001Sounds great. So I thought we will pivot to capital funding overview, give it to Mr. Smith. I think we need to go to the next slide. Okay, good evening again And I'm Ricardo Smith, fiscal supervisor for the capital programs. And with me is Kayla Anthony, and she's a planning supervisor, and she'll interject as needed. As Director Jackson mentioned, these are some of the key areas that we're trying to hit, defining capital and operating funds. Don't worry, we wouldn't include a lot of technical accountant jargon, so we'll skip all of that and give a just general overview We'll also share some best practice guidelines from the industry and discuss some challenges and some situations that requires our flexibility. So If you have perused the district's annual comprehensive financial report, this is great. Thank you, Ricardo. You
002would have noticed some of the statements that you can see in some of the statements that are financial statements, that the funds are split between several different areas. In this case, if you look on the slide, you can see that on one of our statements The funds are split between general fund capital projects, non-special Revenue funds And I'm going to come back to why that appears to be the case. So what is the capital projects fund? Let's go back to the slide for a quick second. Yeah. So what is a capital projects fund? It's a restricted, separate financial account used exclusively for long-term investments in physical assets And we took the time to underline some of those keywords, restricted and separate. And the reason why you saw that those general funds are separated from the
003capital projects funds is that monies can't be interchanged between the two. So if monies are in a general fund It stays in the general fund money's in the capital projects fund, it stays within the capital projects funds And the other two words that are on the phrases that are on the line, long-term investments. Just remember that term. We got to revisit that over and over again for emphasis and physical assets. And you can go to the next slide, Ricardo. Thank you. So here are some of the differences between the operating and the capital funds. The operating is more for ongoing day-to-day activities, but the capital, as we mentioned before, is for more long-term investments. On the operating side, it's more for maintenance, repair, the typical stuff that you see that operates the business and the
004district. But the capital is more into the future, renovations, modernizations, new roofs, stuff like that. One of the key features of the Capital Projects Fund is actually the source of the funding. The source of the funding is actually long term Long-term debt, and most of that comes from the… if you go to the next slide, Ricardo. Long-term debt, and most of that in our case comes from the county. So in ages and periods of growth, of revenue growth, such as when we did the federal relief on COVID federal relief, there was an increase in the Revenues for the district and for the county as a whole, and in turn that resulted in a greater debt capacity for us to increase our investments in facilities. Next slide. And you can see the trend of how we
005increase over time and it's now falling because the reverse is also true in times of retraction when the revenues are retracting, then we have less debt capacity. And of course, less monies to invest in our facilities Next slide. So I mentioned that most of our funding is most of our investments in capital projects funds is really funded by mostly funded by the Prince George's County debts. So let's take a few moments to look at what that how that impacts us By law, the Prince George's County cannot exceed 8%, my policy cannot exceed 8% of the general revenues for the district as a whole, but not for the district, for the county as a whole And in terms that impacts how much money or target number for our debt service. Next slide. So what does that
006mean? In terms of best practices, because our depth, because our funding for our project capital projects is more long-term in nature, which we need to try to match the life cycle of the the facilities and investment in the facilities to the debt service that we have. Next slide, Ricardo. And what does that mean? So we try to match the life cycle by focusing more on investing in capital investments, capital assets such as new constructions, which is about 30 to 50 years out, new HVAC renovations Ricardo mentioned a lot of work that we've done in roof replacements. Those are more long-term in nature, and that's a good match. For us, in terms of matching the life cycle of the funding to the life cycle of the projects that we have. On the other hand, we want
007to limit or avoid expenditures in more short term, most of those projects with more a shorter life cycle, a shorter life cycle such as expendable furnitures and fixtures Or more minor repairs. Next slide. Do you want me to jump in for a minute, Ricardo? Sure. Give you a break. So Ricardo laid out really some of our guidelines or rules, if you will, for how we approach this. But there are some times when We know flexibility is needed, or there's exceptions, and we want to be strategic about that. So you can go to the next slide. Ricardo. And so You know, we recognize that there are times when we want to prioritize keeping our facilities open or making investments in which you would not maybe normally utilize capital funds in that way, but the strict threshold
008requirements don't necessarily align with the need of that moment, and so a couple of examples that we think about is if we're trying to prevent an asset failure or reduce the risk of a facility closure. So, example, and it's good that partnered with Tammy and Ricardo's group, because you got to see some of those capital investments happening, like when a roof is, you know, if a roof fails, then that can cause other asset failure within the building if plumbing leaks or if an HVAC fails, there can be bigger issues And a domino effect that happens as a result of that. And so, we understand that sometimes during an operating budget constraint, that there are ways to use capital funds to make sure that we're keeping our facilities open example, I know Director Jackson will reference
009is FF&E, and I think specifically we try to utilize that when it is something that is physically tied to the building, or there's like a specialized nature of that equipment, such as a stem lab So if you go to the next slide, Ricardo, this kind of talks about like really that challenge when we do this over the long term, right? And so it's one thing to do it in like a one time manner. It's another thing when we start relying on that in the long term and how really over time that can crowd out our funding for those major projects, because you do need the debt limit to be able to support those larger projects. And so when you don't have enough funding to do that and keep up with those major renovations, modernization programs,
010then our buildings kind of create this cyclical nature where we can't keep up with them. They're failing faster, our maintenance teams can't keep up with what's going on, and so it's almost this cycle that we can't get out of when we start doing that. And so, especially when we think about, like, some of these older assets that we have, that can build that backlog crisis. And ultimately, that results in a slower modernization program. So, when we think about the bigger rehabilitation of a facility, a renovation, modernization, making sure that we protect that capital fund so that we can pursue those is really part of kind of why we have these guidelines for how we Invest the capital funds. If you do the next slide, I think. Yeah. Go back Yeah. Can you give me one
011second? I just want to go back to fix assets so we don't lose a key point. One of the key points is that, yeah, we do invest in furniture fixtures and equipment One of the challenges that we have is a clear definition of what that is. So although we are, I mean, it's perfectly legitimate to invest in and acceptable to invest in long-term furniture fixtures and equipment, sometimes the definition of what is FF and the furnished equipment can be vague, and we ended up investing in those smaller and we have lots of stories to tell about some of those assets that we find ourselves in uniforms small music equipment stuff that doesn't have a long life cycle. And so a clear policy that clearly defines some of what an FF&E is will certainly be needed.
