Type Date Here Type Presenter Name/Contact Here Type Date Here Type Presenter Name/Contact Here Finance & Budget Basics for new Principals & Headmasters BPS Finance & Budget Team July, 2014

Agenda Who we are: a quick introduction What we do: the budget development process, weighted student funding How we do it: our key tools BPS Financial Applications Budget Structures & “Chart of Accounts” All Funds Budget Report Budget Transfer Process & Guidelines Monthly Financial Report Overall Procurement Process & Guidelines Trends from FY13 Wrap Up and Q&A 2

Who we are: presenters at this session 3 Erika Giampietro Deputy Chief Financial Officer Naveen Reddy Director of Business Improvement Jordan Cupps Finance liaison (networks B and D)

Who we are: Finance Network Liaisons NetworksFinance Liaisons Network A Margarita Ruiz Blaire Horner Network B Marice Edouard-Vincent Jordan Cupps Network C Elie Jean-Louis Anita Phillip Network D Cheryl Watson-Harris Jordan Cupps Network E Al Taylor Yvonne Macrae Network F Drew Echelson Yvonne Macrae Network G Mary Skipper David Gordon Network H Roger Bourgeois David Gordon What we do: We are your budget partners (we work with you to develop your budget to best meet your unique needs and then to spend against it successfully, in compliance, and on- time) We are your “one stop shop” for all Finance and Budget related questions (if we don’t know the answer, we’ll refer you to someone who does)

What is Weighted Student Funding? 5 Weighted Student Funding, or WSF, or Weighted Student Formula, is a way to distribute resources to schools It is based on a per pupil allocation: “the dollars follow the student” The per pupil allocation is differentiated by student need WSF is not new to school districts (the methodology is used in San Francisco, Cincinnati, Baltimore, DC, New York City, and others) We are entering our third year of WSF Allocates funds based on student needs, improving equity, transparency and simplicity

Weighted student funding: Principles for effective school budgeting PrincipleDescription Student focusedProvides resources based on students, not on buildings, adults, or programs EquityAllocate similar funding levels to students with similar characteristics, regardless of which school they attend TransparencyEasily understood by all stakeholders Differentiation based on need Allocate resources through a comprehensive framework that is based on student needs PredictabilitySchool allocation process is predictable and is structured to minimize school-level disruption School empowerment Empowers school-based decision-making to effectively use resources Alignment with district strategy Supports the Acceleration Agenda, our five-year strategic plan Weighted Student Funding is a more equitable, transparent, and empowering budget approach

What we do: the School Budget Development Process Policy Priorities developed by School Committee and Superintendent. Anticipated programmatic changes from schools. Enrollment Projections Preliminary Budget Figures Developed Superintendent’s Budget Proposal to School Committee by 1st Wed. in February. Development of Superintendent’s Budget Proposal Summer / OCT NOVEMBERDECEMBERJAN / FEB Enrollment figures reviewed by Schools Budget figures reviewed and adjusted by Schools & Site Councils 7

What we do: School Budget Development Process $ In December, each school is sent a preliminary budget figure and is asked to allocate its allotted resources consistent with: federal, state and local statutes and regulations applicable court orders collective bargaining agreements School Committee policy the goals of the Boston Public Schools and the particular priorities of the school $ Completed budgets are typically due back the first day after the winter recess. $ Both the school administrator and school site council must “sign- off” on the school budget. 8

Discretionary vs. Non-Discretionary $ In past analyses, the BPS has estimated that 90-95% of a schools’ general fund budget could be considered constrained by mandates, policies, regulations and/or requirements. (perhaps more so in difficult budget years) $ Potential areas of flexibility include: Administrators, Library Aides, Instructional Supplies, Planning & Development Specialists, some clerical positions, and grant funds such as Title1. Areas of particular constraint include Special Education, and META compliance. $ The greatest flexibilities are not granted by the district, but created at the school level by innovative scheduling, staffing and budgeting. In other words, there are many requirements which must be met but there can be some flexibility in HOW they are met. 9

