001[Music] is [Music] um for the workshop and we are going to discuss budget yeah so um this is our budget update Workshop uh it's uh what we often call the big rocks so we're focused on the big drivers of our budget for next school year so this is a really early look at things there is a lot of work to be done as you saw from that budget development timeline but we like to give a heads up of kind of like where we think we are today and um I'll talk through the memo that's there in front of you I shared that via email a little bit earlier as well expenses revenues Etc um but Patty does the Deep dive into the financial experts at A fine grain level and then we also have kind
002of like a big overview on fiveyear financial projections so um I will caveat this that some of our assumptions assume that title funding and special education funding at the federal level won't change it'll be approximately the same you don't anticipate any changes there despite the administrative change uh but it is a possibility depending on what the um uh the uh house and the Senate do depending so um Revenue limit the per pupil Revenue limit isn't estimated to increase by $325 per student however our total revenue is impacted by ongoing declining enrollment so while we'll get a little bit more dollars per kid we have fewer kids total and so that changes our Revenue for the 25 26 school year we anticipate a decline of 118 FTE on the three-year average so over a 100 kids
003lost um for next year on our three-year average um based on the MD rawers report that is expected to kind of even out as we move forward it's I think next year's our LA or this is our last big drop and then it'll start getting smaller each year until we settle in at around 30 to 35 uh which is a lot lot better than it has been in the hundreds consistently over the last few years and that's really the uh reflective of the um series of recessions we had since 2003 2003 2008 2011 series of recessions that really dropped birth rates in our area and they have consistently held as a result um expenses um we're anticipating about a 3% increase in wages 2.95 5% is the CPI that's established by uh the Wisconsin employment
004relations commission as of July 1 for 2025 um we're also uh including uh a provision to attract and retain speech language Pathologists we have um it's a really really hard to find position right now and when we don't have folks in those roles because it's a a special tion role we're either required to provide summer instruction as compensatory Services which is an expense or we've had to contract out to Virtual providers which are often twice as expensive as hiring internally and so a a small provision to help attract and retain that is similar to other school districts in the state we feel will give us a leg up to getting folks in those roles so I'm just curious because the so it's not a single position that's being added at6000 no it's a um it's
005an amount added to our existing positions in that role it's a retention bonus or uh an uh or traction uh what is the other type of bonus tracting and retaining right okay so we'd offer the same amount of money to the folks who are already here so we don't create a disparity with those we're trying to attract and so it's $3,000 for two each of two years if you come to our school district and $3,000 for two years if you stay with our district uh we don't want to create disparities between those who've been loyal to the school district and cause hard feelings they might leave then and we're also trying to attract other folks this is similar to what exists in some other school districts when we look at postings online and so we're
006trying to be competitive with the job market ran it by our uh Lea folks so that they're aware and they understand the circumstances and they want they don't want our existing School Pathologists to be working overtime and extra in order to meet our needs they want good working conditions for them as well good um health insurance um with the 2425 change in our insurance plan we do have a 7.5% cap increase that is a lot um however um early indicat ations are that our potential we have potential for our increase to be only 4% so our our historical experience was like 120% medical loss ratio meaning that for every dollar of expenses or every dollar that we put in we were spending a buck 20 and so our insurance companies were losing money which they
007don't like to do that is flipped this year um because of our plan change we're much better positioned for medical loss ratio and so the increase as a result at 4% is less than medical inflation generally which is about 5 to 7% the last few years uh and so that 4% renewal rate that we're likely to receive is indicative of the beneficial change that we made it's come with the expense of our employees pocketbooks and we're recognizing that but it has made a difference in our in our health insurance cost other expenses we're budgeting a 1% increase for transportation utilities Services Etc um when we look at revenues and expenses we still end up with a deficit budget our revenues simply aren't enough to to cover our expenses that are increasing that we anticipate um
