1. Charter School Finance Fast Track and Virtual Charter School Pilots School Business March 2015

2. Who is School Business? 28 employees who are responsible for the policy and data of student, personnel and financial of entities receiving public school state and federal funds.

3. What School Business Does Public school budget development Allocation of funds Collection of data Analysis of data Projections Monitor the compliance of laws and policy Report

4. Todays Topics Funding Sources Allotments Reporting and Reports Cash Management Monitoring and Compliance Non Compliance

5. New Charter School Checklist Obtain Tax Exempt Status Obtain a Certificate of Occupancy Establish a Bank Account

6. Vendors and Contractors Retirement - Teachers’ and State Employees’ Retirement System or other Health Insurance -the State Health Plan or other Accounting Services – Internal or contract Insurance provider – Liability insurance Independent auditor

7. Systems to Subscribe to EDDIE Allotments Charter School ADM Projection Cash Management MSA

8. EDDIE Educational Directory. It is the authoritative source for school address, grades served, grades approved, principal name and much more. It is used by all areas within DPI. Keep this updated!! http://www.ncpublicschools.org/fbs/accounting/eddie/

9. Allotments System Allows the school to view all allotment amounts and revisions http://www.ncpublicschools.org/fbs/allotments/

10. Charter School ADM Projection System that provides the maximum allowable funded ADM and collects ADM projections from Charter schools in the Fall and Spring http://www.ncpublicschools.org/fbs/charterschools/

11. Training and Manuals Cash Management training MSA training Allotment Policy Manual http://www.ncpublicschools.org/fbs/allotments/general/ Charter School Finance Manual http://www.ncpublicschools.org/fbs/charterschools

12. Terms Allotment = Funding in a Program Report Code (PRC) = “Bucket of Money” Average Daily Membership (ADM) sum of the number of days in membership for all students individual charter school, divided by the number of school days in the term.

13. Charter School Funding Sources  State  Federal  Local  County  Other

14. State Funds Traditional General Statute 115C 218.105 Allocate to each charter school an amount equal to the average per pupil allocation for average daily membership from the local school administrative unit in which the charter school is located. An additional amount for children with special needs and for children with limited English proficiency

15. Components of State Funding Traditional State base funding based on dollars per Average Daily Membership Children with Disabilities (CWD EC) based on dollars per headcount. Child must be on the April 1 headcount to be eligible Limited English Proficiency (LEP) if the charter school has eligible LEP headcount. At least 20 students or 2.5% of ADM.

16. Virtual Charter Schools Allocate to each charter school an amount equal to the average per pupil allocation for average daily membership from the local school administrative unit in which the charter school is located. Excluding allocation for low wealth and small county supplemental funds.

17. Supplemental State Funds Children with Disabilities (CWD EC) based on dollars per headcount. Child must be on the April 1 headcount to be eligible. Ie. If the school enrolls an student who was not in a public school last year, they are not on the April HC. Limited English Proficiency (LEP) if the charter school has eligible LEP headcount. At least 20 students or 2.5% of ADM. an October 1 Headcount is needed for LEP students

18. Driver Training STATE FUNDING ENDED JUNE 30, 2014 Services are still required. The LEA in which the Charter School is located is responsible for offering driver’s training to all eligible students, but there is a fee.

19. Federal Funding Sources Most common are Title I (PRC050) and IDEA VI-B (PRC060) Allotted as grant award documents are received from Washington Budget approval required before allotments are distributed Refer to the North Carolina Allotment Policy Manual at http://www.ncpublicschools.org/docs/fbs/allotments/general/ for a list of federal PRC’s, eligibility for funds, allotment formulas, and any special provisions. http://www.ncpublicschools.org/docs/fbs/allotments/general/ Unused funds revert at the end of the grant period.

20. Local Funds – LEA GS 115C 105(c The LEA in which the student resides shall transfer to the charter school and amount equal to the per pupil local current expense fund. Plus a per pupil share of the penal fines and forfeitures and supplemental school tax, if any. Virtual CS: the amount transferred shall not exceed $790

21. Local funds 115C-218.105(d) LEA must transfer must be within 30 days of the receipt of the monies in to the local current expense fund. (Best Information can be obtained from the County Finance Officer for $ per student funding.)