Financial Tools Boston Administrative Information Systems (BAIS) - PeopleSoft Boston Administration Information System (BAIS) represents the various ERP systems including PeopleSoft Financials (FN), PeopleSoft Human Capital Management (HCM) and the PeopleSoft Portal (The HUB) All budget & procurement information is available in BAIS Financials (PS FN) and staffing and payroll information is available in BAIS Human Capital Management (PS HCM) The HUB is the gateway to access these applications Future Force is a bolt on application in PS HCM which is used to create budgets during the budgeting process Maximo is an enterprise wide work order system for managing work orders with Facilities and Planning & Engineering PeopleSoft Financial Training: Scheduled for July 26; contact Dolores Sullivan ) for more 10

Budget Codes (Chartfields) Development and implementation of the school budget will require a familiarity with the BPS “Chart of Accounts” and PeopleSoft functionality. In PeopleSoft the fields that store the charts of accounts and provide BPS with the basic structure to segregate and categorize transactional and budget data are called ChartFields. 11

Budget Codes (Chartfields) $ Fields that make up the “Chart of Accounts” $ Organize financial and budgetary information in PeopleSoft - each unique combination of values defines a budget line item. $ Used in requisitions, stipend requests and budget transfers. $ Enable BPS to capture and report information to the required level of detail. Business Unit Budget Ref AccountDept Program Class Project Fund 12

Budget Codes (Chartfields) $ Business Unit: For requisitions it is “BPS01” & Budget transfers it is “BOSTN’ $ Budget Ref = Fiscal Year, i.e $ Dept is the RC designation - six digits beginning with 101. For example, the Adams School is $ Fund is either 100 for General Fund,200 for Grants, or 203 for ARRA Grants. $ Project captures the grant number for all external funds. Title 1, for example is BPS14150 in FY2014. For general fund, leave project/grant field blank. Business Unit Budget Ref AccountDept Program Class Project Fund 13

Budget Codes (Chartfields) $ Account refers to the Expense Object, or the category of expenditure. For example, Stipends (51202), Regular Education Teacher (51002), or Contracted Services (52907). $ Program delineates the programmatic area. For example, Bil/SEI Spanish (2456) or Regular Ed. Math (2120). $ Class is not being used by the BPS, so always enter “0000”. Business Unit Budget Ref AccountDept Program Class Project Fund 14

BPS Budget “Line Items” $ Budget “Line Items” are the most detailed breakdown of budgetary resources and are a combination of ChartFields. $ Each line item denotes a distinct pool of resources budgeted to support a particular purpose (or multiple purposes). $ Examples: 15

BPS Budget Example Example: ML King School, Instructional Supplies (General Fund) PS Organization (Gen. Fund) Budget DeptFundAccount Program Budget King 100 Gen. Fund Instruc. -Texts2137 Reg. Ed. Other $2, King 100 Gen. Fund Instruc. -Texts 2120 Mathematics $1, King 100 Gen. Fund Instruc. -Other2456 SEI Spanish $1, King 100 Gen. Fund Instruc. -Other2016 Grade 6 $1,780 There is some discretion / choice about how to code budget line items when developing budget. There is an opportunity to make adjustments to non-salary budget line items once set up. Requisitions and budget transfers must reference an accurate, valid budget line item with available $ or will not move forward. 16

All Funds Budget Report $ “BPS All Funds Budget Report” designed to be the primary financial management tool for Principals and Responsibility Center managers. $ Includes budgeted dollars and budgeted Full Time Equivalent Positions (FTEs), as well as information on encumbrances and expenditures and provides an available balance for each budget line. $ Includes financial information for funds 100 and 200. $ Pre-encumbrance= outstanding Requisitions; Encumbrance = outstanding Purchase Orders. $ Handout: Job Aid shows how to run All Funds Budget Report. 17