012Go ahead, Kelly No, that was perfect. That was the segue I wanted to make. So thank you. I think the other point on this slide is you know, also when we are paying for… and in here, it's kind of called a ghost asset, right? So you're paying for something that the useful life has expired, but the debt continues on that thing that may have been discarded or replaced because the asset life of it is so short That really what that ends up doing is that our future budgets are having to pay for our needs right now, as well as finance past investments. And so that's what we want to avoid. Next slide, I think, Ricardo, this one's yours. Yeah. So we want to give you a summary of what it looks like in terms of
013where our funding goes. Now, we… the funding is not owned by us directly. I wanted to clarify that the funding is really either the state funding or the county funding, and they actually provide the revenue provide the funding to us, the revenues to us, to support our facility investments. And as you might have guessed, one of our largest sources is the county gold bonds. These are general obligation bonds, bonds, and for the most part, they have like a life cycle of 20 to 30 years And that's the reason why we kept on Kell and myself kept on re-emphasizing the long term life cycle of where we want to invest our capital funds. The next item is the states. The state also provides us some gold bonds. Those are a bit shorter in the life cycle,
01415 years, and we have some dollars dollar amounts to give an idea of where those… the funding for 26 and the funding for upcoming 27 are in terms of funding from those 2 sources. I should mention that the State funding is pretty restricted. It's not as flexible as the county So although they can tend to be adrift in definitions for how the county funds are used, because the state is more restricted there is less likely to be that drift. So what's our takeaway? I guess the two things that comes to mind from our perspective would be, I know Director Jackson is working on a policy That clearly define what an FF&E and what we should really be using, mostly using our capital project funds for. That's not to say that we can't use it for
015something else in terms of emergency, but those should be seen as a waiver and have a waiver process instead of it recreating a change in policy of what the fund should be. And the other, I guess, takeaway is to spread the word to schools of what really capital funds is intended for, and that sort of would limit some of the requests, maybe, so to speak, that cause the drift towers more operating fund expenditures. Kelly, you want to add anything after that? No, I think you summed it up. Great. Thank you, Ricardo. Back to you. Thank you, everybody So board members, do we have any questions now? It appears as though we have all of our questions answered. I do have one that's I guess just a simplifying question. So what happens in An emergency situation
016or quasi-emergency situation where we have to move students from a building. Which fund does that pull from or do we just have to play, figure it out? So I'd love to hear from Director Jackson, but what I will say is that there is a diagnosis of the situation that's done in real time between our building services department and our Department of Capital Programs to best understand what the concern is Typically, when we have an issue, it's not something we can't anticipate, we just don't know when the failure point would be, right? And so, given the fact that we can anticipate most of these, quote, emergencies, we've done some thinking about where the funding may need to come from Chrome to support the repair, but how we go about doing that is where we have to
017have a lot of conversation. So it's flexible. Director Jackson, did you want to add more Sorry, it is a great example because that's the type of flexibility we were talking about when we were putting the presentation together and talking amongst ourselves. It was, you know, when it comes to the emergency, we use whatever is available and whatever is easiest to get a contract there and keep the school open and resolve the situation, that's definitely what we do. And a lot of times it makes clear sense. It's a roof replacement that would always be capital. Other times we're extending the definition a bit just to fit the need. I think I froze just a note on the original question because I imagine a school needing to be relocated, and that is such a hard challenge that
018we have not having available swimming space that it's so difficult. So we do put a lot of work into keeping the doors that we have open. That's a good thing. So we don't have… the point is, we don't have swing space right now, currently. There might be some schools that in the southern region, if something happened, we could locate relocate their student populations, but definitely in parts of the North County, we would really be in a challenging position. So I'm gonna push a little more. I'm going to ask Jason to speak to that because specifically there's an answer. Jason. Specifically, we have no vacant building. We will have space in Old Kenmore, this summer, for potential co-location with a school that's moving in temporarily as we are rebuilding. But, as of probably August 1st, every
019facility that we have will be occupied Gotcha. That is incredibly helpful context So board members, if we have no further questions Okay, board member Jackson Saunders. Thank you. So just a quick follow up to that. I hear the superintendent speaking specifically about our buildings in the South County that are under enrolled at this time and proposing, you know, some potential coexistence, some co, you know locations for some schools Is that do we have that information readily available and is it totally unimaginable that if we would need to relocate a school in the North County, that it is a hard push to bring them to those under enrolled schools in the South So a couple of factors there. We utilizing the current EFMP, that's what we're examining now is what is the available space? What are
020the conditions of buildings that are underutilized? And are there opportunities for consolidation or the recommendation for consolidation This would all have to be presented and approved by the board. So that would be the first step. As it relates to schools, if there's an emergency situation in relocating them further south, that's gonna be an incredibly complicated answer because of transportation, because we would then need to move pretty much a whole campus that's probably walking, or close to walking to out of their boundary area, and that is I think that gives all of us tremors thinking about what that would look like in terms of functionality and making it work. But with all of that said, we have a plan around swing space, and it's just that this year we've run into there's no available space. Next
