001we're moving on to item 5.2 which is the spring 2025 budget update very good thank you Madame President and members of the board uh all of you who are joining us uh Miss Cindy Frick is coming uh to walk us through a spring budget update I always love uh spring as so many of us do it's a time of Hope and yet when we live in an education budget cycle uh it can often be a time that's fraught I think member kemell you uh covered uh the roller coaster ride that we're often on when it comes to education funding and we continue on that even at this time I want to just share though that our goal and the board has already been on this work long before I arrived our goal is to build
002the fysical strength and responsibility of the district so that we don't have to ride the big roller coaster ride that we have ongoing strength in that contingency and rainy day fund uh that we have and your superintendent is responsible for it that we have organizational discipline to ensure that day by day month by month we are aligning resources to the needs and we're making changes when they need to happen so that we are efficient and effective so that we are Innovative uh it dawned on me a while back that when it comes to school funding and I've been in this business a while no one is coming to save us so if our strategy is that we'll just hold out and wait for someone else um that's a bad strategy our strategy really is to
003be responsible to make the decisions that are required so that we can achieve two priorities I repeat the all the time number one the critical mission of teaching and learning and right alongside that the our imperative to have a quality staff member teacher and support staff members in front of our students at all times and those two priorities go together and they drive every decision that we make I want to share uh members that it's because of the hard work that you've done prior cycles of reductions painful realignments and school closures it's because of that work that we're able to bring the report that we're bringing this evening um and yet we don't rest on that work because that constant process of alignment will continue members I've spoken with you uh privately uh just about
004the need for a tighter alignment so that every resource available is structured right into our programs our staff our competitive compensation we've got work to do in organizational discipline not just for today but every day we're analyzing and carrying that work forward so although I'm proud to say this evening that we have met the board's predetermined you deter a few years ago some targets for contingency contingency is a fancy word for rainy day fund uh just like we have at home uh in case of emergencies but I just want to share that I think we're all aware and your discussion is already covered it this evening that we live today in an environment of extreme uncertainty so I would encourage the board as we move forward to continue and let's continue our work to build
005uh that safety cushion so that in times of trouble we're able to stay strong with our staff and with our programming and with our families uh an example that was already mentioned and I said I would I'm so proud for this artifact it's my sticker that says fully fund special education an example is the very serious concern that we continue to hold around the funding for special education so we are committed to the diligent work of being methodical we will avoid hopefully the high highs and the low lows of and the whims of legislators and legislatures uh by doing our responsible work to build the strength of the organization I'm proud of the work that Miss frick does every day to keep us on track with budgeting we think of it in the spring and
006the fall uh she and her team think of it every day of the school year and thank you for that work so she's going to walk us through a general spring update as usual there are many questions that we do not have the answers to at this moment but it's our job to do the work and wait for the answers as they come Miss frak okay thank you when we talk about our District budget I'm often referring to our operating funds uh but I wanted to kind of walk through the whole picture um to provide some background um we do have our biggest fund is the general fund and then we have a supplemental general fund that's called local option budget those both handle the majority of our operating day-to-day expenditures for the district um
007it includes things like utilities repair and Main maintenance um a lot of our supply cost it also pays for the salaries that are not otherwise allocated to a special Revenue fund um and so the special Revenue funds there are many many of those um but they are designated by ksde and they're designed to handle the revenues and expenditures for a specific purpose and so examples of that might be capital outlay or the parents's teacher program and so every um Revenue uh we'll see on another slide the revenues that come in for those particular programs um all expenses um associated with that program are paid out of that account and then we have the ending cash balance um another type of fund is our debt service which pays our makes our bond and interest payments uh
008throughout the year and those are the three types of funds as um are stated on the KSD budget document on the next slide um like I said we have we have just under 50 funds in total that we are accounting for um so this is just a few examples of special Revenue funds if you'd like to see the whole list of funds that we manage um we do have uh Financial reports posted to to the board enclosure the consent agenda item every month at the first board meeting and there is a cash summary report that goes through every single fund that we have uh the monthly Revenue expenditures and cash balances associated with it um so an example of a special Revenue fund for Capital outlay we can only charge certain items there and so
009that is most of our equipment and Furniture it is um our significant um facility improvements vehicles and things like that we can't charge um General salaries to Capital outlay and so when you see a cash balance remaining in capital outlay that is being reserved for the future planning of those infrastructure and Equipment purchases um and so sometimes people will will wonder well you have money left in this fund why can't we use it for different type of purpose and that's just not how it works um we do follow State guidelines on all of this um and so another example would be the atrisk fund we receive money through waiting um that is deposited into the atrisk fund then all expenditures that qualify for that um purpose can are charged there it is currently a list