All Funds Budget Report 18

Budget Transfers Budget Transfers are the mechanism by which available budgeted resources are moved from one budget line item to another in the financial system $ Incremental Approach (FROM= -$ TO= +$; transfer must add to $0) 19

Budget Transfers - Guidelines $ Funding Source: Cannot transfer between funding source (Grants to General Funds) $ Personnel Lines: Cannot transfer funds from a personnel line to a non-personnel unless: ­ Pilot/Innovation/HM Charter School: Budgeted salaries exceed Actual Salaries + Career Awards and Additional Payments (Teacher Leader Stipends, Education level bonus) ­ Position has never been filled (must be approved by HR and Finance Liaisons). If position has been filled and would like to transfer balance remaining, must receive CFO approval $ Nonpersonnel Lines: ­ Can transfer to a personnel line to create position – but must ask Finance Liaison to create PC and complete transfer ­ Stipend line: Check with Budget Office to determine remaining balance Deadline: Cannot make transfers after March 25th in order to be processed in time for April 5 th Spending Deadline. No exceptions will be made this coming year. 20

Monthly Financial Report Every second week in a month during the school year an is generated from the system to authorized personnel which contains an excel spreadsheet with multiple tabs and has as of date information for the current budget year, tabs include ­ An all funds budget with pre-encumbrance, encumbrance, expenditures and available budget for all budget lines ­ Open requisition listing ­ Open purchase order listing ­ Payroll expenditures posted to your budget ­ Non-expenditures posted to your budget If you are not receiving this via , please contact Joyce Trabucco 21

Overall Procurement Process Requisition Vendor Bid & Contract (If needed) Receiving Purchase Order Payment School Business Office Invoice Pre- Encumbrance Encumbrance Expense The State Procurement Law (MGLc30B) establishes uniform procedures to be followed by local governments when contracting for supplies and services. Most goods and services purchased by BPS are procured through competitive bid processes. However, the statute does allow for some purchases to be made without public advertising. Procurement guidelines will be covered at the BAIS FN training on July 26. Open Req Listing Open PO Listing Expenditure Report 22

General Procurement Guidelines $ ThresholdStandard for selection:Required document:Authorization:Turnaroun d time* Under 5000Follow "Sound Business Practices": The School or department solicits three telephone, written or catalogue quotes. The record of quotes remains on file at school or department and is subject to audit. RequisitionPurchase Order1 -2 Weeks 5000 – Under Seek written quotes from at least three vendors and award the contract to the responsible vendor offering the supply or service needed at the best price or submit a sole source letter Requisition, detailed specifications, or a sole-source letter addressed to the City Auditor must be sent to the Business Office/Purchasing at least four weeks prior to the planned procurement. Purchase Order and written quote contract (WQC), signed by vendor and approved by the Superintendent and the City Auditor Weeks and over Formal advertised bid or unadvertised contract Requisition and a completed Unadvertised Contract Request Form or detailed written description of the items or services to be purchased Purchase Order and Fully Executed Contract 8 Weeks 23 The procurement statute does allow for the purchase of certain categories of goods and services without a competitive bid process being conducted. (details in Superintendent’s Circular #FIN-7, ) More information please contact Edward J. Glora, Business Manager - -

Trends in FY13 Better management of funds through out the school year Spend much of your money early in the year to ensure that students receive maximum benefit during the whole school year Help us Help you 24

Wrap-up: Unsolicited Advice... $ Carefully consider the use of all your resources: money, people and time. $ Ask experienced principals about their budget. Effective principals often find ways to use their resources creatively and strategically. $ Spend much of your money early in the year to ensure that students receive maximum benefit during the whole school year ( reserve some until later for unexpected needs). $ Use the All Funds Budget Report!! $ PeopleSoft can be very useful, make it your friend … invest your time early. $ Your Finance Liaison is your partner, they are there to help you in all financial tasks – use them, invite them to your school, make them your partner. $ Start early on contracts! You can and should enter requisitions for contracts before the contract is approved. $ All of your key budget documents can be found in the “budget” tab on MyBPS! 25

