Cascade School District Budget Meeting—May 12, 2025

001record. So, just step away, don't touch, and it will pick you up. Surprisingly, >> fun times. >> What happens to the recordings? >> Uh, they're kept and you can go online and click on them and watch them at your leisure. >> They're kept forever. >> Yes, they are. >> Forever and forever. that it call the meeting to order. >> We are ready to call the meeting. >> All right, let's call the budget meeting of May 12th, 2025 to order. Welcome everyone. Thank you for being here. And let's see, we're going to go down the list. We call to order. Welcome. Introductions. So Brett Stagel, um I'm on the board. Ruth Stevens, >> John Remy, Spencer Rockwell, >> Don Taylor, >> Wendy Coats, Stephanie Maul, >> Don Marquez, Patty Taylor, >> Scott Miller, director of finance,

002>> Darren Drill, superintendent, >> and welcome everyone. Thanks for being here. Okay, number three is elect a chairperson for the budget committee. >> Oh, before we do that, Mr. Chair, you be able to uh uh >> work on the vacancy appointments. >> You want to do that first? All right. Yeah. Before the chair. Okay. >> So, that one. >> Um, I move to appoint Patty Taylor to the vacant budget committee position uh that was previously held by Eric Hunt. >> Second. >> Okay. It's been moved and seconded to nominate Patty Taylor to the board. Any discussion on that from either side of the table or just our just our side? >> Just our side. Any discussion on that issue? Any concerns? Nope. All right. All those in favor signify by saying I. >> I. Oppose.

003Same sign. >> Motion carries. >> Thanks. Welcome aboard, Patty Taylor. >> Y. >> All right, Mr. Pillar. Do we need to do the neck? Um, >> yeah. Why don't we do that one while we're while we're all in in session for that? Let's just do it. >> Mine's mine's done. >> Okay. I move to reappoint Wendy Coats and Stephanie Maul to a new three-year term which will expire on June 30th, 2028. >> Second. >> It has been moved and seconded to appoint Wendy Coats and Stephanie Maul to a three-year term. Um, any discussion on that matter? >> Questionable. >> It looks like there's three people, Wendy, Dawn, and Stephanie on that. >> The third person has elected to not Thank you. >> renew that term. Good question. >> Okay. All right, any other questions? All

004right, all those in favor signify by saying I. >> I oppose. Save sign. >> Motion carries >> for that for that last position, Mr. Rockwell. We will appoint that for next year. >> Correct. Thank you. >> And we thank and we thank Miss Mar for all the years she's done it. It for a long time. >> I didn't realize it till I was reading over like didn't seem like that. >> Yeah. >> And thank you. >> Yeah. Okay, now we will move on to number pardon me number three to elect a chairperson for the budget committee. Any nominations for chairperson? >> I nominate Brettsteagle. >> Second. >> Any discussion? All right, it's been nominated and seconded to nominate me as the chair. All those in favor signify by saying I. I >> oppose same sign.

005Motion carries. Is that even a motion? >> Yeah, it is. We're good. All right. >> That correctly. >> On to number five. Presentation of the budget message. Mr. Drill. >> No, actually the proposed budget overview item four. >> What am I getting ahead of myself? >> Proposed budget overview. Sorry, Mr. Pillar. >> Yes. All right. Thank you. So, in front of you, you have the proposed budget u for the for the uh for next year. The process in the state of Oregon for budget approval um demands us to have a budget committee every year and it demands of staff and administration to put together a balanced proposed budget for the future year. Now the budget committee's job is to evaluate this proposed budget u assess whether it meets the needs of the district and approve

006it or suggest changes to it. So, you have the ability to suggest changes to the budget. Um, and if we did do that, the group together would have to come together and communicate what those changes are and they'd have to vote on th those changes and then direct staff to do that work. Um, what we have done is put together a a shortened version, a little bit trimmer version than we've seen in the past. And so I'd like to just go over the different sections and the different tabs of the budget to let you guys know what you're looking at. So like last year, we have six tabs um for the budget. And it's usually best to just lay it out this way uh because it's in landscape format. So behind section one, uh we

007have all the we have the budget message that Mr. Gil is going to present, the board and budget committee calendar for the next year's budget process. uh the budget review process in accordance with Oregon local budget law, the roles and responsibilities of the budget committee and a summary of our assumptions as well as the state school fund estimates for next year. The state school fund is our largest funding source and so we we tend to spend a lot of time analyzing that and planning for those types of things. uh the particular state school fund grant itemized sheet that comes to us every uh every quarter and then of course enrollment which is a big part of how much money we get in our state school funds. So that's all in tab one. Tab two is

008focused on the general fund. Now remember the general fund is fund 100. We refer to it as 100 fund or the general fund kind of interchangeably. It is by far our largest fund. Most of what we do in educating kids happens out of the general fund. Okay? So that's why it's a little bit more dupal than the other funds that we will see. We have 32 other funds that we work with, but the general fund being the largest by far. >> So behind tab 2, the first thing that we have is the resources report, which is the proposed revenue. This is what we think we're going to have coming in next year. It's not perfect, but we think it's we think this is close to how much money received each year. Some lovely graphs that

009uh my assistant Katie has worked on. And then and then further on it breaks out the proposed spending of that general fund by center and center in our our parliament is by building. So we have a a center junior high, we have the center for the high school, all the elementary schools and all of those are in different pages if you need there is an index at the very front part just behind sheet it's four tab one but anyway so it breaks down by by each of those schools behind tab three are special revenue funds and special revenue funds are a special type of fund that is um defined by revenue sources that we're going to receive that may vary. We will receive them from at least three years um which make them semi-permanent. Um

010but they kind of come and go periodically and so our special revenue funds are the 200 funds and they are split out in two different ways or in two areas. If you just lift one up, the resources, which is the revenue is at the top and the same fund number, the requirements or the expenditures are down below. Like the general fund, the revenues have to equal the expenditures. We have to do that. That's what what we call a balanced budget. Behind tab four are the debt service funds, resources, and revenues put out the same way as the 200 funds. And we have essentially three um debt sources currently um areas that we do debt and we'll talk a little bit more about the first one as we go through the budget presentation. That's the PERS

011debt service. So we have it currently and we have a side account and the PERS debt service fund 302 and I'm on page 78 that is um a big debt service. we end up paying about $2 million a year uh for that debt service. The next debt service that we have is our bond debt service. And that is uh the debt service on our general obligation bond. Our general obligation bond is the bond that when you hear about going out for a new school bond for construction and that kind of stuff, a capital bond, this is what that bond is for. Uh we passed this particular bond was a refinance that was passed in and um and this bond is the bond that is coming off the books at the end of next year. That's

012on page 79. And then finally we have also um a QZAB debt service. And this is the last year that we will have the QAB debt service. If you look at the proposed budget column, you will see we don't have any revenue or expenditures budgeted for Q's debt service because on June 5th or June 15th of this year, we are going to pay this debt off. Okay? And that was a $2 million special uh bonded debt that we took on before I got here 15 16 years ago. >> 2009 2010. >> Yeah. Do you remember what it was for? >> Yeah. So, for general general upkeep and maintenance, uh, they got $2 million at like one or one and a half or so. It was a really the state offered that and Mr. McBride, my

013predecessor, took that deal and we were able to upgrade a lot of stuff, a lot of things that needed to be upgraded. So, yep, I was around as the principal at the time. >> And then, uh, behind Cap 5 is our capital projects funds. We have only two capital projects funds. We have a we've maintained our building and site fund. And so we we put uh some extra revenues that we pick up from um uh rental. Uh we rent out the bus barn property. For instance, we own it, but the bus barn uses it. So they uh they pay us rent. That kind of revenue comes into fund 401. On occasion, we if we get are lucky enough to get a seismic grant, that money comes into fund 401 as well. If we were to

014successfully pass a bond in the fall, the revenue would also come into this fund as would the expenditures. And then uh fund 406 is the construction excise tax. We have a construction excise tax in our district. And so, uh, it has not been throwing off a lot of revenue for us lately, but we and we don't spend much out of it, um, on on the regular, but it is, uh, it does have a balance of about 1.47 million in it currently. So, we use that, uh, mostly. We're kind of restricted on how we use that, but it's usually on facilities improvements that are a direct result from growth. So if if we need some classroom expansion, we can buy some desks with that. But the last few things that we've used that fund for uh

015include parking lot expansions at both Cloverdale and Turner Elementary School. And then the final fund, we're one of the few uh funds in the district that have a 700 fund called the endowment fund. And this is for the pool. So when Mr. Berkeland passed away. He gave um the the school district some money as well as the city of Turner some money to hold in endowment. We can't spend the corpus or the principal of that money. We can only spend the interest on it. So um we we don't spend a lot of money out of there. Um and we've just been kind of sitting it and we we credit it with interest and we have started with $100,000 um a number of years ago and it's now up to $143,000. U but we can only