021summer we will have 3 buildings that open up, because we're opening up 3 new buildings. So… so that is really It's just making sure, and I think Director Jackson and Dr. Coleman have said it. that forces us to not be surprised if something happens, but to be as proactive as we can to, you know, to invest money into schools that may be of concern with that recognition that, you know, there's no easy fallback. With all of that said, we would figure out a solution if we got to that part. And but we hope that we don't get there. But next summer we will open up new facilities, not new facilities. We'll open up new facilities that would move schools out that will free up swing space for campuses as we go forward. Thank you all
022so much. Seeing no additional questions, we are back to Dr. Coleman. Thank you so much. So again, Director Matlock is going to, he's the director of the Office of Alternative Infrastructure Planning and Development. And he's going to provide an update around our phase two construction projects and also loop back and respond directly to your question, board member Jackson Saunders, regarding the status of Brandywine Pre-K2, as well as Brandywine 3rd through 8th grade academy. Good evening. Do they have my proposal, my presentation up. It was sent via PDF. So if you have the PowerPoint version, that would be I do Wait I'm going to share that. Okay Let me see what I can do here. Do I have the ability to share? Yes. Great, okay So let's do that. Okay. Always gets tricky Can you see
023it Yes, sir Yes, we can. Yes. Great. Okay. So Some of you may or may not have any experience with P3. So I'll give you a brief overview, and I'm going to try. There's a lot of my presentation has a lot of dense information in it, and I will try not to go into great detail. I'll give you a broader strokes of overview of what's happening And then we can open up for questions, and then if there's any more details, I can dig out for you, I'll do that. But to give you a general overview, as Ms. Anthony was discussing in the presentation of the capital budget, P3 has risen out of basically operational inefficiency. It's very difficult when I was director of capital, we encountered an issue related to the funding gap between what
024we needed to build and what we needed and the ability to get bond funding, which is direct funding that you spend upfront On the construction of a project. There just wasn't enough of it in order to start making any sort of headway into the into our backlog of buildings that needed to be constructed, and also in lowering our cost of deferred maintenance. So we ended up with a we did one P3 for phase one, which did six schools, which was primarily designed to address overcrowding. And that's why we built middle schools, because that relieved overcrowding in both the middle schools and the elementary schools Phase two is more along structural issues that we've encountered, physical issues in certain schools in the North, and also to address some of the overcrowding that we've had in some
025of the schools still in the elementary schools. And so we are building eight schools. The total value is roughly around $800 million in capital expenditure. However, I need to explain how it's put together. So a P3 in this instance It's where you hire a private developer. In this case, Progressive Education Partners, which is a conglomeration of multiple groups, and they basically go out and they get the funding themselves. Okay? And then they take that funding They designed the buildings with our help. They build the buildings with our supervision And then they provide for maintenance of those facilities over a 32-year lifespan, and then we pay it back like a mortgage Over that 32-year pay, so we don't have to come up with 100 million or $200 million per school in the beginning. We can pay
026it out like you would if you were buying a house, which makes a lot of sense in some ways. Our funding source in this case, although comes from the Maryland Stadium Authority, which is providing $27 million annually to the budget, and then the balance is provided to us by the county off the telecommunications tax And so that's what funds the construction of these schools. So it's not coming from direct bond funding in any way. So again, this was intended to solve a solution related to both physical issues with buildings. We had three of the buildings that we're building were condemned. and were unsafe for students to have to be in. And so altogether of the 8 schools we're going to be replacing roughly 11 school buildings with these 8 schools. So there's a degree of
027consolidation around this construction So that's the overview of the project. Here are the partners and the various companies who are part of the Progressive Education Partners group. And this is sort of where the schools are. As you can see, we have one school in the far south, which is going to be the Brandywine School, and then the other schools are sort of located sort of in the Beltway in the north And one are out near Bowie. So That's the general way that this particular set of schools has been broken up. So, again, we're building very high-performance schools. All these schools will be net zero, except for one. They all have geothermal, they all have solar panels at some point. And they are all designed with a lot of light and things like that. We're delivering
028these schools in roughly three groups. The first group will be delivered this summer. In fact, I toured them this morning, and they are in great. They're coming along swimmingly. They'll open to us on July 15th And we'll be able to occupy those buildings. But the furniture and everything else will be installed before the end of June. So the buildings will be substantially complete by the end of June and available to us July 15th. Group B schools will be delivered the following summer also in July of 2027. And then the last two schools will be delivered in July of 2028. And this is sort of like the Gantt chart of the process that we're utilizing. So we have the early engagement. We're working very closely with the approving agencies. There's a staggered delivery, as you can
029see, optimized resource across the sites So the first six we built all at one time. These were spreading out because we found that it makes more sense from a resource standpoint, the availability of subcontractors, the availability of workforce, and also making it easier on the approving agencies Going forward, and our ability to source material So these are the main agencies that we've been working with very closely. We meet every two weeks to go over and work through problems. And a lot of times this has really been very beneficial to us because there might be something that where we have an issue and we raise it in the meeting and usually And a lot of times, those issues are resolved before the meeting is over. So it's been very, very helpful to us in the long
