2019-20 Budget Message

Posted by Jim Schlachter on 5/22/2019

Introduction to the 2019-20 Budget

Riverdale is more than a school district. It is a community. One united by its dedication to its children and its desire to put education first. Our community shares in our triumphs, sees us through our challenges, and shapes what our schools and our students become.

The above statement from the introduction to the 2024 Riverdale School District Strategic Plan captures what the Riverdale school community is all about. It is our community that collectively shares in our triumphs, sees us through our challenges, and shapes what our schools and our students become. Each year we embark upon shaping what our schools and students become through the development of an annual budget. In recent years, this process has presented fiscal challenges that have been met by the efforts of elected board members, school leaders, school staff, Riverdale families and community members. The budget presented for the 2019-20 school year represents another chapter in the district’s efforts to realize our stated mission to develop inquisitive, imaginative and eager learners who demonstrate of academic mastery through exhibition and become effective communicators and responsible leaders.

The 2019-20 Riverdale School District Budget represents the collective efforts of many. It incorporates the use of a wide range of data related to current and past budgets, anticipated revenue and projected expenditures. The 2019-20 budget also is informed by the Riverdale School District Strategic Plan.

This budget message will cover the following:

  1. Strategic Plan (pages 1 - 3)
    1. Areas maintained in 2019-20 budget
    2. Areas receiving increased support in 2019-20
    3. Areas to be addressed in the future
  2. Revenue Projections (pages 4 - 6)
    1. Anticipated State School Fund (SSF) for 2019-21
    2. Projected non-SSF sources for 2019-21
  3. Expenditures (pages 7 - 10)
    1. Overview of 2018-19 Budgeted and Actual Expenditures
    2. Overview of 2019-20 Budgeted Expenditures

 

 

Riverdale School District Strategic Plan

I. Strategic Plan - Overview - The Riverdale School District completed a strategic planning process during the 2018-19 school year. The strategic plan is characterized by four themes that collectively support the district’s mission and align with the district’s The four strategic themes are:

Educational Model - Students and educators collaborate in relevant, challenging and personalized learning that is shaped by student voice, extends beyond the classroom and draws the world into the school.

District Stability - A public school district with innovative leadership, operational consistency, financial predictability, transparency and efficiency.

Climate and Culture - A safe and supportive district-wide community rooted in the social-emotional well-being of all students, inciting passion for learning and fostering our students’ capacity for mutual and self-respect.

Curriculum and Instruction - A passionate learning community where students lead the learning process, demonstrate their mastery through exhibition and where academic risk-taking is rewarded.

The work of aligning district efforts with the strategic plan includes using the details of the plan to inform the district’s budget. In this budget narrative, attention is given to areas where the budget maintains current practice, where expenditure increases or decreases are made and where attention may be needed in the future.

A. Areas maintained in 2019-20 budget

Relative to the budget, the strategic plan includes a number of areas where the district’s vision is supported and it is necessary to continue funding at the current level to maintain these attributes:

  1. Class Size: Primary among areas that require status quo support is classroom staffing. Grade school and high school class sizes meet district expectations and the 2019-20 budget will continue these class size expectations and the full time equivalent (FTE) needed to make the district’s ideal class sizes possible. (class size)
  2. Enhanced: Providing a variety of co-curricular experiences that allow students to explore personal, physical and academic interests through participation in activities, competitions and team or individual sports. (athletics and activities)
  3. Challenging: A challenging, multi-dimensional program designed to equip all students for success in college and beyond. (rigorous course content)
  4. Guiding principles: Instruction is approached through the lens of the principles of essential schools and current educational research and initiatives, where students are encouraged to demonstrate mastery and embrace challenge. (instructional practices)

B. Areas receiving increased support in 2019-20

A number of areas are in need of added support if we are to meet our vision for the future. Given the revenue projections for 2019-21, increasing support for areas that require added funding will be very limited and often coupled with reductions in other areas that will not be as impactful on implementing the strategic plan. Added support in these areas also may take the form of time and attention. Areas receiving increased financial and support are:

