Hopewell Area School District

2018‐2019 General Fund Budget Board Presentation
March 19, 2018

Mission Statement

The Hopewell Area School District is committed to preparing students to be productive citizens and life‐long learners in an ever‐changing world.

Presentation Agenda

‐District Enrollment ‐Budget Timeline
‐Overview of 2018‐19 General Fund Budget ‐Fund Balance History
‐Next Steps ‐Discussion

2017‐2018 District Enrollment

Enrollment at March 1, 2018: 2,064 Projected enrollment for 2018‐19 (below): 2,136

District Budget Timeline

• January 2018‐Board resolution not to exceed the index

– District adjusted index for 2018‐19 is 3.1%

– Millage can increase by 2.27 mills without a referendum

– Adjusted index calculation depends on economic factors in the Commonwealth

– Upcoming deadlines: April 15th for State to certify funds for property tax reduction, May 1st for notice to
Districts from State of amount of available HS/FS funds, and May 31st for adoption of proposed final budget

General Fund Budget Issues for 2018‐2019

• Limitation on millage increase due to Act 1 of 2006 index—2.27 mills

• PSERS rate increase from 32.57% to 33.43% of salaries

• Health care costs—increase of 3% based on preliminary projection of current claims costs (will be set in April)

• Charter school enrollment/tuition

– 17‐18: Regular Education‐91 students $11,698 = $1,064,518 – 17‐18: Special Education‐21 students@ $24,633 = $517,293
• PA School Employees Retirement System‐Funding Shortfall

Local Revenue ASSESSMENT INFORMATION

–	Total assessments (1/1/2018) increased by $4,808,185 (2.03%) over prior year

–	Breakdown of assessment increases by municipality
2017‐18	2018‐19

–	HOPEWELL
–	INDEPENDENCE –	RACCOON
Totals

$167,077,512 $33,037,291 $36,949,246 $237,064,049

$171,475,637 $33,465,971 $36,930,626 $241,872,234

+$4,398,125 + $428,680 ‐	$18,620

–	 At current millage rate (73.2 mills) and collection percentage (93.5%) the assessment increase calculates to a $329,082 increase in property tax revenue.

–	 At a 1 mill increase (74.2 mills) and collection percentage (93.5%) the assessment increase calculates to a $333,577 increase in property tax revenue. Overall, a 1 mill increase equates to a $555,457 revenue increase.

–	 At a 2 mill increase (75.2 mills) and collection percentage (93.5%) the assessment increase calculates to a $338,073 increase in property tax revenue. Overall, a 2 mill increase equates to $842,487 revenue increase.

–	1 mill at 93.5% collection rate = approximately $230,000

–	State Secretary certified gambling totals •	$1,149,470 in 2013‐14
•	$1,149,470 in 2014‐15 •	$1,152,306 in 2015‐16 •	$1,149,306 in 2016‐17
•	$1,149,546 in 2017‐18 (approximately $212/homestead or farmstead)

Preliminary State Revenues

• Basic Ed Funding (BEF)

– Dollar change from 2017‐18	+$46,510 • Special Ed Funding (SEF)
– Dollar Change from 2017‐18	+$24,149 • Career & Tech Subsidy
– Dollar Change from 2017‐18	+$20,738

PROPOSED NET CHANGE IN STATE FUNDING	+$91,397

2018‐19 Expenditure Budget

• 80%‐85% of expenditure budget made up of salaries, benefits, and debt service – approximately $32‐34MM
• Salaries set by Collective Bargaining Agreements – Teachers and Bus Drivers expire 6/30/2018
• Contracts in place include 2.75% increase in payroll/salary for 2018‐19
• Health care deposit premiums estimated to increase by 3% for those contracts already in place
• Retirement cost on payroll will increase based on both increased payroll costs and an increased rate
• Debt Service payments for 2018‐19: $3,103,775

Budget Challenges

• Rising costs of health care and district retirement contributions
• Current transportation subsidy at risk next year and beyond
• Special Education reimbursements not tied to actual costs
• Still no plan from Harrisburg to address cyber charter school costs/funding
• Continued reductions in Title I and Title IIA funding • Food Service Fund deficits
• Aging facilities and systems

PSERS Employer Contributions

40.00% 35.00% 30.00% 25.00%
20.00%

	
	30.03% 32.57% 33.43% 

25.84% 21.40%
16.93%

15.00%	12.36%

10.00%	5.64%	8.65% 5.00%

0.00%

Fund Balance History

10,000,000 9,000,000 8,000,000 7,000,000 6,000,000 5,000,000 4,000,000 3,000,000 2,000,000 1,000,000
0
2010‐11 2011‐12 2012‐13 2013‐14 2014‐15 2015‐16 2016‐17

Unassigned

Assigned

Next Steps

• Meet with Principals to review building and teacher requisitions

• Contracts with outside vendors (copiers, maintenance agreements, etc)

• Health, dental, vision, life insurance costs • Continue contract negotiations
• Review accounts to ensure accuracy

DISCUSSION