1. 2016-17 Budget Overview Grant Wood AEA Barb Harms, Business Manager January 13, 2016

2. 2 GWAEA Budget Process Nov Verify Supplemental State Aid % - Unknown LEA enrollment count Dec Estimate available funds Set initial budget parameters Jan Prepare State budget, hold public hearing, Board approval Feb - May Negotiate contract settlements Prioritize funding requests Jun - Jul Build line-item budget New budget takes effect

3. 3 AEA Finance Formula: AEA cost per pupil X enrollment AEA cost per pupil grows each year by the supplemental state aid amount Media & Ed Services include non-publics Special Education includes SE weighting

4. Revenue Assumptions 2016-17 Assumption #1: State Aid Growth – 0% for state aid & categoricals that are part of formula An increase of 1% in the rate would equal approximately $320,000 in state aid for the Agency 4

5. 5 State Aid Growth Trend

6. Revenue Assumptions 2016-17 Assumption # 2: AEA Served Enrollment is an increase of 0.8% (combination of LEA certified enrollment + non-public) Special Education weighting increased 0.2% 6

7. 7 Certified Enrollment Trend

8. Non-Public Enrollment Trend 8

9. SE Weighting Trend 9

10. 10 Formula Funding 2016-17: Special Education$21,777,646 Media Services$ 3,857,062 Educational Services$ 4,237,429 State SE Reduction$ ( 963,257) “State Aid Funding”$28,908,880 Categorical TSS & PD$ 2,248,982 “Total Formula Funding”$31,157,862

11. Revenue Assumptions 2016-17 Assumption #3: Federal funding projected to be flat or small increases Assumption #4: Other state grants – cuts are possible with lower tax projections from the REC and focus on funding the built-in Ed Reform initiatives (Ex: State Early Access, Iowa Core, STEM, Early Childhood Iowa) 11

12. 12 Federal Funding Trend

13. 13 Local Revenues: Look at past trends to estimate Most sale of service revenues (such as computer services, professional development and creative services) are projected flat or small increases VAST fees will increase to offset upgrade in kits, and PowerSchool fees up due to out-of-state sales Interest income will remain low

14. 14 Budgeted Revenues

15. 15 Expenditures Assumptions: No increase in IPERS rate for FY17 Health insurance not yet determined, but estimated at 9-14% increase Other benefits increases are expected to be minimal The Agency will provide fair & equitable package settlements – salary/benefits account for over 70% of costs 2 nd year of 2-year settlement with Contracted staff at 3.75%

16. Expenditures Assumptions: Staffing levels may be adjusted using attrition Facilities – Phase II remodel at 33rd Ave facility is on hold pending sale of Coralville building. Roof at 6 th Street is being evaluated for repair or replacement. The Agency will utilize existing fund balance as necessary in order to maintain a solvency ratio of 5- 10% 16

17. 17 Budgeted Expenditures

18. 18 Budgeted Expenditures

19. Fund Balance Trend 19

20. 20 General Fund Balance, Unassigned + Assigned (in Days) Government Finance Officers Association (GFOA) recommends a minimum reserve level of at least 60 days of operating expenditures: FY 13 – 78 days of reserves FY 14 – 62 days of reserves FY 15 – 59 days of reserves

21. 21 Historical Financial Trends Financial Solvency Ratio Standard measure of financial health Formula = Assigned + Unassigned Fund Balance General Fund Revenues Target Range:Preferred 5.0 to 10.0% Acceptable 0 to 4.9% Alert -3.0 to -0.1%

22. Solvency Ratio Trend 22

23. Questions?