The Budget Under Act 1 – Amended by Act 25 of 2011 11/8/2018 The Budget Under Act 1 – Amended by Act 25 of 2011 Preliminary General Fund Budget Revenue 2012-2013 November 15, 2011 11/8/2018

Presidential Election Year Timeline Act 1 Budget Timeline geared to primary election date Normal primary election date = third Tuesday in May Presidential election year primary election date = fourth Tuesday in April (4/24/12) 2012 primary election is 23 days earlier than 2011 – so all dates are accelerated about 3 weeks. 11/8/2018

Exeter Township School District Budget Timeline FY 2012-2013 Exeter Township School District Timeline for events related to the FY 2012-2013 General Fund Budget Timeline PRELIMINARY & PROPOSED FINAL Date Action September 1, 2011 Index is published in PA Bulletin - 1.7 November 15, 2011 Board Reviews preliminary budget December 6, 2011 December 20, 2011 Board Reviews preliminary budget & Preliminary 2012-2013 budget available for public display, or adopt a resolution indicating that taxes won't be raised above the index. January 17, 2012 School Board Adopts Preliminary Budget February 9, 2012 Deadline to submit exception filings to PDE March 20, 2012 Board Reviews Proposed Final Budget April 17, 2012 Update to Proposed Final Budget May 1, 2012 Department of Education notifies school districts of the amount of their allocation of property tax reduction funding. May 8, 2012 May 15, 2012 Adopt FY 2012-13 proposed final budget and mail Certification of Use of PDE 2028 to PDE May 30, 2012 School District Deadline to make 2012-2013 Proposed Final Budget available for public inspection on PDE 2028 June 8, 2012 School District Deadline to offer Public Notice of it's intent to adopt the 2012-2013 Final Budget June 19, 2012 Final Budget adoption; set millage

General Fund Revenue by Source   FY 08-09 FY 09-10 FY 10-11 FY 11-12 FY 12-13 Actual Final Budget Revised Budget Preliminary Budget FY 12-13 to 11-12 Local Sources $ 42,444,873 $ 44,268,538 $ 45,665,715 $ 44,878,887 $ 45,005,334 $ 44,724,655 $ (280,679) -0.62% State Sources $ 15,688,658 $ 14,914,669 $ 16,028,523 $ 15,995,757 $ 16,100,207 $ 16,732,324 $ 632,117 3.93% Federal Sources $ 755,630 $ 1,729,883 $ 2,054,020 $ 595,071 $ 579,786 $ - 0.00% Other Sources $ 357,263 $ 117,506 $ - $ 273,416 $ 2,000 $ (271,416) -99.27% Total Revenue $ 59,246,424 $ 61,030,596 $ 63,748,258 $ 61,743,131 $ 61,958,743 $ 62,038,765 $ 80,022 0.13% % Change from PY 6.9% 3.0% 4.5% -3.1% -2.8% Excl Other Financing Sources Before Real Estate Tax Increase 11/8/2018

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Revenue from Local Sources 11-12 12-13 Revised Budget Preliminary Budget Change % of Local Real Estate (Millage 29.982) $ 38,457,582 $ 38,090,337 $ (367,245) 85% Earned Income Tax (.5%) $ 3,211,526 $ 3,259,699 $ 48,173 7% Business Privilege (.00075/.00050) $ 475,000 $ 475,000 $ - 1% Transfer Tax (.5%) $ 181,000 $ 200,000 $ 19,000 0.4% Per Cap/LST ($10/10) $ 229,134 $ 229,134 0.5% Total Taxes Levied $ 42,554,242 $ 42,254,170 $ (300,072) 11/8/2018

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Real Estate Tax Number Budget before State Property Tax Reduction EXETER TOWNSHIP SCHOOL DISTRICT PROPERTY TAX AMOUNT Collection rate 96.00% Total = July '12 Assessments ESTIMATE $ 1,390,246,600 Current millage 29.982 Tax Levy w/o homestead exclusion $ 41,682,374 Collection rate 96.00% Real Estate Tax Number Budget $40,015,079 Senior Citizen Volunteer program cost $5,000 Revenue to Berks County Industrial Development Authority $281,000 Real Estate Tax Number Budget before State Property Tax Reduction $39,729,079 Estimate of State Property Tax Reduction $ 1,355,000 Real Estate Tax Net of Property Tax Reduction $ 38,374,079 11/8/2018

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OTHER LOCAL REVENUE 11-12 12-13 Revised Budget Preliminary Budget Change % of Local Delinquent $ 1,154,000 $ 1,200,000 $ 46,000 3% Earnings on Investment $ 113,000 $ 113,000 $ - 0.3% Federal IDEIA - IU $ 738,797 $ 738,797 2% Other $ 445,295 $ 418,688 $ (26,607) 1% Total Other Local Revenue $ 2,451,092 $ 2,470,485 $ 19,393 6% 11/8/2018

