September 15, 2008 Budget Workshop Spending Authority

General Fund Basic Calculations & Allowable Growth  Current year’s ( ) District Cost Per Pupil $5,546 Allowable Growth Rate for = 4.0%  Next year’s district cost per pupil growth =  (.04 x $5,546) + $222 = $5,768  Multiply the $5,546 X 3,944.8 resident students = $21,877,861 + Additional Weighting for At Risk, Special Ed., AEA, Instructional Support ($29,000,367) (not included: Carryover Authority, Miscellaneous Income, Federal and State targeted program $’s -- Approx. 7.2 million)

Building Blocks of Spending Authority (General Fund) $29,000,367 $1,564,375 $5,635,625

Financial Measures Key Financial Measures That Must Be Carefully Monitored by All School Districts in Iowa.

1. Solvency Ratio Fund Balance (cash) position of the District. Cash Balance÷Total Revenues $4,206,251÷$35,632,235 = 11.8% (good!)

2. Enrollment Trend vs. Additional FTE (staff) Averaging 3.5% the past six years (+788 students) (good trend!) New FTE added during same time period = fte (1 staff per every 13 students) Non-sustainable- no new primary classroom positions were added the past two years.

3. Staff Cost as a % of Expenditures Average (State-wide) = 75%-85% College = 79.9% College = 81.4% In today’s dollars that equals $545,556 additional expenditures per year.

4. Unspent Balance (Authority) Most Important Measure to Monitor Spending Authority remaining at years end to carryover into next year. Current rate of spending requires student growth to offset expenditures but results in a $500,000-$700,000 deficit yearly.

Other Factors 4% allowable growth (set by State) Unfunded Instructional Support $’s (6.5%) Allowable Growth in categorical ( Example: at-risk ) New Building & subsequent Additional FTE (unaffordable class size targets) Discontinued Phase III (Teacher Training) Net Gain in O.Enrollment (-$730,000 per year) (class size targets & insufficient space policy)

Considerations/What have other Districts Done?: Increase instructional support from 6.5% to 10% (maximum) by the school year. Revise grade level class size limits. Current levels are as follows: K-1-2 (220) (225) (230) 9-12 (235) (Avg. Daily Membership in all grades currently exceeds 305 students) “Our policy needs to be updated”

506.3 Code No INSUFFICIENT CLASSROOM SPACE Insufficient classroom space exists when conditions affect the implementation of the educational philosophy and program of the Board of Directors. The Board of Directors shall determine insufficient classroom space on a case by case basis. Other criteria that may be used by the Board of Directors in its determination may include, but not be limited to, future enrollment projections, available personnel, grade level, educational program, instructional method, physical space, equipment and materials available, finances available, facilities either being planned or currently under construction, sharing agreements in force, bargaining agreements in force, and district goals and objectives. A waiver will be granted in order to prevent the division of a nuclear family between two school districts. When applications from more than one student in a nuclear family are submitted, if any grade level exceeds this limit, all applications will be denied. The Board of Directors may not be required to hire additional staff in order to accommodate open enrollment students. Ratios shall be maintained, as required by law, for special education students. Grade level maximums are as follows: K-1-2 (220) (225) (230) (235) 385

Considerations/What have other Districts Done?: : cont…. Consider placing strict limits (yrs. Exp./level of education, etc.) on new Certified staff hires. (currently recommended but not required) Allow class sizes to slowly increase so that staffing levels are sustainable with student levels. (this has happened the last two years, recommend to continue monitoring this)

If no action Two consecutive years of negative unspent balance results in an automatic visit from the Department of Education to ensure that the District CUTS expenditures at a level that will bring them back to a viable positive position.

What about the Other Funds and the construction? PPEL Fund, Silo Fund, Project Funds Separate Funds which are in very good shape that can only be used to build, fix, repair, or buy equipment with. No provision in the code to allow us to pay ongoing operating expenses from these funds…

Summary Increase instructional Support (10%/10 yrs) (+$765,725 additional authority per year) Update class size policy (506.3) to current capacity levels (Potential Net Gain in O. Enrollment in +$300,000-$700,000) Revise Class Target Size to Sustainable Levels & allow classes to slowly grow (comparable to state average & local district levels)  Request Additional Authority from the SBRC in the Fall of 2009 to support ongoing cost of staffing as allowed with the opening of a new building.