At Last...a Glimpse of the Budget to Be

The School Board's Finance Committee will finally offer a glimpse of the 2012-13 budget this Monday (March 26).  Catch it now, because it because the Committee wont discuss the complete budget until July and the first public hearing will not be until July 30th. Don't get all hopped up on goofballs, though, because--as usual--what is NOT discussed is that of greatest interest...and concern.

2012-13Budget Presentation for 3-26-12

Highlights of the budget include...

REVENUE PICTURE  (extra $350K in aid...all going to debt service)

 The  State is increasing the spending amount per pupil by $50/student The State is giving a special one-time aid (“Per Pupil  Adjustment Aid”  2011 WI Act 32) to districts of $50 per student if the district’s under-levy amount isn’t increased . To ensure that we receive this $350,000, the general levy must be at least $37M.

NOTE:  Last year the General fund levy was $36,025,757 and debt service tax levy of $11,070,101, for a total tax levy of $47,095,858.  This means, according to the district, that already the general fund levy must increase by about $1M (2.8%).


 Using RW Baird forecast model and conservative assumptions, current estimate is for a 4.5% ($1.4 M)
increase in aid for SPASD.  Note here that these are revenues, which are offset by expenses.  The tax levy is OVER those expenses covered by revenues.


 Planned increase in athletic fees of approximately $23,000 and will come forward as information to the School Board
Notice how suddenly we actually get a dollar figure?

COSTS
 The 2011-12 budget used $1.1M in one-time Federal money which is no longer available; therefore, the 2012-13 budget needed to absorb these costs.

 Preliminary budget is based on an increase of 141 students, or 2%.  Note that enrollment increases THIS year do not result in increased state aid.  That comes NEXT year.  For now, this typically represents an equivalent increase in EXPENSES.  Enrollment projection models by UW-Applied Population Lab show a range of 189-329 student increase.  Last year, the enrollment increase was 135 students, or 2%.

 The biggie!  Budgeted 2% salary increase for all.  A placeholder in an amount equal to 2% of last year’s salaries has been included in this preliminary budget until actual allocations are determined through negotiations and/or other Board actions after July 1.

Note...what no one is saying (hmmmm...wonder why) is how much this means in dollars and cents.  Allow us to help.  Last year total salaries amounted to  about $42.2M, which means that a 2% increase will cost us about $850,000.

Cost cutting
 Increase health insurance contributions from 9% to 12% for all employees
 To limit health care cost, redesign health insurance and increase emergency room co-pay for all employees
 All employee groups will pay the same contribution amount  (12%) for dental insurance.
 To reduce dental insurance costs, the district bid out dental insurance and the premiums will go down 7%.
 To limit long-term disability costs, the district bid out LTD insurance and the premiums will go down 29%.
 These will be discussed with the HR Committee in May
Don't get us wrong, we are thoroughly impressed with the board for pushing these behind the scenes.  Finally, we achieve health benefit equity across the district!   These are all awesome things...but without knowing the actual DOLLAR amount, we cannot know how significant these are.  For example, if LTD insurance premiums cost us $100K, reducing them 29$ saves us $30K....which is nice...but a drop in the bucket of a $72-$75M expense budget.

No new programs (unless of course we have another annual meeting surprise)
No additional funding for new programs or new budget initiatives

Debt Levy increase 8%
Based on the debt payoff schedule, the debt levy would increase 8%, and this would increase the overall levy by 2%.
Again...all these percentages...why not tell us what it means in dollars and cents?  Here's our math.  We've shown you ours...will the district show you theirs?
Last year debt levy = $11,070,101
8% increase = $11,955,709
Increase = $885,608


Total levy LY = $47,095,858
885608/47095858= 1.88%
Hmmm...did we round up again? 

 In the preliminary budget, the $350,000 one-time l  special state aid is intended to further reduce debt.


Projected Total Levy % Increase 3% or less

Where's that breath mint I had?

If the debt levy will increase the overall levy by 2%, and they project a total levy increase of only 3%, that means only 1% of the increase coming from the General fund.  Hmm...but we already know that the general fund levy would have to increase by 2.8% in order to get the addition $50/kid aid...right.  If the total levy increases by 2% from the debt levy and the general fund HAS to increase by 2.8%, doesn't that mean a whole lit more than 3%????
This math is as fuzzy as a mint covered in pocket lint.
Oh...and will this "3% or less" be  Diedrich line in the sand?  Or subject to waffles?

