Alum Rock Union Elementary School District 2018-19 First Interim Budget December 13, 2018 Presented by: Kolvira Chheng, Asst. Supt., Business Services

Agenda Budget Cycle Purpose/Reason for First Interim Reporting Changes from Adopted Budget to First Interim Multi- Year Projections Next Steps

Budget Cycle Adopted Budget (June 2018) First Interim (December 2018) Second Interim (March 2019) Unaudited Actuals (September 2019) Audited Financials (December 2019)

Purpose/Reason for 1st Interim School Boards are required to certify projected year end and subsequent years’ financial condition twice a year: Using “Interim Reports” (Ed Code 35015 and 35035) Typically During December and March of each year The First Interim includes a snapshot of the District’s financial positions as of October 31, 2018 This First Interim includes the multiple year projections for current and two subsequent years

Purpose/Reason for 1st Interim Assumptions changes constantly. Administration utilizes the most current information available and continually monitors significant assumption changes, including but not limited to: Enrollment and ADA (Average Daily Attendance) Funding per ADA and COLA Staffing changes State Budget Federal, State and Local funding amounts (LCFF, Lottery, Parcel Tax, Property Tax, Title I) Labor negotiations Cash flow New laws impacting financials

Enrollment History

Changes in Enrollment from Adopted Budget to First Interim

Changes in Revenues and Expenditures in Unrestricted General Fund 2018-19 2019-20 2020-21 LFCC Budget 1st Interim Difference COLA 3.00% 3.70% 0.70% 2.57% 0.00% 2.67% -0.33%   LCFF Entitlement-ARUSD 101,274,699 101,338,038 63,339 100,900,169 99,818,676 (1,081,493) 101,000,525 99,496,194 (1,504,331) LCFF Entitlement-Aptitud 4,521,018 4,310,213 (210,805) 4,639,102 4,405,348 (233,754) 4,759,938 4,504,829 (255,109) Total LCFF Entitlement 105,795,717 105,648,251 (147,466) 105,539,271 104,224,024 (1,315,247) 105,760,463 104,001,023 (1,759,440) One Time Funding One Time Funding Amount 3,196,933 1,699,380 (1,497,553) - One Time Funding Rate per ADA 344 184 (160) Summary of Revenues Changes to Revenues on the Aggregate (1,645,019) (2,960,266) (4,719,706) Summary of Expenditures Savings Not Materialized* 5,624,366 4,218,275 1,406,092 Note: *At Budget Adoption, the district assumed on not filling 44 certificated vacancies in 18/19; however, the district was able to not fill 33 of the vacancies.

Changes in Unrestricted General Fund

Key Assumptions – MYP -Unrestricted General Fund Revenues Prior year P-2 ADA due to declining enrollment for LCFF calculation COLA based on DOF’s recommendation Remove one-time funds Expenditures Increase Step and Column for all three years Increase STRS and PERS rates for all three years Increase contribution for Special Education Program for all three years Maintain same level of contribution to Routine Restricted Maintenance Account (RRMA) for all three years Comply with LCAP’s Minimum Proportionality Percentage (MPP) requirements Savings in 2019-20 for 40 certificated positions at an average salary of $85K through attrition to align with declining enrollment Savings in 2020-21 for 40 certificated positions at an average salary of $85K through attrition to align with declining enrollment Saving of $454K in classified salaries and benefits in 2019-20 through attrition to align with declining enrollment and district’s needs Saving of $3.8M starting in 2019-20 in contract services to align with declining enrollment and district’s needs Savings of $5.7M in 2019-20 to be determined pending on outcome of SERP and Governor’s January budget proposal Savings of $6.6M in 2020-21 to be determined pending on outcome of SERP and Governor’s January budget proposal

Multi-Year Projection Unrestricted General Fund

Per ADA Revenues vs. Expenditures, by SSC, Inc.

Changes in CalPERS Rate

Changes in CalSTRS Rate

Special Education Contribution

Unrestricted General Fund Historical Trend Addt’l revenue is mainly from the increase in STRS On-Behalf and reimbursement for Mathson fire. Expenditures: unspent funds from Educator Effectiveness, Med-Cal, Lottery, RMA, Mental Health and Grant and Donation.

Next Steps January Governor’s Budget Proposal Budget Development Process Begins – January 2019 Second Interim – March 2019 Collaborative Efforts with Academic Services to Develop LCAP May Revise Public Hearing for 2018-19 Budget and LCAP – June 2019 Adoption of Budget and LCAP – June 2019

Thank you and Questions