030run. So here's some construction updates. So the current status right now, we've demolished several of the old buildings that were either or being replaced or were condemned. So old Templeton Elementary School, old Robert Frost Elementary Woodmore Elementary School, which will become the new school in Fairwood. Hydesville Elementary School and Margaret Brent Elementary School. The demolition of Duckwood Regional and Spring Lake Elementary schools will begin this summer for there, so we can start with their replacement. Okay, there we go. So the phase two construction, again, we have a Margaret Brent and Templeton or the first sites to be started working on. And we have reached We're in construction with all of the schools at this point. So and so there will be We'll be moving roughly, I think five schools this summer in order to continue
031with the process. Two of them will be moving into their permanent schools. That's New Margaret Brent and the Templeton Elementary Schools. And then we'll be moving schools into buildings the week of July 18, 2026. So that's when we're actually moving them all in. So this is some I'm not going to go into great detail, but right now where we are is we're putting in finishes and things like that in these buildings, and then the furniture will be starting to be installed. These buildings in Margaret Brent and Templeton, but these are some pictures of the buildings while they were in construction. But for the most part, we are really gearing up for final inspections on these buildings, and as I said, almost everything is complete in these buildings. We're just putting in final finishes, painting, and
032then we'll start installing FF&E Which in this case for us is general furniture and fixtures, anything that's affixed to a wall, and anything that can be capitalized. Smaller items which are non-capital items are being financed outside of the P. 3. So they're not part of the capital stack So small appliances in the kitchen, small items in classrooms, classroom items. Those things are not being funded through this process. So again, there's the construction group B schools. That's Robert Cross K-8, Fairwood Elementary Area Elementary School, the Brandywine schools, and then Hydesville. And so right now. The Robert Frost K through 8, the Fairwood Elementary School Elementary School and Brandywine are all have steel being almost completely erected. They're about to top out on Brandywine. Hydesville is they're working because of the way it's the structure of the
033building is more vertical, they're doing a lot more work with concrete, and they're going through that now, and they're also starting to erect some of the steel in that building and all 4 projects are on schedule and will be completed by July 15, th 2027 And so these are some photos and details of the construction of the various sites. And you can see the work that's being done there. This building is all the steel is up at this particular school. We actually had a topping out ceremony in May And it's really coming together very, very well. And then all we're going to top out at Brandywine this coming month for the 3 through 8 school. As you can see, the steel is going up quite quickly. And So for our last phase, group C construction,
034they'll start construction this summer in earnest. They've all received the mandatory referral. They're all have completed most of the work necessary to get them going. They both have summer programming, so we're trying to work around that as we are moving them into their swing spaces. Spring Lake, Spring Lake is going into the old Adore Kennedy French immersion facility, and Duckworth Regional Program will be going into the old Kenmore Middle School, but they're not going to occupy enough of it that another school couldn't be in there as well. So they're only taking up about a quarter of the school And but we are going to start on construction on site work before they leave actually. There are some things that need to be done in relationship to environmental protection. And so we're going to start that
035work even before they leave the school And right now we have about 95% of the design completed and all the demographic changes. We actually made Spring Hill Lake a little bigger because of demographic changes and That was part of the reason why we split the two schools. Brandy was originally going to be a K through eight. Now it's going to be a three through eight, and we're going to keep one of the schools and make that a K through two program. So that was because of a lot of the building, as you know, that's going around the area And so we want to make sure that we were ahead of the demographic changes and that the school would not be overcrowded. But we also wanted to make it so that every child got the benefit
036of going to that school once they got the third grade. So every child in that area will go to the new school, and the other school will be adapted for a small for a younger program from K to 2. And So should have been questions. So if you have any questions, I'm available for them and I can answer anything you would like on either of the phases if you have questions about them. Thank you so much, Director Matlock, board members If we have any questions, we will start with Vice Chair Brown. Thank you so much. Thank you so much for all the presentations. You guys really do an excellent job. You make construction sound really cool, just FYI. I did want, I did have a question for Sean really quickly You mentioned the progressive, I
037guess, conglomerate of Investors. One of the things that I wasn't sure about was the solar panels. Is that a different lease? Because I feel like solar panels are leased or is it a part of That payment that would have to be done within the 32 years. Well, so the solar panels are not part of the initial financing We were hoping to use our existing solar provider and they declined to move forward with this particular set of projects. So the provider for this construction, Progressive Education's Partners Has offered to roll it in and do the The solar installation themselves on our behalf. We are in the process right now. We were evaluating the financial Ups and downs of that, I was thinking about we would talk to a few other market players about providing those services,
038just to make sure that we were getting a good deal. There are some questions that they're answering for us, but we may be moving forward with them, and then we'll probably roll That change order into the overall pricing of the project. Thank you Board members, any additional questions for Director Matlock? Board member Jackson Saunders Thank you. Director Matlock, thank you so much for your presentation. It absolutely did answer some of the questions that I had specifically about Brandywine. Yes, representing District 9. I'm curious about one thing, if you could clarify for me Is there a plan that the Baden Elementary School is one of those buildings that will be demolished, or what's the intended use for that school since it will be vacated? I'll answer this one, Sean. Right now, we plan on keeping the
