June 20, 2018 CUSD BOT Meeting Agenda Item #48 2018-2019 BUDGET ADOPTION

Board Meeting Agenda page 889

Board Audio

CUSDWatch Comment:

Despite record high revenues and the 5th consecutive year of across the board compensation increases, there were no increases to school site budgets, no reductions to class sizes and facilities have $189 million in “Emergency” facility needs.

 

 

  2017-18 2018-19
GENERAL ASSUMPTIONS
Enrollment

47,475

47,051

ADA

$8,293 $8,822

Site Supply Budget

K-5 $21/Student

6-8 $25/student

9-12 $33 per student

K-5 $21/Student

6-8 $25/student

9-12 $33 per student

Staffing Formula 

  K =      30.5:1

  1-3 =   30:1

  4-5 =   31.5:1

*6-8 =   32.5:1

*9-12 = 34.5:1 

*Includes Prep Time and Electives

*K =      30.5:1

  1-3 =   30:1

  4-5 =   31.5:1

*6-8 =   32.5:1

*9-12 = 34.5:1 

*Staff Full Time K at 28.5:1

*Includes Prep Time and Electives

REVENUE ASSUMPTIONS   

Total Revenues Restricted/ Unrestricted

 

TOTAL $467,415,250

LCFF $384,920,586 

Federal $16,899,656

Other State $60,735,829

Other Local $4,859,829

TOTAL $485,369,622

LCFF $405,439,289

Federal $16,148,289

Other State $58,516,842

Other Local $5,265,842

Other Financing Sources/Uses

"Contributions"

Total $65,716,747

Total $75,066,392

COLA 

State Categorical 1.56%

Special Education 1.56%

LCFF COLA 0%

State Categorical 2.71%

Special Education 2.71%

LCFF COLA 3% 

Lottery 

Unrestricted: $140 per student

Approximately $6.8 million

Restricted $ 41 per student

Unrestricted $2 million

Total $8.8 Million 

 

Unrestricted: $146 per student

Approximately $7 million

Restricted $ 48 per student

Unrestricted $2.3 million

Total $9.3 Million 

EXPENDITURE ASSUMPTIONS   

Expenditures

Salaries and Benefits as a percentage of General Fund 

2018-19 86.9%

2019-20 89.3%

2020-21 90.1%

TOTAL $479,079,815

Certificated Salaries $214,498,795

Classified Salaries $67,174,112

Employee benefits $114,889,402

Books and Supplies $18,843,096

Service and Other Operating Expenses $14,198,538

Capital Outlay $6,269,495

Other Outgo ($538,823)

TOTAL $501,740,890

Certificated Salaries $212,287,365

Classified Salaries $77,856,781

Employee benefits $128,445,342

Books and Supplies $21,884,242

Service and Other Operating Expenses $42,889,463

Capital Outlay $4,239,219

Other Outgo ($524,840)

STEP & COLUMN     
Salary 

CUEA 1.5%

CSEA 2.0%

CUMA 1.5%

Teamsters 2%

CUEA 1.5%

CSEA 2.0%

CUMA 1.5%

Teamsters 2%

PERS

Estimate of Future Contributions 

2017-18 13.888%

2018-19 15.53%

2019-20 18.1%

2020-21 20.8%

Not Included

 

2017-18 Not Included

2018-19 18.062%

2019-20 20.8%

2020-21 23.5%

2021-22 24.6%

STRS

Estimate of Future Contributions   

2016-17 12.58%

2018-19 14.43%

2019-20 16.28%

2020-21 18.13%

Not Included

 

2016-17 Not Included

2018-19 16.28%

2019-20 18.13%

2020-21 19.10%

Not Included

 

Vacancies created due to retirements or those employees indicating their intent not to return will be budgeted as follows:

