001thank you mr watson we appreciate the time you took to come and swear in our board members [Music] okay we will call this special board meeting to order today is tuesday december the 8th we are about five minutes behind schedule offer congratulations to mrs eugetti miss wood and mr carr on their election for the next four years on the governing board congratulations we appreciate your service we will go to item 1.02 off of item 1 1.02 is a moment of silence and then we'll go to 1.03 and pledge allegiance led by mr carr would you please stand for a moment of silence please join me in the pledge of allegiance i pledge allegiance to the flag of the united states of america and to the republic for which it stands one nation under god indivisible
002with liberty and justice for all move to item 1.04 we'd like to welcome all who are viewing the proceedings on live stream and thank you for staff two staff for your attendance miss wilson would you please call the roll dr charles santa cruz here miss larry wood here mr reed carr here miss sheila eugetti here ms jill humphries here mr president all board members are present you have a quorum thank you miss wilson will move to item 1.05 and it is a call for a public hearing pursuant to ars any introductory remarks dr mccord before we move to a motion no sir just uh going to be talking about the revised budget uh for 2021. okay is there a moment under santa cruz just as a point or i may have misheard but it sounded
003like you said 903 i think it's in there if i misheard i apologize but just want to make sure that we state that correctly it is likely that i misspoke it is 1.05 and you were talking about ars 15905 correct thank you thank you for that is there a motion i move that we call for public hearing pursuant to ars 15-905 thank you mr eugetti is there a second bye second thank you mr carr any discussion prior to a presentation if not we will move to presentation before vote so good morning dr santa cruz governing board members dr mccord so today we are sharing a short presentation regarding the revised number one uh fiscal year 2021 budget please know that i have staff with me this morning as well so miss jackie matanin the director
004of finance along with pat donahue and ashley miranda all have been instrumental in creating this revised report as well as the actual document so to move forward so this is what we will discuss the maintenance and operations and unrestricted capital budget details the teacher compensation grid we made a commitment uh last spring that we would update the teacher compensation grid at the revised budget to reflect any changes in average salary that have occurred after all the retirements have been identified and then finally we'll do some federal fund details and share some of the mno budget risks and opportunities and finally next steps dr santa cruz may i ask a question miss fitz miss butts before we start just could you remind us what why we have this public hearing what this meeting is is for
005like according to the law we have to by december by december 15th we are required to revise the budget due to the pandemic our student counts were significantly less than what we projected in our adopted budget last spring yes and so because of that our stated budget limit on our budget was overstated and because it was overstated we were required to revise by december 15th and that's why the public hearing was required as well okay this is the first time we're really talking about this in detail as far as this revised budget for this year that's correct for the that's correct okay thanks okay so to begin these are some of the notable details that are reflected in this revised budget know that our average daily membership we did anticipate 32 800 or so students
006and at this time the student count is twenty eight thousand nine hundred and seventeen so um so again we are still working very much on that uh average daily membership to bring that up but you can see that the decrease from adopted is nearly 4 000 students and that's also reflected in the weighted student count so because of that our revenue control limit now the going from 213.7 million down to 188.1 million roughly is a decrease of 25.6 million dollars associated with that drop in average daily membership or student count so note that that that was that this whole uh situation because of the pandemic the governor um signed an executive order during the summer indicating that school districts will be held harmless to 98 of the prior year's weighted student count so we are
007below that 98 percent of the prior years weighted student count however this is also reflective of the enrollment stabilization grant which we will get through um in a few moments so you can see that that's why we had to revise our budget because of that 25.6 million dollar decline 25.6 million decline in the revenue control limit the m o override maintenance operations override stays the same note the budget balance carry forward however so we budgeted a little over 11 million dollars on the budget balance carry forward and our revised number one that we're sharing with you today shows a budget balance carry forward of just under 31 million dollars that is exactly reflective of the enrollment stabilization grant which is why a week ago we shared with you the revised fiscal year 2020 afr so
008at this point in time because we moved eight we moved 12 million dollars of 12 million dollars of fiscal year expense out of maintenance and operations into the enrollment stabilization grant which increased our budget balance carry forward by that 12 million dollars along with the addition after adopted of the additional carryover of 6 million dollars that's where we received just under 20 million dollar increase in our budget balance carry forward from adopted remember that we adopt in june and so in august in july and august we are making all these decisions regarding spend and do we want to use the mitigation strategies move some spend into other funds all that work was done that reflects the difference between that 19.8 million dollars and the 12 million dollars that we received from the enrollment stabilization grant
