NPSD School Board Finance Committee 3-3-26

001Friday. >> I want to say >> it is earlier. I want to say >> this. to >> Okay, sounds good. No Garrett tonight. >> It's a busy night tonight. We got to go different places. All right. Hello everybody and welcome to our March finance meeting. Uh before we get started, I do want to acknowledge that it is March and it's Women's History Month and I am just so thrilled to be around this table as is Mr. Rash with such phenomenal women. Right. >> And this is why I was very excited that actually uh Mrs. Ms. O'Neal came today because I thought to myself, oh, wouldn't it be good if we had um most of the females that are representing North Pen join us today. So, happy uh third day of uh Women's History Month to

002the fantastic women that I sit around the table with and all to and also to the women, our parents at home and um all the the guardians as well. All right, with that I will call to order this March meeting again of the finance meeting doing the pledge of al allegiance please to the flag of the United States of America and to the republic for which it stands. One nation under God indivisible with liberty and justice for all. >> Excellent. Could I have a motion for the approval of the minutes of the 3rd of February meeting? >> So moved. >> Second. >> Uh motion by Mr. McBain, second by Mr. Bell. Any questions or comments? Seeing none, all in favor? >> I motion passes. All right. Um we will go to we're actually going to

003make a slight change to the order of uh of our agenda. We're going to go first to um agenda item 4B which is the PFM update um on our 2026 U bond offering and then we'll go back to our normally scheduled agenda. Um, I just want to add as part of 4B, he's also going to touch on 3D, which is the resolution that we need to incur the debt. >> Okay. Thank you. >> And with that, uh, for those of you don't who don't know, this is Zach Willard. He's one of our, um, investment adviserss from PFM. They've come multiple times. Every time we talk about the, um, bonds and whatnot, it's either Zach or Garrett. They're our main two points of contact for the team. Um and tonight he's going to talk to you

004guys about the next round of financing for um the next round on the high school. >> Okay, great. Thank you. >> Yep. >> All right. Well, nice to see everyone. So, we'll walk through this handout. Um you know, feel free to ask questions. I'll hit on the market a little bit. Um interest rates are interesting here with what's going on in the Middle East. Um but I think everything's, you know, okay. There's still pretty cheap money out there. And then at the end, we'll talk through the financing plan. At the end, we'll hit the the timeline because, you know, we do kind of have this in motion um in order to keep up with the bills that you have coming in. All right. So, we'll walk through this, but like I said, ask questions. I

005know there's a few new board members. So, some of this you might have heard from watching old meetings or if you're in the audience, but um you know, let's make this useful. So, if we look at this handout and we flip to page one, this is the interest rate chart that we show you every time we're here. This is the 10-year taxexempt interest rate that we look at. So, this is a benchmark. If you go to CNBC or Bloomberg, you see the 10-year Treasury. This is the taxexempt version. Not meant to show you where you're going to borrow. Just meant to show the general trend of rates. Um, this is from last week. All right? Because that's when we finished the handout. If I showed you this today, it would actually have a blip going

006up in that bottom right hand corner. Um, typically when bad news hits the market, you know, if you read in, you know, economics book, interest rates go down. That doesn't seem to be the case anymore necessarily. Um, this happened back in 2022, um, when Ukraine was invaded. And again, here, interest rates now ticked up. It's because of inflation concerns. Will this continue? I have no idea. Um, but the bottom line is rates are still good. Still selling lots of bonds. We had a bond sale today for Pen Cambria School District. The interest rate was I wrote it down here. It was in the low fours. You know, that one was a 389. So, it was a 389 fixed and the final maturity was 2050. So, that one's fairly comparable to, you know, what we're talking

007about here. Um, so no worries in the market, but you know, when you look at the chart in the middle, you can see it goes up and down, up and down. It's going to go up and down, up and down, and we'll get to market and I think we'll have, you know, pretty favorable results. All right. Any questions about that? So, page two, a lot of words. Not going to go through all of this. You know, we've been talking about this project for a long time. This is the next step in the financing plan. And there's a handout over there for you if you'd like one. So, this is the next step of the financing plan. Each time we come to the next step, we're always going to work through things with administration, look at

008the draw schedules, talk about the market, come up with a plan, and then we'll always be back here. So, when we show you this the page that shows the next few borrowings, that's that's never static. That's always going to move around. It did here. I know I've said that a lot, but I just want to say it again with the new board members. So, you know, we're looking at about a $60 million borrowing in this piece. Much bigger than last time. The last one was for to kind of keep things moving to pay bills, um architectural fees, those types of things. This is for the actual project, right? You have draws coming in. This is a bigger number. We always knew this would happen. Um real quick, under number four, we always like to remind

009everybody, and this is not a concern here, but when you do borrow the money, you're expected to spend 85% of it within three years. They don't want you borrowing money and then figuring out what you're going to do with it later because you think interest rates are low or something like that. Okay. Again, you have very live real projects. Not a concern, but we still like to just say that one out loud. Let's skip five for now and go to six, seven, and eight. So 6, seven, and eight are important uh especially for new board members because the way that you borrow money in Pennsylvania is a little odd as far as the resolution, right? Okay. So, you're going to pass a debt resolution. Now, we've made the determination here at North Penn that each

010time you borrow money, you're going to pass a new debt resolution. Sometimes school districts will pass one debt resolution for a very big number and then chop it into pieces along the way. Um, but we always said here we were going to do it piece by piece, right? And so the way it works is you pass a debt resolution at your regularly scheduled board meeting, but we don't have final results that day. The reason that exists is kind of back before the financial collapse back in 08 and09. You used to borrow the money the same day as your meeting. We'd do it in the morning and we'd show up and say here's the results. You know, do you want to approve this or not, but you were tied to, you know, once a month or

011twice a month depending on how you meet. When you go back to the interest rate chart, you do not want to be tied to one specific date in the market because all it takes now is one headline for the market to go haywire. So, one of the kind of, you know, points of this is it allows you to, I don't want to say time the market, but at least pull back if the market is doing something strange and, you know, kind of hit the pause button. Okay? So, you pass this resolution ahead of time. In order to pass it ahead of time, the state makes you kind of build a box that this bond issue is going to fit in. All right? So, when you flip to the last page of this handout, let's just

012go to that real quick. page seven and you look at the bottom of column two, it says the maximum amount that we could borrow is $70 million. We're not anticipating borrowing 70. The draw schedule says you need about 60. So, we're going to borrow about 60. But what we don't know based on today's market conditions is when you price bonds, every single one of these maturities in column 2 wiggles around depending on what the interest rates are and what the investors want to do. So we need to kind of build enough cushion into every single maturity so that we can get the best results for the district, you know, a couple weeks from now. So in order to do that, a lot of times you upsize the borrowing amount by 15 to 20%. In order

013to pass the state tests that they want you to pass. Okay? So we're saying we're going to borrow up to 70. We're only going to borrow the 60 we need, but we just need to kind of build that box so on the day of pricing, we can move everything around to make this all work. The second piece is when you look in column three, it says a max interest rate of five and a half. That's not going to be what the interest rate is. That's artificially high. Um, as I just told you, you know, right now if we did this today, you're borrowing somewhere between the low fours and the kind of mid3s. Um, depending on again the market and what what happens here over the next few weeks. Um, and you do have a

014better rating than a lot of the other school districts in the state which will help to keep that interest rate low. So the parameters resolution is something that you pass ahead of time. It allows us to finish the paperwork, get the credit rating back, enter the market on a day that hopefully nothing bizarre is happening. Um, lock in the interest rates and then we will, you know, report back to terror that day and then ultimately the board president has to sign off on it still. All right. So you're not giving up all control of it. But that's kind of the point of the debt resolution. So can I answer any questions about that? Okay. >> I have I'm sorry. I have a question. >> Sure. >> So, say and maybe this is not likely, so

015forgive me if this is not a realistic situation, but what if the max rate stays above 5.5 for a period of time? >> So, the max rate on paper is not what we actually think we would lock in, >> right? But is that like saying like we won't we won't make a decision if it's above that no matter what? >> Yeah. So if if rates got up to a point where we could issue at 5%, you know, in a few weeks, we would be doing nothing. Um we would be coming back likely the market would be stalled completely because if rates move that fast, that's that means something way more troubling than what's happening right now is happening. >> Fair. >> Um so yeah, we would hit the pause button. >> You do have a

016reimbursement resolution in place, I believe. Pretty sure. I'd have to double check. The reimbursement resolution allows you to let's say something like that happened. you can still pay the bills, keep the project moving with reserve funds, and then when the market kind of calms down, we can go to market and you can reimburse your general fund with the borrowed money because that resolution is in place. So, we don't anticipate using it, but it's there just in case you need it um for that type of a situation. >> Thank you. >> Yeah, >> because those things do happen nowadays. The black swan events that people talk about, seems like that happens every couple years now instead of every 50 or 100 years. It's like every three or four years. So, we want to kind of be

017ready for all situations. So, that's the quick version of page two. Any questions? Um, briefly on page three, this is always in the handouts. This is what we call your debt summary. This is if you do nothing, this is the debt you have to pay back. All right? So, if all this stopped, you still have to make the payments in column seven um based on what the outstanding debt is. the two the bottom half versus the top half. The bottom half is your gross debt service. So you're going to make those payments every year when you see the budget terra is going to have something like column seven in there, right? Then the bottom half is net of the state reimbursement. You still get what's called plan con money on your column 9 and your

018column 10 and your column 12. All right, that program is dead. We're assuming no reimbursement on any new debt, but on the old debt you do. So when you compare column 7 and column 14, you can see column 14 is a little bit less because in your budget you have a receivable that comes back from the state. That is the plan con money that you're owed that you continue to get. So that's that's what this page is. Now the page that that you know we've been following here this whole time is the next one. So page number four and this is the one that I talked about earlier that is not static. So column one in the blue where it says actual at the top step one that is what we did uh last you

019know about a year ago last spring. All right. So we borrowed that first um $10 million to keep everything moving. So column nine was your existing debt at the time and then you add in column 10. That's what we did. Now we're here talking about step two in the red tonight. So that's the 60 million approximately. We're going to borrow it over 25 years. All right, column 11 shows what we expect those payments to be. So once we do this, column 11 will now be back on that last page that we showed you. It'll be there as real debt. Uh, one thing I want to point out in this on this page, we have about a half a percent of interest rate cushion built into these numbers. So if we did this today, you'd be