  1. Technology: Technology is integral to instruction as both a learning tool and a subject for success in a digital world. (technology replacement and instructional support)
  2. Facilities: Well-maintained and appropriate facilities that equipped to support the district’s goals for the future. (operations and maintenance support)
  3. People: Experienced leadership and staff that are committed to delivering on the district’s vision and mission, and developing strong and united relationships built on trust. (superintendent recruitment and selection)
  4. Best practices: Use best practices to maintain financial stability, provide operational efficiency and deliver accurate, reliable reporting. (maintaining appropriate general fund reserves and business office support)
  5. Innovation and integration: Innovative instruction and learning environments that allow for thoughtful integration of subject matter and a culturally responsive curriculum. (increase in electives)
  6. The arts: Dedication to the arts as both a core subject area and a means to reinforce learning in all subjects, as well as foster well-rounded students. (electives)
  7. Collaboration: A climate of collaboration that unites and engages students, staff and the extended community to contribute in meaningful ways to our shared success. (K-12 collaboration)
  8. Flexible: Delivering personalized learning in all settings, with flexible schedules that promote innovative instruction - Note: The High School Scheduling Committee submitted a report at the April 15, 2019 school board meeting. The recommendations made in this report will be reviewed and addressed during the 2019-20 school year. (high school schedule)
  9. Well-being: A positive, safe and healthy environment that prioritizes the personal well-being of students, and is supported through intentional practices and a focus on active, healthy lifestyles and responsible decision-making. (student support)

 

C. Areas to be addressed in the future

Long-term planning is an important process that may not have an immediate impact on the current budget. However, it is worth noting for the purpose understanding that the annual budget does not address several important areas associated with district success. These areas are mentioned in the budget narrative to aid in the process of keeping a focus on long-term planning and future budgets.

  1. Facilities: Well-maintained and appropriate facilities that are equipped to support the district’s goals for the future. (building additions and major capital needs)
  2. Support: Neighborhood schools embraced and supported by local voters, neighbors and the parent community. (2020 local option measure)
  3. Innovation and integration: Innovative instruction and learning environments that allow for thoughtful integration of subject matter and a culturally responsive curriculum. (purchasing adopted curricula, grade school garden support beyond 2019-20)
  4. Student-centered: Responsive to student voice and providing all students with ongoing, future-oriented guidance and support. (full funding of college counselor beginning 2020-21)
  5. People: Experienced leadership and staff that are committed to delivering on the district’s vision and mission, and developing strong and united relationships built on trust. (potential for full-time superintendent beginning 2020-21)

 

Revenue Projections

II. Revenue - Overview - Every two years, Oregon K-12 public school districts are provided with projected funding levels as defined in the two-year biennial budget for K-12 schools. This two-year funding plan is commonly referred to as the State School Fund (SSF) budget. It is necessary for school districts to approach the biennial funding legislation with a detailed one-year budget and a high-level plan for second year budget that assures that both years in the biennium are appropriately funded. As is often the case, the timeline for passed and signed legislation can result in SSF revenue that is not known with certainty until after the time when school district budgets must be adopted.