008the reduction of health insurance increase to 4% would save us about $270,000 our our tiered route system and our bell schedule changes we'll reduce our transportation costs by about 270,000 and then we would underfund our OPB contribution by $2.2 million we have a fund balance in there now and so we're capable of making our uh contributions to our employees um but by underfunding that we would help uh cover a substantial portion of our deficit and the remaining budget deficit will be addressing through our ongoing deficit or budgeting process so the remaining budget deficit here of 53 24,000 this can't yet incorporate any of the savings which haven't been realized from the referendum plans correct that's all for the future and I know you have the note down here that with that passage we'll be able
009to get the necessary reductions correct and I'll let Patty talk about the that second page there the blue and rad this kind of walks through what I talked through but kind of more of the specifics that uh we're thinking about right so we' we start with the base revenue and compare it so when you have that $325 increase per member that's really important because that adds to your base for the following year if the state doesn't allow any per pupil increase then there's no increase in that base for the next year so that is uh reflected there as an estimated 518,000 the um operating referendum exemption is the same for 2425 to 2526 so we're not experiencing any additional um Revenue limit Authority in that area and then uh this is outside the revenue limit
010but it's really important because it brings quite a few dollars in it and that's the per pupil categorical Aid rate uh that stayed the same in the in the same it stayed the same in the last uh banal budget for both of the years so we just and we don't know what's going to happen so we're just using the same amount the 742 but you multiply that against the threeyear membership average and so so if we have declining enrollment it's going to be less because the rate is still the same but the the membership has changed has declined Patty I I I assume this is included in our budget book somewhere I don't know if you're off the top of your head the categorical Aid rate has it ever gone down or have there just
011been flat years the rate so all of our categorical um Aid are we're funded at different rates so when we talk about like special ed categorical Aid that's at like 30 30% are you talking about that 7 I mean the the 742 here so if we're taking as an assump up but it's been at 742 for quite a few that's what I thought I remembered I just wanted to be sure because if we're taking that as an assumption that feels like a safe assumption yeah yeah the there's a a proposal to increase both the revenue limit and the Peru P categorical Aid by the governor in this next bium for districts that are wealthier have a higher value per pupil prefer categorical Aid because they're they get more dollars per student as a result it
012positively impacts their taxes whereas school districts that are poorer in property value per student prefer equalized Aid because that positively impacts their taxes uh and so the use of these two different tools has been used by the legislature to balance the needs of different types of school districts across the state so there's proposals to increase these but we're assuming no change because you don't know what the legislature's going to do is that correct one thing in state law is the 325 per student on the revenue that's the only change that we're anticipating right now we're so we project very conservatively like the the least budget when we're thinking about things if there's more that's great we'll make adjustments we'll figure it out but we're not going to anticipate a Panacea of funding it doesn't do
013seem likely at this point either that they are going to act to remove the 325 increase very unlikely I don't hear a lot about that right now no it would require something in the bium that talked about it which would then be ripe for line make it even bigger and so the majority party right now would be very hesitant to write anything in the legislation about that unless it's a standalone bill which the governor would never sign so and it's not it's unlikely to be V yeah right yep so we're just looking then at the net revenue change uh this is all before exemptions it's before any increase in voucher School payments so this is just the base uh revenue and so we are in the black right now but but not much so when
014you take um into consideration The increased costs that we had talked about earlier um that would put us at about almost 3.3 million in the red and then if we offset it about by some of the potential reductions in costs we we come up with uh a deficit of that 534,906 [Music] you have 34777 and you've got on your sheet with the blue and the red 430 so why and then yeah that great question so there's these two different documents and there's slightly different numbers on each the colorful one is Patty's very fine grade detailed oriented this is likely to be accurate very close very close to what's actually going to happen this is the document that I use for kind of broad long range planning to make sure our targets are kind of on
015track like what are the broad shifts over time so Patty's document is the one we use for like this next year very close fiscal planning the document that this that has all the numbers on it and the graph at the bottom this I use for kind of longer range planning it's not as accurate as patties it's kind of just kind of big picture where we headed so as long as the numbers are moving in the right direction and they're reasonable estimates and Patty and I compare numbers and they're very close you know but slightly different assumptions as we move forward and we'll refine those as we move throughout the year and so my goal with this longer fiveyear projection is just to make sure that if we do what we say we're going to do