020better by, you know, 40 or 50 basis points. You know, about a half a percent. We don't know where the market's going to go. So, we always like to be a little bit conservative when we show you these numbers. Um, but that's what we expect step two to look something like. And so, then each time we come back, we'll reevaluate. So, step three right now is anticipated to be January of 27 for about $30 million. That will change. It'll be a different number. Maybe it's a little bit more, maybe it's a little bit less. Maybe we do it, you know, a little bit later. We wait till March. It'll kind of just depend on how the project's going and how everything's shaken out um with the district and so on. And then at the end

021of the day, the way you read this page is when all the dust settles based on what we know now, we're going to be barring about $245 million for the project. We have a placeholder in there for available district reserves. It says 15 million. I know that number is moved around, too. That'll continue to change likely, but so you're going to get to something like column 16 where you're paying in your budget about 17 million annually in debt service. All right? And you'll have the money to do the projects. So that's kind of where this goes. All right. Thoughts or questions about this page? This is the most important page in here as you're following. Yes, sir. Um why are we pulling step two and step three apart from each other? Um so if we

022got a really good rate today and we have three years to spend the money, why wouldn't we combine step two and step three? So, so you know the way we've built this plan was to follow the draw schedule. Think about it on a calendar year basis as to how much money you need. Part of the plan is to hedge interest rate risk, right? So, if you borrow all the money at once, you could get lucky, you could get unlucky, or you could do something in the middle, right? When you do it over time, you know, go back to that interest rate chart. Typically, you know, it averages out to something that's beneficial. So, we like to hit the market at different times. You know, if if somebody knew where interest rates were going to go,

023it would be easy to make a a good decision. Um, but since we don't know that, part of this multi-step plan was to hedge rate risk. The other piece of it is is when you borrow all the money at once, it's going to hit your budget all at once, right? So, if you borrow 100 million instead of 60 or whatever the numbers are, that comes in and hits your budget all with 100 million versus 60. So the other piece of this that's very important is you know with act one and with all your other rising costs that you know you have staggering these borrowings to help you phase it into your budget. So when you look at column 16 and those first few columns basically down to the 2031 budget year you can see the

024debt service sort of steps up every year. And that was part of kind of all that you know the the modeling and the building of of this project u back when Mr. was here was to make sure that you know as you looked forward and projected out what budgets would look like that this would fit in with kind of the global picture. Is that helpful? >> Okay. >> When we get to $60 million where does that money get invested? Wh why why while not being used? >> Yeah. So that's a good question because that's an important piece of this is you can invest that money when it's not being used because again we're following a draw schedule. So you're not spending $60 million all on day one, right? You're going to spend it over some

0258 to 12 month period typically. Um the last borrowing I believe we put it in Plegate. Is that right? >> Yes. >> So there's different investment trusts that you can put the money in. Plegate is one of them. Pislaf. >> Pislaf, I'm sorry. Pislav, Pislaf is the other one. And they they invest the money for you. You know, right now, I think the interest rates that you're earning there are somewhere in the 350 range. So, you're going to borrow at 4%ish and the money will be invested at, you know, 350. So, there's a little bit of negative drag there in the difference. Um, but that's where it sits. So you do earn money and then that money that you earn we then have different ways to use that money for the project. For example, over

026the life of this project, if you earn five or 7 million, we can then borrow five or seven million less when we get to step six, the cleanup issue. So, you know, once we get to that last bar and whatever step it turns out to be, it could be five, it could be six, seven, um, we then use that money to potentially downsize the borrowing and kind of borrow the exact right amount of money um, at the end of that. And if my kids heard me say six, seven at this meeting, they would all be all over me. So, yeah. Zach, I have a question. Um, so this whole model on this page is only for the high school renovation. Is that correct? Just to make sure that everybody knows that. >> Yeah. Correct. >>

027So if we have to borrow more, we have to come up with a new model. That's basically what you >> Yeah. >> So anything outside of this would be kind of the next phase of borrowing. Now that doesn't mean that you couldn't do it in conjunction with this. So if you said, hey, we want to do this project and it's another 50 million. You can either do it behind it at a later date. So if you were following this, it'd be starting in 2031. Or you can say, look, we got to do that now. So, we want to start that in 2028 and then we would kind of build that into what this looks like. >> And Mr. Kaiser, the the only debt on here that is not part of the high school project, the

028old >> right is in column 9. Yeah, there are still some projects on the books. Got it. >> And just for reference, too, all of our resolutions are written for this is intended for the high school project or other capital projects as deemed necessary by the district and the board. Um, so we have a little bit of wiggle room if we do decide to do other borrowings later that we can use some of these funds. Right now the intention is of course for the high school, but we have a little bit of wiggle room that if there's if we have to do something that those funds can be used for any capital construction project. >> Thanks. >> Any other >> uh Yeah. Um I have two questions. Um the the first being, you know, I

029see the staggered amount with the b with the bonds across the the top row and my assumption was that it would have to do with when things are scheduled with the amount. I didn't know if you had any additional insight or if this is an offline type of question with why in step one, two, three, four, five, six there there are different amounts. Um, and my second question is I see that you know last year was in April, today was in May with timing. >> Is each year afterwards is that set at January as a placeholder or is that typically a better time to borrow in the market? >> Zach, I can hit on some of these. Um, so first, these these borrowings and the timing of those borrowings are really dictated by the architects

030and the engineers who we will hear from later tonight. They provide PFM withdrawal schedule when we will need the money based upon the work exactly as you said Mrs. Coin in terms of the months I can't really speak to um that would probably be more you but the the figures in each step and how big each borrowing is based upon what is planning to be done during that time period >> and phasing in the debt like Mr. Willard said, >> right? And and there so again, as we as I said, this is never static and we always kind of reevaluate this, right? So a situation which could change this drastically would be something happens and rates fall significantly, right? And we get to January of next year where we're supposed to borrow 30 million and

031rates are 1% lower than they are today. So we say, you know what, it it may make sense assuming that, you know, we have the bids back and and everything with the projects. Okay, maybe we do combine, as you said earlier, maybe you combine steps three and four and then we'll run that scenario and then we'll give it to Tara and she'll look at the budget situation and then we'll decide even though rates are 1% lower, can you fit it into the budget that you have in front of you or the next two years worth of budget. So it would be kind of a, you know, we'd have to run some numbers and figure it out and think through it. But yes, that type of situation could happen and that's something that, you know, we

032kind of reserve the right to change as we move through this, you know, or or the opposite happens. Rates go up a whole bunch and we decide, you know, maybe we don't need that money just yet because I don't know, we see something that maybe rates could come back down. Um, that's a harder one because we try not to predict rates. So, can I ask can I ask a clarifying question? So, when you're asking about the amounts of the the amount of staggered money at the bottom. So, we get all of the cash up front. So, the the stuff in sections 1 through 7 is the cash that we get up front and we have that cash in our bank account. And then the stuff down below is the schedule for when the year that

033we pay and how much we pay back in each one of those years. So the the 10 through 16 is the payback of the borrowing and 1 through seven. So when we stagger them, we're trying to keep the end of the year somewhere in that the total cost for each of those years starting in 2026 down to 2055. We're trying to keep that cost somewhere between 12 and 17 million every year for the budget. So that's I'm like the bottom is your car payment and the top is your car. So you get your car and then you pay for it for years and years and years. So that's where we're going to borrow 60 million in May. We're going to hold it in our checking account. That cash will go to the architects and the

034builders and the contractors and also a little bit to debt service, right? So, but we need that cash up front in order to do the project ahead of time and then we pay for it over 30 years just like you buy just like a house. Um, a little bit different because it's a bond, but for the the payback idea is the same concept. So, you get the cash up front, pay for everything, and then you slowly pay back your debt. >> Seems Oh, I'm sorry. Go ahead. >> It's a It's a great clarification. Uh, so appreciate that sort of narration there. >> Um, >> hearkening back to our conversation last month though, I remember Dr. Ber, you noting that the ability to pay the total column 16 debt service in the long range is predicated

035on the concept of annual act one index increases. Is that a fair assumption that with that type of increase annually that managing the average 17 plus uh is stable? >> So assuming assuming act one stays somewhere in the 3 to six range right this year it you know and it has been. So assuming it stays there yes you're going to have to take the full act one. If by some weird chance act one goes to 10% well then no you know what I mean. But if for we're predicting for the next few years it's going to be actually somewhere in the two to four range. Um so two years could get a little squeaky. Um but right now at 3% yeah like the intention is that we will have to take the Aquin index for

036the foreseeable future to meet the debt service. >> Very helpful. And >> and it's so sorry so and it's not just for this project that we would have to take the act one index. We have the maintenance backlog that we have to do. We have 20ome buildings in the system. So this is just one of the buildings that we have to address. So in the next year or two, we're going to have to address uh other buildings with the study. Uh thank you. >> No, agreed. I just appreciate hearing from you and forgive me uh that this this number is stable at that planning and modeling. >> This is yeah this is intentionally built this way. So, we have the ability to do some five and 10-year forecasting. >> Yeah. >> Uh, Miss Hower, could

037you zoom in on I guess row column 11 2035 on the screen? Are you able to do that? Oh, it's Jess. I'm sorry. >> And while you're doing that, um, Mr. I think I had said in that meeting that the forecasting included going to act one for something like the first eight years and then what we did was we used the average of act one since the inception of act one at 2.7% and assumed future boards would take 80% of that >> just as like a modeling. So uh we can go through that long range modeling too. um 2.7 was the number used about 10 years out because who knows what's going to happen. But I I've we talked a couple months ago about the whole concept of a wrap and I remember rebel I

038was talking to you trying to give a little bit of a lesson here on the wrap model. So if you look at the blue column there, column 10, you'll notice that your debt is your debt service is about half a million dollars until 2035 and then it jumps up. Why does it jump up? Well, because the debt in the black column comes off the books. So, we now have more money to allocate towards that first borrowing. So, if you look at each model or each plan for each separate borrowing, you can notice like in the red column, all of a sudden it jumps up at that same time frame because that debt service in the black column falls off. So, we're trying to keep if you go all the way over to column 16, you

039see that that number is very consistent. So these borrowings are all modeled in a way that it hits our bottom line the same amount each year, but we're paying different rates on different borrowings each year. So I hope that makes sense. So it's kind of staggered throughout and that's the whole wrap concept. >> Great. So, so um as I understand how you come up with these modelings, we you just don't look at bonds, you look at borrowing from banks and other institutions, could you explain a little bit to the board about your process for sure deciding to to go with a bond? >> Yeah. So, so you know, typically we're here talking about bonds, but the other way that you can borrow money is through banks, right? So, through local banks and through statewide banks.