010from ksde of um many many different approved practices and programs that based on the amount of time a classroom teacher or another certified staff member spend on those approved practices or programs we can charge a portion of their salary to at risk and so um contingency is a uh is also a special Revenue fund it does not have a certain budget because the point of contingency is to handle any expenses that are not budgeted for um it would have to be not budgeted for and the board would have to approve any expenditure from contingency throughout the year so that's just a few examples um on the next slide we're just kind of going to look at the logistics um most of our state aid the vast majority of our state aid is calculated using the
011general fund um budget calculation or the calculation for the local option budget and so that those enrollment and waiting um money is deposited into the uh the general fund for example the at risk waiting is based on our free lunch account it is it comes to us in the form of General state aid it gets to deposited to the general fund or the local option budget and then because it belongs to the atrisk fund or it's supposed to be used for at risk purposes it gets transferred over and deposited into at risk to be used for those certain expenditures um if that makes sense another example is special education and so our special education state aid is part of the general fund um budget calculation we deposit uh special education state aid into the general
012fund and lob and then turn around and transfer it into special education the trick with some of these funds is we have more expenditures than we have revenues okay so that's certainly the case with special education we spent $29 Million last year in special education and received about 15 million between state and federal funding and so our job via our regular operating funds then is to put enough money in that particular special Revenue fund to cover any expenditures and so we transferred an additional almost around 14 million to special education um we also do receive local tax revenue which is um deposited directly into the individual funds on the operating budget um this is a very simplified um equation um but we do use enrollment uh our full-time equivalency um enrollment and our waiting FTE
013multiplied by our base aid for student Excellence is the uh the biggest portion of our general fund budget in addition to that there's a separate calculation for our virtual program because it is does not use the base it uses a flat rate um the base the last couple years the increase in the base has been calculated using the three-year average of the Consumer Price Index so for the last 30 years the base historically was not tied to inflation But Here recently the last couple years it is now tied um to the average um of 3 years of inflation lob in very simplified terms is a portion of the general fund it's approximately onethird of the general fund budget and so as we've talked over the last couple years about declining enrollment and how that impacts
014the budget um I did want to just show this slide um you know we had some pretty sign significant budget um reduction years a couple years ago because we were coming into this downturn postco um I do want to point out the enrollment numbers we talk about for the budget are a full-time equivalency and so it is not a head count we talked a few weeks ago about our head count um for enrollment this is a little bit different because it breaks down you know if the if this year's High School senior is only attending half time on September 20th then we get a 0.5 uh count for that um student this portion of the budget also excludes preschool aged at risk and virtual education because they are calculated separately um for a few years
015there we had been able to use the higher of the last previous the prior two years for our budget if you'll remember last year that changed and for the 2425 budget we had to use an average of the two prior years so for this year's budget we were able to use the 9877 the part that we've been talking about for a couple years that's coming is now for 25 26 we will have to use the higher of this year's September 20th count meaning September 20th of 24 or September 20th of 25 if it happens to be higher um and so we will be declining about 200 FTE for Budget calculation purposes in 2526 uh some State updates um as Shannon talked about a little bit ago um we are we may need to return some
016safe and secure schools grant money that we received um we already have spent that on the cic's crisis alert system um and some aeds throughout the district uh if we do need to return that money for 2425 we will need to use Capital outlay money to pay for it um and there is also the PO potential loss of some professional development state aid and Mentor teacher it is normal for legislature to be looking ahead to 2526 to make these decisions we don't often get money pulled from the state you know after it has been allocated to us in the fiscal year and so that will be a little bit different if that happens um on the uh operating budget the base will be increasing um but that will be offset by our 200 um FTE
017declining enrollment that we have to calculate with with potentially no increase in special education Aid that will be a big hit you know they were they provided some increase funding last year we received about 2.3 million um which really helped um and so that will be there's a huge gap in the special education realm as well as the historical base Aid when it was not based on any type of inflation factor and so there's a couple huge gaps that we have there in our state aid um and and again the potential loss of professional development so we'll see how those things play out on the federal front we have gotten a lot of questions about our funding so far our primary um Federal uh monies come uh in the form of food service assistance for
018our lunch and breakfast program special education services and title programs those um each bring in um between $2 to $3 million a piece some smaller programs we have we get two different Federal aids for the nas program uh we receive adult education and have stronger connections Grant Etc so far the funding that we know has changed is the local food for schools a couple of the USDA programs um we have the bakery Grant is is currently on hold if we do not receive those funds again it was a program that was awarded back over the summer and so that work has been done the equipment is installed um and folks will be training on the use of that equipment here coming up and so if that money um if is not received we will again
