1. 1 Board Budget Commission February 18, 2016

2. Agenda Meeting Goals -5 Minutes Calendar and Timeline -5 Minutes FY2017 General Fund Revenue -15 Minutes FY2017 General Fund Expenditures -20 Minutes Questions and Wrap-Up -15 Minutes 2

3. 3 Meeting Goals

4. Goals 4 For this meeting -TBD Going forward -TBD

5. 5 Calendar and Timeline

6. Budget Calendar (1 of 3) 6 Atlanta Public Schools Fiscal Year 2017 General Fund Budget Development Calendar 9/4/2015v10 Item #Item Description Dates 1 Board/Superintendent workshop - Initial Academic and Operating Goals and Priorities for Budget Parameters August 27, 2015 2 Senior Executive Leadership Team review of the Fiscal Year 2017 budget planning framework and timeline September 1, 2015 3Budget parameters identified and finalized by Senior Executive Leadership TeamSeptember 1, 2015 4Fiscal Year 2017 Budget Planning Parameters and Timeline presented and approved by the BoardSeptember 8, 2015 5Expanded Cabinet discusses budget framework, parameters and timelineSeptember 17, 2015 6Senior executive leadership team discussion of the budgetOctober 27, 2015 7Board reviews/discusses Fiscal Year 2017 budget assumptions, staffing formulas and strategic prioritiesNovember 2, 2015 8Departments receive Fiscal Year 2017 Budget templatesNovember 11, 2015 9Board Budget Commission Meeting to Discuss Multi-year Budgeting StrategyNovember 12, 2015 10Budget and Finance Advisory Committee, initial meeting (CFO only)November 12, 2015 11Expanded Cabinet discusses budget approach, options and provides feedbackNovember 19, 2015 12Board approves Fiscal Year 2017 budget assumptions, staffing formulas and strategic prioritiesDecember 14, 2015 13Budget and Finance Advisory Committee, second meetingDecember 17, 2015 14Fiscal Year 2015 Mid-Year adjustmentJanuary 11, 2016 15Departments submit completed budgetsJanuary 14, 2016 16Governor's State of the State Address and Education Budget (OMB)January 14, 2016 17Board Budget Commission Meeting to Discuss Multi-year Budgeting StrategyJanuary 21, 2016 18Budget and Finance Advisory Committee, third meetingJanuary 21, 2016 19Budget Office compiles budgetJanuary 29, 2016

7. Budget Calendar (2 of 3) 7 Atlanta Public Schools Fiscal Year 2017 General Fund Budget Development Calendar 9/4/2015v10 Item #Item Description Dates 20 FC Tax Commissioner and FC Chief Assessor Presentation at Board or Budget Commission Meeting February 1 29, 2016 21 Senior Executive Leadership Team budget retreat to complete preliminary budget proposal February 2, 2016 22Budget and Finance Advisory Committee, fourth meetingFebruary 11, 2016 23 Superintendent presents the Fiscal Year 2017 Budget Primer to the Board Budget Commission meeting (at call of Committee chair) February 18, 2016 24Board Budget Commission meeting (at call of Committee chair)February 29, 2016 25Superintendent presents the Fiscal Year 2017 Budget Primer to the BoardMarch 7, 2016 26Conduct regional public meeting for Fiscal Year 2017 General Fund BudgetMarch 10, 2016 27Conduct regional public meeting for Fiscal Year 2017 General Fund BudgetMarch 17, 2016 28Board Budget Commission meeting (at call of Committee chair)March 17, 2016 29Conduct regional public meeting for Fiscal Year 2017 General Fund BudgetMarch 24, 2016 30Board Budget Commission meeting (at call of Committee chair)March 28, 2016 31Budget and Finance Advisory Committee, fifth meetingMarch 28, 2016 32Conduct regional public meeting for Fiscal Year 2017 General Fund BudgetMarch 31, 2016 33Conduct Public Hearing on FY17 BudgetApril 11, 2016 34 Superintendent presents the Fiscal Year 2017 Budget to the Board (Tentative adoption)April 11, 2016 35First read of the tax Millage rates for Fiscal Year 2017April 11, 2016 36Salary Hearing #1 (If necessary)May 5, 2016 37Tax assessor provides preliminary appraisal values to DistrictMay 6, 2016 38Salary Hearing #2 (If necessary)May 12, 2016

