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Dr. Chuck Essigs Arizona Association of School Business Officials.

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Presentation on theme: "Dr. Chuck Essigs Arizona Association of School Business Officials."— Presentation transcript:

1 Dr. Chuck Essigs Arizona Association of School Business Officials

2  FY 2011$550 million  FY 2012$1.0 billion  FY 2013$600 million  FY 2014$1.1 billion

3  Estimated revenue in FY2014 of $8.46 billion  Vs. actual revenue in: FY2005 of $7.72 billion FY2006 of $9.26 billion FY2007 of $9.62 billion  9 years before revenues will be back above the FY2005 level

4  One cent sales tax ends in FY $1 billion  K-12 rollover - $1 billion (estimate)  Suspended funding formulas - $1 billion  Increased cost to State from AV decline

5  Capital Outlay (CORL)**$  Soft Capital$188,120,700  New Utilities (Repealed)$100,000,000  Charter School Add’l Assistance$ 17,656,000  Building Renewal$241,593,600 $646,235,100 *No estimate for New School Construction ** Included both $63,864,800 and $35,000,000 Edu. Jobs Related Cut.

6  “Jobs” Bill – K-12 Specific Items  Reduces the Class 1 (business) assessment ratio from 20% to 18%, in ½ percentage point increments per year, beginning in Fiscal Year 2014 (FY14) and ending in Fiscal Year 2017 (FY17)  Reduces Class 2 (agricultural and vacant land) from 16% to 15% beginning in Fiscal Year 2017  Increases the homeowner’s rebate for FY14 through FY17 by the amount needed to offset the assessment ratio change effects  TABOR  Various bills and referenda were proposed  Would limit general fund revenues to the previous year’s budget plus population growth and inflation---Legislation Passed

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8  State Funding Reduced by estimated $101.2 Million  Districts and Charters Budget Capacity Reduced by estimated Million  Districts Could Use Edu. Jobs Funds to Cover Reduction (1/2 of Total Edu. Jobs Funding Available)  Budget Revision Not Required

9  Base Level stays at $3,267.72/ No Increases  Inflation Increase of 0.9%  Transportation $0.02 Mile Increase  Addition Assistance for Charters ▪ K-8 Increase of $14.47 to $1, ▪ 9-12 Increase of $16.86 to $1,890.38

10  Soft Capital Cut by $188.1 Million – Most Likely a Greater than 90% Reduction  CORL Cut #1 by $63.9 Million  CORL #2 Cut by an Additional $35 Million – Edu. Jobs Issue

11  Additional Assistance Cut by $17.7 Million (Average $135 per student)

12  For districts with fewer than 1100 students, Soft Capital and CORL cuts cannot total more than $5 million statewide

13  Base Level Adjustment  4% FY2012  3% FY2013  2% FY2014  1% FY2015  Qualifying Tax Rate  $0.10 K-8 and 9-12 districts  $0.20 K-12 Districts

14  New School Formula – Suspended  Building Renewal Formula - Suspended

15  Prohibits JTED’s from Receiving State Funding for 9 th Grade Students  Spending on 9 th Grade Students Still Allowed (HB2237)

16  Actual Utility Funding Formula Eliminated  Teacher Performance Pay Program (ARS15-977) Eliminated/Not Teacher Comp

17  Changes Current 50/50 Split to Employee Pays 53% and Employer Pays 47%  Estimated Rate Beginning July 1, 2011  Employee would be 10.75%, now will be at 11.40%  Employer would be 10.75%, now will be at 10.10%

18  Employee goes from 9.85% to 11.40%  Employer goes from 9.85% to 10.10%  Employee up 1.55%  Employer up 0.25%

19 SalaryEmployeeEmployer $20,000$130 increase$130 decrease $40,000$260 increase$260 decrease $80,000$520 increase$520 decrease Amount district saves will result in reduced state aid and budget capacity. Charters are also impacted.

20  Started In FY2002  Highest year FY2008 $397 per weighted student  Districts had been allowed to spend to estimate  For FY2010 cumulative shortfall of $195  Starting in FY2011 state had to adjust for shortfall

21 YearBudget CapacityTotal AvailableDifference FY2002$272.42$ FY2003$239.47$ FY2004$ FY2005$ FY2006$353.00$ FY2007$333.00$333.07$0.07 FY2008$401.00$ FY2009$390.00$ FY2010$244.00$ Total$ $ Ave.$300.54$277.46

22  Estimated Cash amount $219  Adjusted for shortfall $219-$ = $94  Legislature may set amount at $120 (SB1263)

23  Allocation from ARS (per weighted student) $120* per weighted student  Unexpended budget balance from FY2011  The net interest earned during FY2011 *with SB1263

24  Additional teacher compensation money from sources other than Classroom Site Fund for FY2012.  Not considered supplanting for FY2013 calculation.

