BUDGET DISCUSSION FY2014 MARCH 5, 2013 White Pine County School District

Goal of Today’s Presentation Provide a preliminary and broad overview Provide timeline for budget and staffing decisions Provide information about state, federal and local revenue Provide information about WPCSD General Fund expenditure assumptions and information Provide information about WPCSD fund balances Factors that influence expenditures Conclusion

Budget Dates & Information 2/15 Department of Taxation issues preliminary revenue projections 3/15 Dept. of Taxation provides final revenue projections 3/25 Dept. of Taxation provides final abated revenue projections for property taxes 4/15 File Tentative Budget (NRS ) 4/25 Final estimate of net proceeds of minerals provided to Dept. of Education 5/1 District’s must notify teachers of employment (NRS ) 5/15 Mandatory Tentative Budget Public Hearing (3rd Wednesday in May) (NRS ) 5/31 Department of Education notifies school district of per pupil basic support based on updated revenue from Taxation. 6/2End of regular Legislative Session 6/8Adopt Final Budget (NRS ) 8/1School districts notified of final adjustment to projected minimum textbook expenditure requirements based on projected enrollment (NRS (2)) 8/25Final adjustments incorporated into prior year-end DSA adjustments 9/17Official Enrollment for funding purposes (NRS – last day of the first school month) 10/31Audit Report is Final – prior year fund balance is official (NRS (2)) 1/1School districts are required to amend their “final budget” on or before 1/1 (NRS (9)

Sources of Funding Federal Sources  Primarily Grants or restricted funds  Secure Rural Schools (unrestricted) not included in FY2014 State Sources  Categorical funding (restricted)  Special appropriations or grants (restricted)  General Fund (unrestricted) Local Sources  General Fund Taxes: Property taxes, sales taxes, govt services tax (aka motor vehicle registration)  Debt Services Fund: Property taxes, interest, bond & debt proceeds  Capital Funds: Interest earnings, sales taxes  Other (indirect costs, tuition, etc) Outside Allocations  Private grants, donations, scholarships Fund Balance  Not considered revenue and should not be used to fund ongoing expenditures.

FY2013 General Fund Budget (aka operating fund) Projected revenue may decrease after Nevada Department of Education adjusts state revenue (or DSA) for actual final revenue.

FY2014 Current Estimate Projected revenue may decrease after Nevada Department of Education adjusts state revenue (or DSA) for actual final revenue.

General Fund Revenue Projections WPCSD uses projections provided by the Nevada Department of Taxation and Department of Education  98% of Total GF Revenue WPCSD does not alter or change these projections Projections for miscellaneous and federal revenue provided by the District

Note: State funding may not be available until after the final budget is developed.

Charter Schools NRS Apportionments to school districts, charter schools....  2. Except as otherwise provided in subsection 3 and NRS , the apportionment to a charter school,..., is equal to the sum of the basic support per pupil in the county in which the pupil resides plus the amount of local funds available per pupil pursuant to NRS (a.k.a. outside revenue)  WP Per Pupil Amount $6,648  2/3 of the property taxes  Government Services Tax

Estimated Charter School Enrollment Beacon Academy5 Nevada Connections Academy13 Nevada Virtual Academy4 Renaissance Charter School24 Learning Bridge140 Total Charter School Enrollment186

General Fund Worksheet Sample of GF revenue as it appears in our accounting system Final FY2013 Projected Account Number Description Budget FY2013 FY2014 SOURCES Ad Valorem Taxes (1,932,735.00) (2,190,815.00) Net Proceeds from Minerals Adjustment (781,978.00) (1,485,758.00) (1,645,602.00) Ad Valorem-Gas and Oil Leases (10,000.00) Ad Valorem-Personal Property (644,244.00) (730,272.00) LSST (Local School Support Tax) (3,225,955.00) (3,302,455.00) Basic Gen Govn't Services Tax (Motor Veh Priv Tx) (546,255.00) (547,800.00) Tuition From Individuals Tuition From School Districts Outside the State (18,000.00) UNDEFINED Miscellaneous (75,000.00) DSA Basic Support per Student-Nevada Plan (4,308,756.00) (4,583,555.00) (3,883,577.00) Unrestricted Grants-in-Aid From the Fed Thru State (70,500.00) (70,000.00) E-Rate Funds (769.00) TOTAL SOURCES (11,614,192.00) (12,591,502.00) (12,393,521.00)

General Fund Operations The ending fund balance can temporarily cover an operating deficit but is not a long- term solution. At some point the District will either have to realize additional revenue to cover the operating deficit or reduce expenditures to balance.

Preliminary Inflation Factors Group Insurance: 10% (Note: Current Loss Ratio 95%, Admin Fee 15%, inflation 15% = 125%) Other Insurance: 10% Wages: 0% PERS: 2% Worker’s Comp: 2% (meeting 3/5/2013 rate increase of 5% expected) Utilities: 3% - 5% Gas/Fuel: 10% Remaining line items will be based on the FY2013 budget or FY2013 projection.

FY2012 Audited Fund Balance Note 1: Reserve for OPEB should have been $816,949 Note 2: Stabilization Fund is restricted by NRS

General Fund Ending Balances

FY2012 Budget & Fund Balance Governor took hardline stance on no new taxes Taxes were expected to sunset Net proceeds of minerals to revert to prior collection method that would have resulted in $0.00 NPM for FY2012. Operating Deficit estimated at $1.9 million FY2012 expenditures reduced to hedge for FY Nevada fiscal cliff Budget adopted before June 8, 2011 Supreme court ruling May 26, 2011 State education budget approved after final budget adopted.

Future items that influence budget Actual inflation State Legislative Decisions  Can affect revenues and expenditure Federal Legislative Decisions  Sequester Student enrollment  General Fund, Special Education, English Language Learners, Charter schools Audit Report  Adjusting entries, fund balance, actual revenue, actual expenditures Weather  Labor, utilities, fuel Local Economic Development  Mining activity, net proceeds of minerals… Other Factors

Conclusion The District has sufficient fund reserves to operate without cutting expenditures over the next biennium (FY2014 & 15) providing State revenue does not decrease. The District should avoid using its fund balance to finance ongoing expenditures since the fund balance is a finite resource. Budgets by definition are estimates of costs associated with future purchases and economic events. The assumptions and information contained within this presentation are likely to change and may change significantly. The information contained within should be used for discussion only as a means to frame future budget discussions and decisions.