When will we hear more?
Finance Committee reviews complete budget in July
5. Public Hearings on the budget: July 30 and August 16


What AREN'T we being told?
1. What about the surplus from this year's (2011-12) budget?  It sure looks like it could be upwards of $500K.  Where is that in this equation?
2. How much we will save from retirements?  Even 5 teachers at $77K, if we replace them all with teachers paid even $40K, that's a savings of $37K each, for a total of $185K.
3. How WILL we deal with the $1.1M of costs in the budget that we paid for last year with the EdJobs money?  We don't have that this year.  Can you say ...tax levy?
4. What's the current wisdom on equalized valuation? Notice how not a peep was uttered? 
5. What happens if the sky falls and UW APL's projection is accurate....how much additional costs will we need for additional kids?
6. Any feedback on open enrollment, given the longer timeline and more flexibility?  Will we lose more (expense) or gain more (revenue)?

5 Retirements So Far...Top Salary $83K

So far we have five (5) teachers retiring, at an average salary at retirement of just under $77,000.  That's a new all-time best for a retirement year.

$83,000 for a top salary???
Even if the individual is a top-shelf teacher (and we believe that to be the case here)...that's simply too much.
We'll spare you the age-old comparisons to other occupations that work 12 months per year.
What we'll add is that these comparison are to similar PROFESSIONAL occupations...you know...the ones that work nights, weekends, and summers as our teachers indicate that they do.  The comparison are very much on equal footing.

We've said it before; now is a good time to repeat the message.
$80,000 per year for a teacher that works 9 months out of the year is just plain wrong; that extractpolates to a salary of $107K for the "2080 hour" crowd.
Especially when young teachers out of school are paid a paltry wage.
We MUST raise the floor, but we must also install a ceiling.

Retirements for 2012-13
English Teacher [High School]MS, 40 yr....$83,027
German Teacher [High School]MS, 37 yr.....$81,138
Math Teacher [CHUMS] MS, 36 yr............$78,949 
                                      (20% FTE @ salary of $15,790)
Art Teacher [CHUMS/HS]MS, 34 yr...........$76,318
Grade 5 Teacher [Westside] BS,30 yr......$66,743
--------------------------------------------
Average........MS,35 yr................$76,807


Oh...and here's something you likely didn't know...if you look up our retiring German teacher on the DPI website, you'll see that the salary is actually much higher than reported here.  For the 2010-11 school year, our German teacher actually earned $95,743!!!  This is because like a lot of other teachers, this one taught an "overload", or summer school, and actually accounted for 1.2FTE.  Nice!  Overload means the same workday; but 20% higher salary.


The whole overload thing, as well as something to which we've been frequently alerted ---"time-carding"--- are yet more layers in the bloomin' onion which needs to be peeled away.   Soon....soon. 


Ahhh....so little time...so very much to blog about!

He Tawt He Deed and it Turns Out He DEED!

School Board candidate (wait...is he running...or did he withdraw? we're SO confused!) Gary Alan Naud recently updated us to let us know that he DID sign the Walker recall petition.
So, in fairness, we felt we should pass it on.

Our guess is that, based on how he signed the form, you could find it on IVerifytheRecall under "Gary Alan".

We like to present facts here...so here it is.  In the grand scheme of things, however, our bet is that the community values integrity too much to elect Mr. Naud to the school board.

Ahhh..vindication...it brings to mind one of our favorite characters...Tweety Bird.
We extend an apology to Warner Bros.

Changing The Budget Like the Weather

budget [ˈbʌdʒɪt]  n
(Economics, Accounting & Finance / Accounting & Book-keeping) the total amount of money allocated for a specific purpose during a specified period.
---FreeDictionary.com

Budgeting is the setting and allocation of the capital which is then used in the proper way to achieve the set or designated targets of the firm. 
---Budget (Wikipedia)

The purpose of a budget is to establish spending limits on various functionalities (e.g., utilities, rent, salaries).  The idea of course, is to stay within one's budget.  Hmmmm.  Sounds simple enough.  You establish  a budget and then limit your spending to stay within your budget.

Or....you can ride on the SPASD Funds Rollercoaster and just change the budget amount every month!
Whoa...say WHAT?

When the rest of us establish a budget for our homes, we do not adjust our budget based on the bills that come in each month.  That defeats the purpose...right?

So...why is the school district changing the budgeted amount for these five (and others) budget lines on a monthly basis?
Why would you do that?

Certainly, the big changes made in October  reflect the "final" budget following the annual meeting.  We find it interesting, though, that as a result of the annual meeting, approximately $600K of additional spending was authorized, largely on diversity and Response to Intervention (RTI) activities.  How on earth does that translate to the huge increases we see here?  What other reasons are there to explain it?

