masbo 5.5.16 presentation lrfp final - no notes or pics ... · masbo annual conference may 5, 2016...
TRANSCRIPT
5/4/16
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How to create a transparent, collaborative, data-driven community process for
long-range financial planning
May 5, 2016
Patricia Magnuson, Executive Director of Finance and Operations
Kelly Benusa, Director of Business Services
Mike Hueller, Coordinator of Accounting/Payroll
Cindy Brown, Coordinator of Accounting/Payroll
Anne Ramsey, Coordinator of Purchasing and Warehouse
MASBO Annual Conference May 5, 2016 ISD 279 – Osseo Area Schools
Outcomes
◦ Understand the collaborative process used to develop the LRFP framework ◦ Learn about budget tool development and
the specific purpose of each
◦ Learn how to engage stakeholders in financial planning
MASBO Annual Conference May 5, 2016 ISD 279 – Osseo Area Schools
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MASBO Annual Conference May 5, 2016 ISD 279 – Osseo Area Schools
Per
cent
0
20
40
60
80
100
Free or reduced lunch eligibility by site
Eligible for free or reduced lunchNot eligible
MASBO Annual Conference May 5, 2016 ISD 279 – Osseo Area Schools
Percent
0
20
40
60
80
100
Amer Ind Hispanic Asian Black White
Racial composition by site
MASBO Annual Conference May 5, 2016 ISD 279 – Osseo Area Schools
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MASBO Annual Conference May 5, 2016 ISD 279 – Osseo Area Schools
MASBO Annual Conference May 5, 2016 ISD 279 – Osseo Area Schools
} Review historical approach to budgeting } Research finance and budgeting practices } Establish guiding principles } Develop long-range financial planning model
& framework } Design long-range financial forecasting
model
MASBO Annual Conference May 5, 2016 ISD 279 – Osseo Area Schools
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} Program-based budgeting system } Traditional incremental budgeting process } Strategic plan budgeting
} Integrated budgeting approach
MASBO Annual Conference May 5, 2016 ISD 279 – Osseo Area Schools
Mission/ Strategic Plan
Our model and framework is centered on accomplishment of our system's mission and strategic plan.
Legal Our work will comply with legal requirements and School Board policies.
Process We will use a data-driven, collaborative decision-making process.
Resources Our model and framework will guide the distribution of resources in priority order, based on data, research and strategic priorities.
Communication Our work will be communicated to our school community.
MASBO Annual Conference May 5, 2016 ISD 279 – Osseo Area Schools
Mission
Staff responsibilities LRFP guiding principles CIP Budget Organizational Complement
School Board direction Strategic priorities Forecast Budget targets Feedback
MASBO Annual Conference May 5, 2016 ISD 279 – Osseo Area Schools
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} Long-range financial forecast model
} Continuous improvement plan
} Program Efficiency Abandonment and Redirection (PEAR) Narrative modeled after Montgomery County Public Schools
MASBO Annual Conference May 5, 2016 ISD 279 – Osseo Area Schools
RevisedBudget2016 Projected2017 Projected2018 Projected2019 Projected2020
Revenueswithtactics $221,164,868 $222,583,101 $225,904,142 $228,694,954 $229,144,026Expenditureswithtactics 218,785,916 226,990,388 236,126,082 244,728,627 252,917,407
Tacticsrelatedtorevenue
Revenueassumptionbasicformulaincreaseof2.0%forFY2017(Known)and1%basicformulaincreaseforFY2018andFY2020 2,211,649 1,123,974 1,143,475
Tacticsrelatedtoexpenditures
All-daykindergartenandgradespanchangetwoyearexpenseonly(Known) (255,372)Strategicprioritiesadditionalneeds 1,500,000Enrollmentalignmentadjustment(Known) $0 1,044,889 226,602 761,636Other-reducetrendto3.25% (1,093,930) (1,137,957) (1,179,415) (1,218,879)Synergytrainingoneyearexpenseonly(Known) (150,000)Operationalreductions (5,000,000)Targetedclasssizeneeds 450,318
