Parameters Used To Build 2007-08 Budget Forecast Model

December 12, 2006 (updated 1/3/07)

The parameters listed below are being utilized within the context of the budget forecast model to project the district's revenue limit and revenue shortfall for the 2007-08 budget.

Current estimates project the revenue shortfall in 2007-08 will be $9-12 million.

Revenue

Revenue Limit Increase per Pupil: Per Statutes, the statewide per pupil increase in the revenue limit ($256.93 in 2006-07) will be increased by the percent increase in the CPI from March 31, 2006 to March 31, 2007. An increase of 1.3% is being applied in this forecast, resulting in a per pupil increase of $260.27 for 2007-08.
September Enrollment: The enrollment projection model used by the district indicates an increase in pre-K thru 12 enrollment of 17 students for 2007-08.
Student Fees: Student fee revenue of all types is assumed to be unchanged for 2007-08.
State Equalization Aid: Equalization Aid is assumed to decrease approximately $3.0 million (5.3%) for 2007-08.
State Categorical Aids: Categorical aids for libraries, transportation and bilingual programs is assumed to be unchanged for 2007-08.
Investment Income: Interest rates are assumed to remain at 2006-07 levels.
State Special Education Aid: A state reimbursement rate of 27% of eligible special education costs is assumed for 2007-08, (and is expected to decline by an additional 1% each subsequent year).
Other Revenue: Other forms of revenue are assumed to be unchanged for 2007-08.
High Cost EEN Program Aid: The budget includes $600,000 for state aid for high cost / low incidence programs. This aid was received prior to 2006-07 under authority of the State Superintendent but is now provided by Statute.

Expenditures

Employee Salaries & Benefits: Salaries and fringes for regular employees will reflect settled agreements and estimates based on guidelines established for negotiations in units not yet settled.
Teacher Salary Horizontal Movement: Horizontal movement of teachers on the salary schedule is assumed to be $400,000 each year, based on historical averages.
Temporary Salaries & Benefits (Substitutes, Overtime, Etc.): Temporary salaries are being increased 3% and fringe benefits 5%.
Staffing: Staffing levels have been established per enrollment projections.
Natural Gas, Electricity, Sewer & Water: Based on discussions with representatives of utility suppliers, gas and electric are assumed to increase by 8%; water, sewer and phone 3%.
Pupil Transportation: Pupil transportation costs are assumed to increase 4.5%. We don't know what, if any fuel escalator will apply, so that is not included at this time. The cost of City services is expected to increase as well and is estimated at 5%.
Other Non-Salary Objects: All other budget categories having a bearing on the projected revenue shortfall are assumed to increase by 1.3% for 2007-08, based on the October 2006 CPI annualized.
Salary Savings: The salary savings account will be budgeted at $2,000,000 in 2007-08 and in each subsequent year.
General Fund Contingency: The budgeted contingency of $650,000 has been restored and assumes half of that amount will be absorbed each year by continuing expenses.
Retiring Teachers: It is assumed that 77 teachers will retire each year. The number of teachers and the savings are both based on the average of the previous five years. The cost of the resulting vacancies is based on Step 4 and Lane 4 of the salary schedule.
Open Enrollment: Open enrollment expenses and revenues are being estimated based on maintaining the ratio of incoming to outgoing students as in 2006-07.
Maintenance: Maintenance revenue and expenditures reflect amounts authorized by taxpayers in the 2005 referendum.
Fund 80 Reserve: Fund 80 will have a $300,000 unallocated reserve for new programs and ongoing unanticiapted costs added each year.

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