019need to use shift to Capital outlay to pay for that so so as we think about planning ahead I I believe we've um really emphasized this focus on program offerings and supporting the classroom and our students and then also simultaneously uh uring quality staff in every classroom those are really our two dual priorities um also to continue to build fiscal strength uh we may um worry about this legislature and I feel certain we'll worry about subsequent legislatures so it's our work to just be prepared uh we have opportunities to really innovate our practice and to use uh it to use really um strategy and structures to ensure that we are uh tailoring our staffing to exactly where our student enrollment needs are and the assurance that you will hear from me repeatedly is that our
020staffing will follow the students th so that we are sure that we are serving the needs of students every day but we will also be courageous to make adjustments uh because we're not in an environment where we uh should be less than Vigilant on ensuring that Staffing matches our enrollment our next steps with contingency planning will need to take into account the higher levels of uncertainty that we're sure to continue to face um and uh miss frck you may want to speak more in detail about that uh health insurance increase or uh if the members feel like they're already aware of that I'll I'll leave that part to you okay yeah um last year in in the work with our health insurance uh we were capped um and we are using that cap um I
021can't remember 15% cap I think it was for a health insurance increase unfortunately uh we have been notified that we will be using that cap um which is around 1.8 million unfortunately not surprising based on our prior um experience with claims so I think overall we are looking at budgeting for a flat budget with all eyes guardedly observing uh where there may be uh changes in these areas that we're already hearing about um I am grateful to um I believe that we understand that even with the move with the Department of Education that for example it's possible food and nutrition would come through a different agency we don't know that yet um but we are keeping an eye on those concerns as we move forward so it'll be our job to innovate to streamline our
022resources directly to schools and classrooms this will be our uh repeated and ongoing effort moving forward every day because that combination of increased state federal aid Andor decreased expenditures Andor enrollment increases it's that that three-legged uh approach that has to be balanced in order to keep us in good strong fysical condition because we know there's no secret sauce it really is that state aid comes through enrollment through that inflation rate that you mentioned and then also through our special education state aid there aren't there aren't any other bucket kids that we haven't talked about they're all uh pretty clear and obvious so uh members I I would love to say we're bringing a sunshine and Roses budget update uh we really are being very realistic about the challenges that we face look forward to your
023questions Miss frck is standing by okay U just two questions so in instances where we might have to give back um money and then pull from capital outlay is that then taking money from something else so what what may have to go away in order to pay for those things yeah right now capital outlay is a fund um that we do have a cash balance in and so um we typically budget to in capital outlay to do all the all of the projects we could possibly fit in and realistically due to timing um or other constraints we might not get all of that done and so we do carry a balance in uh capital outlay and so that is one of our easier answers at this point um if we have to shift 100,000 here
024um for one project Or Another We're able to do that okay thank you and then um as far as the declining enrollment um do we know what's driving this is it simply like the size of the Kinder class versus the outgo seniors or are there other things that we're noticing that's an excellent question and we just looked at our enrollment report a few weeks ago uh really is that combination of all of those factors um it's one uh of the uh important steps that we'll be taking later tonight to really talk about the enhancements that were tailoring to what our parents have said that they would like to see uh so uh but it's a number of of components uh most especially uh member Castello that uh decline among birth rate and Kinder class size
025and then is not also the impact of covid and the conversation pertaining to public education also having some impact as well absolutely and the question for us and the challenge we Embrace is how do we move forward from this time question uh Carol just check in hi this is Carol and um I want to thank you for Dr Swit for put adding the comment that we have to be realistic about we what is going on in the world because I really just like everybody else we really don't know what's going on dayto day I mean we don't know what's going to happen next is that a pretty safe comment absolutely we know that we do not know I love the way you said that okay Shannon yes um I have several questions so Kelly tell
026me um if you need me to stop okay um thank you for the report I really appreciate the visuals of the buckets with the numbers I think it simplifies what can be a very complicated um set of data around our budget um on the slide when you were talking about federal funds um and you said we got n million in federal funds in 23 24 is that inclusive of the special ed and title funding that is so that's the Allin Federal number not just additional grants over and above that correct um the only thing I excluded was Esser since it no longer pertains to us yeah so it's both for those programs but also any discretionary grants that we got yes okay all right thank you um okay um re uh related to the slide
027about uh the buckets and contingency reserve um about how many days of operating costs could we cover for our district with our current contingency reserve so right now we have about 5% of our general fund budget um we have about 4.8 Mill million in our so days wise 5% of the of the general uh fund um and that doesn't quite hit our goal um a few years ago the board had um requested 6% we should be there by the end of this fiscal year that's still pretty low for a government um but yes are doesn't the state legislature try to maintain an ending balance of 7% m and there's a lot of discussion amongst government entities in general about what the right number is um you'll hear a lot of governments do 10% 10 to