8. Budget Calendar (3 of 3) 8 Atlanta Public Schools Fiscal Year 2017 General Fund Budget Development Calendar 9/4/2015v10 Item #Item Description Dates 39Superintendent presents the Fiscal Year 2017 Budget to the Board (Final Adoption)June 6, 2016 40 Final adoption of the tax Millage rates for Fiscal Year 2017 (may require a called Board meeting (public hearings) depending on the county's schedule and millage rollback) June-16 41Advertise the tax digest for the five year history Fiscal Years 2011-2016June-16 42Advertise and publish notice of tax rate and budgetJune-16 43Advertise the first and second public hearings for the tax Millage rates (If necessary)June-16 44Hold the first and second public hearing on the tax Millage rate (If necessary)June-16 45Advertise the third public hearings for the tax Millage rates (If necessary)June-16 46Hold the third public hearings for the tax Millage rates (If necessary)June-16 47Deadline for millage rates to be delivered to Fulton County Tax CommissionerJune-16 48Tax assessor provides final appraisal values to the DistrictAugust 1, 2016

9. 9 FY2017 General Fund Revenue

10. Considerations for Discussion 10 Roughly 26 percent of general fund revenue comes from the State. Starting in FY17, APS will receive $4.5 million more annually as a result of becoming a charter system. Assumption of $8.0 million increase in QBE for FY2017. General Assembly is considering significant changes to its funding formula which makes FY18-FY21 difficult to forecast (2% growth assumed in these years). Roughly 26 percent of general fund revenue comes from the State. Starting in FY17, APS will receive $4.5 million more annually as a result of becoming a charter system. Assumption of $8.0 million increase in QBE for FY2017. General Assembly is considering significant changes to its funding formula which makes FY18-FY21 difficult to forecast (2% growth assumed in these years).

11. Considerations for Discussion 11 A mil of tax is equal to $1.00 per every $1,000 of assessed valuation of real estate property. Since FY2009, the APS millage rate has stood at 21.64 One mil currently generates about $22 million. A mil of tax is equal to $1.00 per every $1,000 of assessed valuation of real estate property. Since FY2009, the APS millage rate has stood at 21.64 One mil currently generates about $22 million.

12. Considerations for Discussion 12 Roughly 70 percent of general fund revenue comes from local property taxes. We anticipate steady growth of the tax digest will continue over the next several years. The projections assume a 5% increase* for FY2017 and a continued annual 3% growth rate in out years. Roughly 70 percent of general fund revenue comes from local property taxes. We anticipate steady growth of the tax digest will continue over the next several years. The projections assume a 5% increase* for FY2017 and a continued annual 3% growth rate in out years. *Revised projected local revenue assumptions; 3% growth presented to Board on December 14 th.

13. Considerations for Discussion 13 Includes Payments in Lieu of Taxes, tuition, investment interest, rental of facilities, sale of assets, lost and damaged reimbursements, charter buy-back, field trips, and other sources. FY2016 assumes back-payment of IGA Includes Payments in Lieu of Taxes, tuition, investment interest, rental of facilities, sale of assets, lost and damaged reimbursements, charter buy-back, field trips, and other sources. FY2016 assumes back-payment of IGA

14. Considerations for Discussion 14 APS is projected to see steady revenue growth in FY2017 through FY2021.

15. 15 FY2017 General Fund Expenditures

16. Considerations for Discussion 16 As the local tax digest grows and as existing charter schools complete their grade-level build out, expenditures related to charter school scaling will continue to grow. Charters also receive a portion of local revenue which is not reflected here.

17. Considerations for Discussion 17 The annual pension liability payment represent 7.2% of general fund spending. The current annual payments are roughly $1,000 per student, and will grow to $1,400 per student by 2029.

