Public Schools of Petoskey Budget Update and Outlook February 14, 2003

The Big Picture: What We Know About FY at the State Level $127 million deficit in FY Reduction letter has been issued Legislature had 30 days (Feb. 14) to appropriate additional funds or reduce appropriation to avoid across-the-board reductions No legislative action occurred, so the 3.8% reduction will affect our March State Aid payment

At Risk FY Original Budget: $262,385 Reduction for Added Schools:($ 10,132) 3.8% Reduction of Original: ($ 9,971) Amount Budgeted:$242,282 Amount Spent YTD: $242,282

State Aid Cuts – Current Year Amount Subject to Reduction (Sec. 22b) $4,958,193 Reduction Percentage: 3.8% Est. Revenue Loss this Year: $ 188,411

Current Year Changes Capital Outlay: Remainder Mostly Eliminated Supply Budgets: Reduced 20% Conferences: Reduced / Entry Fees Only Cutting in February is particularly tough as most budget expenditures are made in the beginning of the year.

Spending Freeze Non-Payroll Budget $2,133,682 Essential Items (Utilities, etc) $1,147,067 Discretionary Budget $ 986,615 20% of Discretionary Budget $ 197,323 Revised Discretionary Budget $ 789,292 Spent to Date $ 685,331 Amount Avail thru End of Year $ 103,961

FY Budget

FY Budget Environment State General Fund short $2 Billion State School Aid Fund short $366 Million State General Fund contributes $198 Million to School Aid Fund. Governor has indicated the need for across the board GF cuts to alleviate the shortfall. Bottom Line: 11% Reduction next year is the Best Case scenario

At Risk - FY Original Budget: $262,385 Reduction for Added Schools:($ 10,132) 11% Reduction of Original: ($ 28,862) Amount Available: $223,391 FY Budget: $242,282

State Aid - FY Amount Subject to Reduction (Sec. 22b) $4,953,690 Reduction Percentage: 11.0% Est. Revenue Loss:$ 544,906

FY Cost Increases Step Increases alone: $237,205 LT Leave Staff Returning: $ 97,212 Retirement Rate to 15%: $302,529 Health Increase 20%: $515,746 Total Cost Increases $1,152,692 Lost Revenue: $544,906 Next Years Budget Challenge: $1,697,598

How We Spend Our $$ Total Expenditures (FY 02-03): $22,909,242

Revenue Overview BudgetRevisedBudget Local-Taxes$12,787,086$11,932,862$13,150,200 Local-Other455,480445,662 State8,259,0359,262,2677,500,023 Federal323,633441,104 Transfers 970, ,287 Total$22,795,980$22,814,182$22,269,276

Expense Overview BudgetRevisedBudget Salaries$12,567,931$12,733,303$13,067,920 Fringes5,297,1765,344,5766,162,851 Purch. Svcs.2,352,8262,362,5872,363,587 Supplies1,855,1151,574,857 Capital Out.565,671478,919382,659 Transfers 430, ,000 Total$23,068,719$22,909,242$23,966,874

Summary BudgetRevisedBudget Revenue$22,795,980$22,814,182$22,269,276 Expense 23,068,719 22,909,242 23,966,874 Profit / (Loss)$(272,739)$(95,060)$(1,697,598) Beg. Fund Balance $3,526,535 $3,431,475 End. Fund Balance$3,253,796$3,431,475$1,733,877 Fund Balance %14.11%14.98%7.24%

So Now What? We are looking for bright ideas!! We can easily address $200K in cost savings, but $1.7 million is tougher and should be addressed together. Cost savings suggestions? ideas to Kent or your building principal; or fill out the supplied form.

How Do We Increase Student Achievement? Even in this environment of budget constraints. We want your ideas them to Dr. J, Jane Bailey, or Building Principal; or fill out the supplied form.

Questions and Answers