016spend $43,000 of that and that is only for pool improvements. >> We also have to work with the city to have that conversation because they they have a part of it. We have a part of it. So, >> um, no, about 10 years ago, uh, eight years ago, the previous city manager was very interested in, um, taking over the pool. Uh, I was happy to let them. So, if anybody have ever had a pool, you know, and after he did a little research, he decided that was a bad idea. So, um, we we've continued to work together and I appreciate that. So, but the upside is to that very old pool. I think we've probably saved some lives over the many years uh by teaching lots of kids how to swim >> and that's been

017a good thing. >> All right. Great. We are I'm just going to check on get caught up on our slide presentation. Hard to click the slides and talk at the same time. Um we talked about that >> message. >> Oh yeah, you're this is the thing. You're you're almost up. >> Okay. Can you say so? >> Just wait a second to get caught up here. >> I did want to highlight that in our um special revenue funds. We did have we have a few new funds. The fund 229, the mentor grant, that is a fund that we've had before, but we reactivated. It's been inactive. And we also started a new fund uh for next year. We're calling it the substitute fund and that has about $250 >> $50,000 in it and that is to

018pay for some of the long-term subs that we've been getting uh recently. Um it's not quite enough, but um when we go down and talk about a little bit of our budget challenges, we'll learn a little bit more about those long-term subs and their impact on our our general fund budget. So, we're trying to trying to mitigate that. And then some of the funds that have been inactive, they're still showing up in your book. Oregon budget law says that as long as they are within the last two years, we've had experience or expenses in the last two years, we need to present that in the budget. Uh after two years, we can take them out of the budget. But you will see funds 208, 209, the 251, and 241. Um, three of those funds, well

019actually all four of those funds are COVID related funds that we no longer have. We have not received money from from their revenue sources in a number of years. We don't expect to. So, we're going to let those go away. They are officially inactive and then next year at this time you will not see them in the budget. And then those are the debt service funds. We talked about those and Okay. And that's the layout of how the fund process works. We always report on actuals for two years, the current year adopted budget, and our proposed budget. After tonight's meeting, this budget in front of you will become approved. If you approve it tonight, and then after the board deliberates on the budget next month at their general meeting, and there will be another public

020hearing, you will be an adopted budget. The only rules are you can meet this group can meet as many times as it needs to. The only rules are is that it has to be adopted and appropriated by June 30th. That okay so right now Mr. Drill will present the budget message and that is behind page A. Yeah, it's page A behind cabin. >> So Mr. Mr. Pillar got to explain all the fun stuff. I get to start with the the the dirty details about the 2526 budget. So, um I put in there and probably the first paragraph is probably the most important piece of it. Um we are um kind of kind of at two places at one time. What I mean by that is that we have a budget that for the first time

021in seven or eight years um we are going to need to take money out of reserves to be able to cover our budget. At the same time, we have prepared for this so that we unlike other school districts don't have to say we need to make massive cuts or take jobs away or cut days or any some sort of combination of that. So, um, for those of you that have been around for a long time, way back in 20089 when the first big huge recession hit, um, that was my first year as a superintendent and um, I truly still didn't know what I was doing. And uh I was told that, oh, you got you got a little over a million dollars in cash carryover and you're good to go. By uh May, actually by

022April, um the state of Oregon was saying, yeah, you don't not only do you not have enough money, we're actually going to take money between now and the end of June. And so we ended up over the last few years of between 2008 to about 2011 um we cut days, we cut staff, um we zeroed out all kinds of balances and we literally uh just crawl along. There were a couple moments in meetings where the amount of cash carryover um we were the business manager at the time and I were watching to to when the state would give us money and to when the paychecks would go out because if that wasn't timed right, we would have insufficient funds. So we started at that point and as we grew and the economy got better, we

023said never again. We're not going to do that. And so over time what we have done is tried to build up our accounts. So that when we knew when the bad times would come and we really thought when the very first part of COVID hit that might have been the time. Turns out lots of money was handed over and at the very same time we grew as a district. We ended up with not a surplus but more money than we had seen for probably the entirety of a consolidated school district at Cascade. So fast forward three or four years, the the the uh um money from ESRE funds and COVID and the money we got in growth we had spent uh on our staff, we had spent on making sure we built programs and we

024also did save some funds. And so when I say that we are at a place right now where we cannot sustain what um we cannot sustain by just saying, "Hey, we're just going to spend what they give us." um because of a couple of reasons. First and foremost, and Scott will talk about a little bit more, is the PERS issue that came up. And Scott's going to go deeper into the why, but just let me say that um every employee enjoys the PERS retirement. U very few of us are left in that very top tier one, which is what you heard about over the last 25 years about how great the retirement was and and how well that worked. There are very few of us left. I'm one of those, but myself and a year

025behind me. And then that's it. Then you moved to tier two where the deal wasn't as good. And then most employees now are an offserve which is a retirement fund that really says hey this is this is like a pension. You should also be thinking about other types of retirements to help you package in along with social security to help you uh get through your retirement years. So what PERS has done is basically say to us the cost of that is going to go to go up fairly high. A little over 20 years ago, um 20 years ago or so, um this school district with the that board at the time along with Mr. McBride, my predecessor, went out and got bonds to cover the PERS costs. And those bonds worked tremendously well. Over the

026last 18 or so years, those bonds have probably saved Cascade School District between eight and $10 million. Uh so every time that there was an increase in PERS, we would say, "Hey, we got bonds and we made money on those bonds from the stock market and wherever else that they played those and that difference that we made, we could use that towards the cost of purse." So the actual cost to Cascade was minimal, but the overall cost was much more. Well, fast forward to where we're down to the very end of that bond and there's not enough money left to cover that increase. So here we are having to go up and Scott will talk about the amounts and how much as I say in here from June 30th to July 1st in 24 hours

027we will suddenly pay over $2 million almost $2.5 million more just for retirement. We didn't do anything. It was nobody's fault. We didn't miss a deadline. It's just this is how much more we're going to have to pay. So um that's that's issue number one. Scott also mentioned that he put some money in a uh an account to cover long-term uh people that are out for long term. So for this year, good bad or otherwise, we had I don't know, it felt like 295 babies, but it felt probably was more like 12 or 14. And so people were out for extended periods of time. So we were paying them if they had their sick leave to be gone and paying somebody else to cover. Add to that the new leave laws with Oregon and you

028could get extended family leave and extended Oregon leave and all the other leaves to go with it. At one point we figured out that we were funding almost 12 additional teaching positions >> in our fulls >> full FTE >> with health insurance. So um suddenly we are that's not what we budgeted for. The other thing is that the unemployment particularly for our classified folks which was signed into law is that our um our classified folks while they work and get a paycheck for 12 months in the summertime they can apply for unemployment by law and so they get a check as well and we're going to watch that number go up. The final thing was that of the three things was that um this is the first year in seven years that we didn't get

029bigger. um the the uh building of homes around our area had finally kind of been exhausted and there's no new uh uh brand new developments going in yet. There's talk uh but nothing has gone in yet. So we this year kind of flattened out. We started 45 kids lighter than we did a year ago. Last year we kind of spiked up and came right back down. This year we kind of started this way and we've held we are now as of February are starting to be just ahead of the number that we were this time last year. We're about 30 kids ahead. So that's a 75 kids swing from last year. But the time that we were below the number means that if you average it out, we will not be ahead by the end

030of the year. That means no additional funding is coming from the state because we get paid a little over $11,000 per kid. That's how we fund the process. Add all those three things up and suddenly we are at a place where we need to turn and look at our reserves to be able to get us through for next year. Um the upside is we have them. Um the downside is is that reserves like your uh bank account, like your savings account, once you use it, it doesn't just automatically replenish. Um it it goes away and we're going to have to work at figuring that out. So, uh, just today, uh, in this room about three hours ago, sat with all the administrators, some of which are behind you, and they got the fun of hearing

031me say time to make cuts and time to figure out if there's ways for us to sweep money for the remainder of this year and take a look at next year as to how you can do your job with with fewer dollars. And that is the only way we're going to be able to one, survive this budget, and then two, continue on for years to come because we need to be able to do operate with less. Um, we are hopeful that the state of Oregon, who is still in the legislative session and still holding on 11.34 billion, which sounds like just an astronomical amount of money for education and is a huge increase from a year before. But when you take that number and break it down, that's about $2 million more. And I already

032Scott and I already mentioned we're going to spend more than two million just in PERS. We're also in negotiations right now with both of our associations. um actually all three because our administrative team then waits to see what we do with the other two and they usually roll along with it. And so we don't we have a very minimal increase for that as well and let alone any rollup costs because you know um heat and lights don't go down they just go up. So we're going to have to take a look at those numbers and figure out how to budget that. So what we have tried to accomplish over the last couple of months is to figure out a way to build a budget that preserves the classroom as much as we can. Um so

