Albuquerque Public Schools FY16 Budget Strategic Look Ahead Update 2-17-15

FY16 Strategic Outlook Table of Contents FY15 Operational Fund Budget Summary FY15 Approved Budget Operating Surplus/(Shortfall) Trend Enrollment and Expenditure Trends Current SEG Outlook APS Budget Changes FY15 to FY16 Direct Instruction Expenditure Percentage Payroll vs. Non-Payroll Expenditures FTE by Function Comparison Opportunities and Risks FY16 Budget Timeline Next Steps

FY15 Operational Fund Budget Summary A total of $7.6M in new budget priorities were added in FY15: $1.4M for investments and new initiatives including the K-8 Academy, Sandia IB Program Expansion, Office of Innovation, etc. $3.5M for unfunded mandates to support increased requirements from PED including additional Assistant Principals and Testing Coordinators for schools. $2.2M for post recession recovery including school support, social workers, counselors, custodians and other items. $.5M for compensation and other requests including a tier increase for teachers. -Budgeted expenditures exceeded budgeted revenues by $5.3M, cash reserves were used to fill the gap. -An additional $1.1M in cash reserves was used at the beginning of the fiscal year, increasing the estimated budget shortfall to $6.4M.

OPERATING SURPLUS/(SHORTFALL) TREND The existing $6.4M shortfall will come off the top of any “new” revenues in FY16 unless we manage current year expenditure levels.

Expenditures increased on average 3% annually from FY13 to FY15, while enrollment has continued to decline at a rate of .7% annually. Estimated expenditures in FY15 are on track to equal those in FY10 with ~1,200 less students to sustain the same level of expenditures.

Current SEG Outlook The February consensus revenue estimate is $83M in New State Funding. This would mean an increase of approximately $9.0M to APS.

APS BUDGET CHANGES FROM FY15 to FY16

FY13-14 Actual Expenditures & FY 15 Budget EXPENDITURE TYPE ($ MILLIONS) . FY13 ACTUAL   FY14 ACTUAL FY15 BUDGET SALARY $ 407.4 $ 414.0 $ 436.2 BENEFITS 131.4 146.8 155.8 TOTAL PAYROLL 538.8 89.9% 560.8 90.4% 592.0 90.5% NON-PAYROLL 60.8 10.1% 59.8 9.6% 62.1 9.5% GRAND TOTAL $ 599.6 $ 620.6 $ 654.1 Between 89-91% of all Operational Expenditures are Personnel costs alone.

FTE BY FUNCTION COMPARISON

Opportunities and Risks

Important Items of note: 3/1 Academic Master Plan Deadline 4/10 Legislation Not Enacted by Gov is Pocket Vetoed 3/9 Community Budget Meetings 5/19 Finance & Board Presentation for Approval 3/20 Budget Call Prep Schools & Departments 6/5 FY16 Budget Due to PED 3/21 Governor’s Action on Legislation 6/15 Tentative Technical Review with PED 4/9 Unit Value Communicated to School Districts

Next Steps: Determine Board priorities