Budget JEFFERSON SCHOOL DISTRICT

May Revise  The budget includes the following assumptions from the Governor’s May Revise:  Statutory COLA of -0.39% ($-58,407)  No change to deficit factor – currently %  Continuation of Tier III flexibility for categorical programs through , including suspension of deferred maintenance match and instructional materials adoption timelines

May Revise (cont.)  K-3 CSR funding penalties remain relaxed through  Budget includes two additional teachers in to plan for CSR returning to previous penalty levels. We will review/consider options when we plan for budget

Budget Assumptions as Previously Presented  P2 reported ADA of – slight increase over 2 nd Interim ADA of (~+$18K)  -0.39% COLA (-$58,407) in 10/11 and assumes a 0% COLA in 11/12 & 12/13  No salary or benefit changes through 12/13  Anticipate Lottery revenue of $110 per student unrestricted; $13 Prop 20 (restricted) ~ same lottery revenue as  No mandated cost claim revenue anticipated  Step & Column of $200K for certificated and $21K for classified. Estimated S&C in the out years based on the actual % of increase at budget (separately estimated for restricted vs. unrestricted)  Retiree benefits maintained as they now exist  Includes Consumer Price Index adjustment to 4xxx (Materials & Supplies) and 5xxx (Services) object codes of 2.4% for and 2.7% for  Includes 5% increase for utilities for each year

Additional Assumptions  Decrease of 17% in Title II funding (- $5,800) in forward  Worker’s Compensation rate is estimated to increase 10% in and is included in the Multi Year Projection as an increase to statutory benefits  Decrease of 0.38% in all categorical revenues

Previously Approved Budget Reductions  Includes budget reductions of:  $70K – no Deferred Maintenance match  $28K – categorical offset for intervention specialists.  $54K – revised Cafeteria Fund contribution.  $175K – one time additional 1% reduction in Routine Repair and Maintenance contribution  $203.7K – Offset of Special Ed expenses to ARRA funds  $100K – correction of FICA expense budget  $208K – one time sweep of categorical carryover balances  $67K – reduction to Class Size Reduction contribution  $63K – updated Curriculum coordinator & secretary positions, Intervention Specialist positions percentage charged to EIA (Resource 7090) to use EIA carryover for three years ( through )

Previously Approved Budget Reductions (cont.)  $59K – copier contract savings  $ 4K – reduced budget for custodial uniform rental/cleaning  $11.5K – estimated savings from Supplemental Early Retirement plan (three employees retired and accepted SERP)  $30.2K – revised lottery textbook budget.  Consumable (workbook) expenses for are estimated to be $94.8K. We are still ‘saving’ since we will not need to purchase textbooks (no adoptions due to flexibility provisions). We re-budgeted the items agreed to be reinstated (field trips, classroom supply budgets and technology) as planned – and still have an ending fund balance of $314,963 in unrestricted lottery money.  $208K – one time sweep of categorical carryover balances (completed in which increased start balance)

Additional Budget Reductions/Changes Included in Budget  During the budget development process, we identified other opportunities to utilize categorical funds as follows:  $46K – budgeted partial expense of Traina Assistant Principal position to ARRA Title I (Resource 3011) one time in (increased Res 0000 beginning balance in )  $48.6K - revised percentage of position charged to Title I (Resource 3010) for Curriculum coordinator and secretary forward  $20.0K - changed percentage of assistant principal positions to charge 10% of costs to EIA (Resource 7090) forward

Additional Budget Reductions/Changes Included in Budget  Also during Budget Development, we identified other reductions appropriate to implement at this time:  $30K – reduced budget for water/trash services ( forward)  $25K – reduced budget for electricity/natural gas  We will continue to review utilities for additional reductions as our implementation of energy savings items progresses ( forward)  $10K – reduced budget for property & liability insurance premium. Has historically been budgeted a bit ‘high’ so will correct that this year ( forward)

Year-End Changes  We will confirm the following additional changes at year-end  $100K – one time sweep of deferred maintenance funds to Unrestricted General Fund  Confirm estimated increase to ending fund balance – the difference between budgeted expenses vs. actual expenses. Currently estimate the change to be $250K - $500K.  There will also be additional funds in the ending fund balance on the restricted side  We will identify and report these amounts in September when Unaudited Actuals is presented to the board.

Contributions  Contributions from the general fund (Resource 0000) are estimated to be $1,253,120 as follows:  Special Education$707,393  Transportation$115,060  Routine Repair & Maintenance$ 351,000  K-3 Class Size Reduction$ 47,063  Art & Music Block Grant$ 32,604  Note: The contribution for CSR & Art & Music grant are not included in the total contributions reported in the SACS budget forms, since these resources are now unrestricted.

District Status  JESD is positively certified through  In , we are at zero in the unrestricted ending fund balance (still maintaining the 3% reserve for economic uncertainty, the board designated reserve of $500K and our other designations for lottery, mandated costs and board project carryover.  A small adjustment ($569) of the mandated cost designation was required to not be negative

Deficit Spending  Currently estimate district deficit spending to be ~$700K annually – net of the ‘gap’ (difference between budgeted expenses and actual expenses which we will continue to narrow as much as possible)  Should education funding continue with the current revenue limit reductions, we may need to make decisions regarding forward we hoped to avoid  There remain many unknowns -

Next Steps  Will provide an update on historical budget reductions at August board meeting.  will be closed in August, 2010, and Unaudited Actuals will be presented to the board in September. This will confirm our ending fund balance, carryover, etc.  We will continue to be careful with our spending; monitor budget issues and report to the board frequently in  Dana and Mindy will hold budget update meetings at all sites as well as a public meeting in late Fall, 2010.