009any questions on that it's a rather complicated situation we but we anticipated 11 million dollars carry forward with our work over the summer we realized about a total of 18 million then we moved 12 million dollars of expenditures from m o last year into the enrollment stabilization grant last year and that's how we received the nearly 31 million dollars of budget balance carry forward okay which might become quite important as we deal with the decrease of students in the new budget that's correct budget coming up that's correct so i do have a question if we go back to average daily membership you bet um this is a huge loss i mean i've seen declines in our district but this is probably twice as much as i've or more than i've ever seen how much of
010this is due to the number who are enrolled online because we do have a huge increase in students online and how much is it due to people who have chosen to go elsewhere or maybe are just choosing you know i've heard there are a lot of kindergartners you know that haven't enrolled that parents are just kind of waiting to get through this year and then they'll enroll their children in school so depending upon the day that we look at the enrollment we are down in true enrollment between a thousand and twelve hundred students so the remaining loss of the average daily membership is because we have students that are now being educated purely online now we've got some strategies in place that we're working on over the next couple of weeks to make decisions about
011some of these students so that we can increase that student count in addition remember that the online student the adm is captured all the way through the end of the school year through june 30 and it's about the number of hours that they're logging in so there's a lot of time to catch up that student count for those online students to get the 1.0 adm which then at that point in time is brought down to 95.95 adm so we've got strategies to bring up that um that loss of 3 800 to be more representative of the true enrollment loss of a thousand to twelve hundred students okay thank you okay but that's still a big loss it's still it's still alive twelve hundred thousand to 1200 enrollment loss is still a significant loss yes the
012highest i've seen we had 1500 students one year that we lost but that was a little bit we were in the newspaper a lot that year so but keep in mind that this i'd like to share too that this is statewide not just gilbert so statewide there's been a 40 000 student loss across the state and um and even a more significant on a percentage basis of even special education students like 150 or so special education students so so it's been a significant the pandemic has been a has had a significant impact on enrollment statewide so the maintenance operations budget limit you can see that even though we had a revenue control limit of a loss of 25.6 million dollars because of that increase in the budget balance carry forward our m o budget limit
013only decreased by about 5.8 million and then on unrestricted capital again remember that we're adopting a budget in june and we don't know the final spend analysis etc in unrestricted capital so note that our unrestricted capital budget balance carry forward is also reflected as higher by 1.8 million dollars before i move on are there any other additional questions on that okay great so again the maintenance operations budget limit inc decrease so lower than projected student counts again i shared the revenue control limit and then the bbcf the budget balance carry forward increase due to the revised 2020 efr and of course moving 12 million dollars of expense into the enrollment stabilization grant so in moving forward we are recommending actually jackie's right jackie mattinen had recommended to me that we do do a budget revision
014in february so that we can keep you apprised of where we are on these student counts as well as any other legislative work that might be done regarding closing that gap between the enrollment stabilization grant award and the 98 of the prior year weighted student count so we're recommending to present that to you in february we'll have a better idea of our current year student count so we can reflect that um and then also in this budget revision we have a a budget in the enrollment stabilization grant for the current year of 18 million if you remember we anticipated a 30 million dollar award from the enrollment stabilization grant our award was just under 14.3 million so the 18 million dollars is no longer accurate we need to revise that down to the 2.3 million
015dollars that we actually received and then we also did not make any changes on budgeted expenditures out of maintenance operations to put into the esser grant which is the elementary secondary school emergency relief grant it's directly related to the cares act funding and then again as i indicated because of all the work we're doing with trying to capture attendance and minutes for all of our existing students then we do anticipate there will be a budget limit change in february as well so then moving on to unrestricted capital again thus we did have a fiscal year 2020 student account increase which we are able to use for our unrestricted capital recall that maintenance operations is funded based upon current student count but the unrestricted capital is funded on prior student count so we have a statewide
016recalculation that occurs in july again after the budget is adopted and we did realize some additional 2020 student accounts that helped us with our unrestricted capital capacity for the 2021 school year any questions on any of that okay and then this is the detail of the average teacher salary change if you recall the governor requested that this grid be added to all the budgets to verify the 20 percent by 2020 initiative that the governor implemented allowed to happen whatever the case may be and so again you can see where the adopted indicated an average salary of all teachers employed in the current fiscal year of 54 884 and you can see that after the summer activity the decisions that teachers are making to retire and this was actually more teachers than we expected did decide