040Um, you know, right now based on the market, bank loans are not generating kind of as good of a bid as a bond issue would, especially for the amounts that we're talking. 60 million for a local bank is a lot, right? Um, there's a lot of risk that they take. And then when you go out 25 years, these borrowings are all modeled as 25-year borrowings. So sometimes banks can give you a fixed rate out 25 years. Um but oftent times again that's hard for them to do to lock themselves into 25 years with uh you know a school district at a certain specific fixed rate. So as the market changes sometimes bank loans become more advantageous. You know kind of pre2022 um when interest rates were very low banks were very aggressive and we did

041a lot of bank loans across Pennsylvania for transactions. Again, it always depends on the specific size, you know, how long it is, the credit rating. Um, and then as the Fed increased interest rates, that impacts um local banks often kind of quicker and more drastically than it did the bond market. So, bond uh financings have been giving you typically better rates again depending on the specifics of it. So, you know, right now we certainly expect the bond issue to be the better answer for column 11 for this next step. But as things change over the coming years, that's something that we always evaluate. We still get bank loan bids back. We just do it, you know, less than usual. So, we know where uh the bank market is as well um as the bond issue.

042But I think that is an important point is, you know, you're not locked into doing it this way. That's some, you know, the the answer we care about is just getting the right answer for the district, the lowest cost. And so we'll do that in whichever way um you know, the market kind of dictates at the time. >> Yep. Okay. So, last point real quick, two seconds. There's a timeline on the next page. So, on the 19th, bond council will be here with the debt resolution. Again, it's going to say $70 million even though we're not borrowing 70. We're borrowing 60. And it's going to say a max rate of five and a half even though we expect the rate to be, you know, around 4%. Um, but if you decide to move forward at

043that point, then we will kind of put um all the finishing touches on this, lock in the interest rate, and then we'll have the final results um back to Tara that same day, and then she can share those with the board, and then we'll kind of be on to the next step, and that'll get you money, you know, at least through the end of the year, the way we see it now. Yeah. So, my big consideration with trying to get the bond done before the end of the fiscal year is to make sure that we had cash over the summer before taxes roll in and make sure that I had plenty of cash on hand to get the contractors and whatnot paid over the course of the summer because we are going to be doing

044so much work between May, June, and July. And again, tax money doesn't start rolling in until about October. So, we start to get a little skinny at the end of the year intentionally at, you know, that's normal practice. Um, but I just wanted to make sure that we had plenty of cash on hand for the for the summer. Can you, Zach, just speak a little bit to how much interest we're allowed to earn on that money on on bond proceeds? Not other money that we get, but on bond proceeds. >> So, you know, if we borrow at 4% and you take that money and put it in PISLAF, that's the acronym. Um, you can earn potentially up to that 4%. anything above 4% there's certain rules that you have to meet before you can keep

045that money because the federal government doesn't want you necessarily borrowing tax exempt money and then earning what's called positive arbitrage on it. So there's certain spendown tests that you would have to meet in order to keep that. I don't think in the current environment that we're in a positive arbitrage environment. Um we were just not that long ago a year ago that was something that we were thinking through. Um, and part of the reason why we borrowed 10 million was in order to um, kind of meet those arbitrage expectations. So, you have the ability to earn up to that 4%. Anything above that, there just has to be certain spend down tests met. And if you don't meet those, then you have to rebate those additional earnings back to the government. And don't view it

046as a penalty. It's just you earned money that they don't allow you to keep. Um, so, and that's something that PISLAF monitors for you. That's one of the advantages of the pool is they keep track of all that, provide you with reports, um, and so on. >> Okay, any other questions? Um, and so the resolution is on, uh, the agenda tonight. It's I think I said it was 3D, so we'll take a vote on that when we get to that number. Um, and then bond, like uh, Zach said, bond council, I I think she's going to come on the 19th to answer any questions. Um, she had the 19th originally on her calendar and I asked her for the draft for tonight so you could see it ahead of time. But she, if you think

047you're going to have questions, she's more than her name is Rhonda Lord. She's more than happy to come um, and present at full at the four full board meeting on the 19th. >> Okay. >> So, if she um, just clarification on that. So essentially we are able to vote on the 19th. >> Correct. Tonight you would just pass it to the to the action meeting on the 19th. Yeah. >> Okay. And with or without we then make a decision whether we we need a presentation. >> Correct. >> Okay. >> Yeah. >> All right. Understood. >> All right. >> Yes. >> No additional questions. >> All right. So this is a motion to move to the action meeting. Um, we can we can do 3D if you want to do it out of order or we

048can just wait and go in order if you want. I don't know what's easier for you. >> Can you do 3D? >> Yeah, we can do 3D. >> We'll do 3D. >> Let's do it. >> So moved. >> Checking. >> Thank you. Just for clarification, the the recommended action is approval by the board of school directors uh to resolve the authorization sale, issuance, and delivery of general obligation bonds in one or more series in the maximum aggregate principal amount of $70 million to be originally designated the general obligation bond series of 2026. >> Thank you for reading that for me. >> Appreciate it. >> I'm sure that's on the books. But just just to be clear, that doesn't say what's going to the action mean. actually saying that we're approving it. >> So this we

049aren't taking any actual actual action tonight. Okay. >> We are just making a recommendation for the action meeting. Got it. >> Because it still needs to be advertised in accordance with state law and all those things too. Yeah. >> And Miss Lord has presented to this board before some of these. >> So this motion is now for Okay. You have a question? >> No, I just want to say thank you for rearranging the agenda because that helped answer a lot of questions. Yeah, sure. No problem. >> Excellent. So, this is for both. It's only for 3D, right? Because >> Yeah, we'll go through the other ones in a minute. Yep. >> Yeah. Okay. So, do I have a motion already? >> I did. >> Any questions? No. Okay. Can I get a vote? All in

050favor? >> I. Any opposed? >> Motion passes. Thank you. >> Okay. Have a good day. >> Thanks, everyone. Thank you. Thanks, S. All right. So I will go through the regular agenda. So the first item um is the investment report which will go to the action meeting on the 19th. January's investment report is included. Interest rates kind of held. We're starting to get into the threes at some of our some of our larger accounts. Thanks again, Zach. Um we're starting to get into the threes with some of our larger accounts. um dropping out of the fours, but that's kind of been consistent across the market. Um if there are any other questions, take a motion to approve. >> Motion by Mr. Bell, second by Mr. McBain. Questions or comments? Seeing none, all in favor? >>

051Any opposed? Motion passes. Item 3B is the treasures report for the month. Um cash cash receipts for January were 5.6 million. Dispersements were 22.4 million. Um our current available funds is 233 million. 233.7 million. Um any questions or concerns about the treasur's report? >> Okay. Can I have a motion for the treasures report? So moved. >> Okay. Motion by Mr. Kaiser, second by Mr. Bell. Any questions or comments? Seeing none. Um, all in favor? >> I. >> Any opposed? Motion passes. Thank you. >> Thanks. Um, item 3 C is the budget transfers for the month of February. Uh, February was a hoin month for budget transfers. We actually went through and looked at a lot of departments to end true things up. Um, we just finally after having gotten through audit and all that kind

052of good stuff, we had some time to really dig in. Um, nothing there's nothing on the budget transfers that I have any concern about. Um, and most of it's within the same department. There's a lot um not to just call them out because they're sitting here, but there's a lot that was moving between student service functions and special ed functions because they were kind of budgeted together last year. So, we're just getting them slotted in the right location. And we've also opened up a couple of functions for um specific categories of special ed. So, we're trying to move things around as we go. Any questions or concern about the budget transfers? >> Take a motion. Okay. >> Can I Yeah. Was there a second >> and a second? >> Who second? >> Julia. >> Okay.

053I'm sorry, Miss Coin and Mrs. Ramage. Um, all in favor? >> I. >> Any oppose? Motion passes. Thank you. >> Um, we've done 3D. Moving to 3E. Uh this is a request to go out for RFP for a transportation department study. Similarly in line with um our building feasibility study and our demographic study. Um it's our contract is up with first student at the end of this year. Um they have off made some offers to us. I'm not ready to talk about them yet because we're still working. Um some of them good, some of them okay, some of them no. Um, but we also are just at a place where it would be a good idea to get assistance from um, someone else to help us write the RFP a little bit better since we

054have a split fleet. We're looking at um, pretty high costs for propane buses versus diesel buses. So, what's the best model and and where we are looking for that so we can try to preserve that propane fleet the best way possible. Um, so that's why I there are there's really only two companies that do this, so I'm only expecting probably one or two responses to be totally honest, but um do want to go out for RFP. So that's what this item is. >> Okay. Um, can I get a motion for item 3E? >> All right. Motion by Mr. Bell, second by Mr. McBain. Any comments or questions? >> I have a question. Will this study also give us a sense of if our fleet is the right size? Will it do analysis on age of

055fleet replacement? Yeah. >> Rates. >> That's what Yeah. That's how I'm going to write the RFP. Yeah. So, I want I want to look at >> what buses we have, how many we have, what are we outsourcing versus what are we doing in house with the new facility? What room do we have? Um because I don't if we tried to bring the fleet back in house and not outsource at all, I don't know where I would put 50 buses right now. They take up a lot of space. Um so like is that even a feasible feasible option? You know, is there land out there? I I don't know. You know what I mean? So it would kind of look at all of that. I'm kind of hoping for the best. I don't know if I'm

