Business Manager and CFO Roundtable Discussion October 29, 2015 Hank Johnson Consultant

Sponsor Depository bank for Region 11 Service Center Established in 1960 A community-focused financial institution Offers a full range of financial services to individuals, businesses and nonprofit organizations Recently merged with OmniAmerican Bank Operates 64 banking facilities in East, North and Central Texas North Texas operations are headquartered in Fort Worth

Agenda Introductions Upcoming Events Updates on recent TEA Correspondence Annual Financial Reports Implementing HB 2610 Current News and Updates/Reminders Discussion for Future Meetings Questions and Comments

Upcoming Events November 6 th - Public Funds Investment Training The ESC Region 11 Business Center is hosting a Public Funds Investment Training presented by guest speaker Patrick Shinkle, Associate Director for the Center for Public Management at the University of North Texas. CPAs will receive 5 hours of CPE credit. Register with this link:

Recent TEA Correspondence: FIRST FIRST and Charter FIRST Ratings Present and distribute financial management report Public meeting Within two months of the release (10/23) of its final FIRST rating Announcement Published no more than 30 days and no fewer than 14 days before the public meeting Explain rating Template (sample management report) available at: TEA FIRST web page, orFIRST FIRST Rating for Charter Schools web page. FIRST Rating for Charter Schools FIRST rating is considered for accreditation status

Recent TEA Correspondence: SHARS Reporting Requirement School Health and Related Services (SHARS) Reporting Requirement Applicable to local educational agencies (LEAs) and fiscal agents That received or administered Part B (IDEA-B) grant funds Either 2013–2014 or 2014–2015 school year, or both. Information is necessary for calculation of LEA maintenance of effort (MOE) The SHARS Reimbursement Report form is available from the GFFC Reports and Data Collections application Deadline for submitting the form is October 31, 2015.

Recent TEA Correspondence: SHARS Reporting Requirement SHARS Reimbursement Report Form The SHARS Reimbursement Report form is available from the GFFC Reports and Data Collections application. Option 1: The LEA did not participate in the SHARS Medicaid program and thus did not receive any SHARS Medicaid reimbursements to expend again in the special education program. Option 2: The LEA received SHARS Medicaid reimbursements but did not expend any of the reimbursements in the special education program.

Recent TEA Correspondence: SHARS Reporting Requirement SHARS Reimbursement Report Form (continued) Option 3: The LEA received SHARS Medicaid reimbursements and made subsequent expenditures with the reimbursements in the special education program. If option 3 applies to you, you must report the total amount of subsequent expenditures. The total must include the amount expended by LEA. If an LEA participates in a Shared Services Arrangement, the total must also include the amount the fiscal agent expended on behalf of your LEA. TEA will use the information in the calculation of fiscal year 2015 IDEA-B LEA MOE compliance determinations. The determinations will be made available in Spring 2016.

Recent TEA Correspondence: SHARS Reporting Requirement SHARS and IDEA-B LEA MOE SHARS - Medicaid reimbursement for certain health-related services provided to students with disabilities SHARS reimbursements expended for special education services must be excluded for IDEA-B LEA MOE purposes from the state and local expenditures. Validation Maintain the supporting documentation LEAs may be required to submit the supporting documentation to TEA

Recent TEA Correspondence: SHARS Reporting Requirement Reporting Deadline SHARS Reimbursement Report form must be submitted by October 31, Remedies for Noncompliance of Required Reporting TEA authorized to apply one or more of the following remedies: Temporarily withhold cash payments pending correction of the deficiency or more severe enforcement action. Disallow all or part of the cost of an activity or action not in compliance. Wholly or partly suspend or terminate the current award. Withhold further awards for the program. Take other remedies that may be legally available.

Recent TEA Correspondence: Eligibility for Compensatory Education Eligibility Requirements for Compensatory Education Alternative Reporting House Bill (HB) 1305 amended Texas Education Code (TEC), § Allows for multiple methods for reporting students eligible for SCE funds School Districts and Open-Enrollment Charter Schools History: prohibited alternative method if any campus participated in national breakfast and lunch program New: Allows for student count from both a federally funded and a locally funded lunch and breakfast program

Recent TEA Correspondence: Eligibility for Compensatory Education School Districts and Open-Enrollment Charter Schools (Continued) Continue to report students who participate in the NSLP and SBP to the Texas Department of Agriculture (TDA), and Submit locally identified disadvantaged student numbers to the TEA Texas Virtual School Network Requires prior approval from commissioner TEA will provide additional information for submitting eligible full time virtual school students

Recent TEA Correspondence: Eligibility for Compensatory Education Income Eligibility Guidelines Alternative reporting method Meet the income requirements for eligibility under the NSLP LEA must retain the qualification information for each child Count and record monthly Changes in family income status through the year may affect whether a student remains or becomes eligible Families that receive Supplemental Nutrition Assistance Program (SNAP) automatically qualify Families that benefit from Temporary Assistance for Needy Families (TANF) automatically qualify SNAP and TANF eligibility can be documented with an appropriate case number

