Noting that a quorum is present, I hereby call this special meeting of the Board of Trustees of Katy Independent School District to order.
Katy ISD · Special Board Meeting
Katy ISD Special Board Meeting, June 19, 2023
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In this meeting
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- 0:01 to 1:37 1. Call to Order
- 1:37 to 3:01 4. Closed Meeting
- 3:01 to 6:40 5. Reconvene from Closed Meeting
- 6:40 to 1:50:46 6.1 2023-2024 Budget Report
- 1:50:46 to 1:51:03 7.1 Regular Board Meeting - June 26, 2023
Full transcript
Automated transcript, not human verified. It is a way to find a passage, not a quotation.
1. Call to Order
Today is Monday, June 19, 2023, and the time is 3.30 p.m.
Dr. Gagorski, will you verify that we're in compliance with the provisions of the Texas Opens Meeting Act with regard to the notice for this meeting?
Mr. President, I do confirm we are in compliance with the provisions of the Texas Open Meeting Act.
for our meeting tonight on behalf of my colleagues i welcome everyone to today's special meet board
meeting each board member received the agenda and documentation for this meeting on friday
june 16 2023 board members will be able to ask questions receive answers and should be
prepared to take action chief call will you lead us in the pledges of allegiance
Thank you.
No members of the public have signed up to speak, so this concludes the public comment portion of our meeting.
4. Closed Meeting
The Board will now convene in closed meeting as authorized under Section 55.001 of the Texas Government Code for the following purposes.
Texas Government Code 551.071, 551.074, and 551.129.
It is necessary for everyone to please clear the room as the Board will convene in close
meeting in this room.
Thank you.
No, I think they misunderstood.
Understood
5. Reconvene from Closed Meeting
The board will now reconvene an open meeting today is Monday, June 19
2023 and the time is 439 p.m.
The Board heard a Level 3 DGBA Grievance 23-010 pursuant to the Katy Independent School District DGBA Legal and DGBA Local regarding former employee Gregory Baldwin in closed meeting.
In accordance with Chapter 551 of the Texas Government Code, any action regarding this matter must be taken in open meeting.
Do I have a motion to act on the level 3 DGBA grievance 23-010 regarding former employee
Gregory Baldwin?
Do I hear a motion on the level 3 DGBA grievance 23-010 regarding the former employee Gregory
Baldwin?
Mr. Baldwin.
Mr. President, I move that the Board of Trustees denies the Level 3 DGBA grievance and DGBA 23010,
hereby upholding the decision of the Level 1 and Level 2 hearing officer.
It is moved and seconded.
Do we have a second?
I second.
It is moved and seconded that the Board of Trustees denies the Level 3 DGBA grievance in DGBA 23-010, thereby upholding the decision of the Level 1 and the Level 2 hearing officer.
We will now proceed to vote.
Board members, please record your vote on the screen via your keypad.
The ayes have it and the motion is adopted.
The Board heard arguments regarding the Independent Hearing Officer's recommendation regarding
the non-renewal of former employee Lakeisha Jones in closed meeting.
In accordance with Chapter 551 of the Texas Government Code, any action regarding this
matter must be taken in open meeting. Do I have a motion to act on the
independent hearing officers recommendation regarding the non renewal
of employee Lakeisha Jones? Mr. President I move that the Board of Trustees
approves the independent hearing officers recommendation to non renew
employee Lakeisha Jones. Second. It is moved and seconded that the Board of
of Trustees approves the Independent Hearing Officer's recommendation on non-renewed employee
Lakeisha Jones. We will now proceed to vote. Board Members, please record your vote on
the screen via your keypad. The ayes have it and the motion is adopted. The Board will
will notify the employees in writing of the board's decision on the decisions not later
than the 15th day after this meeting.
Thank you.
you. The next order of business is 6.1, and that is the 2023-2024 budget report. The presenter
6.1 2023-2024 Budget Report
is Chris Smith, Chief Financial Officer. Thank you, Mr. Smith.
Thank you.
Thank you.
President Perez and Superintendent Gorgorski and trustees,
I'm here to talk to you about the budget and where we are right now.
I'd like to say I had a lot of new information to provide you today.
I don't.
What I'm mainly talking about is current law,
because new law was really not done during the legislative session as of yet
and I'll get into those details as I progress but we are there at the
underneath the check marks in May or June June is we didn't do it in May
because nothing that happened with the legislative session in May still hasn't
but we're doing June so you can have some closer information about our budget
projections as you look forward to things like salaries and etc over the
this next few weeks so as a reminder how school finance works there's three
things that drive school finance it's the basic allotment and the weighted
formulas that that is written in law there in Austin and so it is in law so
So the amount of money that we get as any school district in the state is contingent upon that basic allotment,
those weighted funding formulas, and the next bullet,
which is the number of students who show up in average daily attendance.
You may recall, or you may not know, we budget our expenditures based off of 100% off enrollment.
enrollment. So we have a budgeted enrollment number that we get in January or February of
every year, and we really work towards that. We build the staffing off of that enrollment,
the staffing plans at all the campuses, et cetera, is done off enrollment. The state pays us in all
school districts on average daily attendance, only on the students who show up. So we budget
one way, and we actually get funded the other. And we've been doing that for my 25-plus years
in this business. So that's not new. And then local property taxes are used to fund that budget,
and when they're not sufficient, state fills the gap. And so y'all may recall, some of you have
seen the canisters that I have the sand in, and the pink sand, and the brown sand. The brown sand
is what our local taxpayers can raise per student. That's not enough, so it needs pink sand on top of
it or state funding if you can raise all you want all you all you can per student uh to that to that
you don't get any state funding or if you raise too much taxes like one district that i know of
that gives a billion dollars back in recapture you give recapture back we are far from being a
recapture district we receive about a little over 50 percent of our funds from the state
because the tax dollars based on our number of students are not enough to
fund that front bullet or that top bullet to the basic allotment and those
other weights so we receive state funding but again property taxes is
important and what property taxes can't do the state finishes up or what
property taxes can do in some districts which is too much the state takes some
of that property taxes back and gives it back to its general fund or to districts like katie okay
so as we look through this budget uh what are our property values gonna gonna do property values no
really no don't really mean that much more when it comes to our maintenance and operations taxes
because the state's setting that maintenance and operations tax rates
But that ratio, the color of sand in the canister, does rely on property values and the property
value growth that we may have or lack of growth that a district may have.
And then also it does affect our INS tax rate.
Property values very much affect our interest in sinking tax rate.
But as far as the general fund I'll be speaking on tonight, property values could go way up.
our state funding could go down. Property values could go down, our state funding
would go up. We still get the same amount per student and the type of student that
they are regardless. And so we're, since we're adding 3,000 kids, we're adding a
lot more expense to supervise and teach those 3,000 kids and the campuses
that will be opening as well. And so we get more money because we have more
students enrollment growth special populations again what will that
enrollment growth be we've got a good estimate we've done historically well
with those estimates but who knows only time will tell and then state funding
changes or formula changes are there any to this point not really or at least not
anything substantive and I'll cover that as we move along but let me set the
the stage first. This is not a Chris Smith or a Katie ISD
derived chart. This came from the Legislative Budget Board.
I'm sorry, this came this one came from the comptroller's
office. And it is in a big report of theirs. And it was
peeled out for this to really show you the line with the
diamonds on it. And you see those line in the diamonds from
2020 on down have gone down. Those are constant dollars that
that have been adjusted for inflation, and you can see that since 2020,
the comptroller says that state funding per student has gone down,
or the amount that the constant dollars do has gone down.
That's because of inflation.
Had there not been any inflation, that number would be straight across
because it hasn't changed.
If there were deflation, well, that number may go up a little bit,
or if they changed the basic allotment two years ago,
that diamond line may go up a little bit.
But it's not because of the stagnant basic allotment that we live in.
So inflation is real.
Here's the comptroller's office with their own graph when it comes to state funding in Texas saying that, yes, it is a real thing and it's happening.
It's a pretty building.
What's going on in it isn't really that pretty.
We started in January how we could spend our $32.7 billion surplus.
Remember, $8 billion of that were monies that were set aside for public education that didn't get spent on public education.
Why? Why didn't they get spent on public education?
Well, average daily attendance statewide is down, and property values are up.
even though we had the homestead exemption and we still lowered the
maintenance and operations tax rate it wasn't enough statewide it wasn't enough
and because of lower numbers of students and higher taxes across the state the
state had a eight billion dollar underspend for for public ed and a total
of thirty two point seven billion surplus that they were working on
throughout this legislative session Texas is big there's 5.4 million
students in Texas 94,000 of them or 96,000 of them after this after we
opened our doors this next fall or in Katy ISD there's 1207 districts and
there's eight thousand nine hundred and seventy three campuses across this state
The math that you're going to see in a couple of slides is biennial.
It'll say 24-25.
That's not two years.
I mean, that's not one year.
That's the 23-24 fiscal year and the 24-25 fiscal year.
