January 4, 2023 at 7:30 AM - Budget Committee Meeting

Description:  The purpose of this agenda item is to review the projected end of the year balance. The 22-23 Fund 10 budget approved by the School Board in October was balanced and included a $100,000 contingency. As of the end of November, the special education teacher approved for Heritage will come from the contingency fund. The budget also includes the additional $1M approved through the operational referendum question. The school board has not approved expenditures related to the $1M at this time. 

The budget committee expressed an interest in reviewing natural gas purchases.  The utility expenditures could exceed the utility budget by a significant dollar amount due to increases in the market rates for natural gas. See attached natural gas pricing chart. Attached you will find additional information about the natural gas market. Administration will be seeking feedback on the topic of purchasing natural gas through market rates or locking in rates based on futures pricing. 

Description:  The purpose of this agenda item is to discuss the draft of the 2023-2024 budget process. Attached please find the budget timeline. 

Description:  The purpose of this agenda item is to review a draft of the budget planning process.  Attached please find the budget planning process draft. 

As a reminder, administration is recommending a budget planning process utilizing the 5-year average for enrollment planning. The 5-year average is projecting an increase of 110 new students, which nets out to a +9 overall. Administration will share the estimates that are being used to plan for the 23-24 budget, the FTE projections for grades K-12, and the overall revenue/expenditure estimates. Administration is seeking feedback from the Budget Committee on this topic.

Description:   The purpose of this agenda item is to review the District open enrollment policy. The School Board is required to identify the number of open enrollment spaces available per grade level at the January meeting. Our open enrollment policy is based on the optimal class size level, not the maximum class size level. The attached document calculates the number of open enrollment spaces in two methods. These methods are moving the current student enrollments to the next grade level and utilizing the 5-year average enrollment projection. Administration is recommending utilizing the more conservative capacity number for each model. The highlighted number in yellow would be our recommendation for each grade level. We are seeking from the budget committee on this topic. 

Description:  The purpose of this agenda item is to review the attached revised financial plan related to the November 8th referendum.The plan has been updated based on the school board approved December borrowing. In addition, the proposed borrowing for January 2023 was changed from $120M to $99M. This change was made due to spend down requirements and our intent to avoid an IRS required interest rate rebate. The $120M option could have required an interest rate rebate based on the project cash flow needs as we understand them today. You will see that the $99M borrowing is a note instead of a bond issue. The budget committee indicated a preference to move forward with this type of borrowing.  Administration is seeking budget committee feedback on the revised financial plan. 

Description:  Actuarial Study: The district was required to update the calculation related to our fund 73 post-employment benefit trust fund. Attached please find the full report and the one-page summary that identifies the recommended annual contribution. The recommended annual contribution increased from $443,666 to $668,817. This increase is primarily attributed to an increase in the estimates related to post-employment benefits. As an example, the actuarial study estimates future health insurance premiums. The district provided them with our 23-24 rate cap of 8.9%. Our health insurance planning for 23-24 is focused on rate increase options between 0% and 3%, meaning that the $668,817 has the potential to be lower in the future. The 22-23 budget currently has $0 identified as a payment and administration is recommending a review of this topic by the budget committee in the spring. 

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