2014-15 Proposed Final Budget
Presentation (May 12, 2014)
Selinsgrove Area School District
GENERAL FUND FINANCIAL STATEMENT
(Current financial position)
2012-13
Actual
Beginning Balance
2013-14
Budget
2013-14
Projected
$ 6,142,492
$ 6,810,646
$ 8,082,703
Revenues
$ 36,936,892
$ 37,780,849
$ 37,957,589
Expenditures
$ 34,996,681
$ 37,780,849
$ 36,844,022
Surplus/(Deficit)
$ 1,940,211
$
$ 1,113,567
0
Transfer out to
Capital Reserve
$
(500,000)
Transfer out for IS
School Roof
$
(850,000)
Ending Balance
$ 8,082,703
$ 6,810,646
$ 7,846,270
2
2013-14 BUDGET SAVINGS (Current Yr.)
Adopted budget balance
Personnel Salary Savings (2.5%)
Fringes/Benefit Savings
Medical insurance savings
Unemployment comp savings
All other department savings (net)
Revenues over budget (EIT)
Not using budgetary reserve
Total Savings (projected surplus) 3%
$
0
$ 450,000
$ 125,000
$ 95,000
$ 63,000
$ 4,000
$ 176,000
$ 187,000
$1.1 million
3
TOTAL FUND BALANCES AT 6-30-14
Designations (“buckets”)
Balance
Restricted - Special Ed ACCESS
$
266,345
Nonspendable - Inventory of Supplies
$
33,631
Nonspendable – Prepaid Expenses
$
31,563
Committed – Retiree Healthcare
$ 2,318,334
Committed - Future PSERS Expenses
$ 2,648,258
Committed – Educational Resources
$
Unassigned Balance
$ 2,248,139
300,000
(6.1% of budget)
TOTAL GENERAL FUND RESERVES
$ 7,846,270 (21.3% of budget)
DEBT SERVICE FUND RESERVES
$ 1,842,373
CAPITAL RESERVE FUND RESERVES
$ 2,400,227
TOTAL ALL GOV’T FUNDS RESERVES
$ 12,088,870
4
FUTURE CAPITAL RESERVE PROJECTS – Importance of
maintaining a healthy Capital Reserve Fund
Project
Amount
Project start date
Intermediate school roof project
$ 880,500
Summer 2014
Middle school addition
$ 275,424
Fall 2014
High school bleacher replacement
$ 163,100
Summer 2015
Intermediate school A/C chiller
$ 91,000
as needed
Football field turf replacement
$ 247,300
as needed
(total cost of
$650,000 balance from food service)
(total cost of $313,000)
Other expenses: annual summer maintenance projects for carpeting,
paving, vehicle replacement. Middle school HVAC system replacement
(possible performance contract), stadium track surface replacement. Fund
used to offset any unforeseen major equipment replacement.
5
2014-15 BUDGET SUMMARY
FLOW OF FUNDS – GENERAL FUND
Beginning Fund Balance
Revenues
(without tax increase)
Expenditures
Deficit
Transfer in from Educational
Resources Reserve
$ 7,846,270
$38,544,948
$39,174,810
( $ 629,862)
$ 125,000
Adj Deficit before tax increase
( $504,862)
Proposed 1.66 mills (2.7%) Act
1 allowable tax increase
$411,811
Operating Deficit to be covered
from unassigned fund balance
( $93,051 )
Ending Fund Balance
$ 7,628,219
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REVENUE HIGHLIGHTS








Moderately growing local economy
1.66 mill real estate tax increase (2.7%) and a 0.5%
growth in the overall real estate base
Earned Income Tax collection budgeted with a 2%
increase from proj 13-14 collections
Basic education subsidy increase of 1.8% (state funding
is uncertain at this point)
Special education subsidy level funding
Accountability Block Grant level funding
Reduction in federal funding (Keystone Literacy Grant &
Title I)
Transfer in from educational resources reserve $125,000
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2014-15 REVENUE BY SOURCE
FEDERAL
4%
STATE
35%
$1.6 M
LOCAL
61%
$13.7 M
$23.6 M
State averages: Local 54%, State 41%, Federal 3%, Other 2%
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HISTORICAL REVENUES BY SOURCE
$25
$20
millions
$15
Local
State
$10
Federal
$5
$-
10-11
11-12
12-13
13-14
14-15
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EXPENDITURE HIGHLIGHTS