02815% um but yeah okay um so there's a little bit of disagreement about what the what the magic percentage is okay um all right and then when talking about the special Revenue funds and the fund balances um is there a a single time in the in the operational year that those balances are at their lowest or does that vary depending on which fund you're looking at it probably varies by fund quite a bit um things like Capital outlay doesn't get only gets tax revenue it doesn't it doesn't um get state aid and so those balances uh those deposits come in in January and then the beginning of June and so we will run down the fund a little ways um before getting our next payment the other funds that receive more transfers from the general
029fund we can um we can control that a little bit more um because as we progress throughout the year uh we can deposit to those funds and transfer as needed um special education specifically we don't receive special education funds um until October so that is another one that gets run down uh before that time and so it varies quite a bit depending on the fund um if uh our board president would deem it appropriate I would be interested in having a little bit more detailed information on that particular topic because this is something that would be help full in our advocacy work as a district um to counteract this false narrative about fund balances because what is happening is they're looking at our fund balances on July 1 which is when our capital outlay is
030likely at its highest and also when our special ed is at its highest and they're saying that that is money that we have available to spend on all the things that you showed us in that bucket of General operating expenses right so um I think it would be helpful to have a good understand understanding of when our lowest points are and what and how low do we get how like how tight are our margins because I I keep saying to people you don't understand we really run on a pretty tight margin right um as as in public education in our district and other districts um but it'd be good to have yeah be able to back that up a little bit Dr Swift affirmed that we can do that cind okay we happy to collect
031questions and that'll be a good one we can follow up on along with days of operating M thank you and then I have one more question and a comment I wanted to make if but if there's okay all right um so you mentioned you mentioned this in passing um but when was the first school year that we received our uh base state aid with the inflation adjustment okay and so I would probably have to look back we had five years under the Ganon case that were set amounts and then we started inflation I want to say 20 uh was it last year 22 23 or 23 24 last year I believe was our first um year that was based on the three-year average of inflation we were hoping that would go through legislature it did
032so um I believe this 2425 is the second year so okay so um so we had unconstitutional funding from until the beginning of the 23 24 school year when they fully phased in the remedy and then started the inflation adjustment um and you know that I think is really important for people to understand um combined with the fact that special education has been underfunded since the 2010 2011 school year so while Ganon has been going up to get to the level that the court said we had to be at our special ed funding has been going the other direction yeah um and that you know that inflation adjustment that is in there was designed to ensure that adequacy was maintained year-over-year that we have the money we need to pay next year for what we
033were doing this year right because everything costs more as you noted with the 1.8 million in increases in our um health insurance that we anticipate for example next year um I just want to make the point for um to remind everybody at the board table and also in our community that that funding formula expires in June of 2027 um and based on the conversation that has been happening around around school funding and this like just antipathy toward this inflation adjustment that is built into the for formula um I don't know that it's a guarantee that our next Formula will have that in it so the more that we can make sure people understand what the purpose of that is and how it has how we have been impacted by these trend lines over time um
034the the better we can advocate for what our district and our community is going to need um going into that conversation so thank you for um answering all my questions I really appreciate it okay I you have a comment okay so um I just have a comment you know as as we've talked about here as as we've talked about contingency and I think Carol said it best that you know we don't know what we don't know you know you know we've really focused on what we don't know in terms of decisions that are going to be made but I think it's also good to keep in mind um you know there are other things that we don't know and so you know earlier in March there was a a tornado that that went through rala
035Missouri and I have a friend who lived down there who sent me an email and of their five schools in their school district three of them became um inhabitable and that covered a thousand students and so they were looking at a plan that involved maybe either finding an alternate location to educate those thousand students or alternating schedules with the two buildings that were left to try and come up with a plan to figure out what to do for the remainder of the school year um as um roofs came off and walls came down and and windows got shattered and and and that was a single day that took out 60% of their buildings and so I think um we really don't know what we don't know and and anything can change and I think um
036there's all sorts of reasons to have those funds available yeah um most of my questions Shannon asked I just have one one question I wanted to ask about so we um as we some one of our our programs that are on slide eight pertaining to Federal Aid updates um the uh the conversation from the federal level sounds like special education and title programming are relatively safe comparative um to perhaps some of the other things that are listed there so speaking specifically about Native American student services which is a um program we had a report on earlier in the year and they provide um critical services and support to our indigenous communities but also are helping us with our um educational goals in terms of better supporting um communities in a in a way that they