So it's every two years is the state's budget, and the state funding has largely been flat
for the last few years, which I just showed you on that slide, but there is a little bit of injection that we got thanks to laws that were written well before this legislative session.
So the things that they were talking about is the state surplus at the 88th legislative session.
Property tax cuts dominated the session.
Enrollment-based funding was a big topic in the session.
Again, we, like going back to when we budget, we budget based on enrollment.
We're funded off of average daily attendance.
There was a big push at the beginning of the session statewide to increase our funding to enrollment, average daily enrollment.
That would be a fiscal expense to the state of Texas because it's always been paid off of average daily attendance.
And so if you're going to pay it at 100%, the expense for the state's going to go up.
But the school district's revenues would go up.
School safety was a big topic. Obviously, during this session, basic allotment changes and whether that was going to happen or not. There's a call in order to stay up with inflation that we needed to increase the basic allotment $900 or $1,000, depending on who you're speaking to.
well I got that's not gonna happen and and I would love that I would probably
take the rest of the day off if or the week off if that were the case but it's
not and so we are squeezed this board is squeezed this administration has been
squeezed to really look and sharpen its pencil because of the fact that it's
static at this point it's still static and then teacher pay uh and and cola relief for retirees
are two other big topics teacher pay being one and retired teachers pay being another one it was a
big topic of the session again all because of inflation so state surplus yeah they had it they
still have it property tax cuts they're having a special session now they couldn't come to an
agreement during the session on that so we're in the middle of a special session
now to discuss border security and tax cuts I'll talk a little bit more on that
in the future enrollment based funding did not work
did not get passed school safety got passed it's not I'll talk about the
specifics on that but it's not gonna it's not gonna solve any school
districts budget woes based on what was passed the basic allotment changes
have not happened. We needed $900 or $1,000 in the basic allotment to stay up with inflation.
At one point, there was a bill that called for a $50 increase to the basic allotment.
Far from $1,000, that $50 would not even fund a tax. I mean, I'm sorry, that $50 would not even
fund our property insurance premium or would not even fund a 1% salary increase for staff.
but that was out there at one point but it did not pass and then the teacher pay
did not pass retired teachers did get a bump which is good doesn't help Katie
ISD it helps the people that work their tail off in Katie ISD in a world of
inflation as well and I will also state in addition to their the retired
teachers of the state of Texas anybody that works for Texas got a six percent
salary increase in the 23-24 fiscal year and in another one in the 24-25. So all the state
employees got, the teachers got salary increases during that session. So $8.7 billion was set aside
side for education in the state's budget. That's new as in quote. I want you to note that because
it's not new. And I'm going to tell you why here in a second. So if you look at that yellow shaded
section, and again, that's two years, that's the 23-24 and the 24-25 biennium. So that in yellow,
The curriculum is for school districts that decide to buy the state's curriculum on various things, and it hasn't been outlined.
The rules aren't there, but they budgeted a half billion dollars or $500 million for that purpose.
School safety, $300 million.
It's restricted for school safety.
There is a little bit in there, and I will elaborate on that, but that statewide cost is $300 million.
million. Going on to the green section, that is all contingent on legislation that did not pass.
So there is, what is that, four and a half, four billion, four billion fifty million there between
those three that didn't get a part of a bill. And so that won't happen, but there is money in the
the budget set aside for that. That's a little that's a little nugget of hope for ISDs in my
opinion across the state. The governor would have to call a special session but there has been money
set aside for possibly something and it would be all of that in green that could go that could be
something that that could be happening later. Going on down to the purple TRS active care
588.5 billion or million, almost a half a billion dollars was set aside to fund active care.
Like most health plans, ours included, they're not doing real healthy since COVID and since all that.
There was deferred health stuff, and people's problems got bigger and got more expensive or got put off.
And so we had, during the beginning of COVID, a pretty good time with our health plan.
And then it hit, and the bottom fell out.
And so our health plan, along with TRS Active Care and most districts that I know, most organizations that I know, their health plan is struggling.
But because the TRS active care is struggling, the state set aside $589 million to fund it.
It's an inter-fund transfer boom, and that was to keep employees' premiums to not increase above 10%.
They were looking at 20% increases in health premiums at TRS active care.
And for those of you who are new on the board, for those of you new on the board in the last 15 years, back in 2003, ISDs had an opportunity, well, let me back up.
ISDs under a certain size, I think it was 10,000 students, had to move to TRS active care, had to.
Districts above that number of students amount had a choice.
We chose to go self-funded and have our own health plan.
It's been a great decision for our employees.
Let me repeat that.
It has been a great decision for our employees to do that and it still is a better decision.
But because we're not one of the majority of districts doing that, they got money, we
didn't.
So that money's not going to go help our plan and our plan needs it.
It's just going to go help the TRS active care.
Does that make sense?
Okay.
Increasing golden penny yield.
I'm going to highlight that on a slide in a minute and it's going to be in gold
writing because that's what's saving this budgets bacon right there the
golden penny yield is is going to increase and I'll talk about the
specifics on that but that was made in law written in law years ago and because
it's written in law years ago it was incorporated into the state's budget I
kind of had to do that but that's saving our bacon to the tune of about 26
million dollars that increase helped us about twenty about twenty six million
dollars new instructional facilities allotment and the instructional
materials allotment instructional materials is not the general fund it's a
separate fund but they did restore the cuts so two years ago they cut that
budget by 60 percent they're restoring that to the levels that it was so katie's going to get
what it used to receive for the instructional materials allotment which is a good thing
but it's not a it's not new money it's a it's a a restoration of a prior cut same with the new
instructional materials allotment the instructional facilities allotment when we build a new campus
Let's say that campus has 1,000 students.
According to the funding laws, we're supposed to get $1,000 for every 1,000 students in that new school because it's expensive to open a campus.
And the state recognizes that.
So they give you a little bit of money the first couple of years that you open a campus to help.
I call it the spoonful of sugar to help the medicine go down.
It's a little sugar to help those new expenses.
And so they're restoring that.
And so hopefully that they restored it to a level that, based on all the new schools in the state that are opening,
that we can get a full $1,000 per student.
Not a lot of money there, but, you know, we're going to have about $2 million in that this next year.
So $367,000 for sure is a restoration of prior cuts.
$589,000 only went to other districts.
$2,367 per student was done years ago.
The others in green are contingent on other legislation that could happen,
but it never passed, so that won't be spent.
If they just never went back to session, that would not be spent.
And then again, that on yellow is really the only new money,
and it's got specific ways to spend it.
Okay.
And let me just say that you don't, on that FSP formula funding changes that hasn't had any law,
if they increase the basic allotment by $50, I told you that that wouldn't fund our property insurance premiums,
$50 increase to the basic allotment based on our number of students is about $6.3 million.
So $100 increase would be about $12.7 million.
million dollars. So again, if they increased it to the levels to stay up with inflation,
that's $800 or $900. I would really take the rest of the week off
because that would be a great thing for the kids across Texas.
Also in here that did not get restored, it's in that big number at the top of the green,
that 3,996.7 was the fast growth allotment.
We are recipients of the fast growth allotment.
That has been, like the instructional materials allotment down below
and the new instructional facilities allotment, those have been compressed.
They said, we're going to give you X dollars per student.
But they say, but once you spend, I don't remember the dollar amount.
I'm sorry.
I should.
But let's just say it's $200 million.
Once you spend it all, then we're going to dial it back because that's all you have to spend.
We got dialed back.
It's $12 million hit to our bottom line.
That's reflected in the numbers that you're going to see tonight.
And when it comes to the other portions of the funding formulas, it's another $2 million.
So that not being fully restored or not being restored like we thought at one point it was going to be is worth about $14 million to this district.
So, let's talk about that first one up there in that yellow section on the page before,
the $300 million for the safety allotment.
They increased the amount that we received per ADA by $0.28.
$0.28.
You heard me right.
From $9.72 to $10 per ADA.
When you do that by our number of ADA, you're looking at about $25,000, that that increases
our bottom line.
And then it also, they did give $15,000 per campus.
And so we have 75 campuses and the math on that is $1,125,000.
dollars so if you added 25 above that is you're looking about a billion a million
two hundred fifty thousand dollars of revenue to the district I'm not sure how
the fifteen thousand per campus is going to flow at this point but that is about
a million one hundred fifty thousand dollars nude money to the district but
there are strings attached and we're still investigating those and the rules
associated with it but that there is a spending requirement per campus that
that will not, this amount will not fund the spending requirement.
Let me be clear, it will not fund the spending requirement.
Yes, ma'am.
So we have a couple new campuses that we've got coming up.
Now, will that $15,000 per campus, will that be included with those new campuses
so they will already be opening with the safety requirements needed for all of the other campuses?
They will open and be eligible for that $15,000 per campus.
as I understand it, yes, they will be.
But when will that money flow, how will it flow,
and when will the rules be written at this point?
I'm not sure.
I'm not sure if that's gonna take effect 9-1.