  1. Anticipated State School Fund (SSF) for 2019-21 - Below is a brief presentation of three levels of state support that have been discussed by legislators during the current 2019 session. (Governor’s Budget, Co-Chairs’ Budget and Governor’s Investment Budget) In addition to the biennial budget revenue projections, related revenue adjustments from the state are listed. (Measure 98, State School Fund May adjustment and the School Improvement Fund) For the 2019-20 Riverdale School District Budget, we are using the Governor’s Budget proposed K-12 funding budget.
    1. Governor’s Budget (HB 5016) (Used in development of RSD 2019-20 budget) - $8.972 B - Proposed by Governor Brown in December 2018, this budget was described as a “current service level” budget. It included an approximately 9% increase in biennial funding and continued Measure 98 funding at the 2017-19 level. Calculations for Riverdale School District revealed that this level of funding would be status quo in terms of meeting the district’s projected expenditures over the coming biennium.
    2. Co-Chairs’ Budget (Not used in development of RSD 2019-20 budget) - $8.772 B - Proposed by the Co-Chairs of the Education Ways and Means committee in February 2019. While described as current service level, the Co-Chairs’ Budget does not account for the higher than inflation rates of increases in personnel benefit costs. Due to Public Employees Retirement System (PERS) and health care cost increases, the Co-Chairs’ Budget falls short of meeting what is needed for status quo in the Riverdale School District.
    3. Governor’s Investment Budget (If realized, not a factor until the second half of the 2019-21 biennium.) - $10.37 B - Proposed by Governor Brown in December 2018, this increase in funding is dependent on state revenue reform. If passed by the legislature and not overturned at the ballot box, collections of new revenue sources would probably not produce increased revenue for K-12 education until 2021.
    4. Measure 98 - Passed by voters in 2017, this measure provides additional state support for school success and science, technology, engineering and math (STEM) related classes. Partially funded for 2017-19, the Governor’s budget includes funding at the current level.
    5. State School Fund 2017-18 Adjustment - Annually, the Oregon Department of Education makes adjustments to prior year’s payments based on statewide calculations related to transportation data, spending down of reserves, high-cost disability grants and small high school grants. On May 15, 2019 the district received an additional $146,608 in the May 15, 2019 SSF payment. This added payment is recorded as revenue in the 2018-19 budget, and will have an impact on the 2018-19 ending fund balance (EFB).
    6. School Improvement Fund (Fund for Student Success) – Should the additional Governor’s Investment Budget become a reality, the increased revenue would likely be allocated through a “Fund for Student Success” with detailed expenditure restrictions. In preparation for such a fund, and at the state’s request, the Riverdale School District developed a non-binding plan during a series of staff and community meetings in March 2019. This draft plan is included as an attachment to this budget message. The district will be provided guidance on the expected added revenue and the protocols for accessing the added funds in advance of the development of our 2020-21 budget.
  2. Projected Non-State School Fund sources for 2019-21

    1. Local Option - The Riverdale School District is the beneficiary of a local property tax of $1.37 per $1,000 of assessed value that was approved by voters in 2015. This revenue source is reasonably predictable in the amount of funding it provides to the school district. Our projections are based on past performance and are increased by approximately 5% over the previous year. Note: A new local option ballot measure will need to be put to the voters in November 2020 if continued local option support is determined to be desirable by the district.
    2. Tuition - A modest increase in tuition rates was passed by the school board in October 2018 for the 2019-20 school year to address the increases in the cost of providing a Riverdale School District K-12 education. These increased tuition amounts are factored in to the 2019-20 Budget along with a slight reduction in the number of tuition-paying students. Note: Overall enrollment is steady with resident and transfer students counterbalancing the modest projected decrease in the number of tuition students.
    3. Foundation - The Riverdale School Foundation has long provided critical financial support for the general fund. For the 2019-20 school year, the foundation increased support to $1.42M, an unprecedented amount that provides much-needed support in the midst of significant budget challenges. Again, with state funding for K-12 schools lagging behind the projected cost of maintaining the district’s current levels of service, the foundation has stepped up to fill a significant portion of the gap between projected revenue and the level of support needed to continue current programs.
    4. Other Funds and Sources of Revenue
      1. Construction Excise Tax - Provided through a tax on new construction in the Riverdale attendance area, this tax was used in 2018-19 to fund necessary repairs and improvements to HVAC systems in both schools. We continue to utilize this fund to meet our facility needs in an effort to reduce the demand on the general fund. 
      2. Federal Funds - The district accessed previously unclaimed federal dollars in the form of Title 1, IIA and IVA funds. These funds assist with student support and staff development work in the district and reduce the general fund support needed in these areas. The federal funds received in 2018-19 were used to reduce budgeted general fund spending in qualifying areas.
      3. SB 1149 Funds - We are currently accessing SB 1149 dollars to upgrade the lighting at the high school. These dollars are also supporting energy audits at our schools. These audits will produce a list of projects that can be funded with available SB 1149 dollars, thus reducing energy usage and general fund expenditures in energy-saving improvements. 
      4. Fund 400 – Grade School Bond Proceeds Fund – This fund accounted for the construction of the new grade school that opened in 2010. Through previous school board action, the relatively small balance remaining is being used for the purpose of purchasing curriculum materials. In 2019-20 the adoption and purchase of social studies curriculum will likely deplete the fund. It should be noted that this one-time funding will not be available for the language arts adoption that will need to be budgeted for 2020-21. A line item in the general fund beginning in 2020-21 for purchasing curriculum adoption materials needs to be considered.

