CPPAC budget presentation

Updating as we go...
Mr. Allen

"an overview of where the budget stands...similar to the presentation to the School Committee" given to the School Committee in January.
Joint meeting with Finance and Operations and Education at Nelson Place on Monday night.
This is not yet online, but will be the backup for the meeting Monday at Nelson Place, so you will be able to find it as part of the F&O agenda for Monday on Friday afternoon.


Revenue from Chapter 70, Kindergarten grant, circuit breaker, charter/school choice, city contribution, federal grant ("sequestration")
Expenditures include contractual increases, class size, MassCore & Common Core adoption, technology, sped and ELL, school safety/space/PCB's/new programs....etc.

9C and education cuts last year (McKinney-Vento cut) plus charter school reimbursement not fully funded
circuit breaker was funded at 70% at FY13 (should be 75%)
charter school reimbursement is at 83% of full funding

FY14 budget preview $1.2 billion gap (from MassBudget) and $1.284 billion from MassTaxpayers forecast
changes in the state budget is a $110 million increase, which is 6% of the proposed change (from MassTaxpayers)

of the $2.7 billion additional, $226 million is Chapter 70, with $40 million in additional K-12

Governor's budget fully funded foundation (Ch. 70)
Lifts the cap on the number of pre-school students we can count in the foundation budget (which would mean $1 million for WPS)
Extended day proposed for high-need middle schools (no idea what that means for WPS)
increases the assumed cost of the average out-of-district special education placements ($2.5 million for WPS)
"whether you deserve it or not, you're going to get state aid, you're going to get $25 per pupil"
also fully funds target aid
ALL THAT'S IF IT PASSES THE LEGISLATURE

baseline changes: "Normal changes" is an increase of $91 million; this is very low compared to previous years, as there are districts that are declining in enrollment and the inflation factor is low
special ed and preschool changes is an $43 million increase
effort reduction is $92 million (that's the "if you need it or not" aid)
Total of $226 million increase this year, which is fairly typical for this year, according to DESE

circuit breaker is only going to provide 55-60% of what is needed; it's supposed to be 75% (we're responsible for the first $40,000 per pupil; anything over that, the state is supposed to kick in 75% reimbursement. Impact for Worcester? $750,000 or so)
charter school reimbursement will not be fully funded again
McKinney-Vento transportation funding at approximately 50% ($250,000 cut for Worcester)
Kindergarten grant level funded, but allocation is changing; "slightly optimistic that our amount will actually go up" as it will be based on numbers of students underperforming on 3rd grade assessments, who are ELL, or who are low-income

Federal funding: "to me, this is the biggest budget item that we're watching right now"
even at level funding: grant funding has fallen from $25.7 million in FY04 to $22.5 million this past year; we need an additional $1 million just for increased cost
"our grants are position-heavy..." (and we've got a chart here on what the grants go to fund)
expenditures of these grants are approved by the state as well as the School Committee
losses in Head Start, as well as the equivalent of 23 teaching positions ($1.3 million)
"again, I don't know where to cut 23 teaching positions, so that's an issue"

City contribution
"an enrollment generated formula" based on October 1 from previous fiscal year
"a per pupil formula with differentiated rates for grade or program adjusted annually for inflation"
it DOES include charter school and school choice students

Foundation budget for Worcester for FY14 accounts for 26,908 students total: which is a $315,543,722 budget for FY14
"because of our enrollment changes, we're creating our own revenue"
previous years, largest increases have been at the elementary level; now middle schools are stating to see increases
"foundation budget is good, but we're dealing with some space issues"
970 more ELL students since last year
663 more low income students
...and that's off a total increase of 409 students
"putting service challenges on the district"

have closed eight schools since 2002, but now we have more students that we did when we closed the first round of schools
projections done by NESDEC and MSBA
about 80% of births in Worcester end up being kindergarteners
MSBA shows us going up 800 students in the next five years; NESDEC going up by 1100 students
"It's good...but I don't know where we're going to put them."

inflation factor this year is 1.55% this year (last year it was 3.65%); if we had last year's inflation factor, that'd be $4.5 million more for us

Who pays for the foundation budget?
Calculation of how much the community can pay; the state makes up the difference
based 50% on property wealth and 50% on local income wealth: the aggregate wealth model (from 2007)
2012 property value of the entire state is $975 billon
2012 total income of the state is $224 billon
the state then adjust percentages to make it be a 50/50 split (for Worcester, property is .3593% and income is 1.5595%)

"those same percentages get applied to every single community...Worcester is more income wealthy than property wealthy"
"Worcester, you should be contributing $95,528,974 to education"
(of the City Manager's chart last night) "the reason why (Worcester contributes a higher percentage) is simple...Worcester is actually wealthier than the communities than are in that sample"

Worcester's local contribution: FY13 required level PLUS municipal revenue growth factor is $92,324,512
BUT the city is thus actually $3 million below what the state says it actually should be
Municipal growth factor:

• tax levy limit
• estimated new growth
• change in non-ed state aid
• change in estimated local receipts

City's available revenue is ACTUALLY going up 4.22% this year

Chapter 70 state aid $223,217,770 for FY14

chapter 70 aid goes up $12.8 million
local contribution goes up $3.9 million
charter school reimbursement goes up by $309,616
charter and school choice assessment then get subtracted -843,538

...which is a change (an increase) of $16,235,710
for a total budget of $301,602,219
however...Allen comments that if he had to propose a budget today, he'd take out the $3.5 million increase from the state (the adding of preschool to foundation and the increase of the cap in out-of-district special ed), as the House and Senate haven't weighed in yet
PLUS the city hasn't met net school spending this year, which is still $890,000. That'll be added to next year
list of increases...which you've seen...for a total of $10 million
needs assessment...which you've seen for a total of $15 million
and it does not include any negotiated salary increase (and all of our contracts are up)
Nor does it include PCB mitigation, playground equipment, rental of space, or any program expansion...

"looks like we're going to be reallocating funding"
"this is probably the best position we've been in in quite awhile"
"those allocations are going need to occur, and they're going to be painful...not the worst budget year we've seen in quite some time"
"a year of reallocation rather than budget cuts"

class size chart is the same as it was in the January presentation
"we got to think about space for the schools"
takes 21 teachers to take care of 37 classes that are over 27 students for next year
"unless we rent space, 6 classes at Chandler Elementary will have30 students" next year

"students that live in Worcester, but attend school choice in another town...where are they going?"
Compare those districts to Worcester on contribution above foundation; all are well above
you saw this chart in January
"I think that tells you what choices parents have made"

currently the city is $812,207 under net school spending (calls out Councilor O'Brien, who just came in, for doing "yeoman's work" in getting us this close)

currently 7500 computers, 700 iPads, 400 document cameras (elmos), and wifi in schools

zero based budgeting: start from ground zero...every single position and dollar has to be justified each year
long term student achievement needs for finance
budget needs to reflect changes in the district and in our students

As the City Manager has now changed his budget timeline, the WPS budget now not coming out until possibly later than the first weekend in May, as originally announced.