033our goal is to take a look at what we do and try to save one as many adults as we can because they serve kids right and two not cut into the things that we do for kids in the classroom. So, while I did say to the administrators today, you've got a principal account or this account, can you do with less, right? Um, our goal is to try to figure out how to make sure that, you know, uh, for example, BMSville has 24 regular classroom teachers that when we start next year, they will have 24 regular classroom teachers. Turner has 18, Cloverdale has nine, the junior high and senior high, I don't have the exact number in my head, but we want to make sure that every teacher is there and we want to make

034sure that we have as many classified folks as we can. The last part is that we are concerned at the federal level that money is not going to come to education. Uh it has been made clear, as a matter of fact, the goal at that level at this time is to close down the Department of Education. Now, I get people that tell me, "Oh, it's okay. the money is going to come to you in block grants. It might, but not at the same amount. And um if somebody can show me that, because I've had a couple of people kind of challenge me on that, my response is, "Show me." Nobody's been able to show me because nobody really knows. Um we have been told, for example, we get a number of title program um amounts

035of money from the federal government. Title is for poor poor students and students that do don't do well in reading and math, right? We have been told plan on a flat budget. That is not an increase. And of the four or five different titles, one or two of them will not exist next year. That money will be gone. So, we need to figure out a way to be prepared that when that money goes away, how do we balance that? We do use some title funds to pay for people, but we can't just shuffle those people into another fund. You're setting yourself up to get to an edge of a cliff and then fall off. So our goal will be as we take a look and see what title is actually willing to support we will

036need to take a look at who's in title we every year because there are 350 or so employees at Cascade we're going to have some retirements we're going to have some people that leave and through attrition we will try to move people over and our goal is to not let go of anybody um at all for this upcoming year and hope that one we grow just a little and two that the state of Oregon while they're still in legislative session might give us a little bit more. Uh we're going to find out some big information on Wednesday because they will they will put out a report to find out financially where the state of Oregon is. They do that quarterly I believe and u we're hopeful that it's at least flat or it's up a

037little bit though everybody tells me uh it's going it's going down. So we'll see what happens. We'll see what happens. So we're waiting around for our legislature to finish up. That's an unknown. We're waiting around to finish up our negotiations with our classified and certified. Um, when we've had money over the last five or six years, we feel like I feel like maybe maybe our associations would say differently. We feel like we have done well with that. Over the last four years, we have given almost a 26% increase to our classified and a 23% increase to our certified, our teaching staff. We now boast the highest paid brand new teacher salary in the mid tri county area of Marian Poke and Yan Hill counties. We are ahead of Salem um across the board and in

038our mid-range teachers we are third out of the 21 districts and or fourth in our top teachers we are third. Um some of you have been around long enough to remember Mrs. Stevens that we were way near the bottom of that. So, we are very proud of the fact that we can turn and pay our people uh a real solid wage, but we're at a place this year where we're going to have to look at our associations and say when we had the money, we gave it to you. Right now, we don't. Um and the first move in negotiations is always that do you do you really not have the money? And so, we're going to have to work through that process and make sure that we are clear with them that no, we really

039don't have that kind of cash this year. we will go from there. So that is my budget message. Um everything is in in accordance with state law. We followed all the processes. Uh the nice part about having a veteran business manager is that he understands this process very well and it makes my job fairly easy. Do you all have any questions on me at this time? >> I I got a question on the cash carryover that we talked about a little bit. >> Yeah. I thought we had a policy where we had to carry a certain percentage. >> We do have a policy that we have to carry a certain percentage. Um I'm not looking at it right at the moment. It's right around uh four, five, six%. >> 6%. >> Um and if you'll

040find this the today we are just at that level. So >> So okay, with that being said, if we're going to say, hey, we've got all this cash carryover, we can dump it into the PERS or dump it into these other funds. What does that do to the policy we have that requires us to carry six? If we take it and ship it somewhere else, we'd fall outside of our policy. >> You'd have to rewrite your policy. >> What if we don't want it? >> Then we'd have to talk about making more cuts >> with regard to staff or days or things like that >> because >> now with the cuts that we put in here, >> yeah, >> we are still at 6%. >> We're six. >> What we shared with what I shared

041with board members individually earlier this month, late last month, was that we were below that number. We have spent time in the last three weeks trying to find um from a from a from a district standpoint, I guess the change in the couch cushions, right? Uh and we have been able to move that number up from 5% to 6%. >> So my my concern just looking at it without getting in the weeds on this is it's a very shortsighted solution if we say, "Hey, let's eliminate that or move it from from six to two or whatever and dump all that cash into it." Like you already said, our piggy bank's not going to fill itself back up and someday it's going to rain. My hope is Brett and I appreciate the the comment. My hope

042is is that we can guide it guide that debt to a place where over time when we lose somebody through attrition we evaluate seriously whether or not we want that person back and then we make the adjustments according so we kind of step down >> without hurting somebody's job or hurting a program too much. We thin it as we go. If we find in November that that's not going to work, then we do have time for that school year to let somebody know come June of 26, right? You may not have a position. >> Okay. So, another question, and this is for you, Mr. Pillar, and you may not know off the top of your head, um, behind tab 2, one of your fabulous graphs, which are amazing. Thank you. Um, it shows that currently

043our salary is at 46%. of total budget. >> It's page three. >> On tab two, it's about page six, page five round. It's got the maroon. Keep going. We going that one maybe. Yeah. >> Yep. >> 46%. See that in the big the big box, the big red? I do. So the question I have is if you had to guess, what was that number last year of salary? Was it 46? Are we are we trending? I mean is it how you I know we put >> actually the next page has the uh expenditures from last the prior year 2425 so last year >> 47 and and I asked that because you already said that over the last few years we've done a 20 some 23 and a 26% pay increase. >> So I'm assuming we

044haven't always been running at 47%. It was running substantially less than that when we were running 23% less for pay. Well, actually, um, essentially those pay increases came as our revenues increased. Uh, we weren't able to give that much more of a bigger jump. I mean, we were probably at and and I could certainly go and research this before kind of pre precoid and then after COVID, but really that extra cash and our enrollment growth, if you remember last year's budget was all about or the year prior was all about this big story being enrollment growth. Enrollment covers a lot of sins, right? So when you have more students coming in, you're able to do a lot more of salaries and we've been maintaining the FTE even though we were having significant classroom size, >>

045right? But we offset it by the increase in tuition >> and yes, >> help pay for that. >> And now we've and so the the it was a conscious decision really in the last couple years to give those larger rate increases and we were able to afford those um at the time. So I I would while I would think that as a percentage of your expenditures 46 47% is roughly about average for other districts and I think that we're going to be pretty close to that. >> That's the wheelhouse we want in the last Yeah, it's it's not too far away from >> then I'm going to hold that thought and we'll come back to it later. >> Okay. >> Thank you for that question. I hope I answered it. So you answered it perfectly.

046Thank you. I would I guess my additional comment on that bre would be that um if I I can't be quoted on it but I want to say we were right around 42 43% 10 12 years ago >> I can't >> right um but and we have grown like like Scott said as a percentage of the total amount of money right it's grown a little bit faster but because of the student growth we've added more staff >> sure I understand I'm just trying to wrap my head around around it's like the the full-time equivalent that we ask about just to see what what our numbers are doing how how we're trending, >> right? >> Okay. So, when we talk about Oh, yes. >> Question. So, what are on that same graph? What are purchase services?

047>> Purchase services are anything that we uh buy that is intended. It's everything including electricity, water, garbage, utilities, but it also includes um you know if we have a person coming in and providing uh training services uh will also purchase services include yeah just any purchase services that doesn't have supplies in it. It's not curriculum but yeah mostly operating. So is that like the janitors >> um are if if well we do buy janitorial sol through total solutions. So for janitorial services are done here and that is a purchase service >> that would fall under there. Okay >> this also includes like WD those kind of services or is that >> the WD that's a really good question the WD stands in support of all all of our services. They provide services through us through

048a process called the local service plan. And so that is a a separate pot of money that they keep on their books. You don't have to do the books on that. Thank goodness. >> Yes. Exactly. So they provide us with essentially a credit or a bank account. We can buy services from them. >> We wrapped that up in early April and I think ours was about 1.2 million. >> Yes, percentage. >> Yeah. So, >> we spend it all but about $10,000. >> Yeah. And we >> mostly in special education services, which is what it is. What that means is >> like if you needed a specialist in autism and but we don't need a full-time person, right? So, Cascade, Estate, and Jefferson could go in together and buy a percentage of that person. And so,

049that person has a full-time job with the ESD, but they go to three different districts in the course of their of their week, so to speak. I hope that makes sense. So when we're talking about um this year before I start summarizing kind of what this budget actually looks like we have to talk a little bit about last year's budget. So uh last well actually it's the current year's budget which we're currently in right now 24 25 and these are some of the adopted budget characteristics. Many of you were here when you heard us that we we we often put together a conservative budget for your use. And I'll tell you a little bit about what conservative means in my parliament. Um and this conservative budget had what I would consider decent performance. Um as

050a business manager, I often rank the performance of our budget. How close did we get to actual expenditures, actual revenues, those types of things? And ours was decent. It wasn't great. It wasn't bad. Uh on our revenue side, we are predicted or expected to spend 99.4% or we are expected to receive 99.4% of revenue. So that's very close. Um I I'll take those odds any date. Uh we had a larger than typical beginning fund balance. Okay. So >> that's July 1st, right? >> Yeah, that's the beginning fund balance of the current year that we're in on July 1st. much larger than typical and we were very grateful for that because it really saved our bacon. Um but the other thing that we noticed is that um we had a flattening enrollment as Mr. Drill said.