I doubt it, it's too complicated.
And I think it's probably gonna be effective in January
or even the following school year.
But we should, those two new campuses
should be eligible for that $15,000 per.
Let's hold the questions until the end of the presentation.
The Golden Penny yield, we're looking, that's what saved our bacon.
That's that 2.4 billion from the slide before.
It went from $96 up to $126 per weighted student.
student and again that generates
twenty six thousand dollars I'm sorry twenty six million dollars but breaking
news this was this was published just last week or about ten days ago when the
session ended it and it says no raise no teacher raises no voucher program law
lawmakers fail to reach compromise on school funding bill fail to reach it so
So anything that a district does at this point from a raised standpoint is all on their own since the state didn't do it.
And a little more on that in the future.
But with that headline, what's next?
Well, the governor called a special session, and that special session has to be what he calls it for.
And so it was on property tax relief and border security.
And I'll talk about where that is on the property tax relief.
but the Senate within 24 hours after the special session started or was called
they sign a died and and they voted on their deal passed it through the house
and they left the Senate is still there discussing property tax relief and how
they may be able to come and do it agreements with the other side of the of
the capital there the other chamber but that's still being talked about now I
have a slide that talks about those specifics here in a few minutes but the
The governor could call for an additional special session after this one
that could maybe be related to school finance.
I heard the rumor that there may be, but I don't know for sure.
And, again, there's money on that previous slide for them to spend
that's budgeted should they call for another session on school finance
because the money is set aside in their budget.
you so what's what's the held up in this first special session well the house
let me let me back up and
and say this just to get to the chase i've got a slide a couple slides it's going to show that
under current law we're going to reduce our tax rate our maintenance and operations tax rate by
eight cents it uh it's all still dependent on what comes out of those appraisal districts in july
but right now i'm estimating eight cents reduction uh so with that said in addition to that
uh where they're at odds right now in austin is the appraisal cap plus compression the house wants
to put a five percent appraisal cap on on real property right now it's ten percent and they want
to shave 16 additional cents off the compressed rate so now you're looking at a 24 cent m o tax
rate uh decrease that's funded by the state that's where the the vast majority of that
surplus that they're giving is in tax relief now they're doing it through the school systems and
they're going to make up for it through the lack of tax revenue to districts through state funds
but let me be clear it does not give any additional monies for students and
teachers etc across this state it's a wash tax reduction great thing for
taxpayers state's gonna pay for it through that big surplus but it does not
affect the amount of money that ISDs get to spend I want to be clear on that the
headline will say we gave 16 billion dollars in tax relief to education did
It did go to education, but it didn't go to the classroom.
And then they adjourned in the House.
On the Senate's chamber, they want to do a homestead exemption.
That homestead exemption would have to go to the ballot in November
and be ratified by the taxpayers of the state of Texas,
which would delay statements going out from the appraisal districts, et cetera,
should that pass, and it will, if that's what makes it.
and they want to shave an additional 10 cents off of the tax rate.
So from an ISD standpoint, they're going to make up for it on either the House or the Senate.
I would say that the Senate's version with that homestead exemption is less appealing to a district that's fast growth
and relies on selling bonds to build schools.
because when you have that homestead exemption,
from anything from this point forward, once they adopt that forward,
we will not get any estate assistance on that additional homestead
when it comes to paying our debt service.
And so because we won't get any additional monies,
I like the house version better because I know that we're going to be in the bond business
and we're going to continue to grow,
and we need to have the state pay for it.
State pays for everything on the House side.
Senate side, they will too,
except for anything new bonds moving forward.
So I hope that makes sense.
Those are the two things.
Right now, the governor's siding with the House.
He likes the House's deal a little bit better
and the Senate's still meeting.
I don't know where it'll come up.
I don't know.
I don't know when and I'm sorry,
but we're going to get 8 cents plus 10,
$10, $18, or $0.08 plus $16 of $24 relief to our taxpayers,
which is good because, like the rest of Texas,
we've all seen appreciation in our values.
So all we can really budget off of is current law.
So with that said, before I talk about the revenue,
without the state's action,
we only have three things left to affect our revenue.
State legislature is the one that so far nothing's happened.
The other things that we can control are very small.
It's $13 million.
You'll see it in one of these slides, is our local revenue.
Local revenue is things like gate sales at ball games, fees that we may charge,
interest, summer camps, that kind of stuff, community ed, interest income on our investments.
But that's very small.
it's a total of 13 million dollars you can't do very much with that as small as that is then you
have the local tax revenue a district could adopt a disaster pennies we did that two years in a row
back during harvey in the aftermath of harvey in order to maximize golden pennies uh you can still
do that right now there's no disaster out there to do it so you can't so katie couldn't do it because
there's no been no natural disaster in our district but that's still a way some districts
may be able to use uh we all know well about aware about the vatre or the tre that we tried to fail
that failed because that would have mean made a meaningful impact to our revenue all on our own
without the states it would just start us and our taxpayers but that didn't pass and the only other
thing is our average daily attendance. What could we do to affect our average
daily attendance, if anything? And next week you're gonna hear a presentation by
Mr. Hines and Mr. Edwards about an attendance rate, a potential incentive
that we could do that would cost us money, but it would make us money too. And
really more so than a money standpoint, kids need to be in school. But the
The attendance rate statewide has gone down.
It's gone down in Katy, and we'll have that information in that presentation next week.
But it's one of the things that we can control.
And so this administration is looking at ways to try to control it.
So our assumptions in the budget, there is in the green that I highlighted, it may not be.
I know you'll see it on your monitors.
It may not be real big.
You can see it up there on the shade.
$6,160.
$160. It's been like that for five years now, and here it is again. Stagnant number. Hadn't changed. We needed to change. The golden pennies, you see it's in gold there. There's where it went from the $98.56 to $126 that did earn us, I said $26 million earlier. It's $27.5 million that that helped us out.
And without that increase that was done, again, years ago in law, this report would be dismal.
Okay.
Enrollment, we're increasing about 3,475 kids.
That's budget to budget.
If you'll recall, we ended last year with about six students shy of 94,000.
Now, we graduated 8,000 students, and we're going to re-enroll those in kindergarten.
And so who knows?
But we're budgeting a $95,347.
That's what our expenses have already been built on, and that's what our revenue is built on.
Taxable values, we're looking at another 14% increase to $62.3 billion.
So for every one penny, that raises about $6.2 million.
dollars but again for maintenance and operation that's offset by state funds
so if we go up six million dollars in state funds we get I mean in local taxes
we get six million less in state as it works now there's the new positions that
we had again we're opening two campuses this year versus the one elementary we
opened last year and then for salary increases throughout this presentation I
say that they're outward we're halfway more than halfway done now don't worry
then we're right now it's a kind of zero amount in there so here's the tax rates
that this budget so far has been built off of you can see the dip at the
projection of eight cents if our values come in a little higher that rate could
Could be lowered even more.
Right now, I think rates are going to be lowered anywhere between 7.9 cents and 9.5 cents.
Somewhere in that range is the amount that school districts are going to be able to lower their taxes.
Right now, I'm calculating about an 8 cent decrease.
Probably going to be a little bit better when it's all said and done.
plus whatever action happens at the special session.
So tax revenue is about $512 million.
State revenue is about $413 million.
Again, we receive a lot of state funds
because we can't raise it all in taxes.
Our TS contributions, that's an accounting mechanism.
There's an expense that will be highlighted in blue later in this presentation.
That's the exact same amount.
It's a wash.
It's not even cash.
It changes hands.
hands, but we do have to recognize the revenue and the expense. And then the federal revenue is
about $16.9 million. And you've heard me say this before. I expect some indirect cost on our ESSER
funds, which are federal funds. Most of that revenue and federal revenue is indirect cost on
our federal grants. It does not include the indirect cost on ESSER. Since that's a one-time
or a two-time thing since it's not going to be recurring I don't budget that an
original budget because if you added that two and a half or three million
dollars to it it would look good but it's a temporary thing and so that'll be
done as the year progresses this is the 22-23 budget we're talking about the 23-24
budget but what I want to do with this is say that we are doing things
from a budget standpoint from an administration standpoint that I expect
this to look kind of the same if anything uh payroll is going to grow from 88 to higher
because we've cut back as much as we could on things in those other pieces of pie like fleet
and some other maintenance things in order to try to get to where we can try to fund a raise and
but we've we've reduced as much as we can there are things like property insurance premiums you
you can't reduce.
The fees we pay to the appraisal districts,
you can't reduce them.
Those are what they are.
So we've done as much as we can,
so I expect that 88% to go up,
but really nothing else will change.
Utilities is still going to be our second largest expense,
clearly.
Again, we won't have this until about another four weeks.
Again, we are a September 1.
August 31st we end this fiscal year and we start our new budget on September 1.
There are a lot of districts, a lot of our neighboring districts, that have
already decided to change their fiscal year to be a July 1 fiscal year day.