Certificated: Column C, Step 11

Classified: Step 3, Range per Classification

Administrative: Step 3, Range per Classification 

Certificated: Column C, Step 11

Classified: Step 3, Range per Classification

Administrative: Step 3, Range per Classification

Salary Agreements with Employee Groups

Salary Agreements have NOT been reached will all employee groups

Salary Agreements have been reached will all employee groups

Special Education non-salary expenditures

Increase of 2%- 5% 

Increase of 2%- 5% 

Categorically funded programs

Dependent on available funding

Dependent on available funding

Benefits

STRS 14.43%

PERS 15.53%

OASDI 6.200%

Medicare 1.450%

Workers Comp 1.450%

Unemployment 0.050 %

OPEB – Active 0.80%

OPEB – All 0.27%

STRS 16.28%

PERS 18.062%

OASDI 6.200%

Medicare 1.450%

Workers Comp 1.500%

Unemployment 0.050%  

OPEB – Active 0.80%

OPEB – All 0.27%

Health and Welfare Insurance Costs

$40.7 million

$46 million

Liability Insurance

$2.9 million

$3 million

Transfers and Capital Outlay

$3.5 million to Deferred Maintenance Fund from LCFF funds

$3 million to Deferred Maintenance Fund from LCFF funds

Indirect/Direct Costs

Inter-program direct and indirect costs 4.2%

Cafeteria Fund 4.2%

Child Development Fund will be charged based on direct staff time used to support the childcare program, utility costs, insurance, maintenance and warehouse services

Inter-program direct and indirect costs 4.63%

Cafeteria Fund 4.63%

Child Development Fund will be charged based on direct staff time used to support the childcare program, utility costs, insurance, maintenance and warehouse services

Debt Service

$800,000 total

Lease Payment Obligations

$1.5 million total

Energy Bond

Lease Payment Obligations

$3.25 million for Supplemental Early Retirement for Teamsters and CUEA

Reserve for Economic Uncertanty

3.5%

2%

New Textbooks

$6 million from Restricted Lottery Funding, LCFF Funds and One time mandate funds

$6.7 million from Restricted Lottery Funding and One time mandate funds

Summer School  $50,000   $50,000
ADDITIONAL ASSUMPTIONS   
Interest Earnings on Custody Funds .35%   1.2%

Charter Funds

5 Charter Schools + 1 allowed to Operate in the District by OCDE

Funds from the 5 are projected to be $415,000

5 Charter Schools + 1 allowed to Operate in the District by OCDE

Funds from the 5 are projected to be $415,000

FUND BALANCES
01 - 60 Governmental Funds
01 General Fund/County School Service Fund
03 General Fund Unrestricted $56,808,325.48 $41,861,474.00
06 General Fund Restricted $10,577,568.00 $1,812,469.00
11 - 20 Special Reserve Funds Charter Schools    
11 Adult Education    
12 Child Development Fund $117,144 -0-
13 Cafeteria Fund $3,498,028 $3,706,926.00
14 Deferred Maintenance Fund $1,700,000 -0-
15 Pupil Transportation    
16 Forest Reserve Fund    
17 Special Reserve Fund for Other Than Capital Outlay (Post Employment Benefits) $80,766 $82,858.00 
18 School Bus Emissions Fund    
21-50 Capital Project Funds
21 Building Fund -0-  -0- 
25 Capital Facilities Fund  $977,993 $3,554,753.00 
30 State School Building Lease-Purchase Fund    
40 Special Reserve Fund Capital Outlay Projects $13,389,399 $8,337,773.00 
County School Facilities Fund -0- -0-
51-60 Debt Service Funds
51 Bond Interest and Redemption Fund $4,660,097  $4,796,777.00
53 Tax Override Fund    
56 Debt Service Fund    
61-70 Proprietary Funds
61-65 Enterprise Funds   
61 Cafeteria Fund    
63 Other Enterprise Fund    
66-70 Internal Service Funds    
66 Warehouse Revolving Fund    
67 Self Insurance Fund $6,480,814 $8,111,929.00
71-95 Fiduciary Funds
71-75 Truste Funds
71 Retire benefit Fund    
72 Article XIII-B Fund    
73 Foundation Trust Fund    
76-95 Agency Funds
76 Warrant/Pass through Fund    
95 Student Body Fund    
Total Fund Balances $85,719,471 $71,264,959

CUSDWatch Comment

CUSD does an early retirement every 5 years so that employee compensation as a % of General Fund Revenues does not go over 100% They just did one again this year. Having employee compensation at 90% of the budget means the priority is adult jobs and NOT the education of children.

Ratio of Unrestricted Salaries and Benefits to Unrestricted General Fund Expenditures
Fiscal Year   Salaries & Benefits Total Expenditures  Ratio 
2015-16 $289,812,869.65 $329,027,202.48   88.1%
2016-17 $289,462,870.24 $331,227,063.56   87.4%
2017-18 $307,230,194.00  $350,449,011.00   87.7%
2018-19 $309,687,095.00  $356,325,610.83   86.9% 
2019-20 $318,577,135.00 $356,572,676.00   89.3% 
2020-21 $324,855,146.00  $360,551,944.00   90.1%

 

CUSDWatch Comment:

Operating Revenues are in decline because of 5 consecutive years of across the board employee compensation increases totaling over $150 million.

