1. METROPOLITAN EDUCATION DISTRICT 2012-13 Unaudited Actuals

2. It was a year of change… By the time the books were closed, there were a lot of contributors to the fiscal outcomes: Two different CBOs Two different Superintendents Two different Fiscal Directors We are grateful for the contributions and support of those who are no longer with us.

3. The Bottom Line Revenue – Expenses +/- Transfers In/Out = Reserves or (Deficit) ROPAdult Ed Revenues$15,051,204$3,820,266 Expenses$14,315,524$4,399,999 Net Transfers($247,258)$0 Net Change +/-$488,422.05($579,733)

4. ROP Fund (010)

5. Adult Education Fund (110)

6. How a dollar gets spent in ROP

7. How a dollar gets spent in Adult Ed

8. Cashflow What Really Matters ….

9. Fund 010 (ROP) Fund 110 (Adult) July$2,276,193$767,737 August$2,746,403$1,326,519 September$3,177,840$1,373,330 October$2,673,805$1,187,283 November$2,205,846$1,070,760 December$2,215,772$1,093,099 January$3,036,316$1,300,299 February$1,719,780$1,050,028 March$1,585,169$1,051,895 April$384,349$801,781 May$210,979$916,541 June$62,067$746,190 ENDING CASH BALANCE – BY MONTH

10. Cash Balance Throughout the Year

11. 7 conditions consistently found in each district requesting an emergency loan; or in fiscal crisis – FCMAT Predictors of School Agencies Needing Intervention Leadership BreakdownIneffective CommunicationInadequate Budget Development Governance Crisis*Staff Unrest & Morale IssuesFailure to Recognize Trends* Ineffective RecruitmentAbsence of communication to community* Flawed ADA Projections* Board micromanagement & special interest groups Lack of interagency cooperation* Failure to maintain reserves* Ineffective supervisionBreakdown of internal systems (payroll, position control) Salary and benefits in unrealistic proportions LitigationInaccurate revenue and expense estimates* Insufficient consideration of long-term bargaining agreement effects* Flawed MYP* Inaccurate revenue and expense estimates*

12. Limited Budget Monitoring Poor Position ControlIneffective Management Information Systems Inattention to Categorical Programs Failure to reconcile ledgers Identification of each position missing Limited access to timely personnel, payroll, and budget control data and reports* Escalating general fund encroachments* Poor cash flow analysis and reconciliation* Unauthorized hiringInadequate attention to system life cycles Lack of regular monitoring* Inadequate business systems and controls Budget development process affected Inadequate communication systems Illegal expenditures Inattention to COE dataNo integration of position control with payroll* Failure to file claims Failure to review Management Control reports Bargaining Agreements beyond State COLA* *Represents the 15 conditions that have been found most frequently to indicate fiscal distress and those referenced in AB 2756 Education Code 42127 and 42127.6

13. What’s Ahead Implementation of Common Core Standards –MetroEd will not receive any of the $19 million that is being provided to our partners for the Common Core. –MetroED teachers will need comprehensive professional development to align curriculum with Common Core State Standards. Proposition 39 Energy Grants –MetroEd will not receive any direct funding for energy saving initiatives. We will only qualify for funding if we are included in a grant with a local district. (Electricity costs exceed $340,000 per year at MetroED) Adult Education/Community College Partnerships –Community Colleges are receiving grants to partner with Adult Education – we are currently working with a local coalition.

14. Summary The district ended the fiscal year with adequate reserves for the short-term. With an unstable funding future and no additional funding (as costs increase) the reserves need to be assigned carefully for one- time or limited use. With Common Core and Local Control Accountability Plan (LCAP) and Local Control Funding Formula (LCFF) implementation there are many uncertainties remaining in the budget year. A high-demand for quality, job-relevant staff development is a top priority as we make the shift to Common Core State Standards and meeting the requirements of the LCFF.

15. Questions? Thank you!