039building vacant to keep it available because there is an adjoining, I think library and so we are going to keep it We're not knocking it down, at this time. The one thing where we would probably need to, if we ever needed to utilize that space, would have significant retrofitting is because it is the only school that we have left that's on septic So it's not actually on sewer. So we spend a lot of money on treatment for the school. And so that's whatever is done on that site will require substantial investment just to make sure that we tie it into public sewer Okay. But right now, there are no plans to demolish the school. And we would, per the there's an administrative procedure that requires us to stand up a building utilization committee that looks
040at the future use Okay. And so that will happen. It happens for all of these schools. It's just that the ones we're knocking down, they've been condemned. So that, you know, so it's but but for the space, we always do a utilization committee for best future use Okay. And Madam Chair, if you would allow me just this brief follow-up, and this is coming from the community. There was a concern about what was going to happen with Baden because the fire and EMS station down the street uses Baden as the shelter in place And they were concerned that if that was going to be closed, demolished, or whatever, that they would, you know, need to be in some communication about what they are supposed to do, since they're obviously not facilitated to handle any type of
041emergency, which would require that shelter in place, which is now Baden Elementary Okay. Thank you so much, board member Jackson Saunders and Director Matlock. Do we have any additional questions, board members? Seeing none, thank you so much, Dr. Coleman and your team You're welcome. Thank you, board member. And with that The chair recognizes I believe It is Chief Howell, please forgive me if Chief Howe, our Chief Financial Officer, is not here for the Title I school allocation process. Hey, Sean, you can pull down your screen so that they can Hi, Chair going some cans. So Chief Howell is not able to make it today, so it's just me. Now, I think we did the title one allocation last. Obafa meeting. And so this was going through the blueprint. School allocation process. So hopefully that answers
042the call. But if it doesn't, and we need to bring Title I back on, no problem, we can definitely schedule to do that in short order. No, thank you, Director Smith. I mean, we would love to have them back, but we will find somewhere on the schedule to have them back because I know we are packed But if you are here, Director Smith, we are so happy to hear from you. Thank you. So I'm going to share my screen. Let me see if I'm sharing the right screen. Can everybody see my screen okay? Excellent. Yes. So good evening, everyone. My name is Siobhan Smith. I'm the Director of Budget and Management Services, and I'm going to walk through as non-technical as possible the school budgeting, particularly regarding how school allocations are derived It was a
043call to order from our illustrious chair who wanted communities, principals, parents, students to really understand how schools are funded, particularly in times such as these where they may be hearing rumblings that schools are receiving less funding than they have in the past And I would just want to hopefully be a myth buster and provide a little bit of clarity. So with that being said, I'm just going to jump Right on in. Okay. All right, so blueprint, we've all heard about this legislation, but what is it and why do we care about it? purpose was, hey, we have students who may need more support than others. And so, as a result, the funding that that student generates will follow the student based off of their need. So what does that mean? It means that we are
044Pgcps. We must align school allocations with the prescribed, which means it is pre-designated. We don't determine the per-pupil amounts, we don't make any of those decisions. It is in the law how much a student should receive, which means that when we say a student will receive how much a school will receive because of that student based off of their demographics. And there's several, which we're gonna go through it. So there's students are the weight, right? So it's it's they are the weighted formula-driven entity now in our student-based budgeting. And as a result, there is a law, we call it stat minimum school funding. You will hear that term a lot over the next couple of slides, MSF, minimum school funding Majority of the funding, at least 75%, must follow the student to the school. We're
045going to talk a little bit about the caveats. You've heard us say before, well, what does that mean? Most of the students that we're receiving funding for were the students that were in the building the previous school year For example, the funding that we are working through now for school year 2627 is based off of the children that were in the building September 2025. So it is not real time. And that can be a challenge. That's one challenge. But at the end of the day, schools are still charged to do what they need to do, and this is where blueprint. There are some loopholes, there's some there's some holes and some gaps in the legislation that LEAs, such as PGCPS is trying to figure out how to fill So we talked about it. It starts
046with the formula. It is a simple formula. It's a math formula. Enrollment Times per pupil amount. That's where it starts for every school and every school, no matter the school type, no matter the school size, no matter If it's a charter school, every school has the exact same formula with the exact same for pupil amounts for the exact same programs, depending on the demographics of the students. And so we're going to talk about it. But if your school has primarily English speaking children, you don't have a lot of students with disability. Most of your kids are not farms student, which means they are not on a free or reduced price meal plan. It is going to impact your funding. So with that being said. There is no set or flat allocation for our kids. For
047our schools. And I think that is the biggest misnomer. Oh, our per pupil, our total per pupil amount, there is not a total per pupil amount. It is based off of the blueprint program And it is based off of demographics of the students that were in the building the previous school year. So these are all things that I do think that parents and communities are having a disconnect trying to understand. And it is not a decision that the district is making. It is what the law prescribes. But that does not mean that we have a little bit of wiggle room to make certain decisions. So again, it starts with student enrollment. Certified enrollment counts are done usually is as of September 30th. We have some programs are more October. I think special education or students