056going to get all that information, but that's, you know, in conjunction with the feasibility and the demographic study. I think it's a good time. It's the other major component to the district. >> Okay. I'm glad you connected it to the demographic study. So, thank you for that. Does it also look at routing >> and routing efficiencies or would that stay in house? That would stay in house. We have software in house that does that. >> That helps. Okay. Thank you. >> Yep. In general though, I will say >> what we are working towards and I think we're pretty much there is that kindergarten or I'm sorry K through six is on the bus for no longer than 30 to 45 minutes. um 7th through 12th, maybe up to an hour. The only people that would

057go over an hour would be non-pubs that are right at that edge of 10 miles from the district. I'm trying to keep everybody under an hour. Um and we're okay. Not great, but we're okay. We're trying to get there. Um so that that's one of the other components of this that we're looking at. So, >> and I'm sure this goes without saying, but it's maybe for the benefit of all of those watching at home, um that the elementary schools obviously it has a smaller catchment area for an elementary school, so those bus runs are shorter. Um the high school is one location in the middle of this very large district and there are some h homes that are very far away. Um so that's why the high school kids are on the bus longer, not

058just because they are capable of being on a bus longer. We'll just put it that way. So, >> I I just had a question about the time frame. Are we looking at a long-term >> analysis like a 10-year plan or just >> 5 to 10? 5 to 10. Okay. >> I mean, the the critical component >> the the company that I'm thinking is most likely going to respond to this because I've worked with them in another district. Um the critical component is helping them helping us write a better RFP for the outsourced part of our fleet and then also looking and then the secondary part would be looking at what we need to do with our own fleet. Our our fleet is fairly >> young. >> Uh it's middle-aged, >> you know what I mean?

059Um diesel buses generally last around 12. You can push them to 15, but usually around 12 years. the propane buses outside of our district, they're so far they're seeing 10. Um, and then the gas tanks start to fail and the tanks on propane buses are more expensive to replace than diesel tanks. Um, so we're trying to I can't do that analysis. I don't have the expertise for that and I need somebody else to take a look at it and see if that's if the rumors that I'm hearing from around are really the case. Um, and if they are, then we just need to restructure our model if we want to stay on propane. >> Okay. >> And our replacement cycle. >> All right. Thanks. >> Yep. >> As I understand it, we never did a

060study like this before, did we, Dr. >> That's correct. >> Thank you very much for bringing this to the attention of the board. >> It's very worthwhile. Okay. Thank you very much. >> You're welcome. >> Am I mistaken? I I thought originally the propane buses were said to be longer like longer lasting andor more costefficient. So are we just are we finding out from around that it's that that's not true. >> So our contractor is saying that that is not true. I don't know if that is true or not which is why I want to kind of do the study. Um I don't know they we have a shared depot with our contractor. The other district that we share with does not use propane. They use diesel. Um, so I don't know if it's them

061trying to marry up all their fleet. I do know that we are getting to a point where the supply of propane buses is basically just one company now. >> Um, so your your pricing is getting a little less competitive. So maybe when multiple companies were building propane buses, they were cheaper and yeah. Um, but now we're down to ma basically one company that makes propane buses. So we're kind of at the mercy. Um, we do have a very good relationship with that supplier who was just in this week. I signed for a couple of smaller buses that we purchased. Um, so I'm not nothing about the vendor. They just got a lock on the market. So, I just want to keep track of that. >> As someone who rode the bus for over an hour

062at high school in our district, >> very much appreciate the study. >> Yeah. Um, I will say that in a superintendent meeting recently, I heard some of my colleagues around the county complaining about their experiences with their diesel buses during our extreme cold. >> Um, the propane buses responded better during the extreme cold. A lot of school districts had a hard time with the diesel when we're talk we're talking like zero and negative degrees. So, um, they're quieter, more energy efficient allegedly and greener. Um, but we're just that all things to be a part of the study. Correct. >> Right. Because when we when we went for propane buses, we understood that the maintenance schedule, the maintenance was uh cheaper on the uh on the uh u propane buses than it was on the gas

063buses. We also understood that the energy cost on the propane buses was cheaper. Now that may not be the case today because the market has changed a little in the last couple of days but uh >> so fuel fuel has been clearly more volatile. They have come closer together. Proa propane and diesel have come closer together in price. Um I would say that the maintenance is is less but when something big breaks it's more. So like a diesel tank is is way is about a third of the price as a propane tank. But propane's easier on the engine. So there's again, it's just trade-offs, you know what I mean? And and and again, I'm not looking to move away from a propane fleet. I just need to make sure that the model that we're using

064of 10 to 12 years is appropriate instead of 8 to 10 because that changes the finances of the borrowings of our budget of everything um going forward and how we have to replace and what our replacement cycle is going to look like. So yes, co >> uh I know that it comes with a lot of infrastructure concerns too, but was there ever a look at like EV busing systems as a potential option? >> Yeah, I not I didn't look at that here, but I looked at that when I was at a previous district because there were a lot of grants on the street um a couple years ago. Uh one of the problems that we have is the turnaround time with our with school buses. So they need a solid 10 to 12 hours to

065get a full charge to stay on the road as long as we need them. Right now, the battery technology is not there for us to get them charged. It's close, but it's not there yet. In addition, they're extremely heavy. Um, and so you go through tires and you need different tires and the structure of the bus has to be different to support the battery. Um there's a lot of I I've was told I don't know if this is true SEPTA went out and bought a whole bunch of battery operated buses and they're the roads were bad that they were blowing tires. So I don't know if that's a true or not but like one of the things that we do not have the electric infrastructure right now that we would need to build in order

066to charge and the batteries technology I is not two years ago when I looked at this the battery technology was not there to turn our buses around fast enough and our district is bigger um so if you're in a small a smaller district and you can do it real quick and get back um longer distances that you can't hold the charge and in cold, it's even worse. >> Got you. Thank you. And >> and the and the grants are gone. >> I was going to say, yeah, I understand that the the >> And that was the other thing. A lot of our propane buses were paid with really good um really nice grants and those grants are gone for the propane buses as well. So, it's all on us now. So, okay. Um three I'm

067sorry, we need to vote. Yes. >> Sorry. >> No worries. >> Getting a little antsy. Sorry. >> No, no, no. Very, very good. Uh very good discussion. Uh so um all in favor? >> Any opposed? All right. Seeing none, motion passes. 3F. >> So 3F I will have a full grid for you at the action meeting um on 319 for the award. Um but I just wanted I did want to update that we as a as a committee met. We interviewed three candidates. Uh the candidates were future think Ross Haber and demographic analytics. Um demographic analytics was the um was the choice. Um I'm still tabulating all of I'm still pulling it all together to make it look pretty for you. Um but we I will have that for you on the 19th. So that's

068good news. We will award that and they will hopefully get started with the study sometime in the month of April. >> Okay. >> I think we need a motion for this one. >> We do. >> Sorry. So, can I get a motion? >> Okay. So, moved. Uh, a second. All right. Motion by Mr. Teao, second by Mr. Bell. Mr. Teao. >> Um, the demographic study once it gets kicked off. Um, where will the like where will the board have an opportunity to understand >> uh the study where it's going and all of that? So, I will have them once they when we award on the 19th, I was going to have them come and either present electronic or virtually or come in person probably in the month of April or May to talk about how

069what the stud is going to look like, what the plan is, what the course of action is, and all that kind of stuff. >> You're welcome. >> Any other questions? >> I'll just share that I know Dr. Tio is a statistician by trade and uh >> No, no, no. I have the grace to prove that I do not. Okay. >> I don't want to have I don't want to put anything out into the universe. >> Do that. We should You didn't want to do a proono. >> No. For the record, we are we're on the record right now being recorded. >> Okay. We fully >> understood that that is not my trade. I have You're not talking the right person. >> Okay. All right. So, let's say that Dr. Tio and I in talking about

070some of his research seems to be very literate when it comes to stat statistics and uh and analysis. uh we can share some of the proposals too. They're pretty interesting. I think you'd be interested in like um the actuarial nature of it. So it's pretty cool. >> Excellent. >> Thank you Dr. Teao for that question. >> He is not a statistician. >> I'm just I'm worried about my advisers just like hold on a second. That's >> uh um >> where was I? I was uh getting a vote. >> Yes. So um all in favor >> I >> any opposed seeing none motion pass. >> Um okay so I will move on to ourformational items for this evening. Um item 4A is I have to announce that we are um intending to adopt a resolution establishing

071a realist real property tax credit incentive for municipal volunteers for fire of fire companies and nonprofit emergency services agencies. Um so we will advertise that the hearing will be in our finance committee meeting um where the public can come and make comment about us adding this credit. This is the same credit that we've talked about for two years now. Um that we agreed to at a previous meeting. Um I just got the wording from Mr. Summers to make sure that we now follow the process the the legal process of is of issuing the the incentive. Okay. Um nothing for you to do. Just letting you know that I will be advertising it for the hearing which will be on April 7th. Um, and so now we are going to move into our budget updates. Um,

072I'm going to do my brief presentation. And if I could get the thingy. Um, I have a few things that I put together for you guys for tonight. And then the special ed directors are going to discuss their budget. Um, I gotta go over here and >> and while Miss Hower is pulling that up, this is, you may recall we had a conversation last month about what the budget process would look like and we spoke about how tonight we would just give an overview of the process itself. Um, so this is really just a preview of some budgeting 101 and what a school district budget looks like and what you can expect. and then we're going to kind of kick off the budget process with with our directors of special education. >> Thanks. >> Yes.

073>> Um okay, so just for a brief overview for those of you that have never been through the budget process before, um all Pennsylvania school districts are provided with a chart of accounts from the Department of Education. Um we all use the exact same numbering system. There is a little bit of play and we'll talk about that a in a in a couple of slides. Um, but for the most part, that's to keep us all in line and comparable from district to district. Um, so when you go to look at other district budgets, if you see re the 6,000's revenue, the 7,000's revenue, the 8,000's revenue, that's all the same thing in every district. Um, the 1100s is always instruction. The 1200s is always special education in special education instruction. Um, and so that way

074there's a lot of consistency between and I think charter schools have to use the same chart of accounts. So, Pennsylvania charter schools have to use the same chart of accounts. I do not know about private schools. Um, but for all public schools that report up to PE their finances up to PTE, we all use the same account. Um, act one that we keep talking about was legislation that was passed um several years ago that limits the amount of tax. Well, one of the things it does that's most important to budget is that it limits the amount of tax increase based on uh multiple factors. There's the um earnings within your district, the consumer price index, and there's a ratio that they come up with, and they issue what that maximum amount can be every year.

