1. BCS BOARD OF EDUCATION BUDGET WORKSHOP April 5 th 2013

2. THE NEW NORMAL Continued dependence on federal funding to replace reduced state funding Reduced staffing in many areas strains the district’s ability to meet expectations State unfunded mandates further stresses employees throughout the system New program initiatives or enhancements must consider local resources, either with money or volunteers or both

3. 2012-13 FUNDING SOURCES In 2007 Federal Funding was 7%. In 2011, it peaked at 13%. Currently it is at 11%. Federal 11% Local 26% State 64%

4. PEOPLE! Human Resources ($193 million) Other ($37 million) 84% 16% Where will our 2013-14 $230 million Operating Budget go?

5. PERSONNEL REDUCTIONS 2009 - 2012 Central Office 5 positions Assistant Principals 7 positions Counselor/Social Workers 3.5 positions Mentors 2 positions Classroom Teachers 51 positions Elementary General Assistants 11.5 positions Media Assistants 2 positions Media Specialist 1 position MS/HS Clerical Assistants 11 positions Custodians 15 positions Clerical staff 3 positions Finance/Personnel 2 positions Maintenance 4 positions Technology 20 positions Transportation 1 position TOTAL = 139 Positions

6. Understanding Budget Terms Position Allotment: provides a certain number of positions or months of employment no matter what they cost (eg. classroom teachers, principals, instructional support) Dollar Allotment: provides a specified dollar amount of support (eg. non-instructional support, CO support including testing, transportation, child nutrition, media, admin etc) ABC Transfer: A process by which funds can be moved from a position allotment to a dollar allotment, or between allotment categories

7. Understanding Budget Terms Instructional Assistants: Four Categories of Instructional Assistants: (1) K- 3 Classroom (2) School-wide Support: Remediation, Media, Computer/Success Maker Lab, General, and In School Suspension at MS/HS level (3) Exceptional Children (4) Title I

8. Understanding Budget Terms Instructional Support: Includes guidance counselors, school psychologists, social workers, and media coordinators/specialists; also includes dropout prevention specialists and curriculum specialists at the central office level. Non-Instructional Support: Custodians, clerical staff/office personnel in both the schools and the central office. (Note: Local funds may provide other categories like maintenance and technology staff and non-teaching professionals in areas like finance and personnel.)

9. Federal Revenue Estimates $4,310,287 less than 2012-13 revenue: EduJobs Funding-gone $2,701,947 School Improvement Grant-going $949,240 Sequestration (5% loss in 2013-14): Exceptional Children/IDEA $288,500 Title I (Reading Remediation) $296,000 Title II (Teachers/prof. devel.) $ 44,000 ESL/Migrant $ 15,600 Career Technical Education $ 15,000

10. Federal Revenue Estimates Impact from EduJobs loss: 10.5% of overall funding for instructional assistants and non-instructional support Impact from Sequestration cuts ($659,100): 10 Full-time Special Needs Assistants 17 Half-time Reading Assistants Professional Development for Teachers Classroom Materials and Supplies

11. GOVERNOR’S BUDGET (STATE) 2013-2015 Compared to 2012-13 appropriations: 50% reduction K-3 TAs - $4,923,545 Increase in Reversion- $ 313,700 Instructional Supplies + $ 173,779 Textbooks + $ 937,485 Read to Achieve + $ ?

12. HOW MUCH ARE WE REQUIRED TO REVERT IN TOTAL? “Reversion” or “Adjustment”: Each year, the State gives us a budget that is not balanced; we have to balance it by deciding which allotments to reduce. 2010-11 $5,327,936 2011-12 $7,407,035 2012-13 $6,167,250 2013-14 $ 6,480,320

13. GOVERNOR’S BUDGET (STATE) 2013-2015 What would this level of TA funding mean for us if not supplemented with other funds? The term of employment for all remaining TA’s would be reduced from 210 days to 205 days. In addition, K-1 assistants’ hours/day reduced: Kindergarten assistant-6 hours/day, not 8 hours 1 st grade assistant-4 hours/day not 8 hours No 2 nd or 3 rd Grade assistants Only one 6 hour/day Computer lab assistant

14. POTENTIAL STRATEGIES TO BUFFER K-3 ASSISTANT CUT 1. ABC transfer total $1,111,264 instructional supply/ textbook increase to TA allotment 2. Redirect $ for elementary general instructional assistants (14) to K-3 assistants - $ 422,324 These steps could provide sufficient funding for: K class assistant – 6 hours/day (same) 1 st grade assistant - 6 hours/day (2 hr increase) 2 nd /3 rd grade assistants provided at 75% of the current 2012-13 staffing level One 6 hour/day computer lab assistant/school

