2009-10 Amended Budget November 23, 2009

1. East Grand Rapids Public Schools 2009-10 Amended Budget November 23, 2009

2. 2009-10 General Fund Budget Original Budget

3. 2009-10 Amended Budget(General Fund changes since June) • Revenues: (Decrease of $594,029) • Per-Pupil Funding: • June: Assumed federal stimulus would keep funding whole compared to 2008-09 • $7,417 pp in state + $450 pp in federal stimulus = $7,867 pp • School Aid Fund passed in October cuts funding $165 pp • $7,422 pp in state + $280 pp in federal stimulus = $7,702 pp • Included $100 million in “new revenue” • $184 million in federal stimulus pushed to 2010-11 • Days later: Governor issues $127 pp proration • $292 total cut in funding, $7,575 pp • $292 cut in funding = $875,000 decrease in revenues

4. 2009-10 Amended Budget(General Fund changes since June) • Revenues: (Decrease of $594,029) • Student Count: • June: Assumed blended count of 2,965 • Actual blended count = 2,997 • 32 additional students = $242,400 additional revenue • Other Changes: • Title I: Decreased $30,000 (no federal stimulus) • Interest Income: Decreased $10,000 • Accounting shift for Field Trips: Increase of $57,000

5. 2009-10 Amended Budget(General Fund changes since June) • Expenses: (Increase of $268,931) • Joint Facilities: Increase of $177,000 • Carryover from 2008-09 projects, 09-10 projects • Operational: Increase of $91,931 • Salaries/Benefits: Increase of $31,000 • 0.8 FTE increase at MS to meet class size restrictions • Purchased Services/Supplies: Increase of $48,000 • Accounting Shift for Field Trips: $57,000 increase • Legal Fees: $10,000 increase • Building/Dept Budget carryover: $63,000 increase • Utilities: ($80,000 decrease) • True operational increase after acctg. shift = $34,931

6. 2009-10 Amended Budget(General Fund)

7. 2009-10 Amended Budget(General Fund)

8. Mid-Year Budget Reductions • $165 cut = Fund balance similar to what was adopted in June ($4.1 million) • Absorbing full $292 cut would use 21% of our fund balance in one fiscal year • Not reducing our budget creates a $1 million “structural deficit”, and 2010-11 projects further funding cuts • Recommend implementing $100,000 to $200,000 of reductions ($200,000 to $400,000 on annual basis) for 2nd semester • $150,000 in reductions at semester would leave fund balance at $3.8 million, 13.7% • All reductions will try to avoid classroom disruption • Approval: Dec. BOE mtg., special Jan. mtg.? (30 days notice for layoffs)

9. 2010-11 Per Pupil Funding • $450 million in federal funds ($280 pp) included in the $7,575 total • $184 million in federal funds left for 2010-11 ($115 pp) • $165 cut in funding before discussing state revenues • State assuming 3.1% SAF growth as of May • No reductions from $7,575 would be necessary • SAF growth recently: • 2007-08: 3.3% growth • 2008-09: (5.3%) estimate in May, $116 million short? • 2009-10: (5.1%) estimate in May • 2010-11: (3.0%) ?? • Some feel funding could be reduced by up to additional $500 per pupil • Assuming 3% reduction in SAF revenues • $300 overall cut in funding, includes reduced federal contribution • $7,160 in state funds, drop of $135 per pupil • Total per pupil funding drops to $7,275 (2002 level of funding)

10. Long Term Forecast

11. Managing Fund Balance & Cuts • In June, we discussed using fund balance down to a 8-10% level the next 3-4 years to soften budget cuts • Assume $2.8 million is the fund balance target • From current $4.7 million, $1.9 million of fund balance to use • Example: • 2009-10: $831,637 • 2010-11: $600,000 • 2011-12: $460,000, fund balance at end of year: $2.8 million • Budget Cuts required: • 2009-10: $150,000 (2nd semester) • 2010-11: $1,800,000 • 2011-12: $1,000,000

12. 2009-10 Amended Budget(Athletics & Food Service)

13. 2009-10 Amended Budget(Sinking Fund & Debt Retirement)

14. Questions?