MARCH 8, 2013 BUDGETARY REFORM PROPOSALS 1

GENERAL ASSEMBLY PROPOSAL House and Senate Leaders Working on Proposal to Consolidate All 32 Current K-12 Allotments into 1 Block Grant. NCASA’s Regulatory Reform Committee, led by Dr. Frank Till, Began Considering Viable Alternatives to This Proposal. Finance Officers Ricky Lopes & Kerry Crutchfield & Peers Developed Possible Alternative Proposal at NCASBO Conference. 2

NCASA ALTERNATIVE PROPOSAL 3

PROPOSED 12 ALLOTMENTS PRC 001 CLASSROOM TEACHERS PRC 005 SCHOOL BUILDING ADMINISTRATION PRC 007 INSTRUCTIONAL SUPPORT PRC 009 NON-ALLOTTED COSTS PRC 012 DRIVER EDUCATION PRC 013 CTE MONTHS OF EMPLOYMENT PRC 015 SCHOOL TECHNOLOGY FUNDING PRC 030 DISTRICT-WIDE SUPPORT SERVICES PRC 031 LOW WEALTH/SMALL COUNTY FUNDING PRC 032 CHILDREN WITH SPECIAL NEEDS PRC 055 HIGH SCHOOL LEARN AND EARN PRC 056 TRANSPORTATION 4

MUST-HAVES FOR NCASA SUPPORT One-Year Delay in Change Is Essential for Transition Time for DPI & LEAs. Changes Must Be Revenue Neutral Or Increase Funding. Retain Position Allotments to Ensure Guaranteed # of Positions & Salary Levels. Non-Allotted Dollars for Longevity, Workers’ Comp, Leave Payouts, Disability & Unemployment to Remain Unchanged. 5

MUST-HAVES FOR NCASA SUPPORT Retain Funding Formulas for Dollar Allotments for Use in Determining Each LEA’s Share but Distribute in Fewer Allotments with More Flexibility/Less Strings. PRC 030 (New District-Wide Support) & PRC 031 (Low Wealth/Small County) Would Have Open Chart of Accounts. All Current Transfer Flexibility to Be Retained/Enhanced. Future Increases in Dollar Allotments Must Cover Salary Increases & Related Benefits. 6

ADDITIONAL RECOMMENDATIONS Allow Carryover of Consolidated PRC 030 until 8/31 Each Year. Consolidate PRC 007 & PRC 013 into PRC 001 if Practicable. Place PRC 012 (Driver Ed) in PRC 030 While Retaining Funding from State Highway Fund if Allowable. 7

POINTS TO CONSIDER Will Allotment Consolidation Result in Less Funding from the General Assembly as Occurred in the 1990s? Is Allotment Reduction Tied to an Effort to Siphon Funds for Vouchers/Tax Credits? Will Some Districts Suffer at the Expense of Others Under Allotment Consolidation? NCASA, DPI & School Boards Association Oppose 1 Large Pot of Money Since It Will Be Harder to Put a Face on Cuts Applied Later. 8

POSSIBLE BENEFITS Fewer Strings for Various Allotments. More Flexibility & Local Control! 9

NEXT STEPS FOR NCASA Response to the Legislative Proposal and the NCASA Alternative Needed From All Districts by 3/15 ! Send Comments & Responses by to 2nd Webinar to Be Held on 3/12 at 2:00 p.m. for LEAs Not Participating Today. Invitations to Come by . Response to Lawmakers to be Provided in Late March Before Senate Budget Rollout in April. 10

REGULATORY REFORM FEEDBACK Jack Hoke Sending LEA Requirements Grid to RESA Directors & Superintendents Today. Each Grid Component Is Assigned to RESA for Review. (150+ items divided into 8 groups) All RESAS Asked to Fill in Comments about Each of Their Assigned Grid Components & Recommend “Keep, Revise, Study or Delete.” Completed Responses from RESAs Should Be Submitted to by 3/22/13 to Meet Bill Filing Deadline the Next Week. 11

QUESTIONS? 12