15. GOVERNOR’S BUDGET (STATE) 2013-2015 Increases over current 2012-13 costs: 1% across-the-board increase in pay – all staff 1% “Up-Front” Unemployment Compensation Employer’s Retirement contribution - 14.23% to 14.59% Employer-paid health insurance - $5,192 to $5,555 Will the revenue provided by the State cover these costs for State-paid staff? BIG ISSUE And how will the Local Current Expense Fund be affected?

16. PROPOSED LEGISLATION Senate Bill 516 - Public School Reg. Reform Senate Bill 374 – Public Schools Budget Flexibility Senate Bill 361 – Excellent Public Schools Act House Bill 469 – Additional Budget Flexibility House Bill 452 - 2013 School Safety Act House Bill 393 – Essential Public School Funding House Bill 334 – Buncombe Sales Tax Flexibility HB 443/SB337 - NC Public Charter School Board HB 97/SB 119 – Lottery Funds / Digital Learning

17. POTENTIAL LOCAL IMPACT Funding Gaps from State Actions: 1% raise for all staff $ 314,927 1% “up-front” UC premium $ 208,152 Health Insurance rate increase $ 154,798 Retirement Contribution rate$ 87,691 Loss of Federal General Support $ 2,701,947 Other Funding Gaps/Unmet Needs Duke Power Rate Increase $ 161,000 Home Base Product/Support $ 160,000 Technology Support Staff $ 360,000 Other Insurance Increase (max)$ 90,000

18. WHEN SHOULD WE CONSIDER USING FUND BALANCE Fund balance is like a savings account; it does NOT make sense to use for recurring expenses Policy 501 establishes Stabilization Reserve of $4.3 Million Multi-Year Revenue Projection Shows Use of Stabilization Reserve as Last Resort in 2014-15

20. HOW MUCH ADDITIONAL FUND BALANCE HAD WE PLANNED TO APPROPRIATE IN 2013-14? Answer: a total of $3.7 million more than the initial appropriation to the 2012-13 Budget: $2,701,847 to replace EduJobs funding, and Up to $1,000,000 in additional one-time or able-to-be phased-out costs (such as the $208,152 unemployment compensation double premium due during 2013-14)

21. WHICH OF THE OTHER INCREASES QUALIFIES FOR USE OF FUND BALANCE? Duke Power Rate Increase $161,000 (why? – yearly “degree days” vary) Other Insurance Increase (max) $ 90,000 (why? - experience will improve) With the $208,162 UC insurance, these add up to $459,162 before considering ADM growth

22. WHICH OF THE INCREASES ARE NOT A GOOD USE OF FUND BALANCE UNLESS WE HAVE FUTURE FUNDING? 1% raise for all staff $ 314,927 Health Insurance rate increase $ 154,798 Retirement Contribution rate $ 87,691 Technology Support Staff $ 360,000 Home Base Product/Support $ 160,000 These represent $1,080,416 in on-going costs

23. STRATEGIC PLAN AND RELATED INITIATIVES Priority I: All students will graduate as high-achieving and globally competitive learners with 21 st Century skills. Initiatives: Technology and Global Education/World Languages Priority II: All learning environments will be safe, respectful, caring and produce healthy and responsible students. Initiative: Safe Schools Priority III: Quality teachers, administrators and staff will provide an innovative and effective educational program for all students. Initiative: STEM Integration Priority IV: Systems will be in place to inform, educate and engage the community to build support for schools and ensure accountability. Initiative: PowerSchool (Home Base)

25. 2013-14 BUDGET PRESENTATION TIMELINE AUTHORIZATION TO SUBMIT PRELIMINARY BUDGET TO COMMISSIONERS May 2 nd BOE Board Meeting PRELIMINARY BUDGET DEADLINE May 15 th To County Commissioners INTERIM BUDGET PRESENTATION June 28 th BOE Meeting FINAL BUDGET ADOPTION August – November (Dependent on Legislative Action)

26. Past BCS Priorities Classroom Teachers: They come first. K-3 Teaching Assistants: They’re vital to giving individualized attention when students need it the most. Instructional Support: Counselors and Social Workers provide invaluable basic services in a challenged environment; Media Coordinators facilitate best practices in applied research & technology use.