051Um our enrollment had been growing pretty steadily and pretty um pretty significantly for a district our size and we saw some flattening and actually as Mr. Phil said we started out low and we're just now kind of starting to get back up. So we are technically in what an area called safe harbor from a school funding standpoint and that was a little bit unexpected. On the extent side we had larger than expected health benefit utilization. Um without going into too much of the the weeds, uh our employees, um a licensed employee get to choose which level they have a tiered benefit approach. And we they get to choose if they want to fund health care for their entire family or just for themselves or just for themselves, their spouse, however whatever station in life they

052are. Um my job is to guess what they're going to pick next year. and sometimes I guess a little bit off. Not perfect at that. So they had we had a little I expected them to pick a little lower and they picked a little higher. Also with the uh temporary teachers uh that we have uh they also got to pick some health insurance and I picked zero for them and so whatever they picked I guessed wrong. The significant increase in long-term leave costs substitutes uh and that cost us about 1.3 um and that those those costs are are still coming in. So that might actually go up a little bit before the end of the year. And we had 101% of current year budget expenses without contingency expected. So we are are spending about one

053percentage point more uh this current year in our expenditure expenses predicted. We do a lot of spending for the last two months. As Mr. Drill said uh today, all of the staff including my department, the fiscal department, I just got my budget cut by Mr. Drill. um we are hopefully going to extend that so that 101% does not take into consideration the cuts we are making between now and the end of the year and six weeks in the year. So hopefully we can get that down a little bit. And then finally the result of that is that utilization of the beginning fund balance. Now without again going in too deep and if you had any questions about that we started the year at $5.6 million and we're going to hopefully end the year at $4.0

0540 million. So that's a $1.6 million reduction. Interestingly, that's right kind of in alignment with the increase in long-term sub costs and the uh healthc care utilization. So that's kind of where we end up pointing the finger talk about that. Uh as uh Mr. Steagel said, yes, you do have a policy that is 6% uh ending fund balance. uh this number about 4% is going to come in about 8% of our revenue uh picture. So we're well within policy for that $4 million. What we're going to start with this budget is we're going to start the year with $4 million. We're going to probably end up having to drop that pack down to 3 million and change which is the 6%. So it's going to be we're going to hold tight to that number. So

055these are the proposed budget challenges for this year. On the revenue side, we talked a little bit about that. It's a reduced beginning fund balance. Uh we don't know what the state school fund is going to be. We predict it to be 11.4 billion uh over two years. We are it's unknown our federal revenue uh whether it's going to be reduced or flat. uh the property tax growth rate is something that we don't really talk about very often, but in Oregon, we're capped at a 3% growth rate in that amount of property tax revenue unless new houses are being built or people are remodeling. Uh as you probably know, you know, if you're trying to refinance a house or sell a house or know someone who has that market has quieted down quite a bit.

056There's not a lot of building going on. there's not new homes going in because of that. Um, we are really that property tax revenue is capped for us at a 3% growth rate. Three years ago it was 6.5%. So that growth rate has cut down pretty significantly and we can't get that money back. Um, oops. On the expense side, uh, we have some significant first cost increases. Uh I did a calculation weighted cost averaging and our cost increase it's it's over double it's 103 and a half% increase totaling approximately 2.5 million across all funds. We'll talk a little bit more in in about why that is uh and how other districts are impacted by the same issue. Unknown salary rollup costs due to negotiations. We don't know what those are. We just started those. price

057increases beyond the CPI doing due to economic uncertainty. We paid real close attention to price increases around here. Uh everything from electricity to things that we buy, purchase services and supplies. Those prices have been just been wildly up and down with the tariff discussions and those types of things. Uh right now we're seeing significant price increases all across the board for everything norm markets. It's it's really challenging. And the other part that we need to address is our continued facilities and maintenance needs. It's no secret we're considering a bond for this fall. Um, and we're very, me personally, I'm speaking with my personal hat on, very hopeful that it passes simply because as Mr. Dill had said to me earlier, we can spend about as much as we can, as much as we have on

058our facilities. Our facilities are older. um you know, our roofs are leaking. We've got some real challenges in a lot of different places. Our HVAC needs, you know, major upgrades, those types of things. And so we uh if you look in the budget, you will see some of the expenditures. We are spending significant amounts of revenue on facilities upgrades. And really, there is no stop to that. I mean, we can continue to do it or just not and hope for the best. The result of that is a particularly particularly tight what we're calling a basics budget. And that's what I'm putting in front of you today is a basics budget. And those characteristics of that budget is a real sharpened emphasis on teaching and learning with a focus on preservation of staff. We have a

059moderation of rollup costs. Now, we don't have a lot of control over that. We're going to be in negotiations, but it's it's going to be a challenging negotiations time. I'm sure we have no FTE additions in this budget. Um, if we do have reductions if needed, um, it's by program centered attrition. Mr. Dill talked a little bit about that. That is if um our if we have staff in a title program that has a reduction in funding, we may not be able to, you know, protect that particular person's job. If we have another job that leaves by attrition, they might be able to fill into that area. That's not a guarantee. We're not going to be able to backfill special programs, SIA, uh high school success, title programs. We're not going to be able to

060fill those with general fund dollars. The general fund just doesn't have enough revenue to support that. Moderate use of reserves and savings to preserve current programs. Um we were very fortunate a number of years ago we put together a savings account for PERS reserves and um we have about $3.1 million in that account. Uh the time is to use it. It's a rainy day fund and it is rainy. Moderate reduction of any fund balance down to 6%. We talked about that. Exploring enrollment options that impact revenue. Um, we have a cap on our enrollment. Um, and um, it's a debated, you know, it's a debated thing. The board's worked on this for a number of years. There's lots of pluses and minuses to it, but uh, perhaps it's time to reopen that discussion. Um, because

061all of those people, all of the new students that we do let in does provide operating revenue for us. >> Did we hit the ceiling on anything here? Did we hit our >> we hit the ceiling most most uh grades of most schools. >> Is that right? No. Even though we were you said we were fairly >> we were flat. We were flat. There are there are it's interesting we have some space openings particularly at the kindergarten level because um as if you read some articles right there are fewer kindergarters not just people have left public ed there there have been some but the reality is that there are fewer babies and that's across the United States. So, um, it is interesting. Every grade level from second grade to 12th grade starts with a two.

062There's 200 and some odd kids. When I first started, every one of them started with a one, right? But this year, from second grade to 12th grade, they all started with a two except for first grade has 193 and kindergarten has 151. >> So, you'll see what that looks like. And we noticed that last year's kindergarten was about 160. It jumped to 191. So, we'll see more people bring their kids to first grades and hold on to them for kindergarten and then they'll go from there. So, we'll see how that goes. But, um, as of yesterday, that's Sunday. As of Friday, we had almost 85 people in line to that are outside of our district that want to come to Cascade. >> So, while we're flat, we could increase to open that up. >> We

063could, but you have to fight. >> It's the same conversation about going out for a bond. Why would we pay for somebody who doesn't pay taxes here? Blah blah blah blah. I get it. >> But for every child, it's $11,000. For every 10 kids, it's $110,000. You're almost saving the staff member for adding to a position. >> Can we make out of district kids bring their own chairs? >> I don't know about that. >> Maybe write that into the contract. >> Exactly. our our what what Scott said about that is what I think we're going to look at is to find where you guys set limits for every every grade and every school. That's what we do. We're going to do that tonight. It's essentially the same. If we have space, right, what we've said

064to people before at beginning years, we don't have any space in third grade at Turner. Sorry, we can't do it. We get to Christmas time because we have trimesters, people knock on the door again. And what we've said for the last couple years to keep that number down is sorry, we're full. We're not we're not adding more kids. Five years ago, as we were coming out of the old budget crisis, eight years ago, we said, "Hey, at Christmas time, we will accept, right?" And so those numbers continue to creep up. The biggest growth that we had over the last eight years is just the houses that were built. I mean, people go, they'll look at me and say, "That's because of all those transfer kids." I'm like, "Yeah, the numbers don't show them." What the

