aaps fy14 audit presentation

FY14 Financial Audit

Presented by: Laura Claeys &

Jennifer Chambers

{Public Schools of the City of Ann Arbor}

General Fund – Budget to Actual ��Year Ended June 30, 2014

$182.4 $184.0 $184.7*

$189.5* $186.4* $186.9*

$170

$175

$180

$185

$190

$195

Revenues Expenditures

Millions

Approved Budget (June 2013) Amended Budget (May 2014) Actual (Audited)

$180.6 $181.1

$5.8 $5.8

1 *Both revenue and expenditures include $5.8 million in MPSERS pass-‐through from State of Michigan

General Fund - Approved Budget vs. Actual net of MPSERS passthrough from State ��Year Ended June 30, 2014

$182.4 $184.0

$180.6 $181.1

$170

$175

$180

$185


Millions

Approved Budget (June 2013) Actual (Audited)

2 NOTE: Both revenue and expenditures exclude $5.8 million in MPSERS pass-‐through from State of Michigan

Grant Programs – Budget to Actual ��Year Ended June 30, 2014

$8.8 $8.8

$6.6 $6.6

$0

$2

$4

$6

$8

$10


Millions

Amended Budget (May 2014) Actual (Audited)

Note-‐ Variances between budget and actual results is primarily due to Uming issues in terms of grant periods and Uming of revenue receipt versus expenditures. The District uUlizes their full grant allocaUons by the end date of the grant period. 3

Combined General Fund **– Budget to Actual ��Year Ended June 30, 2014

$182.4 $184.0

$193.6*

$198.3*

$193.0* $193.6*

$170

$175

$180

$185

$190

$195

$200


Millions

Approved Budget (June 2013) *** Amended Budget (May 2014) Actual (Audited)

$187.2 $187.8

4

*Both revenue and expenditures include $5.8 million in MPSERS pass-‐through from State of Michigan ** Includes general fund operaUons and grant funded programs *** The District Approved Budget (June 2013) does not provide for revenue or expenditures related to grant funded programs

$5.8 $5.8

Combined General Fund��Budget to Actual��Year Ended June 30, 2014

!   1.1% of the 2.37% expenditure variance relates to timing on grants

Amended Budget Actual Variance Percentage

Fund Balance - June 30, 2013 9,426,763$ 9,426,763$ -$

Revenue 193,557,374 192,911,951 (645,423) -‐0.33%

Expenditures 198,166,047 193,477,506 (4,688,541) -‐2.37%

Excess of Expenditures Over Revenue (4,608,673) (565,555) 4,043,118

Plus: Other Financing Sources/Uses (100,000) (42,324) 57,676

Change in Fund Balance (4,708,673) (607,879) 4,100,794

Fund Balance - June 30, 2014 4,718,090$ 8,818,884$

Fund Balance as % of Expenditures 4.6%

Days of operation (365 day year) 17

5

Comparative Combined General Fund Results ��Year Ended June 30

-‐$12,000,000

-‐$10,000,000

-‐$8,000,000

-‐$6,000,000

-‐$4,000,000

-‐$2,000,000

$0

$2,000,000

$4,000,000

2010 2011 2012 2013 2014

($10,955,601)

$3,169,120

($3,865,607)

($7,208,206)

($607,879)

6

Comparative Combined General Fund ��Fund Balance History��Year Ended June 30

$0

$5,000,000

$10,000,000

$15,000,000

$20,000,000

$25,000,000

$30,000,000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

$27,971,185

$24,128,970

$27,207,021

$31,920,876

$27,914,369

$17,331,456

$20,500,576

$16,634,969

$9,426,763 $8,818,884

7

78%

9%

3%

10%

FoundaUon Allowance County Special EducaUon MPSERS Pass-‐through Other (State Categoricals, Special Ed State Funding, Local)

General Fund Revenue *��Year Ended June 30, 2014

* Excludes grant programs Total Revenue = $186,480,897

$16.4m

$19.2 m

$145.1m

8

$5.8m

12,000

14,000

16,000

18,000

16,705 16,488 16,444 16,471 16,597 16,669 16,700

16,493 16,835

Num

ber o

f stude

nts

Student Enrollment Comparison��Fall Count and Percentage Change from the Previous Years Ended June 30

(.27%) .17% .76% .44% .18%

9

(1.24%)

*EsUmated Fall 2014 count (FTE), includes all students for which State FoundaUon allowance is received by the District.