CUSDWatch Comment

Minimum Contribution Proposition 51 School Facilities Fund 

CUSDWatch Comment:

The District reports reserves based solely on the General Fund- but... under Local Control there are only four accounts that are actually restricted.

Special Education, Foster Youth and two Native American youth programs. 

That means CUSD can move money between all other funds- so the "Reserves" are for all funds except 

Special Education, 

Foster Youth and

two Native American youth programs. 

Are Trustees aware of this?

The following was calculated as of September 2017 (lag one year)

 

Capistrano Unified School District Actual Reserves $133 million

 

THE SHELL GAME

Current legislation, policies, and practices allow public school districts to deceive the public about the districts’ financial positions by focusing on budgets that never manifest and “reserves” that only reveal the tip of the iceberg. 

These practices unnecessarily complicate every district function from the LCAP process to labor negotiations to foundations and bonds. 

Stakeholders are in the dark. 

Billions of dollars of taxpayer money that was meant to educate children are being wasted, hidden below the surface and growing annually, and school districts budgets show they plan to continue the trend. 

The practice also makes one call to question how all public agencies present their information. 

 

CUSD HAD $16 MILLION IN GENERAL FUND DOLLARS THAT IT CHOSE NOT TO SPEND IN THE CLASSROOM OR TO FIX AND MAINTAIN FACILITIES INSTEAD IT IS BEING HORDED.

CUSD HAS GROWN ITS ACTUAL RESERVES FROM $51 MILLION IN 2011-12 TO ITS CURRENT $133 MILLION 

CUSDWatch Comment:

In September we can add the 2017-18 data and compare apples to apples.

THE CORRECTING ENTRIES ARE THEN DONE ON CONSENT CALENDAR AS FOLLOWS: 

September 13, 2017 CUSD BOT Meeting Agenda Item #13  RESOLUTION NO. 1718-14, AUTHORIZING THE INCREASE AND DECREASE IN APPROPRIATIONS FOR THE FISCAL YEAR ENDING 2016- 2017 page 472 of 998 

September 13, 2017 CUSD BOT Meeting Agenda Item #14  RESOLUTION NO. 1718-15, RE-APPROPRIATION OF CARRYOVER FUNDS page 476 of 998 

September 13, 2017 CUSD BOT Meeting Agenda Item #15  RESOLUTION NO. 1718-16, ADOPTING THE 2016-2017 ACTUAL GANN LIMIT AND THE 2017-2018 ESTIMATED GANN LIMIT page 481 of 998  

THE WAY TO CALCULATE ACTUAL RESERVES as of 2016-17
 

 

 

 TOTAL FUND BALANCES

01-60 GOVERNMENTAL FUNDS
01 General Fund/County School Service Fund  
03 General Fund Unrestricted

$61,030,106.01 

September 13, 2017 CUSD BOT Meeting Agenda Item #36  2016-17 Financial Statements (Unaudited Actuals) page 811 of 998

06 General Fund Restricted

$13,710,748.53 

September 13, 2017 CUSD BOT Meeting Agenda Item #36  2016-17 Financial Statements (Unaudited Actuals) page 811 of 998

Total General Fund = Restricted + Unrestricted

$61.03 +13.71 = $74.74

11–20 Special Revenue Funds CHARTER SCHOOLS

$0.00   

September 13, 2017 CUSD BOT Meeting Agenda Item #36  2016-17 Financial Statements (Unaudited Actuals) page 829 of 998

Ending Balance in 16-17: -0-

2017-18 Budget: -0-

Difference -0-

11 Adult Education Fund 

$0.00 

September 13, 2017 CUSD BOT Meeting Agenda Item #36  2016-17 Financial Statements (Unaudited Actuals) page 841 of 998

Ending Balance in 16-17: -0-

2017-18 Budget: -0-

Difference -0-

Adult Ed is no longer taught- services are at Saddleback now

12 Child Development Fund

$372,954.14 

September 13, 2017 CUSD BOT Meeting Agenda Item #36  2016-17 Financial Statements (Unaudited Actuals) page 851 of 998

Ending Balance in 16-17: $372,954.14

2017-18 Budget: $372,954.14

Difference -0-

13 Cafeteria Fund 

$4,701,035.49 

September 13, 2017 CUSD BOT Meeting Agenda Item #36  2016-17 Financial Statements (Unaudited Actuals) page 861 of 998

Ending Balance in 16-17: $4,198,786.88

2017-18 Budget: $4,701,035.49

Difference: Increase of 12%

14 Deferred Maintenance Fund

$1,809,647.93

September 13, 2017 CUSD BOT Meeting Agenda Item #36  2016-17 Financial Statements (Unaudited Actuals) page 871 of 998