Nine teacher retirements at end of 13/14 school year
(not replacing one elementary position)
Salary increases per personnel contracts – teachers
3.9% salary plus 2.3% steps, administrators 3.5%,
classified 3.9%
PSERS rate increase from 16.93% to 21.40%
Medical insurance premium increase of 7% and move
to tiered rates instead of composite rate
Building and technology budgets level funded (4th
year at reduced funding)
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EXPENDITURE HIGHLIGHTS




Transfer out to debt service fund reduced by
$400,000 (debt service reserves to be used)
Capital reserve transfer of $96,000 reflects JacksonPenn rental income
New K-5 reading textbook series ($125,000)
Total budget of $39.17 million – overall increase of
$1.4 million or 3.7% from 13/14 original budget and
$2.3 million or 6.3% from 13/14 projected actual
ending budget
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MAJOR EXPENDITURE INCREASES
EXPENSE
INCREASE FROM
13-14 Projected
EMPLOYER SHR OF
RETIREMENT EXP
$ 1,003,000
33.5%
EMPLOYEE SALARY/WAGES
$ 993,600
5.7%
MEDICAL INSURANCE
$ 621,000
15.0%
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2014-15 EXPENDITURE ANALYSIS
Supplies, textbooks, equipment ,repairs, travel
Discretionary
3%
Contractual/Fixed
97%
Personnel costs, student tuition, transportation, utilities, debt service
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HISTORICAL USE OF FUNDS
$20,000,000
$15,000,000
Salaries
Fringes/Benefits
Professional Svcs
$10,000,000
Propoerty Svcs
Purchased Svcs
Supplies
$5,000,000
Equipment
Debt Service
$-
10-11
11-12
12-13
13-14
14-15
Other Expenses
Personnel costs make up 75% of total budget
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FUTURE BUDGET CONCERNS

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
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Modest economic recovery producing inadequate
local and state revenue growth
Act 1 index will remain low
Limited state subsidy increases
Reductions in federal revenue
PSERS rate increases to reach 30%
Teacher contract increases over the next 2 years
New Federal Healthcare Legislation (increase costs
and administrative burden)
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PROJECTED PSERS RATE
Employer % Rate
30
25
21.40
20
29.15
16.93
15
12.36
10
8.65
5
0
25.8
28.3
30.14 30.87
4.78
5.64
09-10 10-11 11-12 12-13 13-14 14-15 15-16 16-17 17-18 18-19 19-20
PSERS Rate
Fiscal Year
16
NET PSERS COST TO DISTRICT
10 Year Analysis
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BUDGET RESTRUCTURING: ACTIONS TAKEN
SINCE 2010-11

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Reduced 27 professional staff (12.7%)
Reduced 2.4 administrative staff (18.6%)
Reduced 29 support staff positions (18.6%)
Salary freeze in 2011-12 for all personnel
Reduced pay increase for administrative staff in
2012-13
Eliminated indemnity health insurance plan
Refinanced 4 bond issues
Cut building and technology budgets by 30%
18
BUDGET RESTRUCTURING: ACTIONS TAKEN
SINCE 2010-11

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Leased Jackson-Penn for rental income
Long term energy contracts for natural gas &
electricity
Strategic use of federal funds to offset costs
Four day work weeks in the summer
TOTAL FOUR YEAR CUMULATIVE BUDGET
SAVINGS OF $14.3 MILLION
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FUTURE BUDGET PROJECTIONS
20
GENERAL FUND PROJECTED ENDING
FUND BALANCE
21
PROPOSED FINAL BUDGET SUMMARY
“THE BOTTOM LINE”
REVENUES
$38,956,759
EXPENSES
($39,174,810)
USE OF FUND BALANCE
($125,000
FROM EDUCATIONAL RESOURCES & 93,051 FROM
UNASSIGNED)
MILLAGE INCREASE
% INCREASE
TOTAL MILLS
1 mill = $247,000 in revenue
INCREASE TO AVG HOMEOWNER
Homestead/Farmstead credit $133
$
218,051
1.66
2.7%
63.41
$45
($3.75 per month)
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PRESENTATION SUMMARY
(POINTS TO REMEMBER)

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Financial reserves (fund balance) – very
strong position in the short term
State funding is uncertain
Significant budget challenges remain for the
future – PSERS, Healthcare, teacher contract
increases
NEW FISCAL REALITY
Importance of long-term budgeting
decisions and forecasting
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