037direct us to so I I can imagine um if you're directing that program that might feel a little um you might have some anxiety around the security of that program so I don't mean to talk about it in absence of the other programs that might also be feeling that but just speaking specifically to Native American student services uh the the cost of operating that particular program as it relates to not just the Staffing but also the supports we provide communities is s is significant but not so significant that we wouldn't be able to continue Staffing uh Native American student services if federal aid became an issue correct correct uh there's two different types of Federal Aid that um go into that program for a total of about 130,000 annually so I'm sure that in all
038of all of the times where we're seeing these cuts that aren't being made sensitively or with consideration to um their objectives this is one of those areas where I I um understand why why districts might be reticent to say we can't commit to this particular program or that particular program because you don't want to sound like you can observe all the costs that they might be be taking but I do think it's important for this board to make a commitment to Native American student services and I'm wanting to know if that's been part of the conversation and if we can say that that's a program we intend to continue to support even if we see a reduction of Federal Aid really appreciate you raising this specific example and the answer is a resounding absolutely yes
039um it's also possible Miss frck and I've discussed that some of our atrisk funding or other buckets may help us there but I have heard the commitment of this board and uh will remain in conversation I surely hope that doesn't go away but we also feel that it could be in Jeopardy I think it's important for our community to hear your support and our commitment as well so I'm just going to ask for support am I correct and and my um okay so um Carol I'm not sure what you can see or not see but um it was all six thumbs up and I'm going to not speak for you Carol but um do know that you have been absolutely it's it's a thumbs up and I think um it's imperative and thank you for
040bringing this up because um that is a a common concern and I'm getting a FLIR of emails from people the Community asking about whether or not the district is still going to support nass and I can I can tell them today in fact tomorrow and today emphatically that yes our school board will support the nas program as well while supporting and enforcing our treaties thank you Carol appr thank you okay yeah I have another question um so one of the things that we had talked about previously um obviously Sr funds are going away or gone but um we' use those Monies to fund like summer school and like the summer science camp so are we going to still be able to do those activities because I know that I think the board felt pretty strongly
041that we would want those continued so we've been talking quite a bit about summer planning have a number of ideas I'd love to chat with you all about and then bring forward uh a plan we certainly can do that uh as we've done in the past and yet there are a lot of moving parts so um it if it doesn't happen it wouldn't be a financial decision so look forward to that conversation so we did the board did commit to Summer programming that looked similar to last uh year when we were uh principal green and others were here so I just want to affirm there will be summer opportun unities I look forward to bringing you a plan for that I do want to share some uh data and some concerns that have Arisen uh
042that may suggest a little bit different design and I would just love to have the board's input and feedback on that okay what would the timing be of that because that seems like something you have to determine Staffing on and Etc we have the plan in hand and it's just kind of a Next Step uh for us okay so we should we would look forward to seeing that relatively soon absolutely thank you all right other yeah there's one question I forgot to ask so or or kind of talk through so um as I mentioned earlier we're really looking at kind of a range of options on special ed funding from the state this year that could be $10 million in state general fund which is actually really only $75 million in new money because that
043has to cover $25 million of federal funds that were used last year that are going away so we're we're kind of in a range of minus 2.5 million from what we got this year to plus 7 a half million Statewide um just so that everybody kind of hears it our when we get special ed funding we get funded on a per teacher or staff person basis correct right so if if the worst case happened and the state actually has minus 2.5 million from where we were last year um which violates maintenance effort by the way so that would be a problem um and then they divide that up as they do um would that potentially look like a per staff person cut for us next year talks about it is typically you'll get x amount
044per certified staff member um and so we would receive less per FTE per um certified and Par staff people that we turned in okay so um and can you remind me when we find that out uh we do not know um what are uh sense that calculation is based on the number of folks working in the districts throughout the year it is not turn into the state until late spring and then we find out in June how much special education money we're going to get so June for this year for the 2425 year we find out um we get our special education um money and that and that determination in June right at the very end of the fiscal year okay and also just to make really hammer on this point so you said earlier
045we spent $29 million on special education education so that's 209 million out of our special education fund for services that are required by students IEPs right they have they have to be IEP services to be paid out of that fund yes and we only received $15 million in state and federal aid for special education so we are backfilling we backfilled $14 million million last year um do you um have a sense of how big that number might be this year you know um will be potentially a little bit better this year um we received about $2.3 million in additional um special education state aid that that one time um trying to make things better money right um but we also have increased cost um and so we will um be transferring over a it's not
046likely that that for that $14 million is going to go down by the whole amount no no that we got in new a okay all right thank you very much that's I promise that's my last question