1. WPCSD BUDGET DISCUSSION FY2015 & FY2016 MARCH 3, 2015 White Pine County School District

2. Presentation Goals Provide a preliminary and broad overview of school finance Provide timeline for budget and staffing decisions Provide information about state, federal and local revenue Provide information about WPCSD General Fund expenditure assumptions and information Provide information about WPCSD fund balances Factors that influence expenditures Conclusion

3. Budget Dates & Information 2/15 Department of Taxation issues preliminary revenue projections 3/15 Dept. of Taxation provides final revenue projections 3/25 Dept. of Taxation provides final abated revenue projections for property taxes 4/15 File Tentative Budget (NRS 354.596) 4/25 Final estimate of net proceeds of minerals provided to Dept. of Education 5/1 District’s must notify teachers of employment (NRS 391.3196) 5/16 Mandatory Tentative Budget Public Hearing (3rd Wednesday in May) (NRS 354.596) 5/31 Department of Education notifies school district of per pupil basic support based on updated revenue from Taxation. 6/2End of regular Legislative Session 6/8Adopt Final Budget (NRS 354.598) 8/1School districts notified of final adjustment to projected minimum textbook expenditure requirements based on projected enrollment (NRS 387.206(2)) 8/25Final adjustments incorporated into prior year-end DSA adjustments 9/17Official Enrollment for funding purposes (NRS 387.1233 – last day of the first school month) 10/31Audit Report is Final – prior year fund balance is official (NRS 354.624(2)) 1/1School districts are required to amend their “final budget” on or before 1/1 (NRS 354.598005(9)

4. Sources of Funding Federal Sources  Primarily Grants or restricted funds  General Fund: Secure Rural Schools (unrestricted) included in FY2015 but must be reauthorized at the federal level. State Sources  Categorical funding (restricted – a.k.a. grants)  Special appropriations (restricted)  General Fund (unrestricted) Local Sources  General Fund Taxes: Property taxes, sales taxes, govt services tax (aka motor vehicle registration)  Debt Services Fund: Property taxes, interest, bond & debt proceeds  Capital Funds: Interest earnings, sales taxes, gifts and donations, net proceeds of minerals  Other (indirect costs, tuition, etc.) Outside Allocations  Private grants, donations, scholarships Fund Balance  Not considered revenue and poor fiscal practice to fund ongoing expenditures with fund balance.

5. Fund Accounting A fund is a set of accounts, segregated for a specific purpose in accordance with laws and regulations or special restrictions and limitations. The General Fund is the District’s largest fund, is unrestricted and can be used to support other funds. Restricted Funds (i.e. grants, capital, etc..) can only be used for their specific purpose. Using the fund in any other manner constitutes a breach of trust and violation of law.

6. General Fund The General Fund is the District’s operating fund and is used to pay for expenses related to the District’s primary purpose – education. GF Accounts for approximately 70%+- of total governmental revenues. Funds are not restricted and can be used as directed by the Board of Trustees (i.e. “transfers out”) Because this is the largest unrestricted fund, the District typically prepares budgets based on how factors influence the General Fund.

7. Nevada Plan Constitutional and Legislative Declarations  “Uniform System of Schools” (Article 11, Section 2)  “Guaranteed per pupil level of educational financial support” (NRS 387.121)  “Reasonably equal educational opportunity” (NRS 387.121)  “recognizing wide local variations in wealth & costs per pupil” (NRS 387.121)  State should supplement local financial ability to whatever extent  “expressed in a formula” (i.e. DSA Formula)

8. Per Pupil Funding

9. FY2014 & 15 General Fund Budget

10. FY2015 & FY2016 Preliminary Local Revenue excludes property tax abatement. FY2015 abatement was $828,547

11. General Fund Revenue Projections WPCSD uses projections provided by the Nevada Department of Taxation and Department of Education  98% of Total GF Revenue Per Pupil Funding will not be available until the education budget has been finalized by the Legislature Additional categorical funding may be available but also must be finalized by the Legislature If DOT or DOE do not provide information, we can not include it in our budget. WPCSD does not alter or change these projections Projections for miscellaneous and federal revenue provided by the District

12. Charter Schools Charter schools reduce the revenue available for other schools NRS 387.124 Apportionments to school districts, charter schools....  2. Except as otherwise provided in subsection 3 and NRS 387.1244, the apportionment to a charter school,..., is equal to the sum of the basic support per pupil in the county in which the pupil resides plus the amount of local funds available per pupil pursuant to NRS 387.1235.... (a.k.a. outside revenue)  WP FY2015 Per Pupil Amount $7,376  2/3 of the property taxes  Government Services Tax  Information in the table above is based on FY2015 per pupil funding.

13. Estimated Charter School Enrollment Charter School Enrollment 151.2 students State will reduce DSA by approximately $253,571 for outside revenue FY2016 enrollment for funding purposes will be based on 83.2 fewer students FY2017 enrollment for funding purposes will be based on 93.6 fewer students (drop of 176.8 students in two years)

14. Student Enrollment

15. Preliminary Inflation Factors Revenue: Net Proceeds of Minerals (Preliminary Projection is ½ of the prior year) Ad Valorem Revenue (abated: $828,000 FY2015) Statewide per pupil amount $7 less than prior year (Preliminary) Expenditures Group Insurance: 15% Other Insurance: 10% Wages: 2% (est. impact of range and step) Estimated impact on total wages for range progression and steps for all employees This does not represent a % increase to the wage/salary schedules PERS: 2% (range and step) and 2.25% rate increase Worker’s Comp: 2% (range and step) Utilities: 3% Gas/Fuel: 3% Remaining line items for FY2015 will be based on the FY2014 budget or projected expenditures (projected year-to-date plus encumbrances)

16. Future items that influence budget Actual inflation State Legislative/Budget Decisions  Can affect revenues and expenditure Federal Legislative/Budget Decisions  Special Education Funding, Student enrollment  General Fund, Special Education, English Language Learners, Charter schools Audit Report  Adjusting entries, fund balance, actual revenue, actual expenditures Weather  Labor, utilities, fuel Local Economic Development  Mining activity, net proceeds of mineral, local taxes Other Factors  General Fund Transfers

17. Conclusion The District will have to deplete its reserves to balance its FY2015 budget Even after using fund reserves budget cuts are probable in FY2016 District should freeze spending in the current year to increase fund balance. Reduce wages through attrition. Budgets by definition are estimates of costs associated with future purchases and economic events. The assumptions and information contained within this presentation are likely to change and may change significantly. The information in this presentation should be used for discussion only as a means to frame future budget discussions and decisions.