School Finance –A Region One Overview Synopsis of Finance Update by Lynn Moak at Region One By Jesus Amezcua, CPA, LISD CFO

State Funding Outlook Deficit at state level Minimal growth Options –Rainy day fund –Expense cuts –Limited revenue increases

School Finance Data Financial Data –A). School FIRST Data (Financial Report Card for school Districts ) Superior Achievement Rating for LISD –B). Dropout Data ( Audit of leaver records by CPA) –C). Financial Calculations –D). Various Updates

Drop out Audit Begins with Risk Assessment using internal control questionnaire Determine sampling requirements

Financial Calculations Basic Funding Elements –No change in basic allotment $2,537 –No change in Cost of Education (COE) Index –No change in small scale adjustments Tier II Guaranteed Yield – $24.70 – $25.81 – $27.14 Equalized wealth at $305,000 per WADA

Calculations (part 2) Gap Funding amount reduced by gain in property value per WADA between and –Not applicable to LISD Declining Enrollment Adjustment – 2% decrease – Nor applicable to LISD Homestead Hold Harmless –Adjustment continues for impact of transition from $5k to $15K Hold Harmless for new salary -relates to $3000 increase from

Calculations (part 3) Hold harmless for insurance –Identify revenue increases Tier II in ($27.14) and ($24.70) –Any gap aid received –Assumes 75% of increase goes for the insurance –Transition aid if $900 times health insurance participants is more than 75% of the increase

Calculations (part 4) Minimum effort transition assistance –Maintenance of Effort (MOE) contribution per full time employee Multiply this amount times the number of full time employees for to determine (Maintenance of Effort) Minimum effort is $1,800 times each participating employee –If the MOE amount is not sufficient to fund the $1,800 (or $150 x 12 months), minimum effort transition assistance is provided. –Left over formula gains above the 75% must be counted first

Contingent Appropriations IFA ($50 M) (N/A) 29 cent tax rate for EDA (N/A) –For any debt payment before Property value decline (N/A) 50% of optional homestead (N/A) Property tax losses due to protest (N/A)

Property Tax Rollback Calculation No change in basic calculation –Tax rate needed to maintain prior year state and local M&O revenue per wada –Revenue gain from formula increases –Use of maximum tax rate in current year to calculate increases –Additional 6 cents per $100 (LISD 3) –Amount needed for debt service

Tax Rollback and Tax Notice Appraiser to provide estimate by June 7 th Certified Tax Roll by July 25 th No change from prior year Tax and Budget Hearings

403 Property Value Audits Comptroller will correct tax court rulings and changes Audit will also pick up properties left out previously LISD has had audit the last three years by Ray, Wood and Bonilla

No Child Left Behind Accountability 10 Components Highly qualified teachers and teacher aides Mentor Program for recruiting and retaining teachers Specific Requirements

403 B Certification Effective June 1, 2002 certification guidelines by TRS Salary reduction agreements with new approved vendors All others are grand fathered Additional monitoring by State and local districts

Section 125 Cafeteria Plan Due to new health insurance requirements, LISD will have to allow a change in status for all health insurance employees Election time will be expanded from August to December 2002 New program that includes credit card to be launched in July 2002

New Finance System New Purchase Orders –April 2002 New Checks –April 2002 New Purchasing, accounting, accounts payable – April 2002 New Payroll June 2002 Training for schools and campuses May 2002 Schools and Campuses will come on line June 2002

Summary Many changes in laws and new programs June Budget Submission July Budget Workshops and presentations August Budget Approval