Gosh help them in a time where the state is is they're adopting budgets off old
law and they have no idea they'll just do a budget amendments and move forward
through budget amendments. We at least have some time to see what the state
it'll do before we legally adopt our budget. But we're building it to put in 80% plus into the
classroom, which is where, or directly spent on children, which is how it should be. And we're
not doing anything different on that case. And with that said, you've seen this before,
here's our administrative cost ratio. That's in descending order. You see, Katie, we are the
lowest. I think the last time I showed this to you, the district that was just slightly above
us now was slightly below us then we've always over the years kind of flipped
but but we're the lowest and I don't know that we're the lowest in the state
but I bet a hamburger and milkshake because of our size and our efficiency
and so fair size and efficiency that we we've got to be the lowest if there's
anybody lower I'll be shocked but but that's very low administrative cost
ratio and you can just pick another one and double it and we'd still we'd still
It'll be midway down the line on that chart to the left.
And I'm not advocating doubling it by all means.
And I put this in there because I think this is important because we're a fast growth district.
And in the amount of time you've seen on this, we've grown 26,000 kids in the 11 years that's represented here.
And this is right off our websites, right off the TEA website.
I put it on our website.
And then we also have another one right out of our ACFA, our audited numbers.
But this just shows a trend where we spend our money over the last 11 years.
And in a district that's grown 26,000 students over that time frame, I think it's remarkable that Ms. Butterfield and her budget department have done to keep everything so consistent.
I mean, if you look down this list, it's kind of hard for us to see on that big screen.
But we are remarkably consistent.
and we're putting the money well over 65% in the classroom where it needs to be,
and that's one of the highest in the state.
So if you break it down, the budget by new positions for the teacher pay group,
that's teachers, counselors, librarians, and nurses,
we added $21.6 million of new positions.
Again, that goes with the 3,000-plus students that came to the district.
There's nothing in here at this point for the salary increase.
It's just the same thing but visual.
For the non-teacher pay group, we added $10 million in non-teacher positions.
Again, that's in line with what we've done in the past.
I've got zero in here from a salary increase standpoint,
and the total salaries for non-teachers is $231 million.
million dollars that would be myself bus drivers paraprofessionals custodians
etc etc that's the same picture but a picture of it our other compensation
those are the type of things that you know we've grown we've added two new
campuses and and organically throughout so we're growing stipends you got
cell phone allowances auto allowances substitutes that's our big one uh substitute teachers this year
um maybe goes a lot along help with our health insurance that i was saying earlier
uh is is really on fire and and we're currently estimating 16.3 uh after we're done with the
payrolls well probably now uh we'll be fine tuning that now that the whole year is behind us
we kind of extrapolate that and move forward and so is that already been sharpened
okay one more round of sharpening and that that may go down may go up i don't know
but that's that's another one that's big work in progress
uh that's the same thing visually benefits um we've got uh the same amount in here for health
insurance we have uh less people participating as a percentage in our health insurance
and I think we added, we were a little bit rich in our budget last year, and so you can see the
same numbers in health insurance from left to right. Pretty much everything is the same,
except for the TRS. Anytime you see TRS, our rate is increasing. Teachers' retirement system or the
state of Texas is requiring us to pay more as a percentage. In addition to us paying more,
employees beginning 9-1 are going to go from 8% to 8.25% out of their paychecks to fund their
their own retirement and it gives them a little benefit from a federal income tax standpoint,
but nonetheless they're going to participate more in those TRS programs.
Yeah, they're all rate increases.
That's just it visually.
So from a payroll budget, and actually just payroll is $842.2 million.
And then here's that where I talked to you about the blue.
There's the 56 that you saw in revenue.
That's the accounting maneuver.
That is a wash, but we are required to record the income and the expense,
but no cash actually changes hands on that.
Same look.
look. Non-payroll, again, the majority of this is in the department allocations. That's the fuel
for our buses, the fuel for our white fleet, the fuel for our mowers, its utilities. We budget
those things centrally. We don't put that burden on the campus to budget. So there you see the
campus allocations. That's all equitable from district to district, or from campus to campus.
elementary schools get the same amount by and large the junior highs and the
high schools do as well and then the departments like the athletic
department's gonna they're gonna budget for referees student travel to Rosa
Stadium or legacy Stadium those those kind of things and then the non
allocations are things like our print shop is one and our TERS or any capital
outlay that we may have in there which is very little is in that non allocations
so 126.8 million dollars in that so there's how that looks graphically our
Our bottom line, if you look at that right-hand column, if we had to adopt a budget today
without any salary increases, we would be looking at a $3.5 million surplus.
That is about several million dollars better than it was until Dr. Gee had the Cabinet
go back and re-look at things.
That we're, not that we don't need them, but we're going to push off until we're going
going to kick the can down the road on some of those expenses. And so we've really sharpened
our pencil to get to that surplus. And again, that surplus already takes into account that
increase in the golden penny yield. We adopted a deficit budget last year. If all things considered
the same, we'd have a big deficit budget this year, but we got that golden penny help, which
which is giving us a surplus, but that doesn't include, at this point, the raise.
So you can see at the bottom of that, we've still got,
are projecting a healthy fund balance at above 31% ratio.
And I'm hoping that the state will,
I'm hoping that the governor will call a special session
and use that money that's been appropriated.
It's in the adopted budget.
They just haven't decided how they were going to spend it if they restored the fast growth allotment
That would be worth 14 million dollars
And if they were would have increased the basic allotment by 50 bucks like they were talking about even though that's not a lot
That's six million dollars and you're looking at twenty million dollars
Twenty-one million dollars would fund a three percent salary increase
So that's how close we are and how close during the session. I was I was not happy and dr. G was
was Mr. Optimist going, hey, but it would fund, you know, good things for the district.
And I just looked at it as, you know, we've been on fixed income forever.
We need more.
But we could make it work had those things happened.
And, again, I just want to say that a 1% salary increase for all teachers and non-teachers is,
I have a note, I can't remember it.
It would be about $7.2 million for 1%.
So you can just extrapolate that, and for 3%,
7.2 million times 3 is 21.6 million.
So it's how much a 3% salary increase is.
2% split the baby at $14.3 million.
Two and a half is about $17.9 million.
But again, the thing to really know is 1% for teachers and non-teacher salaries is about $7.2 million.
And that's really all I have.
That takes care of our June look.
We still have July.
At July, we'll be able to determine by then what our MCR is going to be.
at that meeting.
We will be able to know
if anything happened at this special session
and has another special session happened.
We'll know a lot more later next month.
And then we'll present that
along with our debt service budget.
You heard about debt service back in February.
That kind of set the plan.
Everything looks looking good with that.
We'll present the bottom line,
revenue and expenses on the debt service fund
and our food service fund.
You'll see that initial draft next month.
and then you will have a whole month until August when those need to be adopted.
So, again, we're two months.
We have two more months than these other school districts that are adopting now.
We're in a good position.
We could adopt by the end of this month if we needed to, but we don't.
That's really all I have.
Glad to answer any questions.
Thank you, Mr. Smith.
Board members, questions?
Any questions?
Mr. President?
I have a few questions, so I won't take up everyone's time.
I'll take my turns.
But one of the questions I have is, you know, I know about the bucket thing.
It's taken me a while, but I get it.
You know, we get the same amount of money.
It just depends on who's paying it, the state or the property taxes.
But since we're getting a property tax relief,
relief, do you think that because that means the state will have to pay more of the proportion
in that bucket because of the property tax relief, that that could be a part of the decision
for them not to raise the allotment?
No.
Both in the House and Senate budget, they've set aside the majority of that surplus to
fund relief.
So they're going to fund the relief, period.
And then they've already budgeted that money that could go towards things like the basic allotment.
Now could they back off of that relief?
Yeah, they could say instead of $16 billion in tax relief, we're going to give $14 billion,
and then we're going to increase the basic allotment by $600 million or $600.
They could do that, but right now I think they're laser focused on reducing the M&O tax rate.
to provide relief.
It frankly does need to happen because the values have been rising
in this state, across the state, so fast.
So that $32 million, whatever, however much money that is,
that they have extra, the surplus,
is not being used to pay for some of that property tax?
$16 billion, if I'm remembering right, $16 billion of it is
going to go to property tax relief, period.
So the other $16 billion.
But it is not helping the classrooms across this state.
It's helping the taxpayers, and it's earmarked for education,
but it is not going to affect the classrooms in any way across the state
other than it reduces the taxpayers' burden.
So that's why I was wondering if they were saving that $16 billion
to help fund the property tax relief,
leave if they were justifying that that's why they're not going to give any other money
for basic allotment because they're using half the money for that.
That was just.
Yeah, let's hope that doesn't end up happening.
And I guess it could, but I'm still holding out hope that they'll come up to do something.
Okay, and I know you're going to go over how we can help ADA next month with your thing.
I'm just going to ask this one last, and then I'll stop for a minute.