016things are going to move in the right direction and that does seem to be the case on those fiveyear projections we start off with you know a $500,000 deficit and it slowly closes over time and as long as we're able to um um you know reduce those expenses through the consolidation which we anticipate then we should be achieving a balanced budget in three years okay so my other question is um with your document here on on the bottom on the savings so we don't see any of the redu reduced expense on the consolidation till the 27 28th school year however as I understand it if I wrong please correct me if we if the referendum hadn't P we told the public we're going to have to make Cuts Like right now yes and we said
017with the with the referendum we could do it through attrition so it seems to me there's two years of attrition we could be taking advantage of to get us there right we will be yes is any of that built into any of this no okay but it could be part of the 518,000 corre thing we will work out because we don't have resignations yet mhm so we can't guess what the attrition will be right so I'm guessing that this number that we're going to try to address through the budgeting process is in part addressed by so the question will be let's say that we have a custodian retire at one of our schools every single time we have a resignation we ask ourselves do we still need to fill this position is this part of
018our longer strategy for natural attrition when we consolidate schools and we might say let's say with a custodial position to be down a person and making somebody work double hours or overtime like that's not reasonable at this time and we know from history we have two resignations in our Casal group a year and so we can wait a year at least before we make that decision um another thing might be uh we'll have a teacher retirement that we know is coming in 25 26 or even 26 27 and we could have class sizes of 26 in that building for year instead of you know 18 as our Target we'd have to ask the question like is that worth it to have really high classes in you know a Kindergarten class or do we want to
019rehire that person on a onee and let them know like hey this is a onee you're not going to be rehired back next year because we're eliminating this position and so part of that taking advantage of attrition in advance is hiring folks on like one year probationary contracts like they know upfront they're not getting a job the following year unless some other movement happens but that position will be eliminated and so we'll start to be able to take advantage of that as soon as this year and we might even have people on you know twoyear contracts where we say like you're not coming back in two years just so you know unless other things change and so we'll be able to take advantage of some of those savings early in certain positions but it's hard
020to not fill a evening custodian position it's hard not to fill a kindergarten teacher but there may be places where we can do that we can I mean if this building's offline in September we won't a custodian correct mhm absolutely do we have any history of using those short uh limited term positions those one or two year non-renewable contracts absolutely yep okay yep we've done that um in when we closed Lincoln you know it was a short time frame but folks that were on probation or um were we hired them like even right afterwards like hey you're only hired for six months you know like this is going to go away you know folks knew that Eyes Wide Open you know we try and be transparent with folks as much as possible yeah so when
021the this my last question and anybody else but when the operating referendum was passed the board would set the amount to include opportunities for staff increases for the five years or whatever the length of time is correct so why is where does where does that figure in all of this that's just built into our operating Revenue now and so the like if we had to like put our finger on like the positions that that hires it would be our um academic and behavioral success coaches at the it was also for staff increases there was yep those were the ones those were the staff increases they maintained staff that we had that we had achieved through Esser funding right oh I understood the staff increases to be like raises okay like 4% wasn't there a discussion
022like that there 3% the 3% that you have put in the projection it was it went from like 1025 to 10 there was like a quarter million dollars in there for a pay raise that year that is correct I thought Oh I thought it was for each of the years it was one year I mean it continues on in perpetuity it wasn't a bonus it was a permanent addition to salary for staff and so they gained the benefit of it every year thereafter it wasn't uh continual 0.25 each year right and so the the CPI 2.95 that's you know that's like that's the floor of of increase that's that's happening that's what we're projecting okay when we go into our next negotiation round um we'll wait until after the B anum's figured out it's not
023fair to negotiate without all the cards on the table for either party you know so we'll find out what the state gives us for revenue and then we'll meet with our and we'll we already ongoing joint leadership meetings with unions on a consistent basis we'll formally meet probably for the first time in April or May as we kind of get joint finances recommendations for the budget I think The Five-Year Plan while it's nice we need to understand this is just really thrown mud at the wall and see with sticks you have an idea of what it's going to be but we don't know what the legislator legis is going to do I mean there's a lot of things that can change with this but it gives you at least something to focus on going forward
