1. 2/25/2009 Council Budget Work Session Revenue Impact on Schools

2. 2/25/2009 Council Budget Work Session Local Funding Formula The local funding formula is based on residential real estate, personal property and utility taxes School System receives 61.83% of all residential related taxes, whether increasing or decreasing FY 2010 revenues estimates in these categories are as follows: Real estate: flat with only minor increases Personal property: significantly down Utility taxes: flat with no growth

3. 2/25/2009 Council Budget Work Session Local Funding Formula As a result of these FY 2010 revenue estimates, the local contribution to the School System would decrease by 1.85%, or $1,278,975 This calculation protects the additional $980K of revenue that Council gave the school system last year above the funding formula We exempted the School System from their share of the 2 cent tax decrease, resulting in this funding in excess of the formula

4. 2/25/2009 Council Budget Work Session Impact on the School System Any loss of funds is challenging for an entity; however, the School System has indicated an understanding that this formula amount is appropriate given the declining revenue Their larger issue is the state cut as represented by the Governor’s budget A total of $12.9 million comprised of enrollment loss and actual state budget cuts

5. 2/25/2009 Council Budget Work Session Impact on the School System The Superintendent's budget will be released publicly on March 11 th We have been involved in the development of that budget through our partnership in each others’ budget committees Although we cannot share particulars of their budget before it is released, it is important to note the following: The budget will honor the local funding formula There will be pain associated with this budget but it has been managed with great care in protecting classroom instruction