 

Expenditures

III. Expenditures - Overview - The development of a budget that accurately projects expenditures in 2019-20 involves combining data from the current year (2018-19 actual and projected expenditures) with needed adjustments to expenditure budgets that align with experience and desired changes. To that end, the items below are integrated into the 2019-20 budget.

  1. Overview of 2018-19 Budgeted and Actual Expenditures
    1. 2018-19 Beginning Fund Balance (BFB) and Projected Ending Fund Balance (EFB) At the time of adoption by a school board in June, the year’s EFB is a projection. It is not until the year is audited that we can determine if our projected EFB is reasonably For 2017-18, a $349,766K EFB was projected. At the completion of the 2017-18 audit, it was determined that the 2017-18 EFB was actually $598,456. The difference between the projected and the actual EFB for 2017-18 ($248,690 increase) is factored into our projections for the 2018-19 EFB. [Note: The calculations that were identified as the reason behind the difference between the projected and actual 2017-18 EFB will be corrected for future EFB projections.] An important element of developing the 2019-20 budget is to accurately project a current year EFB based on current expenditure and revenue data. Based on the May 2019 General Fund Summary Report, we are projecting a 2018-19 general fund ending balance of approximately $832,000. A significant portion of this increased amount is the result of the SSF Prior Year Adjustment of an added $146,438. This added funding was included in the May 15, 2019 SSF payment. Coupled with the 2017-18 audited EFB adjustment mentioned above and the use of non-general fund sources for qualifying budgeted expenses, the district is projected to end 2018-19 with a higher-than-budgeted EFB. The district is well-positioned to make necessary adjustments for 2019-20 while stabilizing district reserves at or near recommended levels.
    2. 2018-19 budget reductions in personnel (Full-Time Equivalent: FTE) - The 2018-19 budget called for a reduction of 4.325 FTE. After adjustments were made for a wide-range of personnel and program related issues, the actual reduction, as measured between October 2017 and October of 2018, was 3.92 FTE. The reductions included 1.23 FTE from the district office, 1.37 FTE from the grade school and 1.32 FTE from the high school.
    3. 2018-19 non-personnel budget - Following efforts to reduce non-personnel expenditures in previous years, the 2018-19 budget called for continued restraint in non-personnel expenditures, in the face of deferred maintenance concerns and contractors who temporarily limited or froze inflationary increases in goods and services. Current budget for non-personnel is not keeping pace with cost increases and the needs related to deferred maintenance.

 

  1. Overview of 2019-20 Budgeted Expenditures and Fund Balance
    1. Budgeting Ending Fund Balance and Contingency - The 2018-19 budgeted ending fund balance and contingency were budgeted at $179,00 and $325,983 respectively. This created a $504,982 reserve that represented 5.5% of the district’s budgeted expenditures. Given the district’s size, it is recommended for the long-term health of the district that the combined EFB/contingency total be targeted for 5-8%. However, the 2019-20 EFB/contingency total is proposed at 4.26% The ending fund balance is set at $300,000 and the contingency at $126,489. Adjustments made to increase reserves, now at $426,489, will require reductions in expenditure increases included in the budget.
    2. 2019-20 budget adjustments in personnel (Full-Time Equivalent: FTE) - The budget for 2019-20 staffing level calls for a district-wide increase of 1.78 FTE from the 2018-19 school-year. The changes include an increase of 1.03 FTE in the district office, an increase of 0.63 FTE in the grade school, and an increase of 0.12 FTE in the high school.
      1. 2019-20 budget reductions in personnel (FTE) - The beginning point for building the 2019-20 was that of status quo. Efforts were made to limit increases our overall 2018-19 FTE of 67.16. To achieve this, a reduction was made to offset needed additions.
        1. We have made a reduction of 1.0 FTE in the area of evening custodial support. We will return to supporting both buildings with one full-time evening custodian who serves both schools.
      2. 2019-20 budget additions in personnel (FTE) - The 2018-19 school year has produced data on areas where added staffing is needed to meet contractual obligations and to align our practice with our vision as defined by our strategic plan.
        1. The largest increase in personnel costs is in the area of associated payroll costs. Based on the PERS and health care cost increases for the 2019-20 staff, an increase of $310,000 is required. This increase is equal to 2.0 instructional FTE. Without needed support for the district’s PERS responsibilities, these increased payroll costs will continue for the foreseeable future.
        2. In the area of instructional technology, the return to a 1.0 FTE is recommended to minimally support our technology infrastructure and provide our staff and students with instructional support. The added cost of the 0.33 FTE needed to restore this position will not be from the general fund. We will access the previously unclaimed federal dollars that support teacher instructional support.
        3. Communications coordination, redevelopment of the 0.5 FTE marketing/communications position through a new job description and employment classification for a 1.0 FTE classified position to support district and school communications and assist in recruitment of students.
        4. An additional area where FTE is needed in 2019-20 is at the high school level. Reductions in 2017-18 reduced a science position from 1.0 to .67 FTE. The 2019-20 budget includes a75 FTE science position and an additional 0.25 FTE to be used to support the elective program. This overall increase of 0.33 FTE provides needed support for science offerings and an increase in electives available in 2019-20.
        5. The support needed at our grade school and high school for students with academic and health issues has increased over the last few years. To provide added support for these students, an added 1.0 FTE of licensed and 0.25 FTE classified support has been added at the grade school and 0.5 FTE of classified support has been added at the high school.
        6. Providing the operations and maintenance (O&M) support needed has been one challenge related to the 0.6 FTE superintendent position. With the superintendent unavailable to address O&M issues, the head custodians, principals, and district office administrative assistant have been called upon to patch together needed problem-solving, work with contractors and communications. To address this issue for 2019-20, the two head custodians will receive a stipend for a one-year increase in their responsibilities. While this is not an increase in FTE, it is FTE-related.