And why even bother making such minor changes as we see here? Between August and September, the budget line for OTHER NON-CAPITAL OBJECTS (490) was reduced by exactly $112.  $112!!!!  What Non-Capital object costing $112 did we suddenly decide not to buy?

With the exception of General Supplies (line 411) each of these other 4 lines saw budget changes amounting to less than 1% of the entire budget!  Putting it into every day perspective, that's like a household which averages $100/month on its electric bill, or $1200/year budget, suddenly adjusting its annual budget to $1188.   Why would you even do that?

We GET that the district makes (and the school board approves) quarterly budget adjustments.  It may make sense to make minor coarse adjustments along the way...but EVERY month????

Move it over dad 'cause I'm a double-dipper!
Upside down on the zip-zip-zipper
1,2,1,2,3, I′ve got a ticket so ride with me
Mary go down on the merry-go-round
All is fair on the fair ground
Funds go slow, Funds go fast
These budget twists gonna whip your ass.
----Red Hot Chili Peppers (and the Ohio Players) -Love Rollercoaster

Sprechen Sie Budget?

It is long overdue, folks.
We're in the midst of March Madness (weather-wise as well as basketball-wise).
Dontcha think we should be talking budget?
We may hear something at the next Finance Committee meeting.
But just to whet your appetites....and to perhaps to initiate an incendiary flare beneath district administration's derrieres....we offer you an in-depth budget analysis of just ONE budget line.

Our forecast calls for....surplus...and a surplus of it.
Nope...nothing new here.  That's pretty typical.

Let's just focus on electricity (line 337) ...shall we?
That's an easy one...right?
In fairness, let's begin by saying that the original budget (July 2011) was for $1.261M and it was subsequently reduced to $1.209M in August.

• For FY2010-11, there was a budget line surplus of $194K (15.5% of total budget) 
• For FY2011-12, this line budget has been DEcreased by 3% ($43 K) 
• So…despite a $194K surplus last year, we only DEcreased the budget by $43K? 
• With 58% of the year in, we have spent only 32.6% of this budget line …
• ...and in FY 2010-11, the last 5 months of the year accounted for 47% of spending

 We're budgeting $101,000/month, yet only spending $93,000/month.
That alone suggests a surplus of at least $96,000.

For the remaining 5 months of the year, we have $651,000 budgeted for electricity usage.
At a budgeted rate of $101K/month, that would indicate a surplus of $146,000.

Looking at actual expenditures to-date and even using last year's real costs from February through June, a surplus of $157,000 is anticipated.

Three different ways to analyze it, and we see projected surpluses of $96,000- $157,000.

Anyway you slice it, we have significant surplus in just this one budget line item.

Now that we've outed it, anyone wanna bet that the budget for this line item gets adjusted downward and the "surplus" sprinkled throughout a ton of other budget lines as part of the "March Budget Adjustments"?

Choosing To Gain Vantage?

At the March 15th meeting of the Elementary Task Force (ETF) , committee members heard from a community member who assisted in coming up with a viable high school space plan using a system called "Choosing By Advantages (CBA)".  Our advisor---whose spouse just happens to be  a program manager working in the district office, by the way---touted the incredible awesomeness of the CBA system.  Several times, our advisor stated that the community had effectively blessed the CBA approach by approving the subsequent referendum by a vote of 57% to 43%. [Our advisor actually stated that the previous high school referendum failed 2-1 and, after CBA, this one passed 2-1.  Well...not quite!!!!  How about 1.32:1.  Maybe we DO need to focus more on math.]

What's the Frequency, Kenneth?
To-date the ETF has spent considerable time boning up on how the district defines school target and maximum capacities as well as the available building space, enrollments (actual and projected), and classroom configurations.  This was necessary groundwork paving the way to a more in-depth discussion of space options.

It is perhaps most important to point out that no member of the committee believes that the district will never build another elementary school.  The only question is: WHEN should we/do we NEED to build a new school?  We have to keep in mind that we have opposing interests to consider:  the qualityof the education provided by the district and ...well...cost.  While a large number of community members are aware of the rising cost of property taxes, many do not even know that Sun Prairie ranks second state-wide in terms of capital debt.  Debt may not be forever,  but it lasts at least 20 years...and even longer if the district refinances bonds.

Problem Statement
Prior to establishment of the ETF, the district plan was to begin site selection and move towards construction of a new (8th) elementary school to open with the 2015-16 school year.  Like any other mechanism for decision-making, the CBA system begins with a clear, concise, statement of the problem at hand.  Allow us to take a stab at it.  Please bear in mind...this is the opinion of SP-EYE and does not reflect that of the school district or the ETF.  It's just SP-EYE, yo.