024where you know you're not just pulling numbers out that's what's nice about this but it could be totally different we don't know I mean it won't be a big difference but it could be a lot to our favor if they give more money or totally or all of a sudden we get you know with a new uh addition still across we get more students and you just don't know so yep it's based on some assumptions you know based on the best data we have available right now could easily change and certainly every two years it does you know I don't foresee a another Act 10 like in 2011 when we lost $600 per kid you know but all it would take is a recession for the government to make different choices about how they allocate
025funds and we would have to figure that out too um one of the things that is impact in here is Staffing right and what are our changes programmatically for the next year um our process uh for Staffing um at the each level is for the principles to look at their buildings and based on enrollment and based on course requests uh make proposals to um our HR for what they anticipate necessary Staffing for the following year excuse me um it's pretty stable you know if you lose 118 kids you know spread out across the school district you know that's only 10 kids per grade level about you know so it's hard to you know realize changes in there necessarily um we're looking at class sizes at the elementary level in each building and trying to figure
026out how to you know like what will it look like for next year there's always tough spots where you know if our goal is 18 to one at the third grade level you know but there's 40 kids do you go up to 20 and 20 or do you try and split that three ways and have really small classes and so those are the difficult decisions that our principals and directors are are working through right now early indications that the elementary level is will be flat in terms of Staffing to potentially up to like a minus5 or minus 6 depending on how things work out um at the middle school level anticipating flat uh maybe uh one reduction or or two uh with some slightly small smaller eighth grade classes uh relative to this year uh
027and then at the high school level um pretty flat again also um we've had a greater interest in family and consumer science and so instead of paying overloads for two classes you know we might be able to offer another full-time position there but we also might see some reductions in some other areas like science or English uh so it should probably be a wash So based on the workshop that we had a while ago when those start coming in I think I certainly know Mr bagneski and I are in agreement on this but getting that information sooner than the budget book in September I think is helpful for us to have a meaningful conversation since that's such a big piece of our budget I think when we get to that point in September we feel
028better prepared we can have more meaningful discussions rather than just really reactive discussions that that's my personal opinion I don't know what the rest of the board how they feel again I think it's a work shop type of thing it's not a board action but it's because our action shouldn't be at this point our action should be when we get to the budget but again you're sharing this with us because you want to get our reaction on this too so we're all marching together yeah I think at our next board meeting so one of the things we intend to add um so uh Patty has the kind of the monthly budget update on the second meeting each month we're going to add a excuse me an HR update each month as well that's something that
029folks have been interested in vacant positions fill rate those sorts of things um but I think the second meeting in March we could probably have you know anticipated HR changes programmatically for the district that we could talk about in a workshop I like I said I think it'll be relatively minimal yeah one of the things that also affects our staffing is open enrollment we don't know that number how many kids are open and rolling in until like the first week of May and then they the principles all get together and see how you know if that affects their um estimated staffing needs at this point so it's always kind of evolving and then we can we also have the situation where sometimes the first day of school we have more or less kids than we
030had anticipated we we gone to that point of even moving a teacher from one school to another on a grade level because that school could handle maybe just two sections and another one you needed four and a budget is a plan you you it's a plan and until you hit that date and again it's a plan because you won't know next meeting and you won't know in May what the state budget's going to be so it's our best plan that we can do and it's um we adjust accordingly as things happen I think we could probably give a 85% accurate idea of what we're looking at at our next meeting though and that would be a great Workshop to just talk about course requests and class sizes and and where things are at um yeah