26 Questions

Appendix: BPS Financial Information $ The Boston Public Schools’ Budget is organized into approximately 200 responsibility centers (RC) schools & central departments. $ Each RC must carry out its organizational and educational responsibilities within its budget. $ The BPS operates on a fiscal year beginning July 1 & ending June 30th. $ BPS is a “dependent” district: General Fund (fund 100) appropriation from City of Boston; Grants (fund 200) from state & federal sources. $ Expenditures against a budget are generally made either through the Requisition / Purchase Order process (Business Office) or through payroll related payments (HR / Payroll). 27

What we do: the BPS Budget Development Process Policy Priorities developed by School Committee and Superintendent. Anticipated programmatic changes from schools. Research by Enrollment team Enrollment Projections Enrollment figures reviewed by Schools Fixed costs and prior commitments calculated by Budget Office Preliminary Budget Figures Developed Budget figures reviewed and budget set by Schools & Site Councils Superintendent’s Budget Proposal to School Committee by 1st Wed. in February. Public Hearings on Budget Proposal School Committee vote on Budget by 4th Wed. in March. Budget to Mayor for adjustments, approval. Mayor submits Budget to City Council for appropriation by 2nd Wed. in May. City Council Hearings on BPS Budget I M P L E M E N T A T I O N* Budget figures reviewed by BPS Offices & Superintendent’s Leadership Team District ProcessSchoolsPublic BPS Central Offices Development of Superintendent’s Budget Proposal Chief Financial Office, Boston Public Schools * Note: Implementation includes an October reconcilement of projected to actual enrollment and related adjustments. SEPT / OCTNOVEMBERDECEMBERJAN / FEBMARCHAPRILMAY 28

29 List of schools by network Network A Adams Elementary Bradley Elementary East Boston EEC Edwards Middle Eliot K-8 Guild Elementary Harvard/Kent Elementary Kennedy PJ Elementary McKay K-8 O'Donnell Elementary Otis Elementary Quincy Elementary Umana K-8 Academy Warren/Prescott K-8 Network B Blackstone Elementary Carter Center Dudley Street Nbhd. Charter Ellis Elementary Hale Elementary Haynes EEC Higginson/Lewis K-8 Hurley K-8 King K-8 Mason Elementary Mendell Elementary Orchard Gardens K-8 Timilty Middle Trotter Elementary Winthrop Elementary Network C Condon Elementary Clap Innovation School Dever Elementary Everett Elementary Frederick Middle Holland Elementary Holmes Elementary Marshall Elementary/ UP Dorchester McCormack Middle Middle School Academy Perkins Elementary Perry K-8 Russell Elementary Tynan Elementary UP Academy Network D Baldwin Pilot ELA BTU School K-8 Curley K-8 Edison K8 Gardner Pilot Academy Hennigan Elementary Horace Mann Jackson/Mann K-8 Kennedy JF Elementary Lyon K-8 Manning Elementary McKinley K-8 Mission Hill K-8 Tobin K-8 West Zone ELC Winship Elementary Network E Bates Elementary Beethoven- Ohrenberger K-8 Channing Elementary Chittick Elementary Conley Elementary Greenwood E. Leadership Grew Elementary Haley Elementary Irving Middle Kilmer K-8 Lyndon K-8 Mozart Elementary Philbrick Elementary Rogers Middle Roosevelt K-8 Sumner Elementary Network F EEC at Fifield Ellison/Parks EE Sch Greenwood, Sarah K-8 Harbor Middle School Henderson Elementary Hernandez K-8 Kenny Elementary Lee Academy Lee Elementary Mather Elementary Mattahunt Elementary Mildred Avenue 3-8 Murphy K-8 Taylor Elementary Young Achievers K-8 Network G High Schools and Alternative Options Network H Vocational Technical network NetworkEnrollment A 6,190 B 5,669 C 6,650 D 5,993 E 6,389 F 6,358