075Um, internally, Aquin also, I'm sorry, Aquin also lays out a calendar and a schedule and timing for all of those for all of our proposed final. There's a preliminary, a resolution, a proposed final, and a final final. Why they don't just call them preliminary, proposed, and final. Why it's proposed final, I don't know. Um but your preliminary if you want to seek special exceptions for either construction which we don't qualify for um for retirement which we don't qualify for or special education what we which we could qualify for in some years if you want to seek those special exceptions in November December we would have had to come up with a preliminary budget to show that we were going to be short. We did not. If you remember, we passed a resolution that said we

076would not exceed the Aquin index. So, we've done the resolution, I think, for like the la last forever. Um, and so we did not do a preliminary budget. The proposed final budget has to be presented 30 days before you vote on the final budget. So in order to not add meetings, if we are going to vote on the final final budget, I love these terms on the final budget on the at the June 18th meeting, we will have to pass our proposed final actually at the work session in May because we don't have 30 days between we have 28 days between our May meeting and our June meeting. Um so we will actually do the proposed final budget at the action meeting. I'm sorry, at the work session in May. All right. And I'll show

077the schedule at the end. So, the act one law dictates what how much we can raise real estate taxes and how much and what the calendar is supposed to be. Um, internally, we start working probably November um to start getting departments to start thinking about their budgets again, which they've only spent money for three months, so it's kind of like here we go again. Um, so we try to get all of that into the business office by about December so we can start looking pulling it all together and then really start focusing on the 70% of our budget which is personnel and bud and benefits. Um, the buildings themselves are probably 11% of the budget. Like it's not it's just not a lot of money. So I try to get that knocked out and out

078of the way so they don't have to worry about it and they can go on about their business. Um the big expenses are 70% as personnel and uh salary and benefits. Um Mr. Slaughter is another big part of it. And then Mr. Mr. Ryan's another big part of it um with transportation. So the general fund budget at the end of every year has to balance. That's that's a law. So you have to your revenues have to equal your expenses or if your revenues are short than your expenses then you have to draw from gen from your fund balance. Um you cannot submit an unbalanced budget to PTE. The name of the form in case you ever hear it is a PTE 2028. It's like an IRS 1040. It's just a form number. Um the 2028

079is we put it into a computer program that the state makes us use. It generates. So when we advertise, we will actually put the budget on that form and we will advertise that form. Um the you are only we are only talking about fund 10. Um which is basically everything that we talk about comes out of fund 10. Our capital fund, our enterprise funds, our memorial fund. We don't have to turn in a budget to the state. There are some special tables in the general fund budget that just speaks to what the balances are in those accounts, but I do not have to and nor do you have to vote on budgets for those departments. Okay. Um, so just real quick, I'm going to get a just a little bit because we talk about budget

080transfers and you see these long strings of numbers, I thought it might just be helpful. Um, we have in einance over 12,000 account codes and we roll those all up to make the budget. And the reason why there are so many is because of how many components there are and each one of those components means something different. In general, the revenue codes are structured similarly. They probably go the usefulness of the revenue codes is probably the yellow, the green, and the purple. And then the rest of it doesn't really apply. Maybe the gray, but the rest of it doesn't really apply to revenue. But in the color coding, just so you know as we go through the first section when you look at your budget transfers is your fund. So we're talking about fund 10.

081The next one is the function which is the for what for? What are we spending money in this case? We are spending money for federal instruction. So this is the account code for salary expense at NAP elementary school. The on what is the purple. So what are we spend we're spending for federal instruction on teacher salaries. The state has specific coding that we have to use for the source of the money. Federal funds have a funding code of 411 for title one. Then we have to decide if it's elementary or secondary. So that's level 10 or districtwide is 00. Um the location, every one of our buildings and every one of our major departments has a location. The business office is 02. The superintendent's office is 01. App school is 25. Um and then the

082subject line is that could be anything. That's kind of where we can personalize our accounts to how we want to use them. Um, we use the grant. So if we have title one can run concurrently last year and this year because the period for a grant is 15 months. So we have designators. So we know this was 15 months from 25 and 15 months from 26. So that's why there's a subject indicator at the end. So for every expense that we create and every expense that the buildings put in, they code it to one of these big long codes. Okay. So, revenues, the codes for revenues that you'll see when we bring the when we bring the full all the numbers back to you, 6,000s are the locals, 7,000s are the states, and 8,000s are

083the federals. We generally only have about two um two things in federal, which is our title grants. So, there's four title grants um and then our access funds. Used to have ESSER money, used to have, you know, COVID money. That's all gone. So, we're pretty much down to just title money and access money. Um, our local revenues are the things that you think about, real estate tax, earned income tax, transfer tax. Um, if we have like if we had rentals, um, if we rent when we rent out facilities, rentals go into 6,000s. Um, local grants, like if a business gives us $10,000, that may go in the local state revenues, pretty straightforward. Um, I think the biggest thing that people get surprised about in state revenue, we get a 50% refund from the state for

084the social security that we pay the FICA that we pay, the employer side FICA, we get 50% of that back. Um, and then Pasers is the same way. We get 50% of that back from the state. So, we pay 33% and then later the state pays us back 50% of the 33%. Um, so that number fluctuates when we do the budget. That number will fluctuate as salaries and benefits fluctuate because it's all predicated off of salaries. FIC is a payroll tax. Okay. Um, expenditures. This goes back to my for what and onet. So there's five five major categories of function. Instruction, support services, non-instruction, facilities, and financing. Um those all there there's 1100s, 1200s, 1300s and instruction. Same thing with support services. Support services would be things like superintendent department, the business office, legal services,

085all that kind of thing. Um and then the major objects, all of those objects get tucked underneath the function. So every department has salaries, every department has benefits, every department has outside professional services, property services, management services. Um and those are all categories as described by PTE. Okay. So I generally like to when I do my budget talk and we start talking numbers I generally like to talk about the ones not so much the for whats. I will show you by the department by department but I think it's easier for people to group expenses by type of expense rather than by the instruction special ed. Like I I think it's easier to talk about salaries and benefits and it's easier to talk about supplies and it's easier to talk about property and equipment than it

086is to talk about the others the other component. We have to break it down for the state. So I will just show it but generally most of my discussions I I personally base around the objects personal preference. So to be clear, what you're doing is aggregating people across as an example, aggregating uh PMBB across all five and correct >> sharing that. >> Yeah. Um and generally when I look at salaries when we dig a little bit deeper and we get a little bit more in the weeds in the coming months, I'll look at salaries by labor group. Um so PTE has nine labor groups that they have that they use. And by group, I don't necessarily mean contracted group. I mean by how PTE breaks it down. Administrators, teachers, clerical, security, support staff. Okay. Um

087I do want to touch on a little bit of information about uh benefits for the 2627 school year. Um we did get our final look from Willis Towers. I'm not going to read this verbatim. Um, essentially they used two years of claims data to come up with what they expect our rates to be for next year. The claims data years were um there from December of 23 to November of 24 and December of 24 through November of 25. So it doesn't really line up with the calendar, but they're trying to give us two rolling years worth of data to base our 26 27 um uh rates on. Um medical had been tra t t t t t t t t t t t t t t t t t t t t t t t

088t t t t t t t t t t t t t t t t trending around 7% with districts that don't have GLP1s and about 12% with districts that do have GLP1s. Um admin fees, we kind of roll those admin fees together and then they spread them out across CPASS. Um along with our stop-loss premiums are part of the cons the the consortium pricing. We get a stop-loss based on consortium pricing. So, it's not just our stop loss, it's all of the 17 or 18 so members of CPASS and that's what our stop-loss rate is based on. Um, does anybody have any questions before I move on? >> I'm sorry. Did you say that you the each area of CPASS has their own stop-loss or you said you said it's aggregated? >> Correct. So,

089our premium price is based on the aggregation of all of the lives in CPASS. >> Okay. >> Yeah. And then so if we have a really bad year but 10 other people have really good years, it helps smooth us all out. >> That's the more the marrier. So good to hear. Thank you. >> GLP1, could you explain what that is, please? >> Those are the weight loss medications. >> That's what I thought. >> Yeah. And I've got a couple more slides on that in a second. >> Okay. >> Um, Miss Hower, when would it be an appropriate time to ask questions around the impact of uh the cost of benefits on budget? Will that come later or >> I'm gonna give you some numbers in just Yep. >> Um so overall for CPASS um the

090rates for all of the 17 members ranged anywhere from $1861 to 2453 per month per employee. Um so that's across all 17. We landed kind of in the middle high which is at 2120 per month. So our that's based on our core plan. So we have three plans. We have a core plan, a buy up and a buy down. So our core plan rate is about 2120 per month. That's the average. Um overall the first look for all of us combined, all 17 was 26 million to start. Um and we landed at 235 million. That's for all 17 members. Our component of that is about 43 million. That's where our final estimate for next year. Um that pretty much represents close to a 15% increase over this current year. It's actually 14.6. I rounded for

091purposes of the slide. So that's where we're looking if we continue to include GLP1s in our formulary, which right now contractually we have to. Um so I just wanted to show those numbers to I will show those numbers to you in a minute. Um how it breaks down between medical and script. Um our medical component of our our benefits are about 33.5 million. That's the 13.9 increase which is about 14%. Um most of a lot of our increase is related to the to our prescriptions. Um overall the rates for the other members were anywhere from a drop of 4% um and honestly I forget which district that was. It was one of the very small ones um to an increase of over 21% in some districts. >> So I was going to ask like what

092what is driving that right and what is what is put in place? what kind of medical programs, clinical programs, um or or even um payment integrity programs that could be put in place. From what I understand, there's limitations based on contracts. >> Yeah. >> Um but is there the ability to redirect to formulary as oo you like can you control what is covered with the pharmacy if that's a big driver? So we we do have pharmacy control and we do have pre-authorizations and we have the whole process. We have a co c co-ay share plan. >> Um we have multiple things to help control cost. We included them on the formulary though those GLP1s on the formulary >> four or five years ago. So we will have that would be something that we have to