065number really is is how many people actually move to Cascade, >> and that's that's what happens. Yeah. Do we have a projected number for kindergarten for next year yet? Is that >> they're doing roundups? They're doing roundups right now. >> Okay. >> And so they're working on that process. >> Okay. But we don't have a number yet. >> We we have more we have more kinders pre-registered this year than we did it at this time last year. >> Okay. >> And generally the the the deal has been with kinder pre-registration. That gives us probably about 50% of what we think we're going to get. But it's a guess. This is not an area that does a great job with preschools. They just there's that's that's not the kind of thing. And Cascade School District gets

066zero dollars for a preschool. I don't know how many times people have asked me do a preschool. I'm like, I don't have the money for that. Our vision and our job is kindergarten through 12th grade. Plus our help for our 18 to 21 year olds that that qualify for that. >> If we're low in kindergarten, we make that decision to let transfers in. Are we also letting their freshman sibling in onel >> if there's space? But the reality is particularly from sixth grade all the way to 11th grade there isn't space. Okay. >> You have a cap. That's where it's at. We don't go past that cap. >> You guys said it. So that made my world a whole lot easier. >> Uh continuing aggressively seeking a bond renewal. That would be something that I

067think would help our district a lot in ter particularly on the facilities and maintenance cost side. And then monitoring a new site account establishment. Um that's an important one that um we'll we'll talk about a little bit later. Uh just to kind of give you an idea of why we're in um the spot we're in. So along this line um our proposed budget summary, these are some selected assumptions. So, we based our school uh the school fund on the 11.36 billion legislative allocation. That's behind tab one, page G to H. Looked at that a little bit. Uh 1% increase over year-over-year in enrollment. Um that 1% increase is a little bit it it's sounds small or it could be big if you however you take a look at it but the 1% increase in enrollment

068is actually what we predicted for last or for the current year's enrollment and that equates to about 38 kids. Now where we're at currently right now today as we said with PE students with butts and chairs uh we are actually almost at the level of enrollment that we're predicting for next year. Okay. So, so, uh, that one increase year-over-year enrollment. If we have more kids that come in by October, by what's called the October count, we can go to the state and say, "Hey, we have more kids and so therefore, we deserve a little bit more state school fund. So, just so you know, that process used to be a sixmonth or a one-year turnary. Now, it's a quarterly turn rate. We can adjust to it." So, >> what's what's nice about that is um

069as I said, our our numbers stay has really stayed the same. We haven't been higher or lower than about eight kids the entire year. And what's weird about that or unique, I should say, unique, I use the word weird too much, um is that traditionally our numbers are higher in the fall. They peak out right around Christmas time and then they begin to slide down. And every year and and a year ago, as I said, it really spiked up and came down. It was almost like a mountain peak. Usually, it's more like a rolling hill. This year, it started low and just stayed there. And so, at some point, whenever time comes, we've just continued to stay right across. Like, we gained two kids this week. That's so weird. It's the most random thing. I

070said weird again. Um, it's the most random thing I've ever seen. So, does that mean that we're more stable and less people move in and out? It appears that way, right? That also could be a sign that the economy is is a little more unstable and people don't like the idea of making a move. So that helps us because technically we said to the state for next year, here's the number. We're already slightly ahead of that number and that's a good sign for us assuming that holds when we get into next year with having kids show up. We'll see how that goes. >> Uh the state grants a high school success, SIA, etc. predicted allocations and so we don't even actually have those allocations firmly yet from the state of Oregon but we're going on

071the governor's projected budget on both of those on those extra site state side grants and then on the expenditure side we had minimal cola increases and steps if eligible for all bargaining groups and then our PERS rates increases these are some real numbers for you so uh for every uh dollar of payroll um the current year we're paying 11.8% of payroll um for pers one and two members and then 8.3% of payroll for offser members. Those numbers jump up respectively to 21.3% and 18.3% for offser members. Again, that is that number that's over over double in as a weighted average. And that's going to cost us about $2.6 $6 million next year starting July 1 for no other addition. >> And is that projected to just stay in forever or two years? >> No, that's

072a two-year. That's a really good question. It could go up again or it could go down again. We're hoping um we'll talk about the side accounts and you the board has heard me talk about side accounts and where we're at, why we don't have one to backfill the one that's expiring, but hopefully within two years it gives us some time or a window of opportunity to go out and get another side account that will hopefully lower and control those rates for us. I'd highly recommend the district do that if the timing is a little bit more about that. uh all rollup costs are tied to position-based budgeting. The position-based budgeting is a program that we've implemented a number of years ago and it's been very very helpful for us. That is we just we don't

073fund the person, we put fund the position and we all of our controls are based on how many positions we have not how who were in those particular boxes. >> Uh and the budgeted ending fund balance reduced from 9.75. So that's what we budgeted last year was a 9.75 or current year. When I keep saying last year, I've been so much into this. I apologize. Last year really means the current year that we're sitting in and um and and so that our current year budget was 9.75 in fund balance and now we're going to drop that down to 6.0. So we're going to utilize some of that in fund balance. So two briefly tried to describe what a side account is and how it impacts PERS rates. So districts in consortion with other districts we

074have the ability to issue debt through bond sales without voter approval in certain situations. So most of the time when we get a bond it's a capital bond we have to go out and ask the voters to approve it. Uh however in certain situations uh like borrowing against pers um we can do that without um voter approval and we just go on our full faith and credit of our our creditworthiness as a school district. The proceeds then of those side accounts of those bond sales are given to PERS and PERS invests that effectively in this effectively prepays our future pension liabilities and those proceeds are called a side account. So, we put in um we put in um a little over uh 20 years ago, we put in uh $14 million in our side account.

075So, we prepaid our PERS rates u prepaid our PERS liabilities um with that with some of that money. PERS uses the site accounts corpus of the 14 million plus all the interest that they earn on that 14 million uh to offset pension rates typically over a 20-year amortization. The districts with side accounts receive a credit on their pension liabilities but must pay principal and interest on the bonds that are issued. So the combined payment, so we actually pay debt service on our FUR bond that's, you know, in the in the budget. That's the $2 million every year pay for that. So we're still paying for that for two more years. And then um but we received a credit on our pension liabilities and those two costs combined is still less expensive typically if the market

076rates are good. And over time, those two combined are less expensive by by nine sometimes as much as 9 percentage points. Not 9%, 9 percentage points over going, you know, with a non-sight account. So that's where we get that 8 to9 million savings over that 20-year period. So it was really a really great idea and it helps us because it maintains a lower PERS rate that we can plan on. The downside to this particular thing, it's one of the reasons why it is such a problem is because this year the side accounts, they were all set up or 20 years ago they were all set up with certain assumptions as to payroll growth, how the market was going to do, how much investment, how much of the corpus they were going to have to use

077over 20 years. And the target with all those assumptions was to get that money down to about zero um 22 years into the future. Great. >> Okay. >> We are now 20 years into the future and that that side account is about gone because our our our pers or our payroll has grown not just in the last few years but over time higher than they assumed it was going to grow. And then the other issue that they had is that you know u market rates stock market investment returns that kind of thing have been up and down. Unfortunately the last couple years it's been down. Plus our payroll growth like many other districts have been going up the last few years. And those last few years is when our corpus the amount left in that

078original $44 million allocation is significantly lower because they've been using it for 15 years, right? So we don't have enough money in there to earn interest on it. Even if we're getting 25% returns from the market, there's not enough corpus there for us to catch up. >> So that's that's the problem. Um and that's one of the reasons why uh so many districts there's a number of districts and I think I calculated it's 125 other districts that just talks about the timing 125 other districts have side accounts that are negative impact negatively impacted some more aggressively than others. We are one of the higher, more aggressively impacted districts in terms of percentage rates, but school districts like Gladstone, um, Candy has a huge impact with this. Couple of others in the northern Wampa Valley that

079I could think of off the top of my head, just peers that I communicate with on the on the regular are having I mean, they're cutting days. It's it's >> What are we paying for this? 2 million a year. You said >> uh our debt our debt service is about $2 million a year. And we have how many more years? >> Uh two more years in the step. >> So after two years then we'll essentially have that two million that we can put directly into these PERS accounts. Yes. >> It's a it's a push in two years. >> It is the next two years we're doubling up because we got to pay them plus the offset the difference. >> Exactly. >> But the difference has been over the last 20 years we've saved somewhere right

080around $9 million. >> Right. Right. No, I follow you on that. Yeah. with because you're what you said is you're you're borrowing essentially 14 million to dump it into the stock market to get the gains on it and you pay 2 million a year as your your your fee for borrowing that 14 million up front that they're getting. >> Exactly. >> Yeah. >> Okay. So, we've got two years of doubling up and then if all things stay equal, we can take that same premium money and just put it into the purge and it's a push. >> Yeah. Or if the market gets better, >> the agreement that the board would have to agree to would be to buy another >> right football be really handy. >> Yeah. It is. Yeah. Super handy. Yeah. >> Um

