Is That Pork We Smell?

Didja ever have one of those people in your office that always smelled like pork products?  Ok...maybe that's a story for another time.

Q: Why are Phil Frei and Jim McCourt's arms always tired?
A: From patting themselves on the back for their budgeting frugality.

Bet a buck you were anticipating a different answer ;)

Annnnyyyywwwaaayyy....what we thought we'd do....while we await election returns...is dig into the budget a tad. If you recall, way back in October, the budget picture was tight. So tight, in fact, that we ended up 2009-10 with a huge surplus, and had $8.5M in "Fun Balance". This year, the 2010-11 year was deemed to be so tight that this year's budget called for using $750 of "Fun Balance" to even things out. Remember the public kept pushing the board to lower the tax levy and they grimaced the whole time?

Great poker faces it turns out. Recently, we were informed by Mr. Frei that not only will we NOT need to take anything from "Fun Balance", but there is expected to be at least $450K SURPLUS which could be applied to next year's budget! WTF!

Time to take a look at budget spending to date. We'd give you a link to BoardDocs, but (ahem!) BoardDocs has been down for several days. BUT...thanks to the alternate BoardDocs universe site provided to us by Ari of BoardDocs, we CAN give you a link. Gee...why doesn't the school district post this as an alternate link? Anyway....you can follow along if you like.

LINK TO: 3-21-11 - 2010-11 Expenditure Report by Object Code
LINK TO: 2010-11 Annual Meeting Book

We looked at the budget from the top down. We drilled down on those items that amounted to roughly $500K or more. Fun factoid of the day: there are 79 specific budget line items in Fund 10. Of those 79, 22 line entries account for 93% of the $73M general fund budget. 15 of those 22 can be related to salaries or fringe benefits, and that total represents 82.5% of the budget. That means, folks, that Frei and McCourt are patting themselves on the back largely for "managing" a paltry 17.5% (MAXIMUM) of the budget. In fact, the total amount budgeted under Fund 10 for "General Supplies" (line item)is only $1.15M. So, sure, you could whittle $200K off that, but who does it affect? The teachers who are trying to buy supplies to help educate our kids...that's who. We need to look elsewhere for the OurDough pants fuel.

Initial Assumptions
The district likes to have their assumptions, so we get to have ours. Look, we know that billing/purchasing doesn't always happen on a regular monthly basis, but let's just work on the assumption that its does...for just a moment. This budget report was run March 16, 2011. In theory, it covers February billing, right? If we assume that bills have been paid/expenses have been incurred through February, that leaves March, April, May, and June. Doing some REALLY simple math, that means that 8 months, or 67% of the year is in the books. Which means that --on average--the "spent YTD" column should be showing about 67%. It does not. In fact, it shows 56% spent. The extra 10% of $73M unspent comes to about to a tidy $7M. But of course...let's give them the benefit of the doubt. On the other hand, we can ask the questions. Certainly we don't get the time to do it in those 15 minute Finance Committee meetings. And, even when Finance is allotted more time, it frequently gets squeezed for time by FTT, who perennially runs over.

Utilities - always good targets
Mr. Frei indicate that much of the projected $450K surplus stems from reduced gas costs. So let's look at that. Yup. We've only spent 34% of our budgeted amount. We budgeted for $525K and have spent $175K. Assuming even that only 7 months are in, that comes to an average of $25K per month. If 5 months of bills are left--and these are WARM months-- we might expect to spend another $125K. That would still leave us an extra $225K of budgeted/unspent surplus! And that is half of the $450K surplus.

Electricity is another. We're at 53% and costs have run about $90K per month. Projections using that figure suggest we'd still have about $125K surplus.

Other low hanging Fruit
But what about those "Inter-District Payments"? We've actually only incurred CREDITS to-date! There is $845K in "costs" budgeted under that line item. When exactly are we going to incur these costs with 4 months left in the year? One would think that school districts would want their cash...right? So what's that all about? Is that 100% genuine polyester fiberfill? Employee retirement costs come to $2.1M in the budget, the 7th greatest budget line item cost. Imagine the "savings" from collecting 5.8% of salary from Administrators and Admin Support employees for April, May, and June--like what far less paid state employees face. That would provide about $53,000 of surplus.

Deficit Spending?
Take a closer look at the "Unencumbered Balances" for Teachers salaries, Administrative Salaries, Admin Support salaries, and "Miscellaneous Benefits" (line items 101,102,104, and 293). Why is the unencumbered balance--the budgeted amount which has been committed NEGATIVE? Sum them up and we've OVERspent these areas by $146K. Hmmm. And Admin wanted to use unallocated SPEA position money to fund the HR position THIS year? Double Hmmm: Local60 is the only area in which it looks like we've UNDERspent.

Needles in the Haystack
If you scan further down the list of Object Code expenditures, take a rest stop at line item #339 "OTHER-STORMWATER RUN-OFF". We budgeted expenses of 80,159.00, yet have spent only 23,915.46 to date. Now, certainly we are entering the stormwater central months. But, that being said, having an unspent balance of $56,243.54 (30%) is interesting
Make another stop at line item #386 "PAYMENT TO CESA". Of $115,070 budgeted, we've spent only $28,235 (25%). As with inter-district payments, wouldn't the CESAs want there money sooner rather than later?

Where have all the textbooks gone?
This is our particular favorite. Line item 471* TEXTBOOKS. At the annual meeting, we re told that we were budgeting $352,952.74, a 113.64% increase over 2009-10 [2010-11 Annual Meeting Book, p.40]. Knowing this was a red herring, an explanation was provided, "471 TEXTBOOKS Large textbook adoptions will occur this year."[2010-11 Annual Meeting Book, p.42]. So maybe...just maybe...an explanation is in order for why THIS Object Code report indicated a budgeted amount for 2010-11 of $214,717...about 60% of what was shown in the annual meeting book. More importantly, we've only spent 23% so far. Um...silly question...but aren't textbooks something we'd need in the FALL, not late spring??

While we're on the subject of books...we've only spent 40% of the budgeted amount for library books (Line item# 432 LIBRARY BOOKS). What's up with that?