 

  1. 2019-20 adjustments to non-personnel budgets
    1. Contracted Services - The ability of the district to stay within the budgeted non-personnel amounts is not fully known at this time. However, our projections for expenditures that will end June 30, 2019 suggest that we need to increase non-personnel budgets by more than the 4% originally proje A 5% increase has been calculated into the 2019-20 budget.
    2. Transportation - While transportation of students between home and school is reimbursed at 70% and incorporated into the state school fund payments, transportation for field trips, events, field studies etc. are not reimbursed. These non-reimbursable transportation costs equate to approximately $21,000 per year. The Financial Advisory Committee recommends shifting these costs to a non-general fund source, in the form of student fees.
    3. Business Practices Support - Contracting out some business services supports best business practices.This added cost will ensure that business operations receive outside review and support as needed.
    4. Outreach - The use of advertising to recruit students to the grade school and high school was reduced for both the 2017-18 and 2018-19 school years. The need to fully support outreach is necessary to ensure full enrollment at all grade levels.
    5. Superintendent - Leadership for the district in the superintendent position for 2020-21 will need to be addressed in the 2019-20 school year. A budget has been included to cover the costs of the recruitment and selection process.
    6. Technology - Current student-use technology is providing the student access needed. However, a replacement plan is not in place for student tools or instructional technology. To that end, a five-year replacement cycle is needed to ensure ongoing technology access.
    7. Repairs - Deferred maintenance over the past few years has resulted in a list of needed repairs that will support teaching and learning in our two schools. electrical and low voltage issues will be addressed.

 

Summary of 2019-20 Budget Message

The 2019-20 budget, along with the 2024 Riverdale School District strategic plan can be captured in the following statement taken from the strategic plan.

Therefore our strategic plan (and 2019-20 budget) is the result of shared community goals and, while it rightly puts our students first, it includes the entire community in its focus on creating an engaged, collaborative and inclusive environment.

The 2019-20 budget is aligned with the 2024 strategic plan and represents one of many ways in which we continually strive to shape the district to meet our vision for our students: Students learn to use their minds well, engage creatively and act compassionately.

The development of this budget was made possible through the combined work of many. The Financial Advisory Committee and the Budget Committee graciously engaged in the work of advising and reviewing the budget. In addition, considerable contributions were made to the development of the budget by foundation leaders and district staff. Finally, the budget would not be possible without the tireless contributions our business department, led by Cindy Duley.

 

Superintendent Jim Schlachter

 

Attachments

  1. 2019-20 Proposed Budget
  2. 2019 Riverdale School District Strategic Plan
  3. Riverdale School District Investment Budget Narrative