22. LEA shall provide 1.The total amount of monies the local school administrative unit has in each of the funds - State Public School Fund, local current expense and capital outlay. 2.The student membership numbers used to calculate the per pupil share of the local current expense fund. 3.How the per pupil share of the local current expense fund was calculated. 4.Any additional records requested by a charter school from the LEA in order for the charter school to audit and verify the calculation and transfer of the per pupil share of the local current expense fund. he student membership numbers used to calculate the per pupil share of the local current expense fund. (3) How the per pupil share of the local current expense fund was calculated. (4) Any additional records requested by a charter school from the local school administrative unit in order for the charter school to audit and verify the calculation and transfer of the per pupil share of the local current expense fund.

23. Local Funds-Other All other forms of revenue such as local grants, donations etc are considered local. Local funds do not revert

24. Critical Items when Building your Budget 1. Average Daily Membership Be realistic Know the breakeven number of students 2. State Base Allotment –Varies by LEA $4,538 to $10,443 –Average = $4,915 –http://www.ncpublicschools.org/fbs/allotments/ support/http://www.ncpublicschools.org/fbs/allotments/ support/

25. Budget Considerations Local funds vary by LEA In 2013-14 range from $420 to $3,937 Some LEAs have a charter school for the first time and may not have information available.

26. Budget Considerations Federal Funds are supplemental and not intended for base funding

27. Allotment calculations and Timeline

28. State Funding New Charter Schools are funded based on the $ per ADM of the LEA where the student previously attended. Kindergarten Students – $ per ADM of the LEA where the student would have attended. Other – Private Schools, Home Schools, etc.- $ per ADM where the new charter is located.

30. Total State Funds$13,242,000 LEA Allotted ADM 2,100 Dollars per ADM $6,305.71 Plus: Un-allotted Dollars Per ADM $102.85 (Longevity, Annual Leave, Short Term Disability Worker’s Compensation & Unemployment) Less: LEA Adjustment ($0) (Mandatory reduction by legislation) TOTAL Adjusted DOLLARS PER ADM $6.408.56 (see the Dollars Per ADM chart)

31. Collins Academy - located in Wake County. No. Students LEA Previously Attended $/Per ADMFunding 40Wake$4,434.28$177,371 20Granville $5,046.75 20Private$4,434.28 $88,686 TOTAL ADM 80 $366,992 $100,935 State Base Calculation

32. Data Elements Funded ADM (con’t.) –Initial ADM Updated Estimate of Average Daily Membership Due Late June Basis for 34% Initial State Allocation Basis for Federal Allocations –1 st Month ADM Calculated from 1 st month PMR Enrollment Basis for Final Funded ADM Basis for 68% of State Allocation

33. August when First Month ADM received –usually end of October By end of February When Are The Charter School State Fund Allotments Made?

34. Data Elements Poverty Counts –Estimate of Free Lunch Eligibility December 1, 2013 –Due in June - July –Parents are Surveyed using Income Eligibility Guidelines for the Child Nutrition Program –Used in Federal Allocations Certificate of Occupancy -June

35. Federal Funding New Charter School Data is added into the Federal Funding Formulas Eligibility Requirements for Charter Schools and LEAs are the Same. Funding Formulas are outlined in the Allotment Policy Manual – http://www.ncpublicschools.org/fbs/allotment s/general/ http://www.ncpublicschools.org/fbs/allotment s/general/ North Carolina – Federal Grants - $856 million

36. Data Elements Children with Disabilities Headcount (CWD) –Headcounts December 1, 2013 – Federal Allocations April 1, 2014 – State Allocations –Eligible Students for Funding must be on one of these headcounts –Students Reported on CWD Headcount Transfer Form in June - July –Funds Follow Students 1 st 60 Days of School

37. Allotment Cycle State Allocations –Planning Allocations State Planning Report issued early June Planning Allocations are subject to change –Initial Allocations Issued within 14 days after the General Assembly Adjourns. Usually processed in Allotment Revision 1 Allotments are effective July 1, 2014

38. Allotment Cycle Federal Allocations –Planning Allocations Federal Planning Report issued in August Planning Allocations are subject to change –Initial Allocations Calculations 1 st of September Allocations made in Allotment Revisions as Applications and Budgets are approved.