(1.30%) (1.15%) 2.08%

87%

6%

4% 3%

Salaries and Benefits (inc. $5.8 m MPSERS passthrough) Purchased Services (Custodial/Maintenance, Technology) Supplies and Materials Other (TransportaUon through ISD; Equipment related to trans/maint; dues/fees)

General Fund Expenditures *��Year Ended June 30, 2014

* Excludes Grant Programs Total Expenditures = $186,945,605

$10.3m $8.2m

$5.9m

$162.5m

10

84%

5% 1%

7% 3%

InstrucUon and InstrucUonal Support OperaUons: Custodial and Maintenance

Central AdministraUon School Building AdministraUon

Other (ex: IT, Personnel Services, AthleUcs)

General Fund Breakdown of Salaries and Benefits *��Year Ended June 30, 2014

* Excludes grant programs Total Salaries and Benefits = $162,519,360

$8.9m

$5.0m

$134.6m

11

$11.6m $2.4m

Retirement Funding – MPSERS Expense��Year Ended June 30

12

MPSERS UAAL expense from State Aid. This is a direct pass-‐through from State: -‐ 2013 includes $2.2 million -‐ 2014 includes $5.8 million

$-‐

$5.0

$10.0

$15.0

$20.0

$25.0

$30.0

$35.0

2008-‐2009 2009-‐2010 2010-‐2011 2011-‐2012 2012-‐2013 2013-‐2014

$20.4 $22.0 $22.4

$27.5 $28.1

$32.7 Do

llars (in Millions)

Foundation Allowance and MPSERS Contribution ��(per pupil) ��Year Ended June 30

Commentary: -‐ In 2009, FoundaUon Allowance = $9,723 per pupil

13

-‐ In 2014, FoundaUon Allowance = $9,050 per pupil -‐ Decrease in FoundaUon Allowance = (6.9%) -‐ Increase in reUrement rate since 2009 approximates 106.8%

$0

$1,000

$2,000

$3,000

$4,000

$5,000

$6,000

$7,000

$8,000

$9,000

$10,000

2008-‐2009 2009-‐2010 2010-‐2011 2011-‐2012 2012-‐2013 2013-‐2014

$8,484 $8,000 $8,140 $7,654 $7,334 $7,064

$1,239 $1,336 $1,350

$1,652 $1,686 $1,986

FoundaUon Allowance net of MPSERS Cost MPSERS Cost

Financial Impact of Foundation Funding and Retirement System Costs

Per Pupil Foundation - 2009 9,723$

Per Pupil Foundation - 2014 9,050

Reduction in Foundation 673$ A

Per Pupil MPSERS Cost - 2009 1,239$

Per Pupil MPSERS Cost - 2014 1,986

Increase in MPSERS Cost 747$ B

Per Pupil Impact of Reduced Foundation

and increased MPSERS Cost 1,420$ A + B

Pupil count for Fiscal 2014 16,479.79 blended count

Negative Financial Impact of these elements 23,401,302

Less MPSERS Pass-through from State (5,771,049)

Negative Financial Impact net of State support 17,630,253$

14

Retirement Funding – MPSERS Rate��Year Ended June 30

16.70% 16.94% 20.66%

24.46% 24.70% 24.79%

8.76%

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

30.00%

35.00%

40.00%

2009 2010 2011 2012 2013 2014 2015

Rate (Net of MPSERS pass-‐through in '13 & '14) MPSERS pass-‐through

2.02% 4.90%

25.78%

Increase from 2009 -‐ 2014 = 106.8% -‐ gross rate Increase from 2009 -‐ 2014 = 54.4% -‐ net of MPSERS pass-‐through

15

Health Related Insurance Costs ��Year Ended June 30

16

$-‐

$5.0

$10.0

$15.0

$20.0

$25.0

2010 2011 2012 2013 2014

$23.0

$17.7 $18.0

$19.4 $19.5

Dollars (in Millions)

General Fund – Compensated Absences Balance��Year Ended June 30

Consists of: TerminaUon Pay (ended in 2003 – no new entrants and no addiUonal years of service earned) VacaUon Pay Sick Leave Pay 17

$-‐

$2.0

$4.0

$6.0

$8.0

$10.0

2010 2011 2012 2013 2014

$9.7 $9.2

$7.4 $7.1

$5.8

Dollars (in Millions)

Ann Arbor Public Schools ��Year Ended June 30, 2014��Key Takeaways

•   Your current success is a community and district collaboration

•   Cost containment austerity measures in all

departments are working, but will require continued focus

•   Enrollment has increased by the largest percentage in the last decade, resulting in a current year increase to revenue of approximately $3 million

18

Future Developments in the��School Environment

Capital Repairs

Dependence upon state economy and politics

Union negotiations

Future retirement

contribution rates

Federal funding changes

Delayed state aid payments

Future changes in foundation allowance funding and best practice requirements Health Care

Costs

Cost of Utilities

Charter and Private Schools Legal and

Insurance Costs 19

Cash Flow Needs

Fund Balance levels

Next Steps in our ��AAPS School Environment

Monthly Monitoring Budget Reports

Build enrollment (from within AAPS) & increase revenue

Advocate

at the state level

Build Fund Equity

to ensure sustainability of the

organizaQon

Control expenditures 19

Extend & Enhance

Quality, Innovative Programming in AAPS schools

Thank You!

17

We appreciate the Board of EducaQon -‐ support -‐ courageous decision-‐making

Our AAPS employees

-‐ hard work to extend our quality and make the ‘Ann Arbor Public School’ difference -‐ understanding -‐ sacrifices

Thank you.

aaps fy14 audit presentation

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