Ending Balance in 16-17: $1,809,647.93

2017-18 Budget: $1,809,647.93

Difference: -0-

15 Pupil Transportation   
16 Forest Reserve Fund   

17 Special Reserve Fund for Other Than Capital Outlay Projects (Post Employment Benefits)

$79,958.21 

September 13, 2017 CUSD BOT Meeting Agenda Item #36  2016-17 Financial Statements (Unaudited Actuals) page 879 of 998

Ending Balance in 16-17: $79,958.21

2017-18 Budget: $80,758.21

Difference: 1%

18 School Bus Emissions Reduction Fund   
21–50 Capital Project Funds  

21 Building Fund 

$516,428.77

September 13, 2017 CUSD BOT Meeting Agenda Item #36  2016-17 Financial Statements (Unaudited Actuals) page 890 of 998 

Ending Balance in 16-17: $79,958.21

2017-18 Budget: (.23)

Difference: Decrease 100%

25 Capital Facilities Fund 

$11,321,653.23 

September 13, 2017 CUSD BOT Meeting Agenda Item #36  2016-17 Financial Statements (Unaudited Actuals) page 900 of 998 

Ending Balance in 16-17: $11,321,653.23 

2017-18 Budget: $977,993.23

Difference: Decrease 91.4%

30 State School Building Lease-Purchase Fund  $0.00 

40 Special Reserve Fund for Capital Outlay Projects

$28,105,118.01 

September 13, 2017 CUSD BOT Meeting Agenda Item #36  2016-17 Financial Statements (Unaudited Actuals) page 922 of 998 

Ending Balance in 16-17: $28,105,118.01

2017-18 Budget: $25,442,797.01

Difference: Decrease 9.5%

51–60 Debt Service Funds   
51 Bond Interest and Redemption Fund 

$4,561,164.00 

September 13, 2017 CUSD BOT Meeting Agenda Item #36  2016-17 Financial Statements (Unaudited Actuals) page 931 of 998 

Ending Balance in 16-17: $4,561,164.00

2017-18 Budget: $4,533,921

Difference: Decrease 0.6%

53 Taxoverride Fund  
56 Debt Service Fund  
Subtotal 1- 60 $126,208,814.32
61–70 PROPRIETARY FUNDS 
61–65 Enterprise Funds   
61 Cafeteria Fund   
63 Other Enterprise Fund   
66–70 Internal Service Funds   
66 Warehouse Revolving Fund   

67 Self-Insurance Fund 

$7,079,086.16  

September 13, 2017 CUSD BOT Meeting Agenda Item #36  2016-17 Financial Statements (Unaudited Actuals) page 934 of 998

There was a $7.1 million ending balance in 16-17. $7.3 (EFB), 2.9% increase, budgeted this year.

Subtotal 61-70 $7,079,086.16 
71–95 FIDUCIARY FUNDS
71–75 Trust Funds  
71 Retiree Benefit Fund   
72 Article XIII-B Fund   
73 Foundation Trust Fund   
76–95 Agency Funds  
76 Warrant/Pass-through Fund*   
95 Student Body Fund*   
Subtotal 71-95 $0.00 
Total Funds  $133,287,900.48 

The work that CalProEd has done to date found the "Actual" Reserves for the following school districts:

Billions of dollars of taxpayer money that was meant to educate children are being wasted, hidden below the surface and growing annually, and school districts budgets show they plan to continue the trend.

Why? Kickbacks? Pet projects without oversight? Job security for admin and union? 

CUSDWatch Comment

CUSD's Long Term Commitments:

 

CUSDWatch Comment

Unfunded Liabilities $53 million dollars for pension benefits:

CUSDWatch Comment

Unfunded Liabilities for benefits other than Pensions:

CUSDWatch Comment

CUSD Unfunded Liability for Self Insurance Program

CUSDWatch Comment

CUSD plans to reduce its teaching staff going forward to save money. Class sixes stay the same but 78 teachers at average compensation of $111,000.00 per year are no longer teaching. That is $8.7 million dollars wasted on teachers who no longer teach!

CUSDWatch Comment

Teachers Contract

CUSDWatch Comment

Management Contracts - These numbers probably do not reflect the truth as CUSD has been adding management personnel.

 

CUSDWatch Comment

Multi Year UNRESTRICTED

Multi Year RESTRICTED

Multi Year RESTRICTED + UNRESTRICTED