081so our response has been we um so you know our response was we created a purge reserve fund uh fund 269 uh in your book I think page 71. Um and we started that in 20192020. Um we the we used the budgeted beginning fund balance this year is about $3.1 million for that. So we have a purge reserve fund for rainy day. Yeah. We're proposing in this budget to use a portion of that. Uh in fact we proposed in this budget to use up to $2 million leaving$ 1.1 million in the purchaser for future years. Now, one of the things to consider that, you know, we're using more than half of it uh in this budget. However, we're not going to see that same bump next year because that same rate stays the same. It

082stays flat. So, so it's not going to, you know, we don't actually have to pay more to get that that you know, to get that same. >> We're just short 800 $900,000. >> We've got we've got three. We only got 1.1 left. >> Yes, exactly. the same bill due next year. >> We'll have the same but yeah well well the following year so yeah one more year out uh for that. >> Um but also at that time we will also have uh rollup costs from our state school fund because we do a 4951. >> So so really we are yeah we're trying to get through this year >> right >> and hoping for the best. uh we have met with Piper Sandler representatives, private bankers and purge representatives to pursue new accounts. And when I

083say we, it's the collective we all me and probably 100 of my closest friends and colleagues have been meeting on the regular for that. Um right now for side accounts to work, borrowing rates must be lower and relatively stable. Um that is not happening. Um currently bond rates are going up and down relatively stable. >> Yeah. nothing is is too too stable. Current rate is locked in for two years. A normal rate if we weren't having side accounts would be 27.8% for PERS members and 25.3% for OBS members. So, so you can see, you know, with our rates, we're not actually s you know, you can see how much little impact our our side account is really having. Um so to look for the future um we we agree that we need to really sharpen

084our financial focus on teaching and learning uh coupled with strong financial dis fiscal discipline. Um I was I'm personally recommending a good general obligation bond to manage growth and provide maintenance and cost relief. Also continue to advocate for adequate funding for K12 school districts. Everybody in this room is a good strong advocate for funding for K12 education. We believe strongly in it. Um and uh I think we need to continue to advocate loudly and proudly. And also I think it's important to you know not be so doom and gloom. We have to accept the fact that we do really great work for students here. This is a really really great school district and our numbers shoot show it and prove it all the time and so we need to continue to do that great educating

085students and be responsible to our taxpayers and other stakeholders. So along with that, we now are at a point in the agenda, uh, Mr. Chair, that you can take any questions, uh, for either Darren or myself or or each other about, uh, the budget, um, and the proposed budget that we're talking about. All right, with that being said, number seven. Does anyone on the budget committee have questions that they would like to address at this time? Got to be at least one. I had a question. There we are. It's not a I know the money wouldn't add up to anything that we're talking about, but >> was there any monies left in those inactive accounts? Because I know at some point they had some pretty good money in them. >> Yes. um if they do

086have any money. Some of those inactive accounts we are required to do the the the same type of work, you know, if we made them if we made them active. Um but if there are any funds left in them, we just transfer them to the general fund. >> Okay, that's okay. >> They're not that much though. It isn't it isn't worth really noting that much, but >> but yeah, they we certainly don't let them go away. >> So, I'm gonna ask you a silly question. So, we've got I'm going to come back to this where we've got 46% of the general fund expenditures are for salary. >> Do any districts have policies that state their salaries are capped at a percentage where a district say, "Hey, 46%'s as high as that we will allow. We're

087going into negotiations. That's great. Good luck. But we're capping it at 46%." >> Not to my knowledge. >> No, they they don't do it that way. But when you take that and the benefits and put it together, most districts run somewhere between 78 to 84% depending. >> Right. And no, I understand. I'm just wondering if if it's possible to say, "Hey, we because of the budget issues we're dealing with, we're going to minimize, maximize, put a line in the sand on what our salaries are going to be, period." And so negotiations are what they are, but we have to stay within that threshold. Just like we have a 6% cash carryover, we can't just give that money away. It's got to be there for next year. Do we have the ability to put a cap

088on salary >> in percentage on saying hey >> in theory >> 47%. So if we get if we get 11.6 billion we get our if it's 10 points what it is what it is >> we're capping our salary at 47%. >> Yep. >> We'll figure it out. >> Right. You could do it that way. The downside is over time right if others are higher the quality of your >> Sure. No I understand all that. I'm just I'm just thinking for for now when we're looking down the barrel of budget >> issues, >> is it feasible to say we're putting the top on? We have to >> I think one way to I think one way to look at it would be >> if if we came back a year from now and you said well

089now it's 49%. I thought you know you were going to manage the budget right >> based on the number of people right if it if it holds at 47% and our budget's lower then that means we have said through attrition >> right we have let go of some people at least positions as Scott mentioned position based budgeting >> you know we had 28 positions now we have 26 so that number should drop down >> it would it would drop down but if if we all know that that line is there we have a ceiling >> technically you could do it that way the hope would be you would say >> it would certainly add you Mr. No, I understand. Yes, it certainly adds a challenge to the table because >> everybody has to play within

090those parameters all of a sudden. >> Yeah, >> just a thought. I'm just thinking out loud here. >> I had a thought on I think one of the things that you're talking about too is >> the older teachers, right, that have been around for a lot longer are more expensive than the younger ones, right? >> Correct. But with the new laws that went into place with these younger teachers, there's a new expense that's come into play with, you know, they're probably having babies where the 60-year-old person probably is not. >> So there's a a different expense there now that they're used to being >> Yeah. Good point. >> Demographics matter. >> Yeah. >> So >> I'm familiar with the purge tiers as well. And as we get younger folks coming in, is that something that

091can be decided by our council that we no longer offer them pers? And I know that's a horrible thing to say, but it's happening at the state level as well where people coming in tier three or they only get, you know, a 40, right? Other different types of benefits where that finally will >> I don't know if it's Yeah, I don't know if it's illegal. I do know that if we didn't offer it, we would be at a huge disadvantage for hiring. >> I get that. >> That would be the that would be the most difficult part. If somebody would say, "Hey, we get 6% or four and a half% with regard to PERS. Do you match that?" We do, right? So, we can compete with districts around us. >> Even Jefferson last year, right,

092Don was here. She went to Jefferson. The first thing she did was say, "We want to we want to have PERS so we can match because they kept losing teachers." >> So, let's say five, 10 years from now, >> we're not going to get, let's say, as much state money and fed money. You know, we have to depend on ourselves. Is there something we can do as a board that says we need to really start hammering on our corporate influencers and donations and grant writers and people that we can extract money other ways. Stop thinking about it coming and hoping from bonds and taxes, but by golly, all of our athletes are now supported by, you know, somebody locally that wants to do that. And I know it's hard to get people to volunteer and

093do it, but maybe we need to boost that part of it because they're here and have kids and maybe would then >> outside the box thinking >> trying because I don't the writing's on the wall that the zeros are coming and attrition's great but then sometimes budget lines are specific like okay we lost maybe an assistant instead but that doesn't pay for the certified person over here so then you know Mr. pillar gets to play with the deck chairs on the Titanic and rearrange them, but it's still not bumping back up. >> And I >> one of the other things we have said we did that 10 years ago, right, was and the principles that are in the room, they've already heard me, right, which is, hey, if you have an opening and we have

094a veteran or somebody that's retiring, right, we can talk about how young do you hire, right? As opposed to an experienced person, do you hire younger? Because if you hire younger, they're cheaper, right? So, you have a brand new teacher that comes in that just got out of school and a retiree that just left. That's a $35,000 difference. >> But like Aaron just said, not so much. Now, if we're >> if you hire really young, they're not even married yet. >> But they think >> No, no, no. Five years later, you really pay for it, which is what happened. >> US, right? But yes, I think all of those variables are at play. What you suggest about PERS is unique because I haven't heard anybody say that yet. Well, because that's a dirty thing to

095say to people. They want their benefits and I agree with them. >> Sure. >> I have a husband that works for the state and I understand that feeling of, you know, he's partially tier one and then 10 years later it got cut. It it's frozen. So, it's a reality. It's something that maybe we need to offer a different benefit. Maybe, you know, I don't know what I don't want that >> person doesn't have. >> They didn't have the match. So, they have PERS, right? 6% match, >> but we also pay the employees match to it. Almost all the districts do, right, as a way to incentivize them and come to you. >> Jefferson didn't. >> So, the first thing Don did was we're adding that as part of negotiations, right? And the district debated it

096and they said, "No, we need to get better teachers. >> We don't have the same quality of teachers as Cascade, as Stan, as Scio, as some of the others." So that was her one of her first moves to try to improve the quality of educators that they get because educators have choices in the upcoming if we end up in some sort of a small recession or a national recession, right? That flips where best teachers have choices. There's not a lot of there's not a lot of openings. But the last four or five years there's a lot of openings. They got to pick and choose. And they can pick in negotiating with your groups is you either get a pay freeze to be able to keep your 6% contribution to your PERS or we're going to