Problem Statement                                                              

According to UW-APL elementary enrollment projections, the district will maximize its available elementary school capacity by the 2015-16 school year.  What action(s), considering both cost and impact on education quality, can the district take which will prolong the need to build a new school for at least 2-3 years beyond 2015-16?   

Choosing by Avoidance?
What concerns us greatly is the cavalier attitude with which certain key issues were simply swept aside as non-issues by our community resident/CBA advisor.  For instance, the ETF committee has looked into the net effect of increasing maximum allowable class sizes by one or two students.  Yes, Viirginia, we understand that everyone desires small class sizes, but they're talking about JUST ONE OR TWO additional kids per class!  The quality of eductaion isn't going straight to the landfill if we increase class sizes by 1-2 kids.  Hell...the SAGE program, the pinnacle of small class size programs, just recently raised the class size requirement from 15 kids to 18 kids per teacher.  That's a 20% increase in one fell swoop.  And nobody got all that lathered up about it.  In fact, the SPASD class "target" (goal) size for kindergarten is 18 kids.   That makes the average district kindergarten class no different than a SAGE kindergarten class...and we don't get one dime from the state for thoise kids.
Shouldn't SAGE be special (read: different) in terms of class size?  Isn't that which makes it a special program?

According to our CBA advisor, however,and to the delight of certain attendees in the room, "we" could simply say that according to the educational "experts" (read: district staff) in the district, raising class sizes by even one kid is absolutely not even a consideration.  And  Ba-Da-BING! class size is removed from the list of options to consider!

Oh...and the questions to ask the community!  Let's not ask, "Do you agree that we should spend $22M to add an 8th elementary school at this time".  Nope...can't do that.  Too inflamatory.  Instead, let's just sucker them all in.

• You do believe that education is critical...right? [um...like would anyone say "No"?]
• And you do believe the studies (and we'll only show you the ones that make our point) that small class sizes are necessary for learning...right?   [a little waffling here, but majority would say yes]

Well, OK...then that means you agree we need to build a new elementary school starting immediately.

This is not choosing by advantage!  What it is, is a clever way of "ruling out" the things administration doesn't WANT to do in order to ensure that they get to do what they DO want to do: build a new school right this frickin' second!  That was the plan...wasn't it?  The Situation Report quietly presented last fall as "information only" was titled, "8th Elementary school timeline".  It was a foregone conclusion that no discussion would be had, no meeting of the minds on how to deal with space issues, no collaborative discussion on whether or not we agree that the UW-APL projections remain accurate given the economy and housing crisis that have lingered for nearly 4 years.

How about we go all in "for the kids"!
With that as a springboard of logic, why don't we simply decide that all elementary class sizes will have a maximum of 15 students, and let's build many schools.  After all, it's cheaper to build more at once...right?  Let's limit schools to exactly 24 classrooms and make sure that "specials" (art/science/music) always have a room.  at 15 kids per class and 24 classrooms per school, that will set our target at 360 kids MAX per elementary school.  Based on 3185 K-5 kids as of the 2011 3rd Friday count, that means we need NINE elementary schools NOW, and based on UW_APL projected growth rates of 140-150 kids per year, let's just plan THREE schools now and then one every 2-3 years.
What's another $60-70M between friends...right?  And then plan on spending another $20-25M every 2-3 years thereafter.  Another couple of dozen large pizzas per month for like...ever?

OK...hold on just minute.  Maybe we should think this through.  Hmmmm...$60-70M , even at ZERO percent interest rate (which you know isn't possible) means another $3-4M PER YEAR in debt service payments.

Does THIS Decision Really "Fit" the CBA Model?
Not if cost is not considered or if options like minimal increase in class size are not even open to discussion.
Look....we're not saying that CBA isn't a valid protocol.  What we're saying is that CBA is a TOOL which can be used...and modified...to assist in decision-making.  Like any TOOL, however, it must be wielded wisely.  Using a tool incorrectly can wreck any project.....or any decision.

---

Choosing By Advantages Resources
http://www.decisioninnovations.com/
http://www.enlignconsultants.com/ChoosingByAdvantages.htm

Mr. Naud's Wild Ride

Anti-Walker candidate?
Or  hoping to glom onto recall fervor to get elected??

Today's Journal tells us that all 7 Madison School Board members and all challengers in the spring election signed the petitions to recall Governor Scott Walker.  We wondered how things are in Sun Prairie.

Only 2 Board Members Signed
Of the current Sun Prairies School Board, only John Whalen and Jill Camber Davidson could be found on the IVerifyTheRecall site.  Hmmm.  What exactly does that mean?  Not sure.  But them's the facts.  Madison is 7 for 7; Sun Prairie is 2 for 7.