25  Current QTR $ Unified / $ Elementary and High School  Proposed (FY2012) $ Unified / $1.782 Elementary and High School  State Equalization Rate Current is $ proposed (FY2012) is $0.4259

26  Alternate Contribution Rate (ACR)  Require employers beginning July 1, 2012 to pay an ACR (Est. 7%+)  Required for employees who are retired including direct/leasing/contracted (less than 20 hours too)

27  Normal Retirement Age  Before July 1, points still available  After July 1, 2011 ▪ Age 55/ 30 years of service ▪ Age 60/ 25 years of service ▪ Age 62/ 10 years of service ▪ Age 65

28  Service Purchase  10 years to quality vs. 5 years  Purchase only up to 5 years of service  Require members to forfeit time in old system to purchase it

29  HB 2002 (school district monies; associations; elections)  As amended, this bill would prohibit school districts from paying for membership in an association that attempts to influence an election.

30  Reduces time frame for closing schools  Classroom Site Fund - $120 and supplanting for FY2012  Override calculation relief continues for FY2012 – Base level and Full Day K  Changes performance pay for Superintendents – Excludes benefits and sets amount up to 20%  Flexibility on disposal of equipment, furnishings and supplies

31 Removed From Bill-For FY2012 and 2013 allows unrestricted capital to be used for any capital or operational expense (excludes SFB and override funds) Also Removed-For FY2012 and 2013 permits carryover in excess of 4%

32  Allows warrants drawn on the County Treasurer to be processed through an electronic system  Increases bonding capacity /Approved prior to April 15,2011 5% to 10% and 10% to 20%  Allows for elections to change list of projects and time period to issue extended from 6 to 10 years

33  [Maybe] Soft Capital could be used for operational expenses -Permanent Change  Unspent contributions for a program that has been discontinued or has not been used for 2 consecutive fiscal years may be used for any extracurricular purpose  Unencumbered monies  50% may be used for short-term items such as technology, textbooks, library resources, instructional aids, pupil transportation vehicles and furniture and equipment in Fy2012 and FY2012 (Does not apply to funds received after FY2010)

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36 AZ

37 YearAZU.S. AverageAZ Percent of U.S. Average $674$ % $1865$ % $3717$ % $4476$ % $5030$ % $7610$ % $7608$ % Source: National Center for Education Statistics (NCES)

38  AZ ranked 29 th above 21 other states  AZ ranked 48 th above 2 other states  To move back to 89.7% of U.S. Average  Increase expenditures to $9202 ( )  Increase of $1594 per pupil

39 Arkansas Georgia Idaho* Indiana Kentucky Louisiana Maine Mississippi Missouri New Hampshire New Mexico North Carolina North Dakota Oklahoma South Carolina South Dakota Tennessee Utah* Virginia West Virginia * States AZ was above in

40 AreaNationalAZDifferenceAZ % of National Total$10,297$7, % Classroom$6,262$4, % Student Support$556$577$ % Food Service$390$ % Plant Operations$1,003$ % Instructional Support$539$ % Transportation$438$346 79% Administration$1,109$ % Source: Arizona School District Spending (Classroom Dollars) Fiscal Year 2010, Office of the Arizona Auditor General

41 AreaNationalAZ Total$10,297$7,814 Classroom$6,262$4,481 Student Support$556$577 Instructional Support$539$436 Plant Operations$1,003$881 Subtotal$8,360$6,375 % of Total81.2%81.6% Source: Arizona School District Spending (Classroom Dollars) Fiscal Year 2010, Office of the Arizona Auditor General

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43  SB 1286 (2010, 2 nd Regular Session)  Labeling changed from word labels to letter grades  Adds the labeling of school districts in the aggregate  New formula:  50% of the school and district profile must be based on academic performance measures ▪ ½ = all students academic gain ▪ ½ = lowest quartile academic gain

44  SB 1040 (2010, 2 nd Regular Session)  Requires the State Board of Education, on or before December 15, 2011, to adopt and maintain a model framework for a teacher and principal evaluation instrument  Must include quantitative data on student academic progress that accounts for 33% and not more than 50%  Must include best practices for professional development and evaluator training  Requires school districts and charter schools to annually evaluate individual teachers and principals beginning in school year  Teacher and Principal Evaluation Task Force  Expedited process  Will provide a framework to districts  March State Board of Education Study Session and scheduled for Final Adoption in April  Various organizations will be charged with implementation assistance

45  HB 2731 (2010, 2 nd Regular Session)  Creates the Grand Canyon Diploma to enable high school students to choose different educational pathways.  HB 2732 (2010, 2 nd Regular Session)  Establishes the Task Force on Reading Assessment to report by January 15 th, 2011  Requires that a student not be promoted from the 3 rd grade if the student obtains a score on the reading portion of the AIMS test, or a successor test, that demonstrates that the student is reading far below the 3 rd grade level  Requires the State Board of Education (SBE) to develop intervention and remedial strategies ▪ Requires school districts to offer at least one of the intervention and remedial strategies developed by the SBE


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