But can you tell us what the difference is between ADA and the enrollment-based funding allotment?
Sure.
And I'm just going to use, let's just say that we had 100,000 students, and we're averaging right now 94%.
So we would get funded.
We would build our budget off 100,000 students,
and we would earn our revenue off of 94,000 students
because they're not all coming to school every day.
And our attendance rate used to average around 97% or 96-point-something,
closer to 97%.
So ours has dropped.
Statewide it's dropped.
ever since COVID are we're down and you'll see some graphs on that next week
both statewide and locally but but but a hundred thousand students we're gonna
build a budget for because they're they're kids that are gonna be in the
classrooms and the 22 to 1 student-teacher ratio and all that stuff
has to be considered as if they're there but when they don't come they don't
learn and they don't generate money in the funding systems and there was talk
at the beginning of the session to increase and go average daily enrollment
like I mentioned earlier but in our case then now you'd have to go from funding
us at 94,000 students to a hundred thousand students that's six thousand
times six thousand one hundred sixty dollars plus the special funding weights
you're probably looking at forty million dollar cost to the state of Texas just
off Katy so there's fiscal note is really expensive to move to shift to
that in addition to that some school districts average 91 92 percent
attendance rate in fact the statewide is way down towards 91 ish we're way above
the state always have been still are but but the simple fact is is yeah funding
you don't get it simple fact is is we're here for kids and the kids are best at
that go into school and learning.
Even if they don't feel great, or even if it's raining outside
and it's stay home with mom or dad,
they're better off in school.
They're safer in school.
They're better off in school.
They're going to learn more.
And yeah, it does generate a little bit of money.
Other questions?
Ms. Fox?
A couple of just odd ones that I didn't want to interrupt on.
1,207 districts?
I thought we had like 1,036.
Where did that change?
Do you know?
I thought so, too, and I'm not sure.
There must be some special districts that they're including on that.
I got that off a very…
I'm wondering if it's charter schools.
It must be charter schools, and it probably is.
And I'm sorry I don't…
Okay, I just wanted to give you that.
I should know that, and I don't.
And I think it's charter schools.
I think we're thinking the same thing.
Okay, school safety, $300 million for school safety.
You didn't just ask this, did you, Mrs. Champagne,
because I was working with my broken computer?
Okay, so is this $300 million about the new armed officer
they're going to require at every campus that the governor just signed into law?
Yes.
Now, let me remind you, going back to 2019, they first passed legislation to add the school safety allotment in the funding formulas.
They put $100 million toward it.
And that sounds great, $100 million.
That's a lot of money.
We're really putting money in school safety.
And I'm glad that they did, and that is a lot of money.
But then when they divided that up by the number of students in attendance throughout the state, it's $9.72.
So if you extrapolate that out, if it was $100 million, it went to $9.72, $300 million is going to be about $30 per student.
Which, you know, that's something, but that's still only $30 per student.
And what is in that currently is an increase from $9.72 to $10, or $0.28 per student, plus $15,000 per campus.
And the $15,000 per campus is where the real money comes in at $1,125,000.
But that would not pay a salary of an officer in 46 elementary schools.
No way is that going to cover the cost of what they just signed into law.
No way.
No way.
No way.
So that'll be on the back of us.
And that's the details that TEA is going to be working through
because it's going to be hard for not only to find it,
to find the positions to put in those campuses.
Remember I showed you 8,000 campuses across the state.
My understanding with that is that the parameters are not clearly defined on those.
Like is it bell to bell?
Is it school day?
Is it eight hours?
Is it after school?
Can you share one between campuses?
None of that was defined in the language, as I understand.
To my knowledge, no.
That will come later.
My last thing, Mr. President, is no staff raises in this budget that we're covering.
And people are watching to see.
I mean, that's going to be a concern.
Now, the numbers that you saw, Ms. Fox, had no salary increase in there at a small surplus.
this board can choose like other boards are choosing to do across the state to
give us our increase but they're gonna do it out of savings because the state
didn't do their part that's my car has yet to do their part that's my question
how will we give staff a raise and when will they know when do we need to decide
that and then I'm finished prepared to discuss the compensation plan on Monday
One week from today is when we'll be going through the compensation plan and a recommendation to the board
Be good tonight to hear from the board. Would you guys think about that that that would be helpful for sure?
like Chris explained
Every 1% in a raise is going to be around seven seven point two five million dollars
So how much of a deficit do we feel comfortable with?
Kind of outlines how much of a raise we could do
I mean you guys can do some quick math in your head and see where we're at
Chris if I'm remembering the slide you had up there
The current budget is about three point five percent or three point five million. Yes, sir. Okay, so you're looking at
At a three percent raise you're looking for about eighteen million dollars
On a two percent raise you're we're looking for about eleven million dollars. That's just quick math
Million off of these numbers here. Yes
Yes.
Mr. President, may I follow up with this, what Dr. Kroporsky is talking about?
So Mr. Smith, so next week you're going to talk about how to possibly incentivize children
to come back to school.
And a minute ago you said if it was up to 100%, that would be about $40 million.
So let's act like, I think 100% is probably not realistic.
realistic, but, you know, if we could get it up to 96%, like it would be maybe $20 million
or $15 million, and if we could do that, then that could justify the 7.2% raise, even if
we can get up to, you know, if you, I don't know, I'm not doing math really quickly in
my head, but let's see, $40 million, if it was 2% higher, it would be $20 million.
million dollars so then if we thought that we could do that we could do a 2%
raise I was giving that off a hundred thousand students I think Jamie just
told me and I think I misspoke at cabinet this morning I said 1% was a
different number 1% five and a half million okay so so five and a half
million for 1% so if we were able to get back to where we were that would be
worth 10 million dollars in other words if if the plan that's going to be you know given to us next
week could work or if we thought it could work we'd have a better idea of what we think we could
give a raise based you know on if it's five and a half million and we could raise it up to 97 or 96
then we could probably do a two percent raise so i'm hoping that this plan y'all have is really
good because you know what is it going to be like some kind of you know email
with a game like a you know and miss miss champagne I don't want to steal the
thunder for next week but but that plan is incentivized to our campuses to to
basically allow them to share the wealth and so if 2% we were able to give as a
district and we gained 10 million dollars there would be an expense that
that we would give the campuses to be able to spend on instruction
and on things at their campus that they would want.
So we've got to carry it out there for them
because we need their help to encourage students to come learn.
But we could use that on teacher compensation, correct?
Okay.
You could use some of it on teacher compensation.
Some of it would, the way that we're going to speak to it next week,
the campuses would get money, additional money,
that they could spend on things that they think would incentivize kids to
come to school and make them better on their in their classes and whatever they
campus principal thinks and that this was basically a way for them to share
their wealth because because we need stuff like that in order to turn it back
to where it was we need we need their help and so I know that we're required
to have a three-month surplus in our general fund and that's so that we can
can be in good standing with I don't know the T. A. And the rating agencies, the Moody's
and standard and pores want that to be. Do we receive any anything for that? I mean,
do we? You don't receive anything, but having having a good strong fund balance is more
money on interest earnings. But but but secondly, the again that shows stability to have that
above those threshold of those benchmarks. And when they're above those benchmarks, the
So rating agencies give us a good rating, underlying rating, and that saves our taxpayers dollars when it comes to issuing bonds.
We get better rates on our bonds.
We have better credit.
If you're a better credit, you get a cheaper rate.
And so having a good fund balance, strong fund balance, helps us maintain our underlying credit rating, which lowers our interest expense to our taxpayers.
Okay.
So in essence, we're saving money by having a good rating.
Yes.
And then one last question.
I always forget about this.
But I know that each campus receives a certain amount of money per student in the campus.
I know you know about this.
So the principal gets some kind of like a little.
It's their per-pupil allotment, and those are the same from elementary school to elementary school
or from junior high to junior high.
They're the same.
We do give them a little bit more money if they're a bilingual campus.
they get a little bit more and they and maybe some special needs if they're
housing a special needs program they'll get a little bit more but by and large
that per pupil amount is the same but that's that's how we we are fair as we
can be when it comes to distributing that money to the campuses same with the
staffing plan and so the principal's just use that money for their
continuing education that they need or some kind of campus improvement that
they want they use that however they think that can benefit their campus period all right i think
that's all mr president questions go ahead mr redmond thank you mr smith so we know that
governor are they appointed a special education or a special council committee for education
uh reports to back in what middle of august so if kind of from what we know they're
They're probably not going to hear a special session before the report's ready.
So if that were to happen September, October, and we know it's a priority or it's been set a priority for the school funding and whatever else is tied to that, what are our options as a board to say they don't make a decision until October or November and it moves to enrollment-based funding?
now all of a sudden there's this new amount of money that shows up,
or they possibly increase the ADA at that time,
would we need to approve an additional budget, like an optional budget?
Or at that time, could we go back and amend the budget?
Or what are some of our options there as we move forward?