031and we're always planning for worst case scenarios you know if we saw another $600 per student loss you know how would we grapple with that because it would mean lots of Staff would not be able to work here and so uh those are things we're ready to do if need be um but uh hope that we never have to actually do that and historically Patty your your guesses have been pretty close to reality right so that's always comforting as well yeah and but it's always a way process you know like every time we learn something new we recalculate the revenue limit we recalculate the the aid and then you know we just keep at it all the time yeah and we always have a fiscally conservative approach we're never anticipating more revenue and we're always
032trying to save around the margins continually um and so like I said anytime there's a resignation or retirement do we need to replace that can we do something different can we do it for less money can we do it a different way uh and then even as we approach our programs and other things what is like can we consolidate purchasing can we you know know use a a cheaper just as effective strategy to do the same thing fiscal people want accuracy close as I it's not we always appreciate you liking close but we like it as accurate as possible I mean in terms of estimates like I what I what I appreciate is is when you're making an assumption that it's a justifiable assumption and we have a history of success with those things that's
033yeah this is accurate this is based on a bunch of assumptions to get a good idea where we're headed in the future and these have worked out too by and large oh and it usually every everyone does the city does it I mean it's just there's no other way to do it yeah gives you an idea of where you can go it's it's so the the projected enrollment on the three-year average here I see what you were saying about we have like one more one more big drop and then it really starts to hopefully plateau and that's based on that updated I can't think of the names MD raford y that Community Change Report you know their estimates show us kind of leveling off has has the applied population lab done any new work that
034you know of they um we had one done just last year by them and then we had the the rers um and they were pretty comparable yeah okay yep yeah W applied population I saw a slightly bigger decrease MD roers that more fine grain detail they kind of moderated that a bit and so that's good news for us but even in light of that we turned out better on enrollment this year than they had projected a little yeah that's good we hope to beat those numbers but we're using sensible prudent numbers to plan for the future and if we come in better so much better that is all we have can I ask another question quick please where are we I know we have spoke about um like working with the city a little more
035to uh you know as more of a partner um have we gone any further like setting up a game plan with that or yeah I reached out to the city and we're thinking about kind of where to start you know there new mayor coming in which is going to throw a wrinkle into things but yes totally until they hire a city administrator a lot of the power lies in the department chairs and so we're working with those folks I think the two areas that might be most interesting for us to kind of have some collaboration are either parks and wreck or um uh City Planning you know to sit down and talk with folks uh and it would be interesting to get representatives from both the council and the board to kind of meet and
036just talk about opportunities and and I've been meeting with some of the department heads to talk about you know what's the topic that we talk about you know what is the strategy there and so I can anticipate probably in the next month having an opportunity for us to to get together and start to collaborate actively that's good thank you yeah it's been very positive so far it needs to be I mean really I think we're we're close we want the same things we want the same outcomes and historically you know it's been like two different well and it is it's two different boards but we want we want to work together to make Lacrosse great right so it us working that it not only helps tax base but it helps us bring in students it
037makes us bring in so totally I really I think we really need to work together on that and really develop a closer relationship with our um city board yeah planning and Engineering have been great with the projects that we've been working on recently so that has been really nice to to see um there's 40 Years of animosity that go back to when we were a city school district and in the 80s we split our property and there was you know haggling and it didn't didn't go well in some cases and but with planning I mean you have wonderful lady running it now and she's very open to that and you know and quite honestly she's younger which you know us old people are setting their ways it's you know but it's it's good to see
038that because they're going to be a good partner I think absolutely Andrea train has been a great resource to us she served on our facility advisory committee so she's acutely aware of the issues in the school district um when we've needed information she's provided and vice versa she's reached out any number of occasions for data we've been happy to provide um parks and W has also been a good partner in how we utilize our spaces and provide opportunities for kids you know so Andre only got to be an old well thanks for telling me that I remember to bring that up oh my goodness that's power right there the any other comments that we knew the thank you for all your information if you want to hand your pencils over to Laura any extra paper
039SL down I do we want this to be out there so we give you these back you can have those yep I would share those with anyone who asked those are [Music]