2018-19 Budget Development · 2018-01-26 · 2018-19 Budget Development Board Study Session January...

From strong roots grow bright futures 3188 Quimby Road, San Jose, CA 95148 www.eesd.org 408-270-6800

2018-19 Budget Development

Board Study Session January 25, 2018


LCFF Assumptions Item 2017-18 2018-19 2019-20 2020-21

LCFF Gap Funding Percentage 44.97% 100% 100% 100%

COLA 1.56% 2.51% 2.41% 2.80%

District Enrollment 11,384 10,955 10,524 10,170

Average Daily Attendance (ADA) 11,031 10,592 10,162 9,816

LCFF Funded ADA Include County ADA

11,566 11,146 10,707 10,277

LCFF Per ADA (Average) $8,177 $8,576 $8,790 $9,025

Supplemental grant funding

$7.41 M $7.19 M $7.09 M $6.79 M

2


LCFF funding facts •  2017-18 LCFF already funded 97%

•  Full implementation proposed for 2018-19

•  LCFF goal is to restore purchasing power to 2007-08 levels

•  Future increases flatten out and are well below projected cost increases

• In a 2% to 3% COLA environment, STRS/PERS, step/column, special education and health welfare increases are more than the new revenues

• The multi-year-projections show continued deficits for most districts, particularly those with declining enrollment

3

From strong roots grow bright futures 3188 Quimby Road, San Jose, CA 95148 www.eesd.org 408-270-6800 4


Declining Enrollment


Other Major Revenue Assumptions

• LCFF revenue based on Department of Finance (DOF) January 2018 projection

• One time discretionary funds $147 per ADA in 2017-18($1.73M); $295 per ADA in 2018-19 ($3.3M)

• Parcel Taxes ($2.4M) expires June, 2019

• Revenue contribution to Routine Restricted Maintenance Account (RRMA) at 2014-15 contribution level ($2.66M) in 2017-18; contribution at 2.45% of general fund expenditures in 2018-19 & 2019-20; contribution at 3% of general fund expenditures in 2020-21

6


Major Expenditure Assumptions • Declined enrollment in future years based on demographer’s December 2016 enrollment projection report

– 2017-18 reduce 410 students; reduce 12 teachers – 2018-19 reduce 429 students; reduce 10 teachers – 2019-20 reduce 431 students; reduce 10 teachers – 2020-21 reduce 354 students; reduce 10 teachers

• $0.68M step/column salary increases in future years for all groups

• SERP savings included in future year

• Salary increase status quo (subject to negotiation)

• Health benefits 5% cost increase projected in future years

• Reduce programs and staffs (10.72 FTE) paid by parcel taxes start in 2019-20

7


Major Expenditure Assumptions •  Special Education Excess Cost increase $1.3M annually

•  Proportionality requirement met, spend supplemental grant for students in need. Expenditures budgeted under supplemental grant 1590, 1591, 1592, 1593, 1594, 1595, 1596 and 1597

–  2017-18 $8,023,732 –  2018-19 $8,580,933 –  2019-20 $8,524,159 –  2020-21 $8,665,778

• Increase retirement contributions for STRS and PERS Years STRSRate $increasefromprioryearPERSrate $increasefromprioryear

2018-19 16.28% $1,610,164 18.10% $280,129

2019-20 18.13% $1,588,998 20.80% $285,358

2020-21 19.10% $827,545 23.80% $317,042

8


Expenditures Increase in Three Years


Detail of 2018-19 Reserve

•  3% required minimum reserve is $3,633,710

•  The amount in excess of minimum reserve is $11,525,692. Excess reserve is needed for the following: –  PERS/STRS contribution rate increases –  Projected future enrollment decline –  Deficit spending in the future years

•  Reserve shortage in 2020-21 is $20,682,702

10


December 2017 1st interim Report Budget Projections up to 2019-20


Current Budget Development up to 2020-21 with Governor’s January Proposal


January 2018 Budget Development Compare with Dec 2017 1st Interim Budget Projection

13


-24 -22 -20 -18 -16 -14 -12 -10

-8 -6 -4 -2 0 2 4 6 8

10 12 14 16 18 20 22

2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 Est

2018-19 Est

2019-20 Est

2020-21 Est

Mill

ions

General Fund Unrestricted Reserves

as January 2018

3% Reserve for Economic Uncertainties Unassigned


70

72

74

76

78

80

82

84

86

88

90

92

94

96

98

100

2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18Est.

2018-19Est.

2019-20Est.

2020-21Est.

Mill

ions

General Fund Unrestricted Expenditure and Revenue

as January 2018

Expenditures Revenues


-25

-20

-15

-10

-5

0

5

10

2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 Est.

2018-19 Est.

2019-20 Est.

2020-21 Est.

In M

illio

n D

olla

rs

Unrestricted Operating Deficit and Surplus as January 2018


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pg. 17.2Large version of slide 17.


Fiscal Stabilization

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lem

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l Min

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s18

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19-2

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ated

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port

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lity

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uire

men

tM

inim

um A

lloca

tion

7,19

1,76

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9To

tal S

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tal E

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res

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r Pre

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s +

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ease

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ost)

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lloca

tion

8,58

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9

***

No

Con

tract

s/C

an N

ot In

clud

e in

The

Bud

get

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ms

Sub

ject

to V

oter

s A

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val/

Can

Not

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ude

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udge

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ubje

ct to

Neg

otia

tion/

Can

Not

Incl

ude

In T

he B

udge

tTe

ache

r Sal

ary

BA

+30

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p 5

Is U

sed

For T

he C

alcu

latio

n

pg. 18.2Large version of slide 18.

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