18. Considerations for Discussion 18 APS has a long- standing practice of maintaining a fund balance above 7.5% of revenue, but below the statutorily required cap of 15%. With a projected FY17 Budget around $730m, that would mean a fund balance between $54.75m and $109.49m APS has a long- standing practice of maintaining a fund balance above 7.5% of revenue, but below the statutorily required cap of 15%. With a projected FY17 Budget around $730m, that would mean a fund balance between $54.75m and $109.49m Minimum FY2016

19. Multi-Year Planning Framework 19

20. Looking Ahead to FY17 20 $703.5 m $656.5 m Includes Turnaround, CRCT Remediation/ Enrichment, Flexibility & Signature Programing, Charter System Transition, and Pay Parity $242 m +TBD

21. Budget Parameters 21 Resource ParametersEstimateComment The district will establish a millage rate consistent with the Board’s mission and vision 1 mil = $22 millionDistrict’s millage rate has remained at 21.64 since FY2008. The district will maintain a fund balance between 7.5% and the statutory limit of 15% of projected expenditures Estimated fund balance on 6/30/16: $75.3 million With projected FY17 revenues of roughly $730 million, the fund balance should remain above $54.75 million and must remain below $109.49 million. The district will fully realize all funds coming in from intergovernmental agreements $1.5 millionCurrent Estimate

22. Budget Parameters 22 Expenditure ParameterCost EstimateComment Allocation decisions will be made to prioritize achieving a more equitable distribution of resources pursuant the district’s equity audit. TBD The district will allocate resources to implement effectively the system’s move to a “charter system” operating model. $250,000 The district will fund pension obligations in accordance with State statute and actuarial standards. $51.9 million The district will invest in a multi-year school turn-around strategy that provides additional support and interventions for schools at risk of state take-over. $25.0 million The district will make investments in early childhood education based on findings from research study. TBD The Governors FY2017 budget proposal includes the implementation of a new compensation model to retain teachers

23. Budget Parameters 23 Expenditure ParameterCost EstimateComment The district will ensure that the budget is aligned to the Board’s mission and vision and that resources are allocated against key district strategic priorities in the areas of: Academic Program * Ongoing implementation of district’s CRCT remediation & enrichment efforts $4.5 million Year 2 of support plan for impacted students still enrolled at APS. * Improvement in student achievement in math, science, and literacy, including a comprehensive materials of instruction strategy (inclusive of textbook adoption and online student and teacher resources) TBD College Readiness: AP tests, IB exams, early college textbooks, expansion of work based learning, college tours, internships, SAT/ACT prep, and others. Career Readiness: Dual-enrollment, internships, CTAE, work readiness workshops, career monitoring, CTAE program certification. * Ongoing implementation of signature programming across clusters $12 million * Ongoing implementation of positive behavior supports programming TBD

24. Budget Parameters 24 Expenditure ParameterCost EstimateComment The district will ensure that the budget is aligned to the Board’s mission and vision and that resources are allocated against key district strategic priorities in the areas of: Talent Management * Strategies to recruit, professionally develop, and retain high-quality staff $40,000 Additional costs are included in the turnaround budget * Continued implementation of multi-year compensation study recommendations to address pay parity $13 million Phase 2 includes placing all non- instructional staff on the proper pay scale, as well as a 1% COLA for all staff and a step increase

25. Budget Parameters 25 Expenditure ParameterCost EstimateComment The district will ensure that the budget is aligned to the Board’s mission and vision and that resources are allocated against key district strategic priorities in the areas of: Systems & Resources * The safety, security, and well-being of students and staff (including the implementation of a new safety/security model) $10.62 million Includes salaries, benefits, and one- time costs for start-up equipment * Preventative maintenance of support infrastructure (including buildings, buses, and technology) TBD

26. Budget Parameters 26 Expenditure ParameterCost EstimateComment The district will ensure that the budget is aligned to the Board’s mission and vision and that resources are allocated against key district strategic priorities in the areas of: Culture * Continued implementation of cultural transformation strategy, including strengths-based programming $630,000Strength Finder licenses for new employees, Gallup engagement for all employees and continued implementation of organizational culture initiatives * Implementation of District’s external communications strategy $1.54 millionOperating budget for Communications department

27. What’s Next Next Meeting- Monday, February 29 th 27