093go back and renegotiate. We do have we do offer um incentives, tobacco cessation incentives. We we do find you know there is a um a premium that you have to pay if you are a tobacco user um you know and we do have some diabetes control programs but they are not required as of yet. are is there limitations on like um either giving a discount or paying a fee for um adding dependents onto the pro onto their plans or is that something that's not able to do the I mean we have different groups so there's a single I I guess maybe I'm missing it so we're we have a that's the average price for per employee so we have you know if you're a single it's one rate if you're two party three or family

094plan is that what you mean >> I mean is there a way to incentivize um staff to if there's another plan available from a spouse to encourage >> We do not have we not do not currently have a spousal penalty. No. Okay. >> Um we do offer um >> I think it's 1,200 a month. I'd have to go back and double check if you do not if you decline benefits. >> So there's an incentive perhaps. >> Yeah. Okay. So and and we do have people that are on their their spouse's plan. >> Um but we don't currently I know what you mean. Like Mhm. >> because like my husband's my husband's insurance, he had to pay an extra $1,500 or whatever if I had my own insurance and had to carry. They didn't do it

095for the kids, but they did it for the spouses, right? >> We do not do that right now. >> Okay. >> One one last question just on the the 2120 Pepum from the last slide for North Penn specifically. Is that >> before or after employee contribution? So is that like the all-in or is that the employer? Okay. Thank That's right now. That's the all in. That's what I'm showing today. Um, generally though, the employee component for the most part is 17%. >> Great. >> Yeah, we pay 83% of it. >> Yep. >> Uh, these increases year-over-year are pretty significant. I mean, double digit increases from Yes. >> over time. Um, when possible, I think I would find it helpful and uh to have to see some of this charted out as a trend analysis, >>

096okay, >> to see what it looks like over time. Um, because these are fairly substantial increases and uh in terms of identifying drivers to in to increases to the budget, uh it'd be helpful to have that. So, thank you for at least this. But >> yeah, I think uh and I think Willis Towers already has that, so I can go back to them and ask for it. I I think to go along with that if you don't mind I think hearing from Willis Towers what that compares to their standard book of business uh and like what are some analytics across other industries other non not this specific group but other groups would be really helpful. >> Okay. >> Are we getting are we getting this or do we did you send it and >> I

097did not send this. I'm going to send it after the meeting. >> Okay. Thank you. >> Yep. It's in your executive content, >> I think. >> I >> Did you just drop it there? >> I did. I just dropped it in. >> Um, so just just to talk about RX rates, we stop we talked about medical. Let's talk about RX. Um, prescription in this in the consortium went up anywhere from 5 to 55%. Um, our district as is sitting at 17%. So our pharmacy percentage went up 17%. Um this year we will be at uh 9.4 million. This past year we were at 8 million. No. >> So I will say this this is not uncommon like across the United States. Not and not just school districts. The rising cost of health care is a

098a challenge. >> Um and I think it's just a matter of how you deal with it within your population. And that's where there's there's opportunity, right? there's opportunity once you evaluate your populations and as um Dr. Tio is saying your drivers um what what what can be done to put in place to mitigate >> um and you mentioned GLP wins and you said that there's going to be >> there's there's one more >> slide >> I could talk to you about GLP ones all day um this >> so and and >> our health clinic partners also have a GLP-1 program that the the employee would pay for that component if we take it off the formulary but it would be at a reduced cost. There's so there are things that we are looking at and

099we're researching. We're just we're not there yet. >> Just just to add additional color to that, speaking to other districts that I've been working alongside, we're seeing 12 to 40% increases. So this is actually not as scary as I was expecting to see on some level. >> Um so this is our over this is the overall breakdown of where our renewal projection is looking for next year. This is combined um this is combined RX and medical with all of our associated fees. Um we are self-insured. So when we say we're going to pay $42 million next year, we are going to put into our medical trust $42 million over the course of the year. And we pay our own claims, but we use the Independence Bluec Cross network and they tell us what we have

100to pay. and we they pay the doctors, we pay Independence Blue Cross. Independence Blue Cross is not insuring us. So, we assume we are assuming the risk, which helps hold down our costs. Um, but we do still have to pay for a third essentially it's like a third party administrator. Um, which is what independence does for us. And then Capital RX does that for the prescription side. They're our pharmacy benefit manager. Um, so overall the total um increase is about 14.6%. I was hoping it would be around 12, but it was 14. Um, and I keep hitting down on my own computer, not this one, so I apologize. So, if we could exclude GLP1s, our medical costs would drop about 12.5% and our pharmacy would drop to about 8 point So, it would drop to

101an 8.9% increase. So, it would still be an increase, but it would come down um to about 8.9 um or about $600,000 for the year. the impact. So the the four drugs that I have circled right now are the are our GLP ones. The brand name WGOI and the brand name Zepbound are the weight loss medications. We currently have in the last in the most recent claims year that I have data on about 135 or so people that are accounting for about $2.4 million in spent. So the other drugs are things that keep people alive. Weight loss drugs are the only are the only first two. The Ompic and the Mangjaro are diabetes medications. Same thing, different brand. We're not talking about changing that. That's not at all what we're talking about. We're talking about

102for the specific use for obesity management and weight loss management. Um so the impact to our budget for next year is of the $1.2 $2 million in increased spend for RX. 670 of that is directly related to GLP1s. So, we could lower our cost. We are trying to find a creative fair way to do that. There is one medication that is now on uh generic. Uh so, you know, we've looked at leaving the generic on, possibly taking the name name brands off. You know, is there a way to maybe incentivize we'll pay half, you pay half. We're those all things we have to be careful and why we can't just take we it's either all or nothing, right? Because if we try to give it a special co-pay and we try to call it something

103different, we can put our other pharmacy rebates at risk which would actually cost us more in the long run. So my Jenny Schmidt is my benefits manager. We are we talk about this probably four times a week, five times a week. Um, and we are still trying to come up with a creative way to protect the integrity of the programs for those that are on them. Full disclosure, I'm on one. So, I'm one of those 130 people. Um, so like I, you know, how can we protect the integrity of the program for the employees so they would have the help because it is beneficial um without causing us a million dollar extra spend every year. >> And we have engaged all employee groups. >> Yes. >> In this conversation as well. So, um it is

104a conversation with our union leadership and other employee groups as well >> and it may be something that we don't have we don't make any changes this year and we give ourselves 12 months of runway to try to affect some kind of change in 2728. So, more to come on that but it is a significant driver. I didn't want to not bring it up. >> I'm glad that you mentioned the rebates. Um it is a significant factor especially since you are self-funded or we are self-funded. Um what I've seen nationally trending is pushing to the generic um and removing or making the name brands non-formmulary for this year. Um maybe that's a move next year or you know but that's that's the general trend that I see. I also know that there's a pill that's

105now available. The cost savings to that is minimal if any. I think it's because it's first year development. >> Um it might be helpful for those who aren't fans of the injection. Um but um it it isn't there isn't any cost savings to driving them to that that drug. >> And in conversations with some folks that I used to work in healthcare and so I I had some conversations with folks. They're actually concerned that you'll have more people because people are turned off by me having a shot. Yeah. >> And so they rather take a pill than take a shot. So like we really have to figure out what we want to do before it goes up and it's because it's more accessible, right? >> So we got to figure something out. Um, so that's

106kind of one of the things that's circling in the background of the benefits. Um, just to give a quick update. I'm sorry. >> Oh, uh, just a comment, um, based on what you just said, Dr. Bower, about speaking to the employee groups and staff. Uh, I don't know if this is a question for you or Mrs. Hower, Dr. Kim, but it would be helpful to just share some context when appropriate down the road around how our educators and staff and employees uh feel about the benefits package um and what their level of satisfaction is with things and how uh valuable and how they value it as part of uh their employment at the school district. U I mean not now, but when when appropriate, that'd be a useful data point to to have. >> I

107will make one comment. I worked in healthcare and I have better benefits as a public school employee than I did working in healthcare. Um so I you know I think from a outside of this conversation about this one class of medication I think we have very good benefits that are safe and supportive. Um and we do have a lot of health health and wellness programs. Um we brought in this year um a digital digital physical therapy and digital pelvic floor therapy for women. Um that is actually a lower cost than going to a regular PT's office and you can do it in the privacy of your home and especially with the pelvic floor therapy for a lot of women and actually helps with a lot of other medical problems. So I think we try to

108be very proactive in offering new doing things that are preventive medicine and not just reactive medicine. Um, and I think we have I think our pricing is very marketable. As you can see, we're kind of right in the middle. Um, and like I said, we have broader benefits than I had when I worked in healthcare. >> So, if if I may, and I apologize, just I do know we have some guests in the audience who are going to present yet tonight, and we still have a budget presentation from our directors of special ed. Um, you heard from Miss Hower tonight that our medical costs are increasing significantly. Not as m much as some school districts, but they're still increasing as Miss Coin said, uh, nationwide. And we also have additional costs based upon staffing. So,

109this is really we were meeting about this and setting the table for the fact that there are some things that are beyond our control that are being worked into this budget. So, when you talk about a 3.5 act one index, you just saw the numbers when we were talking about benefits and prescriptions and now we're going to talk about the staffing numbers from our collective bargaining agreements. >> So, I'm going to because we are running out of time. I'm going to go to the very last budget item or I'm sorry, the very last agenda bullet. Salaries reflect 70% of our budget and 70% of our budgeted increase is over the act one index. So all of our contractual arrangements with our with our all of our labor groups are over 3.5 this year with the

110exception of act actu uh act 93 that's at three. So but all of our teachers and all of our support staff their increases this year on average exceed the actin index. So we already know that 70% of our budget is more than we can raise our budget. So um those are the ga that's the I don't want to say the game that's the strategic challenge that we will face in the coming weeks on how we balance that out um and make sure that you know we've had some conversations with some folks about market rate adjustments and additional staffing and where we're going to say no um and where we're going to say maybe and where we'll say we'll see like you do with your kids that never happens. Um, so that's kind of where we