Did Mr. Naud Just Say No to Signing the Recall Walker petition?
The enigma that is Gary Alan Naud continues to be...well...enigmatic.   Here's a guy who's loudly and publicly suctioned himself onto the Recall Walker peeps like a remora on a shark.  Funny thing is we couldn't find his name listed on the IVerifyThe Recall site.

Wouldn't it seem that someone so coattail clingy to the Recall Walker movement would have proudly signed a petition?  Or is this just someone who's hoping to ride the Recall Walker tide past his shoplifting charge (and other legal issues found on Wisconsin Circuit Court Access)?  Just how anti-Walker is Mr. Naud?

Mr. Naud has had a wild ride.  He withdrew from the race in late February after some alert citizens became aware of his shoplifting citation, which was reported by the STAR.  Or did he just "suspend" his campaign while deciding whether or not he could ride the Recall Walker movement to election?  He lost the primary for a City Council seat, and now apparently is back "in it to win it".  How will this wild ride end?

He's Baaaa--aaaack!

10 days ago, Mr. Naud dropped out of the race due to information coming to light that he was cited for shoplifting. It seems he's changed his mind. Know what we love about this community (country?)...never a dull moment!


And he's running on an anti-Walker agenda (how unique!).
Will that drum up votes from the teachers union?
Does John Whalen need to check six?

1. 
   

   
   
2. 
   


3. 
   

   Gary Alan Naud

   The Reports that I have Dropped Out have been Grossly Exaggerated. Stand up to Walker and Vote Naud on April 3rd.

Surplus with a Purpose?

Since the district isn't uttering a peep regarding the status of the 2011-12 budget or potential ramifications of the FY2012-13 budget, we will.  We were reviewing the current " EXPENDITURE SUMMARY REPORT BY OBJECT ".

(click to enlarge)

 Let's start with the low hanging fruit.  Unless you've spent the last 4-5 months working on your tan in Florida, then it should come as no big news to you that we've had a pretty mild winter.  And with a mild winter comes huge "savings"...or, as some district folks like to phrase it, "cost avoidances".

Little snow (okay except for yesterday) means little need for snow removal costs.
Warmer temperatures means for less need for building heat.
Milder temperatures also mean less electricity use what with the thermostat not going on and off.
Actually, we looked at the heating degree days data for the winter, and learned that going back to October, the Madison area is running 18% LOWER than the average year.  And when you realize that the school district budget based its budget off of last year's budget (where we had a surplus) and then ADDED 5%, then there's room for a pretty heft budget surplus AGAIN this year.

The pants of this budget are so loose,
we haven't seen this much crack
since the refrigerator guy was here

Like Caren Diedrich, we understood that this budget was so tight that it squeaked.  Actually, it's  looking like this budget's so loose, it's pants are gonna drop.  You've seen it...and you know it's not attractive.

More to the point, once again, it appears that we budgeted WAY more than necessary.  Your tax dollars at work.  Any guess as to what little projects the district will be seeking to fund with your unnecessary tax dollars?  Let's look at the projected surplus from just 3 budget lines.

Substitute Teacher Salaries
The budgeted amount was $1.25M for the entire school year.  Given that school is only in session 10 months, that comes to about $125,000 per month.  In January, we spent $86,000.  Having only spent $440,000 year-to-date (~$85,000/mo), that leaves us with a budget balance of $810,000 for the remaining 3.5 months of the school year.  Unless a whole boatload of teachers are planning on attending week-long conferences, we should EASILY have $250,000 to $350,000 leftover--if not more.

Gas for Heating

(click to enlarge)

The budgeted amount was $305K for the entire school year.  Given heating is usually mainly needed in October through April , that comes to about $50,000 per month.  In January, we spent roughly $40,000.

Having only spent $100,000 year-to-date (~$25,000/mo), that leaves us with a budget balance of $205,000 for the remaining 2.5 heating months of the school year.  And those would be warmer months in an already warmer than average year.  Unless the arctic slides south a few thousand miles, we should EASILY have $80,000 to $100,000 leftover----and likely more.

Electricity
The budgeted amount was $1.2M for the entire school year.  That comes to about $100,000 per month--on average---and we know that costs are heavier from September through June.  In January, we spent $93,000.  Having only spent $560,000 year-to-date, that leaves us with a remaining budget balance of $650,000 for the remaining 5 months of the school year.  While we could have a VERY warm spring in store, it seems likely that we will have over-budgeted by $100,000 to $150,000.

Combined Projected Surplus
From just three budget lines, mind, you....we see what appears to be somewhere between $400,000 and $600,000.

Stay tuned as we peer into other parts of the budget.