Untitled Document

Attached you will find the proposed budget for the General Purpose School and Central Cafeteria Funds for the 2010 – 2011 Fiscal Year. These budgets were prepared to further School Board goals, the District’s mission, and our District’s beliefs. In preparing the FY11 budgets, we were confronted by unprecedented increases in State retirement, as well as the standard inflationary adjustments, while revenues from local, state, and federal governments remain fairly constant. Across the county school systems are faced with choices which had to be made to balance budgets. We choose academics first with our main goals of maintaining pupil-teacher ratios, student success, and teacher success. This budget saves all instructional positions while eliminating five (5) budgeted positions from the prior fiscal year. The County’s Budget Committee has not set a date to send the various county budgets to the County Commission for final approval; however, it is anticipated that the County Commission will not act on the budgets until its September, 2010 meeting. Particular items of interest concerning the FY 2011 Budgets are as follows:

The Budget is prepared with a tax rate for the General Purpose School Fund of $1.18, which is no increase over the prior year. There was a slight decline in the tax levy over the prior year.

The Budget process is driven by the number of students. The first several pages of the Budget provide a detailed analysis of ADM (average daily membership) over the past several years. It appears that our ADMs have leveled.

Notes within the budget are provided for additional analysis and accountability and have been inserted to better track revenues and expenditures

Page 33 shows were we taking non-recurring expenditures from fund balance and not recurring revenue

Page 33 shows a calculation that, in my opinion, is a necessary fund balance to maintain for efficient operations (cash flow). Our projected fund balance is below this amount by nearly $400,000; however, I fully anticipate that this fund balance projection is the worst case scenario. Unless enrollment is above and beyond our projections, the budget contains one (1) teaching position that will not be filled and diesel fuel and gasoline are budgeted at 150% of our lastest bid price. Based on these assumptions, I am comfortable with taking our fund balance down to this level for a short period of time and going forward all efforts will be made to bring our fund balance back to within the acceptable range.

Page 31 lists our capital outlay projects for the year, including the balance of the Career Technology facilities. Architect and Construction Manager Fees were encumbered against our 2008 – 2009 Fiscal Year budget. We will not immediately begin the projects marked in red. These projects will be performed when and if necessary, unless the economy begins to recover.

Phase 3 of our technology upgrades is budgeted

$55,000 is budgeted for our county-wide athletic programs to help all programs purchase necessary items that the individual school budgets cannot afford to purchase

$30,000 is budgeted to upgrade Vocational equipment – 3rd Year of upgrades

The Central Cafeteria Fund is in sound financial condition and only minor capital expenditures are anticipated.

Obion County Board of Education August 9, 2010	Agenda Item: VII.H.

Consider/Approve FY11 Budgets for the General Purpose School and Central Cafeteria Funds

Background Information : Attached you will find the proposed budget for the General Purpose School and Central Cafeteria Funds for the 2010 – 2011 Fiscal Year. These budgets were prepared to further School Board goals, the District’s mission, and our District’s beliefs. In preparing the FY11 budgets, we were confronted by unprecedented increases in State retirement, as well as the standard inflationary adjustments, while revenues from local, state, and federal governments remain fairly constant. Across the county school systems are faced with choices which had to be made to balance budgets. We choose academics first with our main goals of maintaining pupil-teacher ratios, student success, and teacher success. This budget saves all instructional positions while eliminating five (5) budgeted positions from the prior fiscal year. The County’s Budget Committee has not set a date to send the various county budgets to the County Commission for final approval; however, it is anticipated that the County Commission will not act on the budgets until its September, 2010 meeting. Particular items of interest concerning the FY 2011 Budgets are as follows: The Budget is prepared with a tax rate for the General Purpose School Fund of $1.18, which is no increase over the prior year. There was a slight decline in the tax levy over the prior year. The Budget process is driven by the number of students. The first several pages of the Budget provide a detailed analysis of ADM (average daily membership) over the past several years. It appears that our ADMs have leveled. Notes within the budget are provided for additional analysis and accountability and have been inserted to better track revenues and expenditures Page 33 shows were we taking non-recurring expenditures from fund balance and not recurring revenue Page 33 shows a calculation that, in my opinion, is a necessary fund balance to maintain for efficient operations (cash flow). Our projected fund balance is below this amount by nearly $400,000; however, I fully anticipate that this fund balance projection is the worst case scenario. Unless enrollment is above and beyond our projections, the budget contains one (1) teaching position that will not be filled and diesel fuel and gasoline are budgeted at 150% of our lastest bid price. Based on these assumptions, I am comfortable with taking our fund balance down to this level for a short period of time and going forward all efforts will be made to bring our fund balance back to within the acceptable range. Page 31 lists our capital outlay projects for the year, including the balance of the Career Technology facilities. Architect and Construction Manager Fees were encumbered against our 2008 – 2009 Fiscal Year budget. We will not immediately begin the projects marked in red. These projects will be performed when and if necessary, unless the economy begins to recover. Phase 3 of our technology upgrades is budgeted $55,000 is budgeted for our county-wide athletic programs to help all programs purchase necessary items that the individual school budgets cannot afford to purchase $30,000 is budgeted to upgrade Vocational equipment – 3rd Year of upgrades The Central Cafeteria Fund is in sound financial condition and only minor capital expenditures are anticipated. Staff Recommendation: I recommend approval of the 2010 – 2011 Fiscal Year Budgets for the General Purpose School and Central Cafeteria Funds. Printed copies of the budget are available upon request.