Agenda - 04-29-2014 - 1 - Laserfiche WebLink

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9 Chapel Hill — Carrboro City Schools 2014 -15 Operating Budget Message When the 2013 -14 operating budget was adopted last summer, it was evident that we would face continued budgetary uncertainty in future years. The General Assembly had just adopted a budget that reduced support for public education and this sent clear signals that another difficult budget process was in store for 2014 -15. As soon as the budget was adopted, the district began to take steps to prepare for the 2014 -15 budget development process. The district has been operating under budgetary spending restraints from the start of the year. The district has also been sharing information with our constituents and reminding our community of our recent history. We have made millions of dollars in reductions, our staff's wages have been stagnant, and we have absorbed millions of dollars in mandated cost increases. Despite these challenges, we have also shared how fortunate we are to live in a community with strong support for public education. Absent this support, things would be much worse. We are thankful for the Board of Orange County Commissioners' consistent support of public education. They, however, can only do so much to offset the significant loss of state revenue. Furthermore, this was the final year of a three year Board strategy to use available fund balance for operational expenditures to avoid further reductions. We began the 2014 -15 budget development process with a $2.2 million dollar budget shortfall since fund balance is no longer available. There were millions of dollars in requests from budget managers to support programs and initiatives in our district. Unfortunately fiscal realities required that we hold the line on nearly every expansion item. The attached budget recommendation is mindful of our current reality and considers input received from the Board planning conference and our discussion at the March 6, 2014 Board meeting. We limited our expansion requests to a single item that directly supports the district's new strategic plan and a required need associated with the Culbreth Science Wing addition. We are working with the Board to develop a budget reduction list at various levels to be prepared if the County Commissioners are unable to fully fund our budget. Our requests and possible reductions are described in greater detail below. Local Revenues and Expenditure Chanizes and Recommendations Our official State enrollment project is for 12,353 students in 2014 -15; an increase of 97 students over the current year's State projection. At the current per pupil appropriate rate of $3,269, the projected increase in revenue would be $317,093. An additional $321,692 of revenue growth is estimated from the inflationary increase in the special district tax. The Board's requested budget total is $4,507,262. Deducting the anticipated funding for student enrollment growth and the inflationary increase in the special district tax leaves $3,868,477 unfunded. Mandated Cost Increases and Continuation of Current Services The Superintendent's recommended budget includes mandated cost increases and continuation expenses for medical insurance and retirement match, along with a placeholder for locally paid employees. This wage increase is long overdue and deserved. The current proposed wage 1 --1