017to retire due to the pandemic and you can see that there was over a 400 400 closer to 500 um dollar amount per teacher on the on average loss due to those resignations generally generally speaking individuals who are retiring are way above the average salary which at the in the fall of the subsequent year that will bring the average salary down so that would represent some turnover savings so we have teachers that are making you know 70 to 80 000 that are retiring and being replaced with teachers that might be brand new teachers or teachers making less than that so you can see the result of the um of the average salary increase than over the last three years from 2018 to 2019. we adopted 17.4 and after looking at our average teacher salary in
018the fall it's down to 16.1 percent over the last three years however i want to make sure that it's clear to the public that we absolutely did provide the required salary increases to all of our staff and so this is the same grid that we've we've shared with you in the past showing that looking at an elementary teacher a high school teacher and a junior high teacher and showing what their actual realized pay increase was for the last three years so on average for teachers that have stayed so not looking at the whole teacher body but looking at the teachers that were here in 2018 and are still here in 2021 so you can see on average it's been about an 18.7 percent increase in salary we all know that the governor said it was
019going to be a 20 percent by 2020. remember that the governor's proposal was based upon the statewide average of teachers so even in rural school districts charter schools etc and then also on a classroom teacher and our teacher definition is more expansive than what the governor proposed which explains the delta between 20 and eighteen point seven percent which we included things like librarians and counselors who are certified but not in the classroom that's correct that's correct and that's missed but oh sorry i i had one more question can you go back to the previous slide i just um while you were explaining that i was this little box of explanation is that on the former is that something that we have added it's on the form it's on the form yeah okay so that will
020be um after today's meeting this new grid will be posted to the website which is also required by statute okay mr carr thank you dr santa cruz miss betts i think your next slide i think the point that you made though and i just want to reiterate the amount of money that we received was based off of the average for the statewide because we were already above average above that number we did not receive the full 20 percent that you would have received in totality statewide individual districts may have received more or less we receive less that's correct okay the federal fund budget so this revised budget for the current year shows the again the enrollment stabilization grant of that expected 18 million dollars again i wanted to to reiterate that and again we didn't
021receive 30 million dollars from the enrollment stabilization grant we were only awarded 14.3 million so that's another reason why it would be important for us to revise our budget in february so that we can reflect that accurately and then again esser if you recall last year we anticipated using five hundred thousand dollars of the esser grant for last year's expenditures we opted to not do that so we rolled the full 2.3 million dollar award into 2021 which accounts for the the increase of the esser budget from 1.86 million up to the 2.36 million any questions on that okay so risks so we are showing still um uh we haven't anticipate we are anticipating still a shortfall because we did not receive the 30 million dollars we only received 14.3 so we are anticipating a 15
022million dollar shortfall at this time so the risks we could lose additional students going back to hybrid or virtual there still are new special education students enrolling in gilbert public schools so there could be additional increases in special education increase in covid related spend so one of the one of the strategies that we used with our schools we didn't want them to worry about their supply budgets associated with custodial equipment and supplies so we told them please don't worry about that we have already created a separate budget line which is a coveted supply budget line that that we will be able to allow our schools to use in the event that they run out of custodial supplies earlier than they would have normally expected also as part of the governor's executive order he imposed on
023school districts and charter schools a requirement that they anticipate the percentage of their distance learning students so to explain that a little bit clearer arizona online is an online school so that's global academy these distance learning students are not arizona online students they are students that are enrolled at our bricks and mortar school but we are teaching them in the distance learning model comparable to what we did at the very beginning of the school year so we had two weeks at least of them being distance learned every single student throughout the entire school district was distance learned for that first two weeks and then after that we went to hybrid so there's a portion of those days that are distance learning so based upon all that um all of that all those facts through the
02440th day we calculated that our distance learning percentage would be 62 percent so the governor's executive order indicated that all the distance learning days will be funded at 95 percent so that particular budget reduction has not been realized yet the state is expecting to put that into our calculations starting in january which is another reason why we would like to revise the budget in february so we can find out what our distance learning percentage would be we were required to submit a distance learning percentage through the 40th day but the distance learning percentage is through 180 days so again that gives us lots of opportunities for the next however many days are left over 80 anyway to decrease that distance learning percentage and therefore decrease the adjustment down in our budget capacity so it's a
