2. Budget Development and Assumptions for 2018-19
District Budget Forums
April , 2018

3. Update to Governor’s January Budget
State new funding formula increase = We STILL have little knowledge of if there will be a new funding formula, and how state apportionment funding will be appropriated. It appears COS will only receive additional funds if the funding formula allocates funding “above” baseline.
Chancellor’s Office and State CBO board say we will have the governor’s proposal at May Revise, but with such a unique year, may not know IF there will be a new funding formula until budget adoption by the legislature in late June 2018.

4. Update to Governor’s January Budget
CBO and CEO workgroups have requested changes to the funding formula parameters originally proposed in January.
Chancellor’s office staff are proposing revisions to the formula and will present to the Chancellor in mid-April.
Chancellor Oakley may accept staff requests, or request something else. He will present to the Governor in late April
The Governor may still prefer something else. He will clarify his proposal at May Revise (mid-May)
We may not know if a new funding formula will be adopted until legislation votes in late June 2018.
Best we can decipher for the current proposal:
50% based on FTES
25% to 30% based on low socio-economic status of students (# of Pell grants, first generation students, etc. – not sure if it will include BOG/College Promise grants awarded)
20% to 25% based on number of degrees or certificates awarded, and completions (possibly up to 16 components in this calculation)
All other CC’s are building their budgets “same as prior year”

5. Update to Governor’s January Budget
California Budget Proposal for Items of Note:
2.51% COLA (??) = approximately $1.5M for COS ongoing if awarded
Growth/Access funds for = appx $1.575M for COS ongoing
10,100 FTES actual less 9788 FTES adopted = 312 growth
FTES growth IN (3.85%) is funded for 18-19
Mid-size College funding (level achieved here in 17-18) = approximately $1.2M for COS ongoing

6. Update to Governor’s January Budget
Restricted Funds:
College Promise = $368,000 for COS
“to spend on an array of activities in support of student access and completion goals” (not necessarily free first year of college?)
COS will implement the COS College Promise Reimbursement program
One-time funding for Guided Pathways (Carryover from allowed in )
approx. $1.37M one-time funds for COS =
$342K in (can be carried forward)
$411K in 18-19
$342K in 19-20
$137K each in and 21-22
Plant & Instructional Equip one-time = appx $2,200,000 for COS
$1.1M each for deferred maintenance and instructional equipment ?
SSSP, SEP, and BSI will most likely be combined into one categorical for – funding stays the same

7. Update to Governor’s January Budget
The Governor proposes only funding six more projects from Prop 51 state facility bonds at this time
That makes 25 funded, out of 29 top priority projects
COS is still not included
COS may have a chance to be added at May Revise for , or may receive funds for Basic Skills Building in or beyond
PERS/STRS increased costs for = $793,252 and for $821,016 (already budgeted in advance!)
If the District chooses to fund increased costs in advance, would = $668,300

8. PERS & STRS Increased Employer Costs
Fiscal Year
New total salaries
STRS creditable earnings
STRS Employer % Rate
STRS increase
STRS increased cost
STRS Accumulated increased cost from FY15
PERS creditable earnings
PERS Employer Rate
PERS increase
PERS increased cost
PERS Accumulated increased cost from FY15
Total Annual Increase
2014/2015
34,450,471
19,166,938
8.88
0.0063
120,752
11,288,373
37,139
157,890
2015/2016
37,263,295
20,513,374
10.73
0.0185
379,497
500,249
12,061,443
9,529
46,667
389,026
2016/2017
41,960,918
22,755,902
12.58
420,984
921,233
14,150,730
288,392
335,059
709,376
2017/2018
41,992,399
14.43
1,342,217
232,497
567,556
653,481
2018/2019
42,391,653
22,967,507
16.28
424,899
1,767,116
14,338,380
368,353
935,909
793,252
2019/2020
42,790,907
23,179,111
18.13
428,814
2,195,930
14,526,029
392,203
1,328,111
821,016
2020/2021
43,190,161
23,390,716
19.10
0.0097
226,890
2,422,820
14,713,679
441,410
1,769,522
668,300
2021/2022
43,589,415
23,602,320
14,901,328
208,619
1,978,140
2022/2023
43,988,669
23,813,925
15,088,977
135,801
2,113,941
2023/2024
44,387,923
24,025,530
15,276,627
106,936
2,220,878
2024/2025
44,787,177
24,237,134
15,464,276
77,321
2,298,199
4,721,019

9. FTES Update Historical Perspective
Year
Actual FTES
Funded FTES
8,149.45
8,204.79
8,419.17
8,506.82
8,510.76
8,620.16
7,582.27
8,929.55
8,209.56
10,160.04
9,042.35
10,614.57
8,696.69
10,561.93
8,945.00
9,033.30
8,261.13
8,646.55
8,466.31
9,448.98
8,713.55
8,868.90
9,430.00
9,700.00
9700 (up to 9,740)
10,100.00
10,089?