I think that's a great question, and it's a question that we grapple with
and we will be grappling with before any language is presented next week as I
understand it what most boards are doing because there hasn't been action is
they're they're taking local action through deficit budgeting okay state law
requires if they do an increase to the basic allotment whatever is generated
from that 30% has to go back to teachers counselors librarians and nurses so
So that's what's kind of un-in-sync right now with where we stand,
is we need to do something in June for our people.
But what happens if in August they did come up with a $50 increase to the basic allotment?
We would potentially have to, depending on how we word the item next week,
we would potentially have to give 30% of that to teachers, counselors, librarians, and nurses.
Well, $50, a third of that is only $2 million.
So that's not that much to put in a salary increase or like 0.15% to add.
So we would hope that we would just be able to say, hey, we've given it.
We gave it before y'all did it.
It's there.
It's in compensation in whatever y'all give.
give but you're going to be doing it on you're going to be hedging at the state
like other districts you're going to have to hedge that the state's going to
do something I don't know if they will or not so for example if we were to go
ahead and preemptively do a budget deficit to fund a raise and then they
came with an increase in a DA we might have to double dip and say we did a 3%
raise or 2% raise and then potentially have to match that new money an
additional raise at that point possibly possibly the government and also they're
gonna say possibly but that basic allotment again is only a $50 is only
gonna graze six million dollars to this district one-third of that's two million
dollars one percent cost seven million dollars so that's that's just the math
half of it. The timing is not good. And I wish I could stand up here and talk to you about perfect
timing. It's kind of embarrassing to talk about the cart before the horse and all that stuff. But
that's the cards we were played, dealt. Thank you. Mr. President, one more thing, please.
It's about this House Bill 3 with the school safety, and Mrs. Fox was talking about that.
so right now as I understand it we don't have a an armed officer at each
elementary school and I'm just trying to figure out do they mean an armed officer
at each school 100% of the time you'll know oh we don't know I don't know I
mean I don't know if somebody that may know I don't know that answer I've got
Chief Gaw and Ruben Martinez combing through that bill extensively to see exactly what we believe that the parameters are in that.
It's a little unclear, but some things are more clear.
It does not say a police officer.
It says a armed person or armed security person, which we're not sure what that really means.
But there are some ways to sidestep around that.
they do allow boards to make a waiver and that are unarmed a person could be
on the campus but until I get chief gone Ruben Martinez going through that bill
and coming back with a recommendation I kind of hesitate to bring anything to
the board right now until we have that finalized thank you I'm gonna call
myself for a couple questions okay one is um i heard you say um a couple times about sharpening
sharpening our pencil and so on and i think it'd be interesting uh good information to have to know
to get to the three and a half million um surplus like what have you gone through maybe you know as
a follow-up give us a list of of what what has what has been done in terms of whether it's
delaying costs, reducing costs, etc. That would be good to know. We can get that
information. I don't, I do not have that. Okay. I expect that. But it's been a lot of work and it would also be in addition to non-
salaries, it's salaries. I mean, you know, the, it comes up through cabinet, ask for
requests of things to help with growth. For example, you add two new campuses, you
need a field engineer in technology. And so that may be added, but we may have
asked for and i'm just coming two sure and we had to say no you got two new campuses you can only
get one and so there was a lot of that as we went through this budget process um where where where
you know in years past before we were on fixed income we would get that as growth came on and
i think that's why it's important that i went back 11 years to show that as we've as we've grown as a
district and and gone through the years we've been relatively consistent keeping growth in every area
consistent the way it has been, and I'll give Ms. Butterfield a big benefit on that, and also the
cabinet for that happening, but we've been very consistent on that, and we're trying that same
consistency this year, but we've tightened it down a little bit in order to try to get to fund a raise.
And then looking at it, if we were to go ahead and approve a deficit, a big deficit, because
because I think, speaking for myself,
we think, I think that salary increases are critical,
especially for our teachers.
And so if we were to look at a deficit
in terms of going in because we approved a certain salary,
other than coming from the state,
any ideas for possible remediation
or improvement on that deficit as time goes on?
or is that going to be like permanent deficit that we're stuck with?
Is there any ideas or any potential for improvement from the deficit that we approve?
Yes, sir.
A couple of things that just popped in mind, underspending.
We always underspend.
We budget for underspending, but we're going to underspend.
We're underspending the budget that we're currently in.
I will say this, Mr. Perez.
In order to get to the number that we are, we're going to have less underspending.
We're going to have underspending still.
We're going to have less of it because if a position hadn't been filled in a couple of years because of, you know, we've really evaluated.
A lot of times it's because we can't, like a custodian at a campus.
But some of those we've actually just said we're turning them loose.
And even though we weren't filling them, that created underspending.
So there's going to be less underspending, but underspending is one.
one. The indirect cost on the ESSER, we will have ESSER expenditures in this fiscal year.
Will they generate two and a half million dollars in indirect cost? Probably not,
but it's going to be a juicy number, but that's not in the budget. And then we have those audits
by Mr. Puanca that we do annually that kind of settle up our state funding from prior years,
and we will file an audit.
We've got two of them with the comptroller now waiting on this to happen that will help the deficit that we're in.
I think that because of those, I'm not worried about the deficit we were in.
but if the comptroller doesn't work those until September well guess what
then that that may that may be revenue that we can push that we already know
about in the next year the odds are it's gonna happen this year but we're gonna
file another one sometime next spring and that should generate some money
would but I don't budget for that I can't and I won't because I don't want
to mislead you guys or the public on something that may or may not come to
fruition I bet it will but I don't know for sure and I don't know I wouldn't
know how to budget for it being fair as the whole rest of the budget process is.
But there may be a list possibly of some upside to the budget, if you will, some things like
that that aren't definite, but some upside.
I think there's some upside.
I do.
We've already baked into the cake the lower attendance percentage.
We've already baked some of that in for the budget we're currently in.
and then next year's if we were if the attendance incentive or just normal
times went back that would that would be a good thing to the bottom line the
other thing I wanted to ask about is as I look at this slide that you have up
right now I know we're looking at the official budget for 2223 but aren't you
thinking that we may get to a break-even for this year yes sir so therefore that
at the end of next year that our fund balance could really be about,
with this budget right here, about $330 million?
Or if you just improve it by $12 million, let's say?
Yeah, I think if everything works out the way I think it is now,
now, again, still three months left in the year,
but I think that our bottom line at the end of 22-23 is going to be about break-even
or about $326 million fund balance, maybe slightly higher.
So that would mean that if we're at $330 million based on this,
that even with the deficit, even with a salary increase and a deficit,
that we could still have a healthy fund balance at the end of 2024?
Because we're expecting to start the year better than this.
Yes, sir.
I don't like saying this,
but a healthy fund balance is for where we are right now.
You guys built it up for instances where we have to get courageous
and do something because other people aren't doing it for us,
and that's why it's there.
The risk is, and why I don't like saying it,
is because if we don't have the state do something
or we don't do something to get out of that,
that once you start that using the fund balance and going into deficits,
it's hard to pull out of.
And so I just think that I'm not concerned about this board
or this administration pulling out of it.
We're good enough to do that.
And I do think the state of Texas cares about kids enough
that they'll end up doing something in Austin.
But until then, I think that's what fund balance,
a healthy fund balance is for.
We just need to be conscientious that it's temporary.
temporary. I'm just saying the 12 million negative that we were not incurring this year
could be shifted to next year. I stood in front of you last year and said I'm not cutting my
wrist over a 12 million dollar deficit and if we put an 18 million dollar deficit out there I would
not cut my wrist. I like it and we're starting to get to where I don't have any levers to pull
but that's the right thing for the teachers and the staff of the district to have to be have to
do something like that I think that's what that fund excess fund balance is for mr. president I
know you won't have questions it's tagging exactly on to what you're talking about are you going to
talk about deficit budget okay go ahead okay this is just quick so when we draw down from our fund
fund balance, if the state does nothing, it's just going to keep drawing down and keep drawing
down because this is a cost that keeps recurring.
So that's the concern we have, but I'm hopeful the state will help us too before it's all
said and done.
So to visualize your point, Ms. Fox, that $12 million in that middle column, the deficit
that you saw last year.
If it weren't for that tier two increase of $27.5 million, that right-hand column would be a $24 million deficit.
Okay, it would be a $24 million deficit.
Why?
Because nobody paid for the raise we gave a year ago.
