final Discussions on the 2019-20 budget Budget overview 1.3 final Discussions on the 2019-20 budget

What we know What we don’t know Enrollment is trending down Our largest class will graduate in 2020. Negotiations for PSE, DEA & DEAA are open this year 2019-20’s kindergarten class looks to be around 45, maybe higher K is Now estimated at 43 Both the House & Senate budgets have SEBB included, cost is still being discussed. SEBB is enacted Both the House & Senate budgets set salary allocations at 2%. Salary Allocation set at 2% Levy capacity increased to $2.50/$1,000 Levy – will it stay at the current reduced limits Salary allocations from the State SEBB, will it go into effect January 1, 2020 as currently slated? 2019-20 kindergarten class size Salary increases post-negotiations

Enrollment trend While we are above budget, our enrollment is down 25.53 FTE from last year, and it is projected to continue declining. Enrollment reports are shared with the Board monthly and this Trend Report is included periodically throughout the year. District Webpage

School Employees Benefits Board (SEBB) SEBB is a new State run school employees benefits program that is set to be implemented in January of 2020. The District currently estimates the cost of SEBB for 2019-20 will be $191,804. (assuming the State funds us at the $14,040 rate for funded employees) UPDATE: HCA has reduced the estimated cost per employee for the health care offerings through SEBB by $60/person/month. This results in a reduced cost to the District. We now estimate SEBB will cost $125,811. I am currently estimated SEBB will cost us $88,000. This includes working on possible cost cutting measures so we don’t have as many extracurricular, part-time and/or substitute employees work more than 630 hours.

Changes in funding 2017-18 through 2019-20

Summary of Fiscal changes Feb. Est. March Est. June Est. Loss of Revenue due to declining enrollment $101,578 $101,578 -$122,456 Cost of Implementing SEBB for 2019-20 (Jan.-Aug.) $127,325 $ 92,785 -$ 88,683 Reduction in Revenue due to Levy & State Changes $226,597 $201,597 +$223,534 Net Savings Goal -$455,500 -$395,960 +$ 12,395 Some of these losses/costs can be offset with Capital Projects and Transportation Vehicle Levies, however, they have restrictions on how the funds can be spent. Net savings goal $395,960 $ 12,395 Transportation levy -39,500 $ 39,500 Capital projects levy -$125,000 $125,000 Net goal remaining $231,460 $176,895 Savings!!

Net Funding Saving Goal = $231,460 $176,895 Cost Saving Measures from 2018-19 to 2019-20: Staffing resignation/absorptions/shifting to sped -$125,000 Technology/subscriptions pre-paid and/or cancelled - $25,558 Total Savings To Date -$150,558 $231,460 - $150,558 = $80,902 $176,895 + 150,558 = $327,453 Total savings & increase in funding. This leaves a balance of $80,902 in estimated savings to reach out goal.

Other possible savings recommendations Skill center bill SSB 5872 This would allow us to run our own Satellite Skills Center and claim the enhanced funding. Possible Savings: $26,285.27 YES! This is additional savings. McKinstry commissioning This is an evaluation of the efficiency of our buildings. There is a guarantee that we will see some cost savings, but we are in the early stages and those possible saving are not yet determined. Pending… Copier purchase vs. lease option We currently lease our copiers and it costs us $9,000/year. We can purchase our copiers when the lease runs out next winter and use capital projects funds. I am proposing we look at a combined lease/purchase option at the very least.

Other possible savings recommendations, CONTINUED Continue after-school and pre-school programs Increase fees…amount TBD…will land on final amounts once state budget is completed. We begin discussions tonight. Consider pros and cons of “pay to play” fee for each sport Equipment fees…travel expenses(will need to follow ASB guidelines) Consider adjustment in classified staff hours Early release, extra days etc. Will have to be part of negotiations. Implement a four-day work week Summer – district office, custodial and maintenance staff – energy savings. YES, we are doing this for the summer. Shop fees Agriculture, Skills Center, Art, Business etc.

Other possible savings recommendations, CONTINUED Continue to reduce travel and workshops Utilize technology for professional development as much as possible, i.e webinars, zoom, go to meetings, online subscriptions etc. Possible cuts for 2020-21? Consider cost saving recommendation from department heads April 15th 4:00 p.m. school board meeting – department head presentations See transportation vehicle review, maintenance of buses possible savings Consider increasing ALE offerings This can get complicated but we are looking into options. Dip into cash reserves? Pros and Cons

Planning for the future We have to keep in mind enrollment drop in the 2020-21 school year. With the new levy rules and state funding, I am estimated a loss of 19 FTE would result in a loss of revenue of $266,405!

Questions? Thank you for coming, we are happy to answer any questions, now or later. Leslie Oliver Jim Kowalkowski (509) 725-1481 ext. 5003 (509) 725-1481 ext. 5004 loliver@davenportsd.org jkowalkowski@davenportsd.org