097reduce your first contribution to make 3% if you actually want more in your paycheck. >> There are conversations that are taking place usually in negotiations is I want all of it. >> That's usually where they start. >> And you know that's that's their job. that's their job to to ask for as much as they >> else. >> It's interesting the pur pickup uh 6% was was done uh correct me if somebody else knows the exact dates on this but it was in the early 80s when we were in pretty significant recession. A lot of public employees were not getting raises. There was no money raises >> and so the offer to pick up the 6% contribution was made simply because it saves both the the employer some money. Right. So by by when we pay

098somebody 6% raise for instance we have a burdened and benefit cost to that uh providing 6% of salary to a a retirement program relieves us of that cost. So as 6% goes it's it's a pretty good deal for us as the employer relative to 6% of salary. So anyway, Wendy Oh, Wendy the >> I'm sorry. >> There's a fund. Um, what is the safe school culture? >> The safe school culture grant is a new grant. Um, you want to talk about it just real quick? >> Yeah, I can talk about if you want to. So, >> I don't know that grant. >> Safe school. So, basically we train um well trained trainers and so each one like at Momsville, we have special programs there for kids that are in self-contained classrooms. So like how to

099handle like a restraint or seclusion. And so we train our staff members on how to do that safely. And so we train the computers in your Coleman and we make sure that they are trained. And so now they can train our staff. And so all our admin um and all of our instructional assistants are now on train on how to do that. And so we pay for any sub costs or any training to train them um to kind of go that. So make sure that we're covered. Um they were compliant as the state law and regulation um handling those situations. >> So only those people at AMSville or July. >> Yeah. So building admin. So anybody that we really hit on anybody that would have that opportunity that that would arise and so if we

100have a runner and a kid's running, we have to put a kid in a restraint to make sure that he is safe or they are not that they are safe that we can do it safely in the right way and also to make sure that we're following protocols afterwards when we're doing that. Let's make sure that we're that training up to date across district. To your point though, most staff are at because we have all of the self. >> Yeah, it's all special education staff and admin. >> I would assume that you guys do long range planning and projecting. Correct. >> Correct. And I would assume that in that planning projecting you've identified extracurricular activities or whatnot that could be cut before we start cutting teachers for retirements. >> Okay. >> So one of the

101one of the first things that we talked about for the upcoming year is attrition. Right? We know about how many people on average leave. We also recognize that in a tighter economy fewer people do that. Right? But there's also something a little bit unique. Whereas in the legislature two years ago agreed to allow people to retire and work back, right? So at the moment we have a number of employees who have retired and are working back, right? And we want those employees because of their experience. However, um they are probably not as um you know the contracts that we set up for them are a yearto-year contract, right? And our associations agreed. they they actually agreed to that. They're like, "Our job is to take care of the active members that are here for a

102much longer period of time." So, one of the things we look at is for next year, do we say to those folks that have retired that are working back, next year will be your last year, right? Whether it's admin, whether it's teachers, whether it's classified. So, that's another long way range question to ask. I am fairly confident, not completely confident, that we will see enough attrition to help with this offset with this. I'm also a little bit hopeful, call me Wednesday afternoon when the financial forecast comes out. I'm a little bit hopeful that the legislature will provide a little more mo money only because for the first time in about 35 years I witnessed a number of educational folks and a number of advocates particularly in special education actually ban together. These are people that

103usually fight across the table with one another but they went to the legislature collectively and said you have not adjusted special education since the early 90s. It is time for you to put money on the table. And so the next move, I believe, if the legislature has the funds will be to give public schools more money in the realm of special education, which will help us across the board. So I am still slightly optimistic, but those are some of the long-term pieces that I'm taking work for sure. >> Okay. And I have one more question, so I'm just a dummy, so explain it to me. >> Oh, no dumb questions, brother. So, it sounds like this the enrollment rate is a bit of a volatile number that's ever changing. It's fluid >> all the time,

104>> but yet buildings and grades have caps on the the number of students. Um, but it sounds like with that enrollment number, every penny of that is budgeted. Correct. Obviously >> we we but we so when we say hey we think we're going to have 2730 kids next year that's what we bud budget for. If we're below that we're a little light. If we're above that then we've got a little more left over. Does that make sense? >> It does. But I guess that brings me to my point is what what I'm struggling with is that seems almost d that seems dangerous to me. It seems dangerous to budget with a number that that is so fluid that >> sure >> if an apartment complex and also burns down and 20 kids have to relocate

105or somebody makes somebody mad and because earlier you know you said 10 kids was $110,000. So um yeah it just seems like that's a a very dangerous game to play. >> I totally agree with you. So if and and I think everybody in the room would be like, "Hey, you know what? The smart prudent thing to do is lowball that." >> Yeah. >> Right. You're like, "Low ball." >> Yeah. Because you got Yeah. >> So every two years I negotiate, right? And so not picking on either of those associations, but they're going to walk through the door and look at what Brett just said about, "Hey, 6% in cash carryover, right? You got more than enough money to pay us more money, right?" He as the board chair might say, "Hey, 6%'s for 6%." They're

106going to look at him and say, "That's just a number you guys picked out of the year. This district does this. This district does this." If I said, "Hey, we're only going to get 2700 kids next year." And I end up with 2750, right? They're going to look at me and say, "You budgeted, bro. You know, you've got 2750." So, we try to guess as exact as we can with regard to transparency. We want to make sure that we are as transparent as we can because we don't want to turn and go, "Well, we thought we were going to have 3.5 million. we really have 4.5 million right about the only time that's ever happened is when we saw the the really for us the combination of esser funds and the growth happened at the

107same time that's the only time in our careers where we were like wow where did we see that and it only took our associations and rightly so right about six months to go you got the cash let's go let's go right it's time to pay us >> right and so that's the hard part about it I totally get what you're saying, right? And as it is, we really feel like we are as conservative as we can be with regard to the numbers. So, Greg, were you going to say something? >> Talk about the safety net and double harmful springs as well because that's part of this question. >> Yeah. Yeah, I can address that. So, if if if we're in a situation and it's a year-by-year situation. So, let's say we have 3,000 students in

108this current fiscal year and that's what we're getting paid on. Next year we start the year at um 3,000 students, but like you say, something happens and we lose a hundred automatically. There is a one-year safety net called safe harbor where it just goes back to the most recent number. So, so it would just drop down to >> pay and one of the things that happened particular like in Phoenix, right? They lost, you know, poor neighborhoods because of the fires and same up the canyon, right? They paid those folks for what the last year's number was because they had so many people leave. It got so bad they actually went to the legislature and said, "Can you hold that number?" Just recently they said, "Okay, we've done that for three or four years. Times up."

109And the superintendent at Phoenix Talent was like, "I'm still not back. I'm going to lose big dollars this year. I'm not back to the same." But that's a great question. Makes >> sense. >> And it just makes us makes it difficult for us to kind of do this thing. >> Add a quick one to the other pillar. There's a um bun 271 technology enhancement. I was just curious why it's all going to elementary. They're probably the reason I just learned what it is. Why junior high and high school's not getting >> that was um that that actually we have the ability to move it between the different schools uh without a resolution approval. And so that just happened to be the active account that held last year's amount. >> So it's just a bucket. >>

110So yeah, it's just a bucket. It's just a holding account. That is a good catch. You will notice that that dropped down from last year's allocation from 125,000 down to 75,000 I believe this year. So >> mine's showing 55,000 for current year and it's up to 100 next year. >> It's um in page 73 in section. >> Oh, but the proposed budget um Oh, yeah. Oh, yeah. We did put it back up to 100,000. I didn't know if they were expecting to hopefully get like more uh computers for the kiddos or if there was maybe something coming to the elementary school because I know they have home. >> Yes, they do. >> They're hard to remember everywhere. >> True. >> Yeah, that's right. >> And then the bond I haven't I haven't participated much in

111that. Is that going to be hopefully for like I'm going to put a plug in like AC for the junior high. Our track is horrible. We need those kinds of things. So the committee, yeah, the committee at the moment, uh, Greg talked about it earlier today with our advent team, uh, they are honing in. So we had a whole committee was, it was kind of invitees. We had everybody from every corner of the district. We put them in the room. We said, "Here, here are the things." We walk through the different buildings. Here are the issues. This is how much money you can raise. So right now, we're all paying about a$110 11 12 cents per thousand. 20 years ago, that started at $1.97. That's where we were 20 years ago. And so the the

112conversation is do you go back you know in two years that dollar 1011 goes to zero. So our hope is to catch it so we stay at least at a$11011 but because we don't have a lot of business in our district tax-wise it's not a lot of money. So do we raise it back to $1.97? Do we try 229? Do we take a look at what we look at like Stton and Jefferson and Salem? You know and so those are the questions. And then at that point, we're going to put it out to our community. We're going to try to get that information back. We're go to the board in June and say, "Will you go out for a bond in November to do that?" But those those things that you listed are on that

