS audit; Each program or service will need to be documented within the district’s accounting system. Supporting documentation will be part of the audit process. Wisconsin Uniform Financial Accounting Requirements (WUFAR) will assist each district in this process. 19

20. Community Service Fund 80 – Levy Limit Current law limited the Fund 80 levy authority. The levy limit was the same for 2013-14 and 2014-15. The levy limit expires after 2014-15. 2013 Act 46 amended the prior levy limitation: 2011-12 Fund 80 levy if more than the 2012-13 Fund 80 levy; and Less than $1,000,000. The law required a school board to hold a referendum to exceed the 2013 or 2014 levy limit. 20

21. Annual meeting budget summary was required to include planned information on Fund 80 expenditures in 2013 and 2014 (no longer required per law). Posting/reporting requirements : District’s website recommended; 10 days to complete DPI’s Fund 80 Survey; DPI will post on its website; and DPI reported on 2013 and 2014 Fund 80 to Legislature before December 1, 2014. Website with a link to the report is the Community Service Fund Information http://sfs.dpi.wi.gov/sfs_comm_servhttp://sfs.dpi.wi.gov/sfs_comm_serv http://sfs.dpi.wi.gov/community-service-fund-limits-and-reporting-requirements- under-2013-wisconsin-act-20 21

22. Community Programs and Services (Fund 80) Bruce Anderson, Consultant …608-267-9707 Bob Soldner, Director …………608-266-6968 22