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Local Revenue Trends 11-12 Real Estate Tax Collection Rate is projected to be 96.5% versus 96% budgeted resulting in a $131,000 favorable budget variance net of discount and penalty. 12-13 Real Estate Tax Collection Rate Assumption – 96% Due to the sluggish housing market, and property assessment reductions, the real property assessment growth is estimated to decrease by .67% Residential and Commercial assessment reductions effective for 12-13 will likely result in $310,000 less in real estate tax revenue. Real Estate Tax revenue is projected to decrease by $385,000, budget to budget before any tax increase. Most other local revenue sources continue to be constrained. 11/8/2018

“Noteworthy” Other Local Revenue Sources 11-12 Rentals – Clearwire Wireless Communication Site Lease at Senior High - $18,500 Stadium Rentals - $5,000 Hess Demand Response Program - $12,600 Antietam Student Athlete Fees - $14,600 Extracurricular Activity Fee – Estimated- $40,000 ECEF & APT Donations - $50,000 11/8/2018

General Fund Revenue by Source   FY 08-09 FY 09-10 FY 10-11 FY 11-12 FY 12-13 Actual Final Budget Revised Budget Preliminary Budget FY 11-12 to 10-11 FY 12-13 to 11-12 Local Sources $ 42,444,873 $ 44,268,538 $ 45,665,715 $ 44,878,887 $ 45,005,334 $ 44,724,655 $ (660,381) $ (280,679) State Sources $ 15,688,658 $ 14,914,669 $ 16,028,523 $ 15,995,757 $ 16,100,207 $ 16,732,324 $ 71,684 $ 632,117 Federal Sources $ 755,630 $ 1,729,883 $ 2,054,020 $ 595,071 $ 579,786 $ (1,474,234) $ - Other Sources $ 357,263 $ 117,506 $ - $ 273,416 $ 2,000 $ (271,416) Total Revenue $ 59,246,424 $ 61,030,596 $ 63,748,258 $ 61,743,131 $ 61,958,743 $ 62,038,765 $ (1,789,515) $ 80,022 % Change from PY 6.9% 3.0% 4.5% -3.1% -2.8% 0.13% -2.81% 11/8/2018

State Sources of Revenue 11-12 12-13 Change Basic & Operating Subsidies $ 8,018,244 $ 8,018,244 $ - Subsidies for Non-Educational Programs $ 2,188,743 $ 2,213,629 $ 24,886 Specific Educational Program Subsidies $ 1,775,959 $ 1,775,959 Subsidies for State Paid Benefits $ 2,581,718 $ 3,188,599 $ 606,881 Property Tax Relief $ 1,354,650 $ 1,355,000 $ 350 Extra Grants $ 180,893 $ 180,893 Total $ 16,100,207 $ 16,732,324 $ 632,117 11/8/2018

Exeter Township School District Basic Ed Funding & Other State Grants   FY 2008-09 FY 2009-10 FY 2010-11 FY 2011-12 State Appropriation - BEF $ 7,881,905 $ 7,353,296 $ 7,073,431 $ 7,888,244 Federal EdJobs Appropriation $ - $ - $ 579,705 Federal ARRA Appropriation $ 989,554 $ 978,928 Total BEF $ 8,342,850 $ 8,632,064 Other State Funding: EAP $ 11,587 $ 83,843 $ 86,576 Dual Enrollment $ 77,668 $ 11,072 $ 24,256 Accountability Block Grant $ 492,629 $ 495,211 $ 460,420 $ 180,893 Reimb of Charter School Exp $ 103,855 $ 117,963 $ 103,670 $ 685,739 $ 708,089 $ 674,922 Total BEF & Other Funding $ 8,567,644 $ 9,050,939 $ 9,306,986 $ 8,069,137 Change Yr to Yr. $ 483,295 $ 256,047 $ (1,237,849)

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State Sources of Revenue Basic Ed Subsidy – Governor is looking at a status quo for next year. Legislators are saying that while they don’t expect the subsidy to decrease, they see little or no increase. (2% at most = $157,765). Debt Service Reimbursement will be revised based on the debt service savings realized from refunding. State reimbursement for employer paid social security will be revised based on the budgeted wages for FY 2012-2013. State reimbursement for employer paid retirement contributions for FY 2012-2013 increases by an estimated $570,000 due to the increase in the contribution rate from 8.65% to 12.19%, or a 40% increase. This line item is also subject to revision based on budgeted wages for FY 2012-2013. 11/8/2018

Federal & Other Revenue Federal Revenue 11-12 12-13 Change Title I $ 308,640 $ 308,640 $ - Title II $ 71,146 $ 71,146 Medical Assistance $ 200,000 $ 200,000 $ 579,786 $ 579,786 Other Revenue Proceeds from Extended Term Financing $ 271,416 $ - $ (271,416) Sale of Assets $ 2,000 $ 2,000 $ 273,416 11/8/2018