048with disability, those counts are due October. They're certified in October. But at the end of the day, it's still based off of the previous school year And then you get your per pupil amounts. You multiply that that gives you an amount. But now you got to start back. Now we so that was multiplication. Then we move into subtraction. So you have lock staffing. That's going to be your principles. Every school has to have a principal. You don't get a choice. You don't get to decide whether you want a principal or not. No, you're going to have a principal You know, there are certain lot staffing that comes with special education, everything is locked. Principals don't get to decide what special education positions they want to purchase. After you bag out all that, whether it's school-based
049life saving or centrally managed lock staffing, after you back all of that out, then you get a total, and now you have a net allocation, and that is what we call Sbb, or student-based budget that Number is what now principals have autonomy over on what they want to purchase. And it's unique to their schools. And then at the end of the day, we have the ability and we work very closely with our school support and leadership division, whether it be the chief or the associate superintendents for each of the area offices to include the innovation zone to determine if a subsidy is required. And I want to be really, really clear when we talk about a subsidy, it is not spare money that we just have sitting around. The subsidy, if we feel like a
050school What their students, those demographics are generating is not enough to operate a school. We will make some decisions. We have, remember, at least 75% of the funding has to follow the student to the school. So that gives us 25%. So we may take a school that might be 98% funded And say, okay, maybe we can pull 50,000 from there and give it to this school. We can do it for all of our schools with the exception of charters. Charter schools, we do not have that autonomy. Charter schools get all of their allocation and they make the decisions on how they're going to utilize their funding. But for our traditional schools, that is where we can have some trade-offs So I'm going to go a little bit more into that. Another thing that we can
051look at as far as whether maybe we can give a subsidy, you have some schools who are not only do they get their blueprint funding or their SBB funding, but they also are Title I schools And they also are a community school and that's all additional funding that the school will receive. And sometimes those services and supports overlap So a school may be able to leverage their title one dollars to help free up general fund or SBB dollars, or they may be able to leverage their concentration of poverty or community school funding in order to help take some of that pressure off of SBB, which is basically our general fund, right? Where that funding is really, really limited I also want to make sure it's clear that the majority of the funding that the district
052gets as a whole is blueprint funding. The little bit of funding that we are able to generate outside of on the unrestricted side. Most about 90 plus percent of our funding is blueprint dollars. We have a little bit of funding, which we call board sources. Sometimes, you know, our interest earned that we get. These are things that you don't necessarily have control over, but it is additional revenue That revenue is not enough to really make a dent or a difference. We are really dependent on the revenue through Blueprint. So what can we control and what can't we control? In full transparency, again, Blueprint, which is law, there's a formula that goes to it. We don't control that formula. We don't get to dictate and decide when we're going to use the formula and when we're
053not. But what we can control is how we organize our central offices and those central services that we provide. We can control the staffing models that we may use within certain legal and bargaining limits For example, our specialty program, they that's all lock staffing. Again, schools don't have the autonomy to purchase. That is provided by our central office of specialty programs in the Arts They make those decisions. They can decide whether some supports just need to be managed centrally versus dispersed out in decentralized across schools. And then whatever funds that are non-blueprint that we have in the general fund how we are able to fund certain schools that may be struggling. And we're going to go into what those challenges are very, very shortly. And then provide those subsidies when the formula alone is not
054enough, and it is almost always not enough So this is just a good example, okay? You have school A, school B, school C, they have the exact same number of students. And again, this is just very simplified for ease of discussion for right now. But they have the same number of students. But as you can see that bottom, they're getting a different level of funding So challenge number one, every student who is certified in that 930 count, we receive a base number or amount or funding for them. That is what we call foundation. That foundation funding is not enough to operate the school. by itself. So we know that the per-pupil amount That is prescribed that every LEA in the state of Maryland is using the exact same number is not enough to operate the
055basic needs that a school Requires. We know that to be a fact. So that's challenge number one. So by itself, 900K is not going to be enough to do anything. School A has a good amount of compensatory education dollars, which means that out of the 100 students, 54 of them are farm students. I mean, they're on free or reduced price meal plan 26 of them are multilingual learners, meaning that English is not the primary language spoken at home. And then 12 of them are a student with a disability. They have an IEP in some shape, form, or fashion that requires additional support. Student B, I mean, school B also has 100 students, but they have even more comp ed students, 60. They have even more multilingual learners at 50, and they have more students with
056disability at 18. So their blueprint funding by school increased It went from school A has 1.68 million, whereas school B now has 2 million dollars. And then you go to school C, who also has 100 students in total. They get the same foundation-based funding. But they only have 37 Comp Ed students, 5 multilingual learner students and 7 special education students. Look how much their funding drops for schools with the same amount of children in the building. So just to give you a picture, this is what we're working with And if the minimum school funding rule of 75% must follow the students to the school a principal At minimum is going to see 1.26 in their budget. Now, some of that might be locked that they don't get to control for school A, 1.5 for school
057B, and 975K for school C. That's what they're working with, where we, the district and the board has autonomy is we can make trade-offs within that 25%. For our traditional schools. And that's what the subsidy comes into play. So our challenges. We already talked about foundation. The base dollars we get for every student is not enough to operate a school by itself. Okay, then we layer in the complexity of special education No two students with an IEP are built the same, but we get the same flat rate for every student with a disability. So you may have some students that require translators, require nurses in classroom, which you know what I'm saying? And then you may Another student who may not require all of that So we already know, and this is not a Prince
