West Sonoma County Union High School District Proposed 2016-17 Budget Prepared by: Denise Calvert, Interim Business Manager Presented to the Board: June 15, 2016

OVERALL FISCAL CONDITION The District will meet the minimum reserve requirements in 2016-17. The District will not meet the minimum reserve requirements in the two subsequent years 2017-18 and 2018- 19 without expenditure reductions. The MYP includes a reduction of 3 FTE for 2017-18 and an additional reduction of 3 FTE for 2018-19 and an additional $450,000 reduction in expenditures for 2017-18 that will carry forward to 2018-19.

2016-17 ADA & LCFF Projected Gap Funding – Department of Finance (DOF) in MYP 54.84% for 2016-17, 73.96% for 2017-18, 41.22% for 2018-19 Projected COLA – 0% - at 2nd Interim Projected .47% Projected Supplemental Grant funding 26.2% for 2016-17 Average Daily Attendance – based on prior year (2015-16) = 1919.53 – a decline of 39 from 2nd Interim representing a decrease in the projected revenue of ($348,270)

Other Revenue Projections Detailed in MYP (page 159) and Assumptions (pages 160-161) Federal revenues estimated at 2015-16 amounts, onetime grants reduced, MediCal (MAA) unrestricted revenue reduced to zero and budgeted upon receipt Other State revenues: Lottery ($181 per ADA) adjusted for declining enrollment, One-time revenue for discretionary spending from May Revise not included ($237/ADA) Local revenue includes $1,108,000 for Measure K parcel tax, donation estimates, payments from Consortium partner districts SCOE CTE/ROP reimbursements and final 6 months of solar incentives ended in 2015-16

Expenditure Projections Detailed in MYP (page 159) and Assumptions (pages 160-161) 180 student days, 184 teacher work days Step and Column increased costs 3.0 Certificated FTE reduction in 2016-17 and 3.0 reduction in 2017-18 Health Benefits increased costs – 2016-17 based on estimates using actual rate changes; 3.5% certificated and 4.5% classified STRS and PERS rate increases based rates known at May revise Books and supplies – based on site allocations Textbook purchases are not budgeted, will be budgeted at 45 day revision. Services and Operating – 2016-17 based on 2015-16 and adjusted for known changes, then increased 1% overall in 2017-18 and 2018-19 for Special Education placement needs, plus Routine Restricted Maintenance fully budgeted at required 3% contribution Increase of $102,253 for payment to SCOE for staffing Contributions reflect needs of restricted programs

Expenses – Other Outgo & Transfers Out Other Outgo – Transportation excess costs to JPA $833,591 – 100% of excess costs. Estimated revenue of $512,282 has been added to LCFF. Transfers Out – to other funds Deferred Maintenance Fund (14) $50,000 annually (no longer an assigned reserve) $35,000 annually for turf replacement Cafeteria Fund (13) $86,067 for 2016-17; $70,000 for 2017-18; $65,000 for 2018-19

Supplemental expenses Unrestricted LCFF funding includes supplemental targeted funding for English Learners, free or reduced meal eligible, and foster youth. The estimated targeted funding for 2016-17 is $842,887 (5.05% of LCFF revenue) Total Supplemental Grant expenses included in 2016-17 budget: $842,887 Detailed lists included in the LCAP and Budget Narrative on page 9 (see Agenda pg. 149)

Multi-Year Projection - Agenda page 159 2016-17 Adopted Budget   Budget Year2016-17 Projected Budget 2017-18 Using DOF Gap 73.96% 2018-19 Using DOF Gap 41.22% Object Codes Total COLA (enter percentage) 0.00% 1.11% 2.42% GAP Funding Rate (enter percentage) 54.84% 73.96% 41.22% ADA for LCFF purposes (current or prior year) 1,919.53 1,883.80 1,813.30 6 Total Revenue 23,708,965 23,985,706 23,643,111 7 8 Expenditures 20 Total Expenditures 24,358,664 24,213,098 24,477,972 21 22 Excess (Deficiency) (649,699) (227,392) (834,861) 23 29 Total Transfers/Other Uses (106,067) (85,000) 30 31 Net Increase (Decrease) (755,766) (312,392) (919,861) 32 Fund Balance 33 Beginning Balance 3,144,914 2,389,148 2,076,757 34 Audit Adjustment(s) - 35 Net Ending Balance 1,156,896 36 Components of Ending Balance: 37 Reserves for Economic Uncertainties 9789 735,892 730,893 738,839 38 Revolving Cash 9711 6,850 39 Prepaid Expenses 9713 40 Assigned for Math III Textbook Purchases 9780 120,000 41 Assigned for Science Textbook Purchase 360,000 42 Assigned for unspent carryover - school site 150,000 43 Assigned for difference in midGap to DOF Gap 204,283 149,488 44 Assigned for deferred maintenance 45 Assigned for tech. hardware replacement 90,000 46 Restricted Ending Balance 9740 904,741 785,875 498,991 47 Unappropriated Ending Balance 9790 21,665 228,855 (357,272) 48

Deficit Spending (line 31 of MYP on page 159) 2015-16: $ 217,858 positive projected, due to one-time funds not budgeted. This is estimated to be at least $300,000 higher due to site allocations unspent. 2016-17: $ 755,766 deficit projected 2017-18: $ 312,392 deficit projected 2018-19: $ 919,861 deficit projected Ending fund balance for 2016-17 and 2017-18 remains positive – above the 3% minimum reserve. 2018-19 is not positive. A plan will need to be developed to address this structural problem in the two subsequent years and will need to be included with the 2016-17 First Interim Report.

Reserve Levels - Narrative pg. 8 Fund balances in excess of the 3% minimum reserve must have reasons identified Combined Assigned and Unassigned/Unappropriated Fund Balance: $1,484,407 3% minimum reserve = $735,892 Remaining Balance to Substantiate Need =$ 748,516   Assigned for Math III Textbook Purchase Summer 2016 $ 120,000 Assigned for Common Core Science Textbook Purchase Spring 2017 $360,000 Assigned for Technology Hardware Replacement or New Purchase $90,000 Unassigned/Unappropriated –intended to cover deficit spending in 2016-17 208,516 Total Substantiated Need $1,484,408

Impact of LCFF Accountability Each district must adopt a Local Control and Accountability Plan (LCAP) for 2016-17 (including a 3 year plan) and beyond The local school agency goals for the LCAP need to be based on eight state mandated priority areas All goals in the LCAP have been aligned with the 2016-17 Proposed Budget as presented Goal and expenditures tied to the Supplemental funding calculation and the minimum proportionality percentage have been accounted for in the 2016-17 Proposed Budget as presented

Next Steps Adjust 2016-17 Budget with any changes necessary from Board and public input from tonight’s LCAP and Budget presentations Present the final 2016-17 Budget for approval on June 29, 2016 Prepare the 45 Day Revise to 2016-17 Budget and present to the Board on August 24th Work on plan to address Deficit Spending Close books for 2015-16 and finalize 2016-17 beginning balance Present 2015-16 Unaudited Actuals to Board on September 14th

Questions?