Central Dauphin School District Budget Town Hall Meeting

Central Dauphin School District Budget Town Hall Meeting March 18, 2021

Agenda –Budget Workshop • Background Information • Specific Information – CDSD Demographics, Facts and Figures • Basic Budget Information • Challenges Facing CDSD – 2021 -2022 Budget

Financial Performance • History of impeccable financial performance. • In the last 15+ years, there have been: • zero financial statement audit findings, • zero state audit findings, and • Furthermore, we have one of the top credit ratings in the Commonwealth of PA. • These results are attributable to many years of diligent work by employees of the Central Dauphin School District.

CDSD Demographics, Facts and Figures

Central Dauphin School District • Suburban community of 95, 000+ residents • Encompassing 118. 2 square miles • CDSD is the 9 th largest school district in the Commonwealth • Student population of 11, 775 • Notwithstanding COVID-19, the student population is projected to grow for the foreseeable future • Buildings - 13 elementary, 4 middle, 2 high schools • Annual operating budget of $211. 8 million

Central Dauphin School District • Board of School Directors includes 9 members • We provide services to students in 20 outside educational facilities • Because the prison is located within geographical boundaries of the district we are required to provide services to incarcerated students regardless of county of origin • We also provide psychological services • Occupational and physical therapy, and • Nursing services to parochial schools

More Facts and Figures (non-COVID Totals) CDSD buses travel 2, 644, 284 miles per year to 51 public and non-public schools CDSD serves 1, 676, 567 meals CDSD buildings include 2, 019, 322 square feet of space That’s 12, 000 square feet of lawns to mow 98, 000 feet of sidewalks to shovel 236, 000 square feet of parking lots to plow

Facts and Figures 48. 7% of the student population is economically disadvantaged 1, 206 students are English-learners who speak 52 different languages; 1, 921 students have special needs, 336 students are gifted, an additional 240 students have health impairments, and 154 Homeless/Foster students

School Board’s Responsibility • The Pennsylvania Public School Code of 1949 defines a school board’s general powers and duties. • Adopts and maintains compliant board policies for the organization and operation of the school district. • Provide education to all school age children residing in the district. • Provide facilities for instruction.

Budget Process • Must pass a balanced budget no later than June 30 th. Available Resources Educational Needs

School Districts Can’t Run Like Businesses • Not revenue generating, but revenue assessing • Heavily regulated. The school code tells us: • • Who to hire – specific qualifications How many to hire (i. e. caseloads) How to buy supplies/equipment Where to invest district funds What food to serve Terms and conditions of the retirement plan How much revenue may be levied (Act 1)

Budget Gap Salaries and benefits (including retirement) General increases from contractors (special education, facilities, IT, and transportation) $6, 126, 381 693, 055 Tuition increases (mostly cyber charter schools) 5, 073, 927 Reinstating 2021 budget cuts (i. e. facility maintenance, textbooks, equipment) 2, 362, 599 Change to debt service Net change to state and federal subsidies Net change between EIT and use of reserves TOTAL 712, 675 94, 757 3, 133, 193 $18, 196, 587

Open Items • Sphere of influence/control • • • Salaries Health Insurance Cyber Charter Schools Real Estate Taxes Earned Income Taxes ESSER stimulus funds • Outside the sphere • • • Retirement Contributions (PSERS) General Contract Increases Reinstating what we cut Debt Service State/Federal Subsidies

Open Items • Sphere of influence/control • • Salaries Health Insurance Cyber Charter Schools Real Estate Taxes Earned Income Taxes Stabilization reserve funds ESSER stimulus funds • Outside the sphere • • • Retirement Contributions (PSERS) General Contract Increases Reinstating what we cut Debt Service State/Federal Subsidies

Open Items • Revenue and Other Financing Sources • • Real Estate Taxes Earned Income Taxes Stabilization reserve funds ESSER stimulus funds • Expenditures • Salaries • Health Insurance • Cyber Charter Schools

Proposed Solution – DRAFT subject to change Revise Assumptions: Cyber Charter Tuition – assume 90 (25%) of 373 return to CDSD $1, 000 Health care renewal – assume 5% renewal instead of 8% projected 1, 000 EIT – assume we collect 100% of 2020 audited 1, 700, 000 State subsidy increases 2% 400, 000 Board Action: Raise real estate taxes 3, 500, 000 Reduction in force - 25 staff members 2, 000 Use reserve stabilization funds 4, 000 Use ½ of the ESSER II stimulus allotment this year and ½ next year 4, 600, 000 TOTAL $18, 200, 000

Salaries and Benefits 100’s ▪ 200’s

Charter Schools FYE Charter School Percentage Tuition Change 2011 $ 3, 111, 075 NA 2012 4, 169, 219 34. 01% 2013 4, 677, 737 12. 19% 2014 4, 945, 553 5. 72% 2015 5, 634, 185 13. 92% 2016 5, 949, 672 5. 59% 2017 5, 970, 238 0. 34% 2018 7, 124, 007 19. 32% 2019 8, 482, 642 19. 07% 2020 9, 789, 201 15. 40% 10 -Year Increase 214. 65%

Tuition 560’s

Real Estate Tax Increase 6111

Net Change Between EIT/Use of Reserves 6131 ▪ 9360

Net Change to Subsidies 7000’s ▪ 8000’s

Why stimulus money will not save the day • Structural imbalance • Systemic Budget Pressures • Pensions – state funded at 46. 3% • Special education – state funded at 17. 8% • Charter school tuition – no state funding • Cyclical deficit • Earned income taxes (COVID-related)

Net Change Between EIT/Use of Reserves Line Number Not Assigned

Proposed Solution – DRAFT subject to change Revise Assumptions: Cyber Charter Tuition – assume 90 (25%) of 373 return to CDSD $1, 000 Health care renewal – assume 5% renewal instead of 8% projected 1, 000 EIT – assume we collect 100% of 2020 audited 1, 700, 000 State subsidy increases 2% 400, 000 Board Action: Raise real estate taxes 3, 500, 000 Reduction in force - 25 staff members 2, 000 Use reserve stabilization funds 4, 000 Use ½ of the ESSER II stimulus allotment this year and ½ next year 4, 600, 000 TOTAL $18, 200, 000

Budget Gap Salaries and benefits (including retirement) General increases from contractors (special education, facilities, IT, and transportation) $5, 074, 010 693, 055 Tuition increases (mostly cyber charter schools) 5, 073, 927 Reinstating 2021 budget cuts (i. e. facility maintenance, textbooks, equipment) 2, 229, 437 Change to debt service Net change to state and federal subsidies Net change between EIT and use of reserves TOTAL 712, 675 94, 757 (2, 564, 155) $11, 313, 706

Concluding Remarks