Baselineoperatingbalance(posttactic)FundBalance(beginningofyear) 54,732,264 57,111,216 54,314,561 45,459,663 30,378,803FundBalance(endofyear) 57,111,216 54,314,561 45,459,663 30,378,803 13,206,141Changeinfundbalance $2,378,952 ($2,796,655) ($8,854,898) ($15,080,859) ($17,172,663)
FundBalanceTargetFundBalanceasa%ofBudgeted/ProjectedExpenditure 26.10% 23.86% 19.27% 12.46% 5.34%5%ofBudgeted/ProjectedExpendituresMinimum $10,939,296 $11,379,570 $11,794,151 $12,188,791 $12,373,008
ProjectedRevenueAssumption(FY2017-FY2020) 0.00%ProjectedExpenditureAssumption(FY2017-FY2020) 3.75%
MASBO Annual Conference May 5, 2016 ISD 279 – Osseo Area Schools
} Department Continuous Improvement Plans (CIPs) ◦ Major Function
◦ Key Essential Services
◦ Key Performance Indicators
◦ Goals based on Plan, Do, Study, Act based on Baldrige Model
MASBO Annual Conference May 5, 2016 ISD 279 – Osseo Area Schools
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} Business Services Example
} Provide leadership on emerging and existing financial opportunities } Ensure compliance for responsible areas pertaining to federal state
and local laws and guidelines
} Provide customer service to internal and external customers in order to meet and exceed their needs based on best practices
} Sustain and ensure the operational processes supporting data integrity
} Provide governance to the system of management and controls exercised in the stewardship of financial resources
} Design and deliver work processes to increase efficiencies and enhance workforce capacity
} Utilize performance measures and indicators to identify operational, budgetary, and financial opportunities
MASBO Annual Conference May 5, 2016 ISD 279 – Osseo Area Schools
} Business Services Example
} Major Function - Business Services functions are designed to plan, develop, secure, and effectively manage fiscal resources in compliance with internal and external accountability requirements, which encompass accounting, accounts payable, payroll, purchasing, and warehouse, to support the education of all students.
MASBO Annual Conference May 5, 2016 ISD 279 – Osseo Area Schools
FY2013
FY2014
FY2015
Percentageofinvoicessuccessfullyprocessed 99.1%
99.0%
99.4%
PercentageofpayrollchecksiniAallyprocessedcorrectly 99.97% 99.96% 99.96%
PercentageofW-2scompletedaccuratelybyJanuary31st 98.98% 99.98% 99.34%
Moody’sInvestorsServicehasassignedanunderlyingraAngtothedistrict’sgeneralobligaAonbonds Aa1 Aa1 Aa1
ReceivedacleanauditofitsFY2015finances.Theindependentauditorsaidtheschooldistricthas“excellentfinancialrecordkeepingandreliablefinancialdata.”
Yes Yes Yes
OsseoSchoolDistrictwasawardedtheAssociaAonofSchoolBusinessOfficialsInternaAonal’sCerAficateofExcellenceinFinancialReporAng.
Yes Yes Yes
Budgetsummarygoalwithin2%ofamendedbudget 1.95% 1.31% 1.32%
Business Services Example
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} PLAN: Identify the gap and the approach } DO: Develop and Implement Action Plan } STUDY: Analysis of data after implementing
specific steps in the action plan. } ACT: Standardize the improvement and
establish future plans.
MASBO Annual Conference May 5, 2016 ISD 279 – Osseo Area Schools
} Program, Efficiency, Abandonment, and Redirection (PEAR) proposals: ◦ Instructions ◦ Narrative ◦ Worksheet ◦ LRFP Analysis
MASBO Annual Conference May 5, 2016
ISD 279 – Osseo Area Schools
} Describes budget proposal } Identifies productivity improvements } Assess impact } Requires consultation and planning across
departments } Considers legal requirements and board
policies
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MASBO Annual Conference May 5, 2016 ISD 279 – Osseo Area Schools
Division Dept.