39. REPORTING

40. Financial and Student Reporting GS 115C-218.30 –Schools shall comply with the Uniform Education Reporting System (UERS) –Subject to Audits Monthly Financial Student Accounting Ad hoc data collection

41. UERS Required Accountable Basis for: Federal Reporting State Reporting Media/General Public General Assembly We are only as good as the data you submit!

42. Chart of Accounts Shows how the allotments were expended. This is the only financial communication between the Charters and DPI. DPI uses this data to communicate to the State Legislature, the State Budget Office, media and the Federal Government.

43. Chart of Accounts Uniform Accounting System for all LEAs and Charters Information Gathering Consistency amongst LEAs and Charters Comparability between years Decision making tool www.ncpublicschools.org/fbs/finance/reporting

44. Chart of Accounts Data in the chart is used for: –Highly qualified teacher reporting –Teacher certification requirement (50% rule – brick and mortar; 100% Virtual Charters) –Reporting to the General Assembly, Federal Government, media and general public on past and future education initiatives –Building the budget –Research and Statistics

45. Account String Fund-Purpose-PRC-Object A-BBBB-CCC-DDD 1-5110-036-121

46. Reading an Account Code 1-5110-036-411 State - Regular Curricular - Charter Schools - Supplies and Materials 1-5270-036-121 State - LEP - Charter Schools - Salary - Teacher 1-6550-036-171 State – Transportation- Charter Schools - Salary Driver

47. Datafile Submit these files to us on a monthly basis Payroll Accounts Payable Software will create these files Schedule: http://www.ncpublicschools.org/fbs/finance/reporting/ http://www.ncpublicschools.org/fbs/finance/reporting/ Review the files and reconcile Provide you financial reports

48. Financial Reports Access these reports via WS_FTP PRO Software ALTARPO1 - Budget Allotment Revision ALTINRP1 - Planning Allotments JHA 305 - Local Account Balance Reconciliation JHA 705 - Budget Balance Reconciliation JHA714 - Cash Balance Report Monitor - Monthly Monitoring Report

49. Certificate of Occupancy PLEASE READ!!!!!!!!!!!!!!!!! –Brick & Mortar – School Building –Virtual – Local Administrative Office Following Forms NOT Processed Without CO

50. Cash Management Establish a ACH bank account with the State Treasurer’s Office. Allow 2 weeks –ACH Bank Account Authorization Form –Voided Check or Original Deposit Slip (Cannot accept temporary checks) Establish access to the Cash Management System (CMS) – Complete Security Forms –CICS Application Maintenance Form –RACF02 Site Security Officer Form –RACF03 RACF User ID Maintenance Form Complete Bill Action Code Form – ITS Access

51. Cash Management Know the cash calendar and funds requirement date (FRD) Do not order more cash than needed to cover the current expenditures It is against state and federal law to hold their cash for more than 3 days. (GS147-86.11) Guidelines and forms www.ncpublicschools.org/fbs/finance/cash/

52. Charter Financial Training Spring 2015 Date TBD – Education Building (DPI) Required Topics Covered – Financial Personnel –Forms Needed for access to systems –Cash Management –MSA (DPI General Ledger) System –Required Software –Chart of Accounts –Zero Out Process

53. Student Accounting Principals Monthly Report (PMR) –Due Monthly –Submitted via PowerSchool –Source of Average Daily Membership (ADM) –Student Accounting Reports School Attendance and Student Accounting Manual: http://www.ncpublicschools.org/fbs/accounting/manuals/ http://www.ncpublicschools.org/fbs/accounting/manuals/

54. Student Accounting School Activity Report (SAR) –Who, What, When and Where of the School –Accuracy of Data –Uses of Data SAR Manual: http://www.ncpublicschools.org/fbs/accounting/manuals/ http://www.ncpublicschools.org/fbs/accounting/manuals/

55. Take Aways Data reporting is NOT optional (must be in our required format – on time) –Financial Datafile – UERS Transfer Schedule –PMR – PowerSchool –SAR – PowerSchool Board of Directors is responsible for data submitted Decisions made based on submitted data No access to funds until approximately 2 weeks after CO is submitted DPI Provides Cash Management Training (Required for all new schools)

56. Contacts Financial Related Questions –Roxane Bernard (919) 807- 3725 PMR Questions –Ozella Wiggins (919) 807-3757 SAR Questions –Sandra Johnson (919) 807-3737