058George's County problem. This is a nationwide problem, but particularly in the State of Maryland, every Lea, all 24 have the same issue. We have way more special education costs than we have funding The federal government only funds maybe 5 to 10% of what they said or promised they were going to fund. So it does not just start with the county and it does not just start with the state. It starts with our federal government. But yet the federal government provides all of these requirements That we have to meet You layer on that with COMAR, with the state, and those requirements, we have what we call SPED overage that then encroaches on our ability to provide additional supports for our multilingual learners and for our compensatory education students Because we need that funding to help bridge
059the gap in special education. And then finally, transportation is another area where we receive funding for transportation that is nowhere near enough to cover the true cost of transportation. So we have a transportation over That every school, with the exception of charters, have to absorb. So these are the big hurdles that we have to cross. And then you have smaller hurdles, but are hurdles nonetheless. We have the challenge of a small school. They call them lumpy costs, but basically these are just It is not the cost that we receive to run a school. Just because you have fewer students, you keep hearing about enrollment dropping, but that does not mean that costs will automatically drop with it. So, if you're a small school, and you have less capital or less children in the building to
060help generate revenue, that's less funding you're going to get that that does not mean that you don't need a base amount of funding to run your school. Blueprint also does not account for specialty programs. There is not a designated funding source for all of our wonderful and Prince George's County public. We have a lot of really great specialty programs that have to get funded under Blueprint, like everything else. And then athletics Blueprint does not count for athletics. It does not. There's not a designated set funding for that. There's not designated set funding for safety and security. There's not designated. So all of these things have to get funded with one set of formula-based So we already kind of talked about small school versus a large school. So most schools operate on a step fisc cost,
061which all that means is that the baseline level of funding can't be scaled down proportionally even when enrollment drops. A school still needs a certain amount of funding to operate on a day-to-day basis. And when you're a small school and you have less students who are generating less revenue How do you then still meet the day-to-day requirements that the school needs? That is the challenge that principals face. That's the challenge that the administration faced. That's the challenge that the board faces, and we're trying to figure this out. We have… we don't have all the answers We're doing the best we can to try to keep schools floating and running while at the same time stay in compliance with Blueprint. Athletics That funding as well what it requires and what we get funding for. There's a
062gap there. So we're using our regular blueprint dollars our foundation dollars, our Ml dollars, our comp ed dollars. We're having to use. It's the same pot of funding, I guess, is what I'm trying to drive. What I'm trying to drive home for everybody. There is not a separate pot of funding that we can pull from. So when parents or Pta or advocacy groups, when they send angry letters to the Board of Education or to the administration demanding that we restore funding to a school, I want to make sure that they understand that we did not decide to fund a school less than what they received in the previous fiscal year. It is the formula and even our subsidy process We still have to make sure that we're not taking from another school and jeopardizing compliance.
063Okay, so it is a balancing act and we're constantly having to monitor to make sure that we meet. And why is compliance so important? Because it impacts funding. If we are non-compliant with blueprint, it potentially means funding withholds in the future. And in today's environment with where we're seeing enrollment going, we cannot afford to lose any revenue. And then we kind of already talked to, again, specialty programs and why they don't always pay for themselves. That's additional funding that, again, in the same pot, same money, now has to stretch to make sure that we can cover what a specialty program requires. It does not make sense to have a program at a school, whether it's a specialty program, whether it's, you know, a CTE of some sort, it doesn't make sense to have it, and
064yet we can't provide the materials that the students would need to fully maximize that program. So that is a challenge. How do we still preserve all of the value-added programs that we here at Prince George's County, public schools think are important and are good assets and opportunity and exposure for our children, while at the same time recognize that there's no, like, the cost has to be covered with the same revenue that we have to make sure that we have smaller classroom sizes To make sure that, you know, we have all of the math and reading interventions in place to make sure… so it is a fight. It is a prioritization fight That is a challenge for the district right now. And not just our district. Every district in the state of Maryland under Blueprint And
065then we already and then the other layer is our charter schools. Charter schools We have to provide commensurate funding. So it's not just about blueprint. They get blueprint funding, but then we also have to provide commensurate funding. But yet, we still need to make sure that we're outlining what kind of in-kind services. These are services that we provide through a central that we centrally provide at no charge And then buy in or buyback services. What supports are we providing charter schools? Where we are still working through all of that as well. So there is layers of complexity that Blueprint ads that we as a district are still working through, and we're doing our best. However If a school sees a change in their allocation year over year, it is not because a decision was made
066to unfund a school or defund a program Pull back funding for school. It is because the formula dictates it and where we can restore it as best as possible through a subsidy, we do try to. So we kind of talked about this, what we're trying to balance, legal compliance with equity Versus fixed operating cost. Program access and exposure for our children, and then sustainability. That is what we're all trying to balance. That's what our board is having to balance. That's what the administration is balancing. That's what our schools and our principals, that's what they're trying to balance And sometimes that balance may seem unbalanced. Because again, we're still trying to work through. It's clunky. It's not clean. It's not neat. It's not black and white. It's very gray, and we're still working through it. So