I (Instructional) or N (Non-Instructional)
- insert code from key below Proposed Proposal FY 2016
FTE FY 2016 Budget
FY 2017 Proposed
Equivalent FTE change
FY 2017 Proposed
Budget change
PEAR Reference Number Impact of Proposal
Object Code
Impacted Budget Code
Bargaining Unit Affected
TBD TBD 4 Add supplies From FY 2016 Budget Worksheets $19,957 BA-01 insert answer from PEAR Narrative #4 TBD TBD ESP Class 2
TBD TBD 6 Eliminate ESP 1 FTE 10.00 From FY 2016 Budget Worksheets (1.00) ($19,957) BA-02 insert answer from PEAR Narrative #4 TBD TBD ESP Class 2
TOTAL (1.00) $0
I (Instructional) or N (Non-Instructional) Key Code Description
1 I - Instructional support and staff
2 N - administration
3 N - Athletics/co-curriculars/activities
4 N - purchased services and supplies
5 N - staff development 6 N - support 7 N - transportation
MASBO Annual Conference May 5, 2016 ISD 279 – Osseo Area Schools
} Develop essential services
} Define metrics to measure effectiveness
} Review and adjust annually
} Initial reaction …
MASBO Annual Conference May 5, 2016 ISD 279 – Osseo Area Schools
You want me to do what?!
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} Commitment to process
} Lack of understanding } Fear of loss } Time required
MASBO Annual Conference May 5, 2016 ISD 279 – Osseo Area Schools
Ø Secure superintendent and board
Ø Include all management
Ø Inform and influence
Ø Be prepared
MASBO Annual Conference May 5, 2016 ISD 279 – Osseo Area Schools
Ø Collaboration
Ø Inclusion
Ø Communication
Ø Repetition
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Ø Seek feedback
Ø Debrief
Ø Demonstrate benefits
MASBO Annual Conference May 5, 2016 ISD 279 – Osseo Area Schools
Ø Instruct and educate budget managers
Ø Provide a single contact
Ø Create a workgroup
Ø Adhere to timeline
MASBO Annual Conference May 5, 2016 ISD 279 – Osseo Area Schools
Ø Comprehensive understanding
Ø Data driven decisions = better results
Ø Increased trust
MASBO Annual Conference May 5, 2016 ISD 279 – Osseo Area Schools
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MASBO Annual Conference May 5, 2016 ISD 279 – Osseo Area Schools
MASBO Annual Conference May 5, 2016 ISD 279 – Osseo Area Schools
Ø Demographicdata
Ø Revenuecomparisonsandassump?ons
Ø Expenditurestrend
Ø An?cipatedadjustmentsfornext2fiscalyears
Ø Fundbalancepolicy
Ø Fundbalancehealth
MASBO Annual Conference May 5, 2016 ISD 279 – Osseo Area Schools
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MASBO Annual Conference May 5, 2016 ISD 279 – Osseo Area Schools
MASBO Annual Conference May 5, 2016 ISD 279 – Osseo Area Schools
MASBO Annual Conference May 5, 2016 ISD 279 – Osseo Area Schools
RevisedBudget2016 Projected2017 Projected2018 Projected2019 Projected2020
Revenueswithtactics $221,164,868 $222,583,101 $225,904,142 $228,694,954 $229,144,026Expenditureswithtactics 218,785,916 226,990,388 236,126,082 244,728,627 252,917,407
Tacticsrelatedtorevenue
Revenueassumptionbasicformulaincreaseof2.0%forFY2017(Known)and1%basicformulaincreaseforFY2018andFY2020 2,211,649 1,123,974 1,143,475
Tacticsrelatedtoexpenditures
All-daykindergartenandgradespanchangetwoyearexpenseonly(Known) (255,372)Strategicprioritiesadditionalneeds 1,500,000Enrollmentalignmentadjustment(Known) $0 1,044,889 226,602 761,636Other-reducetrendto3.25% (1,093,930) (1,137,957) (1,179,415) (1,218,879)Synergytrainingoneyearexpenseonly(Known) (150,000)Operationalreductions (5,000,000)Targetedclasssizeneeds 450,318
Baselineoperatingbalance(posttactic)FundBalance(beginningofyear) 54,732,264 57,111,216 54,314,561 45,459,663 30,378,803FundBalance(endofyear) 57,111,216 54,314,561 45,459,663 30,378,803 13,206,141Changeinfundbalance $2,378,952 ($2,796,655) ($8,854,898) ($15,080,859) ($17,172,663)
FundBalanceTargetFundBalanceasa%ofBudgeted/ProjectedExpenditure 26.10% 23.86% 19.27% 12.46% 5.34%5%ofBudgeted/ProjectedExpendituresMinimum $10,939,296 $11,379,570 $11,794,151 $12,188,791 $12,373,008
ProjectedRevenueAssumption(FY2017-FY2020) 0.00%ProjectedExpenditureAssumption(FY2017-FY2020) 3.75%
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MASBO Annual Conference May 5, 2016 ISD 279 – Osseo Area Schools
FY2016Budget 63% oftotalGeneralOperating/Transportationbudget$215,802,477FY2016Adjustment ofGeneralOperating/Transportationtotalnet$0adjustmentAdjustmentdetailislistedineachdepartment'sbudgetsummaryunderchangefromprioryearsection.
