1. WINSTON-SALEM/FORSYTH COUNTY SCHOOLS 2012-13 BUDGET PREVIEW

2. First, the Good News! Projected local budget surplus in 2011-12, which, except for items listed on subsequent slides, should continue to be available in 2012-13 $9.0 million Savings from remainder of local assistant positions due to be eliminated June 30 $0.75 million

3. Funding Losses Federal Jobs Bill Funds $10.5 million Race-to-the-Top Funds Used to Pay Equity+ Bonuses in 2011-12, but not Available in 2012-13 $1.8 million Carryover exhausted in Federal Title II CSR $0.4 million

4. Other Expected Funding Needs “Temporary” Salary Savings in 2011-12 $175,000 Already Enacted Increase in Matching Ret. $1.1 million Already Enacted Increase in Discretionary Reduction$2.2 million Anticipated Increase in Matching Health Ins. $325,000

5. Other Potential Funding Needs Projected Increases in Utility Rates Potential for Matching Legislated Pay Increases Potential Losses of Other Federal Funds County funding might reduce due to lower property tax valuation

6. Pent-up Needs Due to Budget Cuts Activity Bus Replacements Computer Replacements Textbook Adoptions Staff Development Other replacements/enhancements of technology and other tools

7. Other Potential Sources of Funds Use Some Portion of Fund Balance That is Accumulated in 2011-12 Modify and/or Find Another Funding Source for Equity+ Bonuses If the Board approves, combining Hill and Philo middle schools should save $320,000 annually in utilities and office staffing

8. Bottom Line Sources of Funds$9,750,000 Funding Needs -$16,500,000 Potential Funding Shortfall -$6,750,000 Does Not Take Into Account Other Potential Funding Losses, Pent-up Funding Needs, or Other Potential Funding Sources

9. Next Steps We have been meeting with a committee of principals and central budget managers Tentative agreement to recommend use of one-third ($3 million) of fund balance Still discussing all of the permanent reduction ideas on the next two slides

10. Ideas for Permanent Cuts Permanent Pay Cuts? A 1% reduction in all employees’ annual pay would save $2.5 million A lesser reduction rate for lower-paid employees is being discussed, and would decrease the annual savings

11. Ideas for Permanent Cuts Eliminate Central Office Positions (Some have already been eliminated this year)? Continue Converting to Contract Cleaning? “Trial Employment” Temporary Staffing? New Instructional Delivery Model for AIG? Teacher Assistant/PRT Allotment Formula? Reduce Substitute Pay?

12. Summary Picture is Somewhat Brighter Than Anticipated Use of Fund Balance can Help at Least Delay Some of the Pain Still Hope to Avoid RIFs Still Hope to Avoid Class Size Increases Still Lots of Unknowns

13. Next Steps Continue meetings with Budget Committee Work through our normal budget request and budget review process Continue to Monitor and Update State and County Funding Projections Make final recommendations to the Board in April