113can help us financially not have to pay for those things. >> And then the thing with buying side accounts, is there a way that you guys can pass a policy that says if the bond price is x amount, go buy some? Because waiting every 20 years when you kind of want that to be a rolling side account, can you do that like every five or 10 or whenever the market says this is the time to do it? >> You can. It takes about six months to put together a side account. One of the ways that we can do it without going out for voter approval is by joining in consortium with other school districts. So we have to kind of bond together. The last the side account that we're part of that is almost ready

114to expire. I believe we were in joined with about 75 to 80 other school districts in order to do that. Um, and that's it's a tremendous amount of work putting that together. That team of people that are interested in that side account has been together and working at it. We're at the point now where we're watching the bond market to determine when a good time would be to go out. When that when that bond market we're thinking positively, it's going to stabilize and we'll hopefully lower. Uh when that does happen, uh we will be relatively ready to go, but it will still take four or five months for us to get from the point of pulling the trigger at the board level to actually getting the proceeds in the account. Um and and again, even

115at that point, it's still there is a certain level of risk, right? Because you know if the economy kind of tanks or we go through a period of significant down downward uh economic performance in the very first part of that you know timing is everything and that those types of side accounts if we go into a negative performance feature in that first year it could it could impact us negatively for 20 years into the future. So we just we just don't know. It is a little bit of a of a crash. It's it's cautionary at some degree because the first two groups in like 2004 five and then six seven when we went out 56 >> they were okay. Another group a smaller group of school districts went out in 78 at the beginning of

116seven >> and then the market crashed. They had been chasing that bond the whole 20 years. They can't get it off their books fast enough they made no money. >> They dropped so fast so hard that they've never recovered. So that became a cautionary tale to kind of like let's do it every well hold on let's think about that because nobody wants to be the one that said oh yeah we bought bonds and they tanked I remember that board member or that super >> everybody's like no no no interested in that concept so they're >> kind of weigh the odds >> that's a very good question all very good questions anymore about the community >> I guess on that same note in the future are you still considering going with that same group that we

117are currently with >> uh yes, Piper Sandler is probably the uh um there's one other company that sells MUN bonds, but they are probably the ones that are considered the experts in terms of these types of u per fonts. >> yeah, >> same group and they're saying wait and watch. >> Yeah, >> you're up. >> Okay, so you can now please open the public hearing. So, we're going to open public hearing and it says the wording will be on the screen. There it is. The budget committee chair. The public hearing of 2526 proposed budget is now open. Any member of the public can address the budget committee on the proposed budget. Members of the public may be asked to limit their remarks in the interest of time and allow others to comment. With that being

118said, we are opening public uh hearing. Does anyone from the public or any of the board members have any further discussion items? Come on, you gang in the back. You're just here hanging out. So exciting. >> All right, then with that being said, the public hearing is closed. You missed your chance. >> All right. All right. So, at this point, we now deliberate uh so you can deliberate and discuss the proposed budget. Uh again any changes to the proposed budget must be moved and seconded and passed by a majority of the budget committee as a whole. Historically we have not had a lot of deliberation but um these are were interesting times. So all right if anybody has anything that burning certainly work with the group to come to agreement or consensus on >> they've

119done everything Mr. Pillar has gone over for us today. Does anyone have any questions or concerns for that matter? Any concerns whatsoever? This fabulous budget? >> There's always concerns, right? >> Now, now's the time to air those concerns. What are they? >> Oh, nothing specific. I I did I wanted to piggyback on what you said earlier, though. My I think my biggest concern is burning through all of that store that that savings so fast. And I just cautious us to just burn through it so fast. So I don't have a solution or you know the you know do this instead. Um >> I just I have concerns with >> totally agree that the other side of it is we need to cut more. We need to start with people. >> So it gives us from

120now until the end of June to let people know that they don't have a job. And so our our thoughts were let's save that fun task for next year if nothing gets better, >> right? and give us an opportunity, us collectively, administrators and staff to say, "Hey, we're in save mode. How can we do a great job working with kids, and figure out a way to say we've had we have veterans that did it before." I think John probably said it to me best, which is now is a great opportunity to hone in on exactly what your charge or what your job is and focus on that. I appreciated that comment. John was talking down the a couple weeks ago, so I'm with you. I don't like it either because I've been there and it's

121not fun. But um I'd rather try it this way and see if it works. If I'm back in a year and I'm shaking my head now, then you guys can be like, "Told you should have done something a little more severe." But we're going to have to monitor as we go. And I think our board needs to remind us where are you? How's it going? >> That was part of my next question is let's say we get six months down the road and we decide, hey, this is not working. Do we have the ability in six months to make drastic changes to our budget? At that point, >> there's some things you can do. Um, and there's things that the board can do, but you can also direct to us to say you need to

122shrink your staff quicker. >> That would be the first suggestion that that I would suggest to you to direct me to do. So really what I'm hearing then is the budget we're the proposed budget right now is really a um we're going to hold our breath but kind of prepare people for potentially got some heartburn coming a year from now and everybody to to try to do their their best to control cost and if they don't >> we're going to have to make some unfunded decisions. >> I'm hopeful that we can get collectively get together instead of heartburn maybe just some some air bubbles right >> and we can go from there. So we'll go from there. If it got to that point though, is staff the first thing to get cut or is it

123the number of school days? >> Either way, um it's been interesting to have that conversation with our associations, their leadership has changed, but after we got done with the great recession, I was told by both associations, "We will never cut a day again." >> Oh, really? >> They both They looked at us and said, "No way. We'll never do that again." My response to them, which probably wasn't very nice, was so you'd rather eat your young >> than cut a cut a day. >> That leadership at that time, the leadership has changed, right? Was absolutely. >> So that that means they don't want to take any day cuts so that they would so everybody essentially takes a pay cut. They'd rather have the newbies. >> Good job. Now, the both associations could look at it

124differently and you know, our association um I I think that they would at least uh seriously listen to that conversation first before they went there. >> And I want to say I don't believe that it came down to it. I do not believe it. >> You were hopeful. I was hopeful that it was just coming from the leadership's comment, not the collective. Exactly. Me too. But that's what I got told and they were representing as the leadership for those groups. Remind me, how often does Scott present at the board meetings? >> Every month. It's every month. Okay. >> Yep. You'll get that kind of financial updates every month. >> It would be every month. It would at least. >> Yeah. So, you'll be able and that that cash flow report that you see, that financial

125report does a pretty good job of predicting what that ending fund balance. >> I haven't had to pay as much attention to it in the past. So, >> well, the last six or seven years we have it, but now's the time to pay attention. >> Yeah. Because the numbers have all been good. So, I'll tonight when I present tonight, I'll just show you some of the numbers you want to keep an eye on. >> Yeah. I was just thinking like moving forward, we'll get each month we'll have a better idea where we're standing, you know, if we have to make changes or not. You know, >> that's what happens. >> And we might end up with more money, too. >> We might. >> Yeah. Yeah, we could. >> Um I said earlier, you know, we

126asked the the administrators tonight, can you figure out a way to save? Well, I took money from them. I didn't figure out. >> Yeah. You weren't given a choice. Now, now I didn't take all their money between now and June. I left some >> For now. But I said if you're not going to use it, sweet. Because every dollar that we'll save between now and June 30th, we can push into cash carryover and bring that number up. >> Right. Right. >> It's a whole different conversation come July one when we say here schools, here curriculum, here the different funds. Right. We think you should be able to do with less and save even more money that way. There's ways for us to do that. But that's that's a collective conversation I need to have with,

127you know, the people I rely on to to run their buildings. I trust them to say this is truly what I need. >> So, and if they don't whine a little bit and complain a little bit, >> then they're not doing their job. >> So, I appreciate that. >> Awesome. >> Okay. So, uh item 12 on the agenda is the approval of the proposed budget. So any member of the budget committee can make a motion to effective what is read there on the board. Um so if uh somebody would like to make someone like to move the uh the bottom portion there. >> Anybody can even please. >> Go ahead. Just blurt it out. >> Oh, sure. I'll do it. >> All right. I move that the Cascade School District Budget Committee approve the 2526

128proposed budget in the aggregate amount of 64,331,983 and set the property tax rate at the permanent amount of 4.6405 per thousand of assessed value. >> Somebody needs a second. >> Second. >> All right. 9A approval of the 2526 proposed budget and set the property tax rate has been moved and seconded. Any discussion? No discussion. All those in favor signify by saying I. >> I. Same sign. Motion carries. >> All right. With that being said, >> you can now eat your sandwich. >> Thank you very much for your service. >> Yes. >> Appreciate it, guys. They're going to come in here and rearrange the the table. We're we're actually the first part of our board meeting tonight is to congratulate our our valatorans and seat saludator. Yay.