111are with staffing. Um, timeline real quick. So tonight I gave you some overview. Special education is going to present their budget, the work session. We're going to have the high school update. And then at the FNO meeting this week, this month it'll just be a normal FNO meeting. There won't be um any presentations regarding budget. Next month um we'll have the bond update, a full benefits presentation um from Mrs. Schmidt and we'll have some other information from Willis Towers for you based on what you've asked for tonight. Budget topics, curriculum will present. I will provide for you an uh executive summaries for the uh public relations, HR, and the business office. We're not going to do presentations for them. Um and then we'll have a tax rebate discussion about the low-inccome tax rebate or the

112property tax rebate. Um which and then in work session, it will present and transportation will present. And then if we have it available and we think it's necessary, we'll do a staffing update. FNO will present their budget at the facilities meeting on April 23rd and I will have all of that rolled up and have a proposed budget for you sometime in the week of April 27th. April 27th is my husband's birthday, so maybe not that exact day. Um, and then we will go through the proposed final budget at work sess at the finance committee meeting on the 5th. pass the tax resolution or approve the tax resolution for the work session and then pass it in work session. Approve homestead farm session for work session, pass it in work session. Um and then the other

113items are there as you can see with hopefully present the final budget to you on June 2nd and then we'll vote on it on June 18th. Okay, that's all I got for that. We've still got more, but that's all I got for that. Any other questions or concerns? All right. I am not going to go through the financial reports. They are there for your review. If you have any questions, sorry. If you have any questions, just shoot me an email. Um, they are in the new format. They look nice. Feel free to look at them whenever. >> Um, and then if Go ahead. I was going to have the special ed come up and present. >> Just a quick uh wondering and clarification and request then. I think the 7,000 state revenue budget line or

114item the revenue line is student driven >> or enrollment driven. >> Um some of it is yes >> it would be helpful to see just enrollment trends over time to see what that looks like too. >> Okay. >> That'll be a part of the enrollment RFP too. >> Yeah. So um Okay, great. So, as part of you just saw a budget timeline and when the presentations will be as part of putting this budget together, we've decided to prioritize certain departments and uh honestly because the magnitude of the spend and special education is a big driver in our budget um and obviously a very important uh program that we provide for our students and families. And so we have Dr. Kler, Dr. Balden to talk through the special education budget for next year. We'll start with

115Dr. Cougler who is our director of elementary um and special education and people services. >> All right. Good a good evening. Just >> we started this meeting in the afternoon, but it is now it's now evening. >> So >> I sent an email at 4:00 that said good morning is just where I am today >> and I'm not seeing it in the agenda. So give us just >> one second. Well, I can I can start by just telling you that our first few slides just um go through our district mission and vision statements. And the reason for that in particular to tonight's presentation is that our budget for special education and student services is really really rooted in the needs of our 2,600 and some students that we have uh who receive special education services

116and the thousand or so that receive gifted and 504 services and of course the tier one services that we provide across um across all of our buildings for for student services types of things. So you'll see in our slides and we have I think 13 um you'll see in our slides that uh that is what we um cover and it's really student driven. So we'll be happy to share that with you moment >> and I think you bought us enough time just have to hit refresh. >> Where did it go? I can't decide if we have pensive faces or hopeful faces. >> Nope, that's me. Nope. >> Because it's in Google. >> Sorry. >> Um, so a quick way to do this, could you share it with me, please? >> I would. >> Yep. >>

117Y Do it. >> Do you have it? Never mind. >> Yep. >> Shared. >> Okay, refreshing. Stand by. Here it comes. Okay, I got it. >> So, oh, he's going to present. Thank you for your patience. >> Ethan, can you tell Mr. Gilmer sorry? >> There's no greater ang than having to wait to present like this. >> But I feel like we're ready to go to slide four. So like I feel good about it. >> There we go. >> Thank you, Dr. Bower. Yeah. So slideshow present. Here he goes. All right. We did really mad at me. >> Uh I take it for that. >> So sorry. You can go you can advance. We did this slide. Next slide please. We did this slide and here we go. >> Okay. So good evening everyone. >>

118I feel as though I gave Dr. Kler an introduction. So this is Dr. Balden, our director of special education pupil services for secondary. >> Thank you Dr. >> Good evening Dr. B. >> Good evening. Um, so this is our personnel cost slide and I would like to ask you just to take a moment, a few seconds to look at the different groups who support our students um, who receive special education and student services in our district, the administrators, support staff, and the professional staff. Okay, thank you. All right, this slide um shows the uh agencies we uh contract with for services for our students, mainly related services, mental health, social work, SAP counseling is another level of mental health counseling, occupational, physical therapists, um vision, hearing, um and any additional related service that a individual

119student might need that won't require us to have a full-time employee um working in the district. So those are our rel contracted related service providers. >> And I just for people who aren't in this world every day, SAP stands for student assistance program and OT is occupational therapy, PT is obviously physical therapy. So >> sorry about that. >> Okay. Uh we mentioned earlier that this is all really student driven. So we wanted to give you some data. Um it you can see our increase in um our special education students across the last four years. Um so you'll see that um this information is pulled from what's called the December 1 count. Every school district has to submit a snapshot of how many students actively are receiving special education services on December 1st of each year.

120Um we don't get the um data back from the stat the state in the report until as early as May, as late as sometimes July. Um so we have the data from last school year. um 2587 students with IEPs, which represents 20% of our total student body, slightly under the state average. Um we also wanted to provide you with the data for students educated in other settings. Generally speaking, the students edi educated in other settings are the students whose um total educational profile is um a more expensive ticket. Um, and so we are proud to say that we are able to educate almost 97% of our students within our own school district buildings, but we do have other students whose needs are more complex. And so we um look for placements that can meet those

121needs. So 3.1% of our students um educated outside of our district schools and we're well under the state average for that. >> 3.1% of students with identifications. 3.1% of students with identifications or 3.1% of the bodies. >> 3.1% of our students with IEPs. Yes, thank you for good question for that. Okay. Um, we also wanted to to expand on that a little bit just to show you what the costs are for those out of district placements in our budget. Um, so these are broken down by the different types of placements. Um, we did put the MCIU separate because that is our our county. um we pay a slightly different fee if we uh place students at either the CC Chester County IU or the Bucks County IU. Um and so those are the breakdown of

122different costs. So even though that is only 3.1% of our students with IEPs, the total cost we spend for those students needs is $9.2 million. >> I'm sorry, is that annual? >> Yes. Um, we also wanted to highlight for you our specialized classrooms. And so those are classrooms that um maybe provide um supplemental or full-time autistic support, life skill support, multiple disability support, um emotional support. Um and so those are the number of classrooms that we have at each level across our buildings. Um and so typically those are students who have a lot of related services. is they might have par professional support in their IEPs and and other types of services that um impact our budget. Um we are also just including the data here for you just to show a little um thing

123that we're also very proud of. In last year's data, the percent of students who spend less than 40% of their day in the regular education environment um is 4.7% of total students with IEPs. Typically, those are students who are educated primarily in specialized classrooms. And we're really proud that we're well well under the state average, which is 10.6%. Um this is a largely growing number as you can see. Um and so this year we had just the other day grown to 184 students who are North Penn students currently. Um but they are North Penn residents I should say. They are receiving early intervention services um for special education. Um, and so there are 184 of those students that were notified of. We were 183 and then I talked to a parent the other day, so

124we're up to 184. Um, and we also wanted to highlight for you the number of students that in early intervention are already receiving services in a specialized classroom like the slide that we showed you previously. And also something that's really growing is ABA clinics. Um ABA stands for applied behavior analysis and that is a service that is typically provided to students with autism and it's covered through medical insurance um in six months to one year spans and so clinics have opened up and they can provide six hours of services per day for students who are qualified and oftentimes those students are the same students who um whose IEP teams make a decision that a specialized classroom is right for them. So, as you can see, that number has dramatically increased over the last four years.

125As well, >> I just want to bring your attention a couple meetings ago, I talked about the governor's budget and the increase in special education. Um, and just look at these numbers here for early intervention. From 2023, 2024 to anticipated for next year, it has risen by nearly 50%. 50% our students coming into kindergarten requiring early intervention services. Um, now that's not an exact science in terms of the amount of services and the level of service, but still to just to think about the cost. Um, when I say we can't advocate enough for more support and special education with funding and staffing and resources for our most v vulnerable students, um, I really mean it. I mean, it's just amazing to me that from 2324, which feels like it was yesterday, we've gone up about

12650%. is my understanding is that the state funding for special education is wolffully under you know it's it's not enough before so so I don't anticipate I don't anticipate it jumping up for us unfortunately >> it has uh special ed directors across the commonwealth regularly say that it has been IDEIDA has been underfunded since the day that it was adopted um and the gap has gotten wider and wider So when we see increases of 3% um from our our subsidies and from the state and federal government and you see an increase like this, it's just really mindboggling. >> Mr. Ber, >> and I have a question about the process of identifying which students are in need of these specialized classrooms, right? There is a timeline, right, that has to be followed and there's a certain

127set of uh studies that need to be done, uh progress checks, things like that. What what's the general timeline of say a student presents with certain needs from that moment to the moment that they get into a specialized classroom. It takes quite a while because of the legal hoops that have to be jumped through. Could you speak to that timeline real quick? >> Sure. So, it is it is rather rare that students would be receiving services in our um regular education for a large chunk of their day and then move into a specialized classroom. Unless we're talking about students who have emotional support needs. Um but the process um if students are coming in let's say in early intervention um we have meetings they happen right in this room. We meet with all our families.

128We talk to them all 184 of those families. We speak with them. We review their documents. We issue a permission to evaluate form to re-evaluate really. Um and that's a 60-day window for that evaluation. And then once that's completed, we then provide that to the family and we have up to 30 days to then hold an IEP meeting and the team talks together about as you said the the various data that go into the report and the assessments um quantitative and qualitative anecdotal information and just experience and thoughts overall as well as what are the family's goals um what does the school district have to offer because we have a lot of options. We really do have a nice continuum of services and we also have that responsibility to consider not just our school building

129placements but what else do we have outside of the district as an option if a child should need something more substantial than what we can provide in our buildings. So you're looking at at least 90 days then we issue a NORA app. Family can choose to agree or if they disagree there are lots of options for them to work through that. Um and so that that entire process um can be a couple of months, >> right? Thank you. And I wanted to highlight that process because we're talking about the cost of the staff and professional needs. >> Uh one child moving from one spot to another takes that amount of time, that amount of uh you know, manhour so to speak to get it done thoroughly and properly while we communicate with the family properly.