GeneralOperating/TransportationBudgetDivisionofLeadership,TeachingandLearning(DLTL)Departments
$135,296,577($154,000)
CIESprovidesstaffdevelopmentintheareasofcurriculum,instruction,andassessment;leadsprogramimprovementprocessestoaligncurriculum,instruction,andassessment;andensureshighqualityinstructionthatleadstoincreasedstudentlearningandequitable
DLTLOperationsisresponsiblefordeveloping,implementing,managing,andevaluatingoperationalandmanagementsupportsystemsforelementaryandsecondarysitesandsystemlevelefforts.
DLTL OperationsandSites Curriculum InstructionandEducationalStandards(CIES)
FY2016Budget FY2016Budget%ofGeneralOperating/TransportationBudget %ofGeneralOperating/TransportationBudgetPerPupilCost PerPupilCostFullTimeEquivalent(FTE) FullTimeEquivalent(FTE)
$3,806.231,104.41
FY2016Budget FY2016Budget$84,376,616
39.10%$6,043,895
64.19$272.64
2.80%
-Add$13,332fromPEAROP-01largesitesupport
-Add5.13FTEclassroomteachersformiddleschool8periodschedule
ChangeFromPriorYear ChangeFromPriorYear
-Reducestaffdevelopment/travel
-Redeploy21.3FTEclassroomteacherstoalignwithenrollment-Transferredsalarybudgetcapacityof$1,065,212forFY2016toDLTLOperationsandSites
-Transferredsalarybudgetcapacityof$1,065,212forFY2016toDLTLOperationsandSites
-Allocationandattritionbasedon51.5retireesforFY2016
-Add$391,468fromPEAROP-01largesitesupport
-Add1FTEAdministrativeEducationalSupportProfessional(AESP)positionateachhighschool
-Add4.27FTEelementaryESPpositions
-Reassign($540,000)forgradespanproject
} FY 2014 Reducing budget capacity } FY 2015 Enhancing budget capacity } FY 2016 Redeploying budget capacity
} FY 2017 Enhancing budget capacity
MASBO Annual Conference May 5, 2016 ISD 279 – Osseo Area Schools
Strategic priorities
Continuous improvement plan, Program Efficiency,
Abandonment and Redirection planning
Feedback & board budget
planning
Approve budget
adjustments and levy
Complete budgets and monitor legislation
Final approval of
budgets
Mission
Use of the LRFP framework results in budget decisions that support strategic priorities
MASBO Annual Conference May 5, 2016 ISD 279 – Osseo Area Schools
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} Outcomes for budget adjustments
◦ Align with mission and strategic plan
◦ Involve stakeholders
◦ Maintain required fund balance
MASBO Annual Conference May 5, 2016 ISD 279 – Osseo Area Schools
} Budget adjustment proposal ◦ Identify legally required and mandated essential
services and programs
◦ Formal analysis
◦ Base quality education provided
◦ Board policies considered
◦ Program Efficiency Abandonment and Redirection (PEAR) process utilized
◦ Staff and citizen input solicited and considered
MASBO Annual Conference May 5, 2016 ISD 279 – Osseo Area Schools
Patricia Magnuson [email protected]
Kelly Benusa [email protected]
Mike Hueller [email protected]
Cindy Brown [email protected]
Anne Ramsey [email protected]
MASBO Annual Conference May 5, 2016 ISD 279 – Osseo Area Schools