And if we give a raise this year and nobody pays for it, it starts to compound.
pound. Again, luckily we got the funding and so we're starting off at a level that doesn't make me
start freaking out. But this time next year, if nothing happens, nothing, because the ledge is
not going to meet in a session next January, it'll have to be a special session. If they don't
and y'all give a raise, then next year when we're going to be at the same spot and there won't be
any money to fund or another raise only to compound on it and so it's getting not to where i'm i'm uh
i'm freaking out yet but if the state doesn't do something it's time to freak out
okay mr president thank you um okay so i just wanted to ask one on the 5.5 million right for
a one percent raise that's for teachers and non-teachers for for one percent uh-huh all right
i want to get and for one percent for the teachers counselors librarians and nurses pay group those
are all in one pay group and that would include instructional coaches okay they're right pay group
one percent is four million let's just call it uh uh five million dollars okay i'm rounding to
five million the non-teachers which is everybody else custodians bus drivers etc uh one percent is
2.2 million okay and uh and added together um those you know obviously is is what it is okay
so you're saying um for the teachers it's gonna be teachers counselors nurses instructional coaches
is who am i leaving out and librarians okay great okay and then one other question um remember we
were talking about 30 percent um would go towards salaries was that we were talking about the
allotment increasing the allotment okay so what what are the spending limitations on the seven
the other 70 percent are there any spending okay and at this point and they talked about increasing
increasing that to 50%.
50% must go to teachers, counselors,
librarians, and nurses.
I always laugh at that, and I say,
because most people in my position,
you know, we don't need that.
We're going to, the administrations
are going to recommend that go to teachers,
counselors, librarians, and nurses.
Right.
Because they need it, they deserve it,
and we don't need law to say,
you've got to give these funds in salary increases.
We want to do that so desperately bad,
it's killing us.
so desperately bad just so we're clear that's if the new legislation that if we do get a basic
allotment increase doesn't change because it could have uh things that are in that new legislation we
obviously can't predict for at this time right and so go ahead good point in other words that
a new law could say we're going to increase the basic allow about 200 and you got to give every
bit of it to teachers counselors librarians and nurses every bit and then we would be going
okay we're giving give it all and it's a great thing for them but they could do
something like that mr. Graham makes a good point okay so this I'm sorry this
probably is a question I know you know and I just am new so on the the
allotment right now is that the case so the out of this the current student
allotment 30% of that goes to pay to you we've already we've already delivered
We delivered that with historic pay raises back in 2019.
Okay.
We gave a very, very generous pay raise.
A lot to that, but we gave in excess of the minimum requirement
because that was what the right thing to do for the staff was.
And the administration and the board did that,
and we exceeded that obligation,
and they hadn't changed that number since.
And so we've only done it off of efficiencies and savings.
Mr. President, I have three specific questions, Mr. Smith, just to understand three different slides a little better.
on slide 17 I was curious why you're only budgeting on a 3.8 percent
enrollment increase versus last year's 4.8 percent enrollment increase
close
Okay, so you're talking about the 3.8% increase?
Yes.
Yeah, well, that's budget to budget.
So we budgeted a year ago at this time an enrollment of 91,872.
We keep these consistent from one year to the next because everything needs to be consistent because it's going to all be a moving target.
And if you can't get it consistent from the day one to where we are now, and that's what we're doing here by showing those consistent numbers.
Yes, we ended the school year last year with just under 94,000.
So if you look at the jump from $94,000 to $95,000, that's not but 1%.
But remember, a year ago, we budgeted our expenses off 91,872 students.
We blew that out of the water, and we had more kids than we budgeted for at expense.
One of the reasons why I feel pretty good about our bottom line.
But this year we're budgeting expenses of 95,000 students of 95,347.
So we're increasing the number of students.
Oops, that's a touchscreen.
By that amount.
Sure.
It was just interesting that it's less than the increase that you were budgeting for last year.
Yeah.
Last year our demographers and everything that we saw showed it was going to be big compared to what we had budgeted the year before.
Now remember this time two years ago, we were in the middle of COVID and
it was even less unclear as to what was gonna happen.
And so we outperformed that last year.
I don't know if we will or not this year.
Again, interest rates on people's homes that we rely on on growth.
They're higher as the growth slowing.
or not didn't show any indication of doing so as we've winded down the school year but who knows
what august uh middle of august will will show okay thank you uh then on slide 26. okay you were
uh budgeting net new position let's see these are non-teacher pay groups it looked almost double
from last year or wait a minute is that correct project that say 23 24 mm-hmm
second column yeah slide 26 okay I'm on non teacher pay group slide
Okay.
Okay.
I just noticed the net new positions budgeted for for non-teacher pay group was 5.4, 22,
23, and I'm assuming that second column is next year, correct?
Even though it's a typo there?
Yes, that second column is projected for next year at 10 million.
Okay.
Yes.
So it's doubled almost.
Is there any background on that?
I think the reason why that is on the net new positions is because we've added a campus
And so you're adding what I call rocks in a bucket.
So you're adding a principal.
You're adding assistant principals at two campuses versus one.
So the expense of opening new schools is double.
I'm not sure what else I'm missing on that.
Mr. Chess may be able to help or Ms. Butterfield.
Because right now I'm only grabbing the two schools.
It does include, we did some,
some this board adopted some additional positions for this police department last fall that
would be included in there that were not in the initial number from last year because
we did it after we adopt the budget.
Mr. Smith is correct though the bulk of that is because two new campuses as opposed to
one last year that's going to be the bulk of it.
Okay but non-teacher pay group?
Yes and also
Also, there's some ESSER that we are rolling out and attempting to wean ourselves off of ESSER, and that probably includes some salaries associated with positions that we were paying for with ESSER that now we're having to shift.
Okay.
Thank you.
And one last specific question on slide 28.
you're seeing something a little different than me so okay it's the other compensation
budget update slide okay there we go we were budgeting more for substitute let's see we're
trying to it we're increasing from 12 to 16 it's a big increase for substitutes who are I guess
certified is what you mean by teacher there is there a reason like a calculated reason for that
and miss butterfield can throw something at me and knock me out or she can throw something at me to
say yeah you hit it but part of it has to do with covet and this type of things that we're working
in society but this time last year in order to fund a salary increase we dumped the teacher
attendance incentive the teacher and sent attendance incentive proved to be healthy uh
proved to be working.
So we, in order to, instead of paying that in a teacher incentive,
we put that cash towards their 5% salary increase.
And so that incentive went away.
That could be part of it.
I don't know that.
I probably never will know that.
But Ms. Butterfield and Ms. Rios, every month,
they look at our sub-expenditures that hit the general ledger,
and they extrapolate it out.
And so they've got one more look at that this year,
now that the payrolls are finishing up.
It doesn't happen the minute that the school ends.
Wait a couple of weeks before that happens
until they can get actually two payroll cycles
before they can say, okay, this is how last year ended,
and then they'll extrapolate it.
That could go down, may go up.
Still not to know.
That's probably a pretty good number
because Butterfield came up with it,
and it was well thought through.
And it just shows that we need more subs.
So if y'all heard her, y'all have better ears than me.
What she reminded me is, you know, one of the things that's growing is not just the average Joe or Jane in our district.
It's our special populations.
And so bilingual special needs is growing at a more rapid pace.
So what you don't see is the minutia of that, but our special populations are funded differently.
They're funded more because it's more expensive on those.
And so we, that number that you mentioned a minute ago, where it went from 5.5 to 10,
And in addition to the things I said includes additional LSSPs,
limited licensed psychologists, school psychologists,
it includes speech pathologists,
and some of the other things that's supporting our special ed program
because that is growing at a faster pace than regular ed students.
Thank you.
Other questions?
Mr. President, I'm sorry.
I just want to say thank you to your team for just being proactive
and looking for some areas that we could trim back.
I know that's not fun.
It's not.
And in the cabinet, Dr. G and his leadership in the cabinet get a lot of credit for that
because it came from from their department some of it came from my department but uh we're just
gonna have to tighten our belt and don't like it and again i will say that when we do get some
money if the state does do something and let's say they in a perfect world they increase that
basic allotment by 600 i know the majority of it we go to staff salary increases i get it
i support it but at that point in time we need to be conscientious of things that we reduce that
that long-term are going to cost the district more money
by not having a chiller maintained appropriately.
You don't want the chiller to go out if it's not maintained.
I'm not telling you we're giving up our chiller program,
our maintenance program,
but we are cutting back on some of that stuff.
That's just an example that popped in my head
that we'll have to rebound at some point
when the state allows us to do so.
And the other thing, one more thing I want to mention is
there's no playbook right now because it's all up in flux that we have.
There's a guy at the state who produces the funding template that most of us use
that's been changed three times in the last week, literally three times in the last week.
I expect it to change again, and I didn't look today,
but it had changed Monday, Wednesday, and Friday of last week.
And so I expect it to change again.
So that's a moving target. He's doing really, there's stuff inside of that file that June 30th districts need.
And he's doing it for June 30th districts primarily.
So there could be something that comes up on one of his next releases that could affect this budget revenue standpoint.
TEA doesn't even have this calculated yet for next year because they're trying to figure it out.