067now I'm really talking to our community. How do you read a school allocation? Like, how do you do it? Part of it is understanding student enrollment and the student demographics in the building, especially if it's a school that you care about, right? So most parents, they really care about their community And how it impacts their schools Understanding and having a conversation about, okay, what is provided to a school, what we call locked resources. But what is provided to a school where a principal does not have a choice. But it's going to come out of their school allocation versus what is discretionary where a principal can make a decision You know, I want to purchase this many classroom teachers, we need this many resource teachers, this many paras, you know, they can make certain decisions. And
068then, okay, we want to have this many discretionary dollars, which in our formula, we try to do, I think it's about $66 per student We want schools to have in discretionary. Some schools they have to use all of their funding to purchase positions. It's all position based, and then they rely on their title one funding. If they have any or their community school funding for the discretionary piece Then trying to understand, okay, did the school receive a subsidy? Did we increase or subsidize the net allocation to help bring a school back to a more realistic total and understanding that if we did, that is because we took from another school to do it. And then what are the program costs outside of just the basic student weighted formula? And that goes back to understanding if
069your school has a specialty program that adds a layer of complexity that somehow we have to find a way to fund. If your school is a small school If there's athletics involved, you know what I mean? So again, just understanding what's going on in one schoolhouse And then we have to… we have to focus on all of our schools. So the key takeaway, understanding blueprint ties funding to students and student needs. That is the whole point of Blueprint. We have to follow the legal funding rules and the minimum school funding floors. Which is 75% no lower. Small schools, athletics, specialty programs, charter schools, shared services. They usually cost more than the formula generates. And then there's if there's going to be a public conversation instead we just need to come together as a community for
070advocacy. And that advocacy needs to be in the hands of, hey, we understand that Blueprint is the law and this is what, but there has to be certain programs The funding, the base, the per pupil amount is nowhere near enough. to do what Blueprint is saying it should do. It is not enough. So when we talk about advocacy, that's what we really need from our communities to advocate to get those per pupil amounts need to increase. Also understand, especially no two students are created equal. They're not the same So just having a flat amount for every child just because they have what we call in a disability doesn't mean that that per pupil amount is enough and that is evident in the fact that the state is riddled with SPED debt And so it starts
071with just having that basic understanding of what the funding formula entails, and that can then help support better funding decisions. So with that being said, I will be quiet and answer any questions that you may have. Thank you so much, Director Smith, for that Very comprehensive overview. It was sorely needed. So at this point, board members, do we have any questions by Cher Brown. Thank you so much, Chair Goins-McCants, and thank you so much, Director Smith, for the presentation. I just had a simple question. Well, I hope it's simple, not really that complicated. You know, I know that students follow the scholar… the money follows the scholar And I recall when my son went from you know, our neighborhood school into a specialty program, not necessarily the beginning of the school year. I think it
072was maybe October You know, how does that work when it comes to following the dollar? Does the neighborhood school write a check to the new school? Does it go through the system? Like, I've always kind of been curious how that allocation works. Or if it does work So that is such a good question because Not only it does not. We are funding schools based off of the demographic of the students the year prior. So what actually may be in your building in school year 26 and 27 may not reflect how your funding was generated. So we're a year in arrears. Charters are the exception, but so we're a year in arrears in how we receive funding, which is, I believe, how we always receive funding, but because of the complexity with Blueprint and the autonomy
073that blueprint took away from us. It makes things harder No, that makes sense, and I feel like this was the question that, Chair Goins McCants had the last meeting, that we had that was very similar, and so there is no other formula or way, because I can only imagine a school that gets an influx of students, hypothetically speaking, but are getting the last year dollars, and how that might be a little tricky, but then the school that's probably not getting as many students is still receiving the allocation as if they have that many students. So I'm sure people are thinking, well, that's not fair, that's not right I don't really know how you all have to deal with that, or if that's something that's fixable, but you know, right-size in the next year. I'm just
074curious. Yeah, okay, that part got it. Thank you. Yes Board members, do we have any additional questions? I do have one in that same vein. So, in the case of a school with drastically changing demographics from year to year, that balancing or support is on us as a school system Correct Yes, ma'am. And then overall, that just comes out of our general operating budget. We don't get any additional monies or support from the state to cover that. No Sure. That is a little bit concerning. Given our demographic changes, but that is very helpful to understand and wrap our minds around how Blueprint connects to school budgets and what schools are actually grappling with. When they are making these decisions Thank you so much for presenting this to us. Thank you. So, as we are moving
075at this point, board members, if we are sure There are no other questions We will move towards Adjournment Thank you all for joining us this evening and giving us all of these wonderful presentations Please remember that this meeting will be recorded and available on our PGCPS YouTube channel. And with that, the time is now 7:04 Pm. And the May 18th, 2026 operations budget and fiscal Affairs Committee meeting is adjourned.