025funny imposition i thought any questions on that we will share that in our future monthly budget updates for all of you guys um and then the other risk is there's no additional funding to close the gap to of last year's weighted student count so we have not received any confirmation that we would or nor any certainty that we would not but it still represents a risk any questions on that okay great and then finally these are opportunities so increasing student accounts in the current year i indicated that global academy as well as technology services and joanna canton zero our student count specialists in finance are all working very hard to maximize the student counts there is an opportunity to request legislative budgetary help to close that gap between the 98 percent funding associated with last
026year's weighted student count scrutinizing vacant positions to assess need to fill we are looking at that this week actually utilizing cash funds that's always a an opportunity we have to move some expense out of mno and put them into some of our cash funds such as medicaid or e-rate some of those funds transfer capital to maintenance and operations again i indicated that our carryover increased by 1.8 million dollars right now we are scrutinizing all requests for unrestricted capital to keep at least a balance of 1.5 million dollars just to make sure that we have additional flexibility as we complete the current fiscal year again vacancy savings i shared with you the change in the average salary that's not vacancy savings it's turnover savings we have one fte that has a lower value now than it
027did when we did the budget so those are opportunities and then always we do realize unspent budgetary dollars primarily at our departments as an example fuel costs could possibly decrease in transportation then we are able to realize those savings as well so we are scrutinizing all those major buckets at this point in time so now next steps monitor glbc and ospb revenue projections so jlbc is the joint legislative budget committee ospb is the office of strategic planning and budget that's out of the governor's office continue monitoring the legislative process as we enter into the legislative session starting in january continually update monthly financials to reflect uh this budget revision we will do that in our next november monthly report which we will share with you next week uh present december no it should be the
028no no november 30th yeah november as of november 30th that we'll share with you in december and then present for approval revised budget number two in february and continue current year and new year budget updates so we are if you have any questions staff is here to be able to help me as well board members anything there i intentionally wanted to do the presentation before we took a vote on the public hearing is there anything additional you want to ask or make comment about i just wanted to make a comment i i know this is really complex school finance is really complex and i really appreciate the hard work of the whole finance team in scrutinizing our budget making sure that we're you know using it wisely and presenting it as well as we can
029to our community it is it is very complex because our money comes from different places and has different restrictions on it and it's and you know it's going to be a challenge we the money is only a means to educate the student we care about the students but if we don't have funds to educate them if we can't pay a teacher or we can't buy supplies or we can't pay for their classroom then we're really struggling so i know we talk a lot about the budget but it's not because the budget is utmost in our minds it's because it's a means to an end of educating our students anyone else if not then we will vote on item 1.05 which is the call for the public hearing we have had that before we move to
030item 2. all those in favor of the call for public hearing please signify by saying aye those pose the same motion carries 5-0 item number two is the public hearing and item 2.01 is a request to speak regarding fy 2021 budget revision one and i don't believe we have any requests to speak we'll move to item 2.02 adjournment of the public hearing is there a motion some moved thank you mrs humphries is there a second second thank you ms eugenie any discussion seeing that there is none then we will call for a vote on adjourning item 2.01 the public hearing all those in favor please signify by saying aye aye those pose the same motion carries five zero we have item number three is an action item three point zero one fy twenty twenty one
031budget revision number one uh dr mccord any introductory remarks uh no sir just that uh appreciate our finance department ms betson and company and thank you for the presentation this is a tricky year when it comes to finances and i think you guys are doing a phenomenal job so thank you echo that comment uh we are going to be doing some real complex calculations in the next few months as we try to recover money and reallocate money where we need to so we are at item 3.0 one is there a motion so i move that we revise our 2021 budget number one and he is there a second second thank you ms eugenie any comment seeing that there is none then we will vote on item 3.01 fy2021 budget revision number one all those in
032favor signify by saying aye aye aye those oppose the same motion carries five zero we are at item four which is adjournment of this special board meeting uh is there a motion so moved thank you mr jetty is there a second a second thank you miss wood typically no discussion on adjournment we will take a vote on item 4.01 adjournment all those in favor signify by saying aye aye those opposed the same we are adjourned and we move to policy meetings you