Salem-Keizer Public Schools

2012-13 Budget Message

All students graduate and are prepared for a successful life.

Budget information available online at www.salemkeizer.org

10 Years of Funding History

$30,000,000 $20,000,000 $10,000,000
Current Service$Level

2003-04 03-04

2009-10

2002-03

2004-05

2005-06

2006-07

2007-08

2008-09

2010-11

2011-12

$(10,000,000) $(20,000,000) $(30,000,000) $(40,000,000) $(50,000,000) $(60,000,000)

2012-13

Cuts: 2002-03 through 2005-06

Current Service Level $-

2002-03

2003-04

2004-05

$(5,000,000) $(10,000,000) $(15,000,000) $(20,000,000)

2005-06

Direct Instruction, 11% Support to Students, 7% Central Administration, 6%

03-04

Concessions, 4% Reserves, 72%

$(25,000,000)
$(30,000,000) $(35,000,000) $(40,000,000)

Adds: 2006-07 through 2008-09

$25,000,000 $20,000,000
Reserves, 19%

$15,000,000
Purchase of Portables, 11%

Direct Instruction, 35%

$10,000,000

03-04

$5,000,000

Central Administration, 13% Support to Students, 22%

Current Service Level

$-

2007-08

2006-07

2008-09

More Cuts: 2009-10 through 2010-11

Current Service Level $-

2009-10

$(5,000,000) $(10,000,000) $(15,000,000) $(20,000,000) $(25,000,000)

2010-11

Transfer to ARRA funds, 12%

Direct Instruction, 9% Support to

Students, 4% Central Administration, 8%

$(30,000,000)
$(35,000,000) $(40,000,000) $(45,000,000) $(50,000,000)

03-04

Concessions, 10%

Reserves, 57%

This Year: 2011-12

Current Service$Level

$(10,000,000)

2011-12

Reserves, 13%

$(20,000,000) 03-04
Concessions, 20% Direct Instruction, 54% Central Administration, 5% Support to Students, 8%

$(30,000,000)

$(40,000,000)

$(50,000,000)

$(60,000,000)

FTE changes over time

2002-06 2006-09 2009-11 2011-12 cut added cut cut Licensed Staff (64) 167 (12.5) (278) Classified Staff (127) 69 (8) (139) Supervisory (14.0) 8 (1.5) (9)

In the 2009-10 budget process Federal Stimulus Funds paid for 31 FTE licensed staff, 15 classified staff and 1.5 supervisors.

Total Proposed Budget: $578,990,853

Special Revenue Funds* $79,327,732 13% Debt Service - PERS* Internal Service $17,473,784 Funds: 3% $22,115,014 4% Debt Service - General Obligation Bonds* $32,285,206 6%

Enterprise Fund & Trust Fund $518,300 <1%

Capital Projects Fund* $87,940,665 15%

General Fund $343,423,734 59%

* Restricted Funds

Total General Fund: $343,423,734

General Fund $343,423,734 59%

Our current reality is a $20.5 million shortfall for next year

How is the shortfall determined?

For 2012-13, we estimate our current service level costs to be: $363,455,805

Since this is the second year of the biennium we already know what amount will be allocated by the State of Oregon. We estimate our total revenue to be: $343,423,734 *
*Includes flow through revenue from property taxes, interest earnings and fees.

How is the shortfall determined?

Here is the math: Estimated revenue for 2012-13 $343,423,734

Costs to maintain current service levels Add funding for technology Total
Shortfall

$363,455,805 $500,000 $363,955,805

$ -20,532,071

How do you decide what to cut?

Determine what is needed to get the results Understand what is legally mandated Pay attention to the values of the community Listen to feedback from staff Ask the Budget Committee
Here is what we have been hearing

How do you decide what to cut?

From our staff They worry that large classes impact their ability to differentiate instruction effectively. They need more time to work with their peers. They feel the loss of support systems. They would like to use technology so they can be more efficient. They miss their colleagues.

How do you decide what to cut?

Areas of focus from Budget Committee discussions Protect Class Sizes Protect Programs For Students Protect Technology and if possible increase funding Reduce Ending Fund Balance/Contingency Reduce Compensation Through Concessions Reduce Instructional Programs

How do you decide what to cut?

Supplies & Materials, 3% Other, 3% Purchased Services, 7%

Salaries and Benefits, 86%

How do you decide what to cut?

What we can do Raise class size What must be negotiated Salary Adjustments

Eliminate or reduce programs Reduce central services

Furlough Days

Benefit Packages

Addressing the shortfall.

Keeping in mind the factors that influence the decisionmaking around the $20.5 million shortfall
Results Staff feedback Community Values Budget Committee discussions Mandates/Legal requirements Contractual agreements 86% of funds are in people
Here are the recommendations to balance the 2012-13 budget

Addressing the shortfall.

Total shortfall: $ -20,532,071

Apply the following to offset the shortfall: Reduce Ending Fund Balance to 3% Adjust associated payroll costs $7,197,288 $3,610,000

(This includes less allocated for unemployment costs and an adjustment based on historic spending patterns)

Remaining Shortfall

$-9,724,783

Addressing the shortfall.

Remaining Shortfall
Apply the following to offset the shortfall: Small School repurposing Reductions for supplies and materials across the district Reductions in Transportation Reductions in contracted security services $801,739 $473,044 $350,000 $100,000

$-9,724,783

Amount of shortfall remaining :

$-8,000,000

Addressing the shortfall.

Amount of shortfall remaining : Employee concessions and/or additional cuts. $-8,000,000

$8,000,000

Balance

$0

There are no easy cuts

Reductions to the budget must be: Legally compliant Sustainable Operationally sound Support academic achievement for all students Over a four year period of time, which includes this budget recommendation, we have cut $125 million from our budget and we must be prepared for additional reductions in the next biennium (2013-15).

Final Thoughts

All students graduate and are prepared for a successful life.