130So I wanted to highlight that this is a real process with those professional needs and costs. Thank you. >> Yes. Sure. One last note on just sort of thinking about these numbers because Dr. B, I think you're right that these are increasing really rapidly. I I'd also love just your professional perspective. >> This upcoming group is also your first kindergarten COVID baby group, right? It's >> I guess, right? So now you're watching this bump up hit against that really quickly. How much of this is sort of the perpetual increase that we should anticipate versus in your again there's no way of actually there's that's a little dice roll but like but how much of this is something that is the bump that happened in COVID and may be a bit of an art to a

131curve. So the good news is that the research actually indicates that with the increase in early intervention, it's because it's or the transition in with IEPs, it's because of early intervention, which is a good thing, you know, and not every student, not all of those 184 students will qualify for school age services. >> That's why it's called early intervention. >> Yes. So it's hard to it's hard to say. We'll be you know, I am interested to see what the number is next year. Um, but I think we saw the impact of CO on our students who are now in first and second grade as opposed to the the little guys that are now coming up. >> I also just want to commend was probably two or three slides ago. Keeping that many students in the

132least restrictive environments is not only wonderful for their education, their experience, their opportunity, but it's also not $103,000 on an outside of the building placement per child. Like that's a money that you're able to really resource and prioritize all the incredible work that your personnel are doing. So, I really am grateful for your ability to continue to find ways to serve students where they are. That's awesome work by you guys. Yeah, we appreciate you complimenting them because it is really the staff in the buildings that are doing that great work. >> Do we have I I can see how that disparity between the state versus our district um could accommodate like more rural school districts. Do we have like a drill down of maybe Montgomery County school districts of comparison? Is that possible? >> We

133could put it together for you. Yes, we can. Okay, speaking of um cost, additional costs, we have large a large these are our largest non-personnel single expenditures. Not a single person but single category expenditures. Um and two of the items on here, two of the items are PTS and Lakeside. Those are actual personnel cost for um actually there's services that are provided through personnel but they're services. So all of these are services and they're required services to ensure that our students are successful. Um some of the you see our out of district placement although we are below the state average it is a cost and we have to consider that when a student is attending an outofd district placement it is because they have a very intensive need that we cannot provide that service for

134and with intensive needs it requires oftent times additional cost. So, it's not something that we can stare away from, but we we know that we need to provide FAPE, a free and appropriate public education for our students. And as as Mr. McBain mentioned it is a process and we have many experts who are evaluating supporting our students not just looking at a student making a judgment decision but we really go through a process and we try to educate our students within the least restrictive environment but there are times where it costs more. All right. So, with that being said, there are ways of recouping funds for our students. Um, idea funds was already mentioned. Contingency funds are funds that the state tries to help us out for some student cases that are very expensive. And

135we it's $150,000. And I know it seems like that's a small amount, but that's the largest amount of money that you can receive um for contingency funds. 4010 slots are supported funds um that we receive from the state for students who attend approved private schools. We really love 4010 slots because the state will pay 60% of the students tuition and then the district will pay 40%. you we just receive a call or some type of indication from the approved private school and says we're going to give you a 4010 slot. So, it's not something that we apply for. They just know that all districts want them and we're very fortunate to receive 4010 slots. Access billing is the district's way of receiving reimbursement for students who um qualify for Medicaid and the district provides the

136medical services such as nursing, speech, language therapy. All right. So, thank you. That was a a brief overview of our budget, but we appreciate your attention. >> Thank you. Thank you very speedily. There were no other questions for them, I'm sure. Okay, these good adult, but thank you very much for our student rep. Any questions or comments for us? >> Yeah, I just have one question. Uh, forgive me if it's not much of a good question, but uh like for example um well it seems to me like the district's like really in debt and like the budget's a little bit tight. So like for example like the busing research like if we did that um like this year like where would we get the money from and like like say it's a loan like how

137would it affect us like would it in any way? >> So that we always have a few contingency if contingency funds in the back to to do things like this that may come up. Um I don't know that we would necessarily even start the busing in the next three months because I have to to do an RFP. It normally takes about uh 6 to 8 weeks to get it out. So, at that point, we're pretty close to the end of the school year. So, I may budget the fees for that particular consulting into next year. But, in general, if something came up that we really needed to do in our budget, every year there's about a million dollars that we call budgetary reserve for things like a boiler breaks and we have to we have

138to fix it or we need to do a study. So, there's always those contingency plans. There's always that contingency funds set up in the background. Thank you. >> Yep. >> Are you aware of what an RFP is? >> No. >> I'm sorry. That's um so it's a it's called request for proposal. So there's request for bid, which you have to do by law for like construction programs or projects. And then request for proposals are for professional services that we don't technically have to go out for bid on. Um, but that's the best way to get competitive pricing from multiple service multiple service providers. So, we write a document that says we would like somebody to do the busing study and your study has to have all of these components. It's almost like a class rubric.

139So, when you get at the beginning of the school year, these are all the things you're going to do in this school year. These are all the things that we want your report to say and it's almost like the criteria for the report and then they give us a price for that and how long it would take and all that kind of good stuff. Okay. Okay. >> Excellent. Thank you. Good question. >> Um, >> so I do feel compelled to ask Mr. Laneir, did you plan to do two public comments? >> Okay. All right. All right. >> Okay. Okay. Individuals attending this meeting and intending to speak to the committee should be aware that they are being recorded. In order to meet the requirements of Pennsylvania sunshine law, it is necessary to record the names

140of all the citizens who speak to the committee during the meeting. To asssure compliance with this with this requirement, it is essential that those planning to address the committee state their name, municipality. And as a reminder, the public comment portion of this meeting is reside for residents and taxpayers of the district to provide comment and feedback on matters being discussed at tonight's meeting or matters that may come before the finance committee. It is not designed for debate or discussion with members of the committee. When appropriate, committee members may choose to respond to public comments that have been made or request that a member of the administration follow up with the speakers after the meeting. Members of the audience are asked to limit their questions and comments to three minutes. Welcome. >> Good evening. Um, a

141lot of great information with the budget. I always uh >> name a municip municipality. >> Uh, Jason Lir Lansdale. I know this. I know this. Uh and any lot of good information when PFM loted lot of uh granular detail. Wish I could organize my finances as well as they organize theirs. Uh and I I might adopt some of the budgeting here, but I that might be drilling down a little hard on the family when you line item each thing that we buy and ask them to justify it. Working on it, but >> my husband can do it. Your family can do it, too. >> But you know, a lot a lot of negative feedback. I anticipate from that, >> right? I mean, we we have the macro ones about uh Netflix and think, do we

142really need this? You know, that sort of thing. And in any event, um looking at this from sort of a macro, you know, 30,000 foot view. Um a couple years ago, we had people up from Montgomery County telling us what the anticipated enrollments would be looking forward. And from what I remember, this is two or three years ago, it was going to be generally flat, maybe drifting upwards. Looking at the all the development that's happening in our townships that make up North Penn, that doesn't look to be the case. And I don't know if you guys all know, there's housing developments in at least four of the townships proposed, and they're pretty sizable. Um, upper Gwenned I think it's like 125. Uh, Talment's 200 200 roughly. Um, Hatfield 130 150 depending upon what they can

143get their zoning for. And Landstill is just talking about another 75 units over by just across the road here. That's we're talking 600 more houses. That's a lot more students. And how would we I don't even know how you forecast for the potential to build a new elementary school if they all came in young and what are you going to do about everything else? I look at this and saying not only is there a financial issue with um revenue to pay for everything, but maybe there's a time where we say we need to tighten our belts and we have to figure out what we can do, you know, uh let's call it efficiency experts when they come into private corporations and more people doing fewer things because this is really I mean at some point

144the taxes on the properties are going to get to the point where it means people are going to migrate out or people can't afford or we're we're just it's going to become a negative driver on on the population in in the the North Penn area. Sort of food for thought. Don't know if you guys knew about all those projects and uh I anticipate more coming. So, I'll leave it there. Thanks. >> Yep. Thank you, Mr. Laneir. Yeah. >> Yeah. Um I agree with Mr. Laneir that there's quite a bit of development happening in the school district. I will say that when we did our enrollment study a few years ago, they actually did project a pretty significant increase. Uh but you may recall that I had stated that the volatility of the data at the

145time given the onset of um full day kindergarten and then the pandemic. So a lot of students came into the district, then they left, then they came back um and we said we would revisit an enrollment study within roughly 3 to 5 years. Well, here we are and we are in the process and we're going to improve approve an enrollment study at the March action meeting because uh I really do think we have to take a look at it. And with that, it would be great if we were doing a capacity study in our facilities and a facility study as well, which is also um an RFP that was just approved recently. So, uh we're moving forward and with both those things because I agree. Now, I will say and Mr. I can give you

146a copy of our last enrollment study. When people hear 600 houses, they assume, well, every house has at least two children. So now we're talking 1,200 kids. That's another grade. That's really not how the math maths. Um a townhouse is actually from a a statistical standpoint worth 0.25 school age children. Um because just the way the family dynamics work, you get a young family in there, they start to have children, and by the time the children get to the age where one of them is going to school, then they move. And so like the mathematics of it all and the birth rate and the age of the women in the community that all goes into that calculation. Um so a a very large expensive home actually has less than that because in order to afford

147a home that is that expensive typically their children are older um and they might not be school age. So anyway I'll be happy to share a copy. I have many copies of the last enrollment study and we will certainly have our presentation with the new one. So with that >> yes excellent. Uh so we are moving to the action committee um sorry the action meeting items 3A to 3F. >> Yes. >> Yeah. Okay. 3A to 3F. Excellent. And can I get a motion to adjurnn? >> Excellent. >> Meeting adjourned.