10. Fiscal Solvency Projections
Step and Column Costs (Cost of 1% = information only; not in budget projections)
Description
COSTA
CSEA
COSAFA
Mgt/Conf
Total
Cost – Step and Column (Unrestricted)
214,500
218,800
58,000
491,300
Cost of 1% (Unrestricted Only)
217,800
95,300
44,700
61,600
419,400
Cost of 1% (Combined)
240,900
135,750
48,000
76,200
500,850

11. Fiscal Solvency Projections
Scenario 1 (NO COLA)
assume same as 17-18, + mid-size college
Assume 312 growth in (10,100-9,788), = $1.575M new revenues in ($5,050 per FTES) – these funds will be budgeted (ongoing) as we end the year
Assume 0% growth for 18-19
Assume NO increase for new funding formula (funding formula is yet to be clarified!)
Assume NO COLA = 0 for 18-19
Assume College Promise funding estimate $368,000 (restricted)
Assume reaching the 10,000 FTES mid-size college mark! = $1,200,000
= 2.77M new revenues 18-19
Assume 0% growth for 19-20
Assume 1% COLA for = $600,000 ongoing
= 600K new revenues 19-20

12. Projected Budget - Fiscal Solvency Plan Unrestricted Only Scenario 1: 0 COLA, 0 Growth, Mid-size college base 18-19; 1% COLA and 0 Growth estimated for 19-20
Description
State Allocation
57,244,798
60,106,000
60,706,000
Federal and Local Funds
3,300,712
2,934,100
Total Revenue
60,545,510
63,040,100
63,640,100
Expenditures (GF 1000 to 7000)
60,448,951
60,448,950
62,022,250
Step/Column
491,300
492,000
Utilities/WC/P&L/LRC & other augmentations
200,000
Savings from GFU retirees (est = 9 then 3)
(1,161,000)
(405,000)?
Cost of 15 new Faculty (then 5?)
1,715,000
571,800?
Cost of PERS/STRS Incr (budget 2 yrs advance)
668,000
208,600
Savings: X budgets – budget augmtns
(340,000)
Total Expenditures
63,089,650
Structural Surplus/(Deficit)
96,559
1,017,850
550,450

13. Fiscal Solvency Projections
Scenario 2 (2.51% COLA)
assume same as 17-18, + mid-size college, % COLA
Assume 2.51% COLA = $1.5M for 18-19
All other assumptions same as Scenario 1
Structural Surplus could be:
$2.52M in
$2.05M in

14. College Promise AB 19
Though the state has not been clear regarding the purpose of the initial funding proposal (they are now emphasizing “multiple activities in support of student access and completion goals”), the District plans to implement a one year pilot program called:
COS College Promise Reimbursement
$368,000 (estimate) for COS
Restricted funding
An average of the tuition fees paid by first year freshman who completed and passed 15 units per semester = $34,000 per semester
$70,000 per year cost estimate
If the program draws more students, cost could rise to $150,000 per year
To be funded by state AB 19 funds estimated at $368,000, or by General Fund Reserves if state funding is not allocated

15. College Promise AB 19
Other criteria of the one year pilot program called
COS College Promise Reimbursement
Pilot Program will be one year only/one year at a time (if state funding continues)
First year college students only (includes prior dual/concurrently enrolled HS students)
Students must complete FAFSA submission by the last day of September for fall semester or last day of February for spring semester (FAFSA required per AB 19)
Must enroll in, and complete with a passing grade (C or above), a minimum of 15 units per semester
Will apply to two consecutive semesters (Summer sessions not included)
Reimbursement of 15 units or more of tuition will be made upon successful completion of 15 units in a student’s first semester, and again in their second semester
Student’s account will be credited at end of semester for tuition previously paid
The reimbursement would not cover books or fees (such as transit, health, student center, student activity, nonresident fees, etc.)

16. Enrollment Management - FTES
FTES as of April 11, 2018:
Assume zero growth for summer 2018 (same as 2017)
FTES
Actual Hours of Attendance
Weekly Attendance Method
Indep
Weekly Attdc Meth
Daily Attendance Method
Indep Daily Attdc Method
Total
Summer 2017
Session 2 shift 88
Session 3 62
117 36
215
Fall 2017
497
3,847
344 89
116
4,894
Spring 2018
452
3,500
317 93
136
4,498
Summer 2018
Sessions 1&2 72
305
108
485
TOTAL
10,180

17. FTES Status Hanford & Tulare
projection based on summer 2018 “Same As Last Year”
FTES
(to date)
projected
Hanford
1,037.00
953.58
1,039.00
Tulare
2,428.36
2,195.75
2,596.72
1,696.18
1,673.32
1,869.27
Tulare included Hanford FTES these years
First year FTES separated

18. Notes: Closing books
Administration anticipates additional funds to add to General Fund Reserve (fund balance) at close of
Actual FTES (10,100) over budgeted (9788) will bring additional one-time revenue (appx $1.575M)
COS Anticipates meeting mid-size college status, which could bring another $1.2M in retroactively
Estimated at $2.77M+ unspent (one-time $’s)
Resource Allocation Manual provides guidance for expenditures of one-time funds such as these
COS admin and budget committee will follow those steps in fall 2018, when these funds are actually allocated by the state
Portions of General Fund Unrestricted District budgets go unspent each year (comprised of over 1,000 account lines) estimated at $1M

19. “May Revise” Budget to come
All of these assumptions and projections will change when the Governor issues the “May Revise” projected budget
Will be issued approximately May
We expect the new funding formula will be finalized, and simulations/projections will be available
Fiscal Services will then revise assumptions and budget development, before rolling the budget
Tentative Budget will be submitted for Board approval in June
State legislation will approve final State Budget in late June
State legislation could vote NOT to approve the new funding formula! (Still in flux)
Final COS Budget will be submitted for Board approval in September
NOTE: This is a UNIQUE year due to the proposed new funding formula! No final formula exists yet, and legislation may choose to delay implementation.

20. Questions?
Comments?