Expenditure Target Reporting

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Expenditure Target Reporting

• Texas Association of School Administrators
• Midwinter Conference
• January 28, 2008
• Austin, Texas

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Background

• The 79th Texas Legislature, Third Called Session,
  authorized House Bill 1, which added Texas
  Education Code, Section 44.011 to require the
  commissioner to establish and annually report
  spending targets for school districts based on
  the best practices of campuses and districts.

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Stakeholders

• The Texas Legislature, Texas Education Agency
  (TEA), school districts and campuses, regional
  education service centers (ESCs), and the public.

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Data Sources

• The source of Projected and Actual Expenditure
  Target reports will be financial data reported by
  districts to the Public Education Information
  Management System (PEIMS).

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Expenditure Targets Timeline
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Methodology

• Expenditures are divided into four categories
• Instruction
• Leadership
• Ancillary
• Administrative
• Targets are established for each expenditure
  category and school district community type.
• The Instruction target is aligned with the NCES
  definition of Instructional expenditures.
• Non-Instruction targets are based on a tolerance
  around the grand mean for each category and
  school district community type

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Community Types

• Major Urban In counties with populations of
  650,000 and over 35 economically disadvantaged
• Major Suburban - In and around the major urban
  areas and if not contiguous, have a student
  population that is at least 15 of a major urban
  district
• Other Central City - In counties with populations
  between 100,000 and 650,000 and not contiguous to
  any major urban districts
• Other Central City Suburban In and around other
  central cities and if not contiguous, have a
  student population that is at least 15 of a
  central city district

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Community Types Contd

• Independent Town - Largest school districts in
  counties with populations of 25,000 - 100,000
• Non-Metro Fast Growing - Five-year growth rate of
  at least 20 percent, at least 300 students, and
  not in any of the other above categories
• Non-Metro Stable - Students in membership exceeds
  the state median and not in any above category
• Rural - Growth rate less than 20, number of
  students is between 300 and the state median, or
  the number of students less than 300

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Expenditure Categories

• Instruction
• Instruction (function code 11)
• Extracurricular Activities (function code 36)
• Payments to Fiscal Agent/Member Districts of
  Shared Services Arrangements (function code 93)
• Payments to Juvenile Justice Alternative
  Education Programs (function code 95)
• Leadership
• Instructional Leadership (function code 21)
• School Leadership (function code 23)

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Expenditure Categories Contd

• Ancillary
• Instructional Resources and Media Services
  (function code 12)
• Curriculum Development and Instructional Staff
  Development (function code 13)
• Guidance, Counseling and Evaluation Services
  (function code 31)
• Health Services (function code 33)
• Transportation (function code 34)
• Food Services (function code 35)

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Expenditure Categories Contd

• Administrative
• General Administration (function codes 41,92)
• Facilities Maintenance and Operations (function
  code 51)
• Security and Monitoring Services (function code
  52)
• Data Processing Services (function code 53)

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Example ISD

• In Example ISD for a given year, the following
  expenditures were reported

In the table above, the value of instruction is
60, and would comply with the expenditure
targets set for both 2006-2007 and 2007-2008, but
not 2008-2009.
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Setting Targets

• The 65 minimum of operating expenditures for
  instructional costs is being phased in over a
  three year period as adopted in Texas
  Administrative Code, Title 19, Part 2, Chapter
  109, Subchapter AA
• Fiscal Year 2006-2007, the indicator will be "Was
  the Percent of Operating Expenditures Expended
  for Instruction More Than or Equal to 55?"
• Fiscal Year 2007-2008, the indicator will be "Was
  the Percent of Operating Expenditures Expended
  for Instruction More Than or Equal to 60?"
• Fiscal Year 2008-2009 and beyond, the indicator
  will be "Was the Percent of Operating
  Expenditures Expended for Instruction More Than
  or Equal to 65?"

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Instructional Targets

• For the 2006-2007, the percentage of operating
  expenditures spent on instruction must be 55 or
  above.
• In FY 2007-2008, the target for operating
  expenditures dedicated to instruction is
  increased from 55 to 60.
• By 2008-2009, the percentage of instructional
  expenditures will be 65 or above.

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Median Instructional Expenditures
Instruction (function code 11) Extracurricular
Activities (function code 36) Payments to Fiscal
Agent/Member Districts of Shared Services
Arrangements (function code 93) Payments to
Juvenile Justice Alternative Education Programs
(function code 95)
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Median Leadership Expenditures
Instructional Leadership (function code
21) School Leadership (function code 23)
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Median Ancillary Expenditures
Instructional Resources and Media Services
(function code 12) Curriculum Development
Instructional Staff Development (function code
13) Guidance, Counseling and Evaluation Services
(function code 31) Health Services (function code
33) Transportation (function code 34) Food
Services (function code 35)
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Median Administrative Expenditures
General Administration (function codes 41,92)
Facilities Maintenance and Operations (function
code 51) Security and Monitoring Services
(function code 52) Data Processing Services
(function code 53)
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Tools

• The expenditure target dashboard tool is designed
  as a reporting and planning tool for school
  districts.
• The tool was developed using Microsoft Excel
  2003.
• The tool requires the customer to enter the total
  budget amounts.
• A comments section is provided as part of the
  school district tool for explaining variances
  (colored as red or yellow) for each expenditure
  category.

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Color coding targeted
For the purpose of providing a means for
monitoring expenditures, TEA has developed a
traffic light color scheme to represent
expenditure targets, with regard to their targets
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Projected Expenditure Example
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Actual Expenditure Example
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Dashboard Example
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What is required of School Districts

• School districts not meeting the defined targets
  are required to provide an explanation of the
  variance in a school board meeting.
• The dashboard tool is designed to assist with
  school board presentations

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Next Steps

• Projected Expenditures for future reports will be
  adjusted based on the following
• Comparison to PEIMS financial actual data
• Best Practices
• Feedback

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School Finance Forecasting Fiscal Analysis
Staff

• Belinda Dyer, Director
• Al McKenzie, Senior Systems Analyst
• David B. Cohen, Systems Analyst

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Web Resources Contact Info

• School Finance website
• http//www.tea.state.tx.us/school.finance/
• School Finance email
• sfinance_at_tea.state.tx.us
• Phone number
• [phone]
• Fax Number
• [phone]