Dr. Boone, Campus Leadership

7:54

FSP is the state groundwork for school finance.

Idea behind the Foundation plan - minimum level of spending per student across the state.

Wednesday July 30, 2008 7:54

7:55

State is the responsibility party in school finance.

Wednesday July 30, 2008 7:55

7:56

In a series of decisions, Edgewood v. Kirby, Decision - 1989
Edgewood - 1994 - current finance plan that we basically used was declared constitutional.

Wednesday July 30, 2008 7:56

7:58

West Orange Grove v. Neeley - 276 plaintiff districts. Largest # of plaintifs ever.

State overturned lower court decision.

Basic structure is a result of the Edgewood decision.

Wednesday July 30, 2008 7:58

8:00

Power equalization - the state sets an amount of money the school district can spend. Money this amount is recaptured and redistributed to poorer school districts. This goes back to 1994.

The numbers have changed over time.

Education is a State Responsibility that is partially funded at the local level.

The word independent means the district can levy its own taxes. It does not mean they are free of State Responsibility and Jurisdiction.

Wednesday July 30, 2008 8:00

8:02

The local district has two responsibilities independent of the state: Hire a superintendent and approve the budget.

Wednesday July 30, 2008 8:02

8:05

Texas School Finance Basics: The Foundationn School Plan

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8:10

--Financed by shared state, local and federal funds.

--Three tiered structure

--Power equalized ( Chapter 41 or Robin Hood; Chapter 42

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8:13

Driven by 4 factors:

-- Student Enrollement measured by average daily attendance (ADA) & full time equivalents (FTE)

-- Programs, e.g. bi-lingual ed, compensatory ed, GT, career & tech programs

-- Taxable value of all property in the district

--Tax Effort measured by taxes actually collected, not adopted tax rate.

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8:14

Tier 1
A basic program defined by a series of formulas/allotments for each of the following:

-- regular education
--special education
--career & technology education
--bilingual education
--

Wednesday July 30, 2008 8:14

8:21

Some Tier I programs are weighted: (a weight is a multiplier designed to adjust or compensate for increased costs of running some programs.

Regular education = ADA x AA x 1

Special education = FTE's x AA x weights (every handicapping category has a different weight)

Career &Tech education = FTE's x AA x 1.35

Bilingual ed = ADA x AA x.1

Comp education = enrollment x AA x .2

G & T Education = enrollment x AA x .12

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8:21

Tier 1

Transportaion
??
??

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8:22

The local share of Tier 1

100% of yield of the first 86 cents on teh local tax rate.
This is amount is substracted from teh total cost of Tier 1.
The remainder is the states share.

Wednesday July 30, 2008 8:22

8:24

The goal is to neutralize differences in property value.
For example:
poor not so poor
Total Cost Tier 1 $1,000,000 $1, 000,000
Less local share 300,000 700,000
State's share $700,000 $300.000

Wednesday July 30, 2008 8:24

8:25

Formatting messed up columns

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8:27

Tier 1 Exception

If the district is rich enough, it recieves no Tier 1 state aid:

Total Coast of Tier 1 $1,000,000
Less local Share $1,500,000
Tier 1 allotment -$500,000

Wednesday July 30, 2008 8:27

8:32

Tier II
Supplements/eneiches teh basic Tier I program at the level that the district is willing to tax itself teh 86 cents required for Tier 1.

Guaranteed yield.

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8:35

Tier II Equalizing

the goal is neutralize differences in property value among districts.

poor not so
Guarantee $31.95 $31.95
.01 tax effort $3.00 $12.29
State share $28.95 $19.66

Wednesday July 30, 2008 8:35

8:36

Exception

If a district is rich enough it does not recieve any Tier II allotment.

Wednesday July 30, 2008 8:36

8:39

Chapter 41 or "Robin Hood" Districts

A district is subject to the recapture provisions of Chapter 41 T.E.C. if:

-- It has a total per WADA (weighted average daily attendance) property wealth exceeding $319,000. Total value divided by WADA

-- Local revenues generated by.01 of tax rate per WADA exceeds $31.95.

Wednesday July 30, 2008 8:39

9:09

Tier III Facilities Funding

-- Instructional Facilities Allotment (IFA) and Existging Debt Allotment (EDA)

-- both guarantee tghat geach penny of I&S tax rate will yield no less than $35.00 per ADA

-- the district must levey and collect its share (or use excess M&O or I&S money from previous years beginning 2000-2001) to get full state share.

Wednesday July 30, 2008 9:09

9:15

Bond issues can be used for:

build new schools
renovate old schools
equip new schools
school buses

Wednesday July 30, 2008 9:15

9:18

Specail session 2006 Tax Compression HB1

-- taxes for maintenance and operation (M&0) are forced down

-- state insures taht districts will receive the same total state/local revenue per student at the compressed rate as they got at the higher, non-compressed rate.

Wednesday July 30, 2008 9:18

9:19

The formula is driven by the students.

State growing by 400,000 students per year.

The formula did not account for that.

Wednesday July 30, 2008 9:19

9:22

Property is the main revenue for all local agencies.

Wednesday July 30, 2008 9:22

9:33

Budget

Wednesday July 30, 2008 9:33

9:35

Budget powerpoint

Wednesday July 30, 2008 9:35

9:35

Budget and CIP should be connected.

Budget should be the financial plan for implementing the CIP.

Wednesday July 30, 2008 9:35

9:36

What do we need?
How much will it cost?
Where are we going to find the money?

Wednesday July 30, 2008 9:36

9:37

Budget code

199 11 6399.00 001 08 11
(1) (2) (3) (4) (5) (6) (7)

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9:38

199 -- The first number is the fund code - how will the expenditure be financed?

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9:38

11 -- The second number is function code: why is it being made.

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9:39

6399 -- object code - what is being purchased?

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9:39

.00 Sub-ojbect code: for which department or grade level.

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9:39

001 -- organization code - what unit (school) is purchasing it.

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9:40

08 -- what year

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9:40

fiscal year

11 - program intent code - what student group.

Wednesday July 30, 2008 9:40

9:41

Budgeting Myths

Wednesday July 30, 2008 9:41

9:53

Steps to budgeting

1. determine allottment
2. id fixed costs
3. involve all parties
4. identify potential expenditures
5. reconcile expeneditures & income (cut back)
6. avoid continuing debt
7. develop a plan
8. develop goals
9. evaluate the budget
10. live with the budget

Wednesday July 30, 2008 9:53

9:56

program budgeting
zero budgeting
typical budgeting - historical/incremental

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9:56

historical/incremental is most common type utilized.

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9:58

Dr.Boone's advice is the more open we are about the budget, the more responsible people will be in managing their needs and finances.

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9:58

district wide fixed costs

wages and benefits is upwards of 80%