Act 1 Index Each September, PDE publishes the index for use in the determination of allowable tax rate increases in the following fiscal year. The base index is the average of the percentage increase in the statewide average weekly wage, as determined by the PA Department of Labor and Industry, for the preceding calendar year and the percentage increase in the Employment Cost Index for Elementary and Secondary Schools, as determined by the Bureau of Labor Statistics in the U.S. Department of Labor, for the previous 12-month period ending June 30. For a school district with a market value/personal income aid ratio (MV/PI AR) greater than 0.4000, its index equals the base index multiplied by the sum of 0.75 and its MV/PI AR for the current year. Exeter Township School District Index for FY 12-13 = 2.2% 11/8/2018

Exeter Township School District Calculation of Adjusted Index For Use in FY 2012-2013 Budget I. Act 1 Index based on SAWW and ECI 1.7% II. ETSD MV/PI AR Aide Ratio 0.5306 III. Calculation of Adjusted Index: MV/PI AR Adjustment 0.75 Factor for Increase 1.2806 Adjusted Index (Act 1 Index (x) Adj Factor 2.2% IV. Maximum Real Estate Millage Increase FY 11-12 Mills 29.982 Adjusted Index 11-12 Maximum Tax Rate FY 12-13 w/o referendum exceptions 30.635 Mill Change 0.653 Value of a Mill $ 1,350,000 Dollar Value of Real Estate Tax Increase $ 881,164 11/8/2018

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Changes to Act 1 – Act 25 of 2011 Eliminates all but three exceptions: Pension (calculation revised) Special Education (calculation revised) Debt (grandfathered, and electoral debt) 11/8/2018

Pension Exception If the anticipated increase in the school district‘s share of payments to the Public School Employees‘ Retirement System between 2011-2012 and 2012-2013 is greater than the school district‘s index, the school district will be eligible for an exception equal to the portion of the estimated payment increase that exceeds its index. ETSD Pension Exception FY 2012-2013 FY School District Index 2011-2012 BASE SALARY FOR REFERENDUM EXCEPTION Employer Retirement Rate SD Share of Retirement 46.94% SD Retirement Cost Difference Index % of PY Share of Payments to PSERS Est of Exception Amount 2011-2012 1.8% $ 29,953,505 8.65% 4.06% $ 1,216,205 2012-2013 2.2% 12.19% 5.72% $ 1,713,935 $ 497,730 $ 26,757 $ 470,974 11/8/2018

Debt Exception Clarification of Tax Rate Rescission Based on the original language contained in the Taxpayer Relief Act, PDE previously interpreted ―final payment of interest and principal‖ – a phrase found in section 333(f) in conjunction with approved debt exceptions – to require the rescission of tax rates following either the last scheduled payment of a bond issue or the refinancing of a bond issue. Act 25 of 2011 added section 333(o) to clarify ―final payment of interest and principal‖ for previously-approved Academic or Nonacademic school building projects to not include a school district‘s payment of debt as a result of refunding or refinancing the debt. However, previously-approved Grandfathered Debt (indebtedness incurred prior to the effective date) and Electoral Debt referendum exceptions must still be rescinded according to the language in the Taxpayer Relief Act – following either the last scheduled payment of a bond issue or the refinancing of a bond issue. If indebtedness was refinanced, school districts may request approval of a referendum exception for the refinanced indebtedness but only in the fiscal year immediately following rescission of the originally-approved tax rate increase related to the refinanced principal. 11/8/2018

FY 2010-11 FY 2011-12 FY 2012-2013 With Refinancing FY 2012-2013 - No Refinancing Millage 29.624 29.982 Year to Year Increase in Millage 1.2% Rescinded Mills Due to Refinancing (0.50) Base Mills Subject to Index 29.481 A. Maximum Mills Based on Index 30.129 30.642 Index 2.20% Increase in Mills 0.147 0.660 Additional Revenue Generated $ 199,038 $ 890,465 Effective Increase In Millage w/No Exceptions 0.49% B. Debt Exception - Recission $ 676,543 0.5011 Millage Including Rescission Amount (A + B) 30.631 2.16% C. Retirement Exception $ 470,974 $ 470,974 0.3489 D. Debt Exception - New Allowable $ 998,007 $ 322,741 Note: Would not take more than "before refunding exception amount" 0.2391 Millage w/ Rescission, Retirement ( A+B+C) 30.979 30.990 3.3% 3.4% Millage w/ Rescission, Retirement, New Debt( A+B+C+D) 31.219 31.230 11/8/2018

Budget Review Dates to remember December 6th & 20th – Expenditure and Fund Balance Review January 10, 2012 – Revisions January 17, 2012 – Adoption of Preliminary Budget for 2012-2013 11/8/2018