Recent TEA Correspondence: Eligibility for Compensatory Education Funding HB 1305 will not impact SCE funding for the 2015–2016 school year Available for the first time with the 2016–2017 school year. Must start reporting in for funding District Responsibilities Collection of data from families Verify Report Maintain records for audit Retain records for a minimum of five years after the reporting year

Recent TEA Correspondence: EDGAR Two-Year Grace Period for Procurement Policies and Procedures Implementation can now be delayed to the IF implementation delayed Continue to comply with the old regulations Must document compliance with the old or new regulations

Recent TEA Correspondence: EDGAR EDGAR Change: Complete elimination of the “3-day rule” for cash on hand and refunding excess cash Revise local grant policies and procedures to align with this change

Recent TEA Correspondence: EDGAR Survey Participation required for all local education agencies: EDGAR regulations requires TEA to collect information From all LEAs Real property purchased with grant funds Deadline for completing and submitting the survey is October 31, TEA developed an online form to collect the data Ownership status Description of how you disposed of the property, if applicable

Recent TEA Correspondence: EDGAR Continued - Survey Participation required for all local education agencies: Information to complete the survey Each real property purchase made with federal grant funds before the 2015–2016 grant year LEA’s name, county-district number, and region number Type of property purchased, if any, such as land, buildings, or outdoor structures such as athletic fields, sidewalks, or parking (review “real property” definition) Purchase date, or approximate date if not known Name of grant program whose funds were used for purchase Ownership status Description of how you disposed of the property, if applicable

Recent TEA Correspondence: Preliminary SOF Preliminary 2015–2016 Summary of Finances (SOF) Increased basic allotment (from $5,040 in 2014–2015 to $5,140 in 2015–2016), Increased equalized wealth level in Tier I (from $504,000 in 2014– 2015 to $514,000 in 2015–2016), Increased guaranteed yield for Tier 2 level 1 (from $61.86 to $74.28), and Preliminary available school fund rate of $

Annual Financial Report (AFR) GASB 68 Government wide statements Report GASB 68 information on Schedule L-1 Other Changes Eliminate Exhibit J-2 (old Indirect Cost Rates Schedule) Information reported in the Indirect Cost Rate Proposal Electronic data feed will no longer accept J-2 data Optional - Exhibit J-3 (Fund Balance and Cash Flow Calculation Worksheet) Can be included in the annual financial report Will be deleted from the electronic data feed submission

Annual Financial Report (AFR) Must be audited by a licensed independent CPA firm. Have the audited AFR approved by board Create a PDF version of the audited and approved AFR The AFR PDF file must include: signed certificate of board approval and audit firm signatures, (if issued) management letter, which may be submitted as a separate PDF file. Submit the AFR PDF file electronically Charters Only - Complete the Charter School Data Template by entering data from the AFR into the template

Annual Financial Report (AFR) Due Dates (150 days after year end) November 27 for June 30 fiscal year end January 28 for August 31 fiscal year end

Implementing HB 2610 HB 2610: Changes required instruction from 180 days to 75,600 minutes Effective for school year Report days for to TEA Maintain records that substantiates 75,600 minutes Days of instruction Start times End times Report minutes starting Records subject to audit

Implementing HB 2610 Recording Attendance – No change Minimum 2 hours of instruction for ½ day excluding intermissions and recess Minimum 4 hours of instruction for full day excluding intermissions and recess

Implementing HB 2610 Calculation of average daily attendance (ADA) Days of attendance divided by days of instruction Adjusted for minutes less than 75,600 Funding adjusted for minutes less than 75,600

Implementing HB 2610 Teacher Contracts – No change 187 days Bad weather days Include in calendar Can add minutes to days for makeup 840 minutes

Implementing HB 2610 Waivers TEA to honor approved waivers waiver policy under review Limit on waivers – 4,200 minutes School Calendar Weather makeup days Early release Teacher training Waivers if needed?

Current News TEA Commissioner stepping down State revenue estimates revised downward Testing Property value appraisal litigation School finance litigation

Updates High quality Pre-K funding Up to $1,500 per student for second half of full-day Pre-K Guidelines due from TEA in Spring 2016

Updates Fractional Funding Request an Adjustment: Send a letter, signed by the superintendent and board president, to the Office of School Finance. The letter must include: Certification by the superintendent and board president that the adjustment should be made and The district’s adopted 2015–­2016 M&O tax rate.

Updates FSP payments to fast growth charter schools Accelerated payment schedule Accelerated payment schedule can continue for subsequent year Growth of 10% or more Contract with municipality for construction of an instructional facility, stadium or other athletic facility ISD can contribute resources Can be on municipalities property, owned by municipality or operated by municipality Must have a use agreement before construction

Updates Capital Appreciation Bonds (CABS) Limits amount to 25% of total outstanding principal and interest at time of issuance Transparency Disclosures

Updates Annual financial report of debt information As of last day of fiscal year Outstanding principal and interest Combined outstanding principal and interest Applies to debt secured by ad valorem tax Total and per capita Effective date: January 1, 2016

Updates Increase homestead exemption to $25,000 Requires constitutional amendment November 2015 General Election State must make up the loss of local levies

Discussion for Future Meetings Future Topics Dates for Future Meetings

Questions and Comments