He's trying to figure it out. We're all stroud. She's still trying to figure out even though majority of it's off current law
still a lot to
To take into account and so, you know, it's all subject to change once those new releases come out
Thank you, I have a question for you
So the superintendent kind of asked for our feedback about where we're gonna be because the compensation plan is coming next week
And so this question is for both of you
if we make a decision now and put that into place and then the governor calls a special session
and they come back with a districts must give teachers a twenty five hundred dollar raise
and we've already given a raise from fund balance that happened to us a few years ago
considerably a few years ago so are we prepared for that could we delay could we say we are going
going to give a raise. We're waiting for the special session to make sure. I'm a little
concerned that that might happen. I can't imagine that the governor of Texas goes all over Texas
talking about vouchers and the virtue of vouchers and then doesn't call a special
session about something that he said was one of his number one priorities. That's my concern.
Mr. Graham and Mr. Smith and I have talked about that, that that's a possibility that that could
could happen and they're examining some legal language that we could use should
we want to be proactive on a raise how could we state that that kind of covers
for what might come in the near future and will we be asking for a decision
next Monday or just a proposal we mean time to think about it I think yeah
that's that's a question for the board on that if the board's not ready to
to examine that. Remember, you're not going to adopt a budget until September.
But I know our people are very anxious to know if we're doing anything for next year.
So I think time is of the essence to that respect that I'm sure people want to know
what we're looking at. We're just real boxed in this year. This has not happened like this before.
And I was just, you know, and you guys know how I feel about what the state has done on that.
I'm just really surprised that the state has done nothing for four years and continues to do nothing and then
it puts that burden on our board and our
Local taxpayers and things like that
you know I mean Chris showed you a few things of what happens when the state doesn't come up with money to adequately fund public
schools and
And the only lever we have is is for a TRE to ask our taxpayers pay a little bit more money
because the state doesn't want to fund that so it's a real challenge in there I
would think through this one if I was to board this week is think through what
you feel you think you could live with as a deficit budget knowing that 1% is
going to be about seven point two five million so can you live with one two or
three percent on that we could certainly have a comp plan that has one in there
But we could we could easily flip that stuff around as well
I mean comp plan is an overall comp plan of everything but the raise could be modeled at 1% 2% or 3% I
Think my yeah, I think my opinion is that we we can't not do anything
We can't just like sit back and say let's hope that the state
Bails us out or come through with a raise we have to I think there is some level of deficit that we're willing to
uh be comfortable with and the fact that we're going to be i think break even what i heard break
even uh for this year versus a 12 million dollar deficit i know that you don't necessarily like to
say that but you know but uh that there is some level deficit that we're going to be comfortable
with and that you know perhaps if the state comes through with something we can do better than what
we did but we need to do something and telegraph to our employees that uh the board is you know
appreciates them and and his take is taking a hard look at a raise sooner
rather than later I agree with you mr. president and as long as there is
language I like that as long as there is language that we would pay it back to
fund balance should the state give more money and make that available having
that in or that if the state requires something we've already done that from
our fund balance however that language looks I would be comfortable making that
decision soon as long as we're protected from the double dip which could really
impact our fund balance. Having said, sorry. Yeah, because we're having two months, two meetings a month.
Every couple of weeks we do get to meet so we could, if we don't get to a
comfort level by 26, we're back in two weeks after that and I know that your
plan is not for us to make decisions in work studies but if there is something
something so important that we might need a little more time.
It's up to you.
I just feel like this special session is about to be over.
The house has already gone sine die, and they're waiting for the,
and I think he'll call one immediately after that.
So just things to be thinking about, for our board to be thinking about,
because this is our time to discuss, because we can discuss in public to each other.
We can't call each other on the phone this week to talk about it.
So I'm anxious to hear from all of you, but those are just my thoughts.
Mr. President.
Go ahead, Ms. Chaput.
Can I give, I guess, kind of a suggestion?
But first of all, on your agenda, normally there's a place where the secretary tells you, you know, action plans and all those sort of things that we need to do.
so I was going to add that to it but I was going to say maybe we could be
presented with the different clump plans like he said you know the the 1% the 2%
the 3% and maybe we could get that and I mean before maybe before Friday update
but you know so that we could look at that so that when we come back we can
make a you know a good decision as a board yes well I mean we know that 1% is
is 7 million, so 3% is going to be 21.
You said 6.2 or something like that, right?
6.2.
Or 7.2.
7.2 for 1%, so.
But you said 4.4, something like that,
with just the teachers, librarians, nurses,
and all that.
Five.
Five.
Five.
Five.
And then, and so then when you add everybody else in,
it equals 7.2.
Yep.
OK.
So I think the information that I'd be interested in would be how you slice and dice the $7 million in terms of, you know, for example, like the function 11, is that all the teachers and what else is in there?
And, you know, the breakdown of the $7.2 million and where that's going, where that would be going would be interesting to know.
The $7.2 million.
That's a good suggestion.
Any other information requests?
I think I mentioned about how we've sharpened our pencil
and maybe upside in the budget if we do approve the steps,
what's the upside in the budget,
even though we can't say it's firm,
but that we may be able to make some things up throughout the year.
And also you said something about you wanted to know
where the 3.5 surplus came from?
You wanted a breakdown of that?
Right, some of the sharpening of the pencil that they've done already
plus what we, again, the upside looking forward.
Any other questions or comments?
Okay, so I just want to know something.
So Mrs. Fox is right about this.
This is the only time we can talk about this.
So, I mean, I know that one time we did like a poll, like who would want to even contemplate a raise, not to vote on it and not to say how much, but could we do something like that right now?
Mr. Graham?
As of right now, I mean, it's on your agenda.
Y'all can talk about how you feel about the agenda item.
Sure.
It's not really called a poll.
It's just kind of feedback we're giving to this to the board president to guide
He and the superintendent is they build the agenda
So whatever information you want each of us to have because if we hear something we'd be able to talk about it
Or we'd be able to call this the board president and talk about things, too. I
mean, I think
personally, I think we've given feedback in terms of that we there's a
unless somebody else wants to
to chime in on this.
We've spoken up about the fact that we want to give raises,
that it's important to do it sooner rather than later.
Only two or three of us have said that.
Okay.
No, I think everybody has mentioned
that they're in support of that.
I think we're in unison on that.
I'm in support of teacher raises just to be clear yes but yeah so there's that I'm in
support of paying teachers more but I do want to break down on the what does the 5.5 million
and raise who who does that exactly cover and then we go up to a seven point whatever
who else are we including in that i'd like to know that before we decide anything
i think whatever i mean if administration feels like financially we can afford it and it's not uh
what was the comment you want to slit your wrists um then let's be good with that
I understood the emotion when you said it, though, so I get it.
I think I just want further clarification on exactly how the money is being spent, where it's going, what that looks like in terms of teachers, non-teachers, what exactly all of that looks like.
And having that breakdown and having clarity on that, that's more of what I'm concerned about, not whether or not a teacher deserves a raise.
obviously with the inflationary cycle being what it is we are all in agreement that teachers deserve raises that's not in question it's just making sure that we are being fiscally and good stewards of taxpayer money while we're waiting on the state to do its job.
So that one sheet that I talked to you about that one sheet that I spoke to you about that had the green and I said it was from T. A. Operating cost and it was on our website.
If you look at that, if you look at the most current year, for example, it shows our spend percentages by function.
So if you gave a 3% salary increase and all things stayed the same, then 3% of that salary increase, 65 of it, 65% or 67% is going to go to instruction.
And that's not just teachers, that's classroom paraprofessionals.
2% or less than 2% would go toward, like myself, in this building, administration.
So those percentages, if you dial back, if you look at that, at the 7.2, that's pretty much where it's going to go.
There would be some exceptions.
For example, maintenance.
Function 51 is a huge function.
Most of that's utilities.
And so that wouldn't work in that function.
But by and large, of the $7.2 million, it should follow that expenses.
I don't know if that makes sense.
Okay.
Thank you.
Thank you very much, and thank you, Mr. Smith, for your presentation
and all the work that everybody's put into it.
Any other final questions or comments?
Our next meeting is the next regular board meeting will be held on Monday, June 26, 2023.
7.1 Regular Board Meeting - June 26, 2023
23 there being no further business before the board this meeting is
adjourned the time is 626 thank you
Official documents
Motions and votes
Recorded actions
MOTION 001 · AGENDA 5.1
PassedIt is recommended that the Board of Trustees denies the Level DGBA 23-010, thereby upholding the decision of the Level One and Level Two Hearing Officer.
7 Yes · 0 No
| Trustee | Vote |
|---|---|
| amy-thieme | Yes |
| dawn-champagne | Yes |
| lance-redmon | Yes |
| mary-ellen-cuzela | Yes |
| morgan-calhoun | Yes |
| rebecca-fox | Yes |
| victor-perez | Yes |
MOTION 002 · AGENDA 5.2
PassedIt is recommended that the Board of Trustees approves the Independent Hearing Officers recommendation to non-renew employee Lakisha Jones.
7 Yes · 0 No
| Trustee | Vote |
|---|---|
| amy-thieme | Yes |
| dawn-champagne | Yes |
| lance-redmon | Yes |
| mary-ellen-cuzela | Yes |
| morgan-calhoun | Yes |
| rebecca-fox | Yes |
| victor-perez | Yes |