School Finance, Weekend 2 Administering the School Budget

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School Finance, Weekend 2Administering the
School Budget
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Administering a School Budget

• A good principal must first possess the basic
  skills necessary to keep a school running. That
  is, a principal must be well-grounded in
  budgeting and other nuts and bolts processes at
  the heart of a functioning school.
• -Kent Peterson (1995)

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State Aid Primer

• Public School Funding comes from 3 sources
• Federal 4
• State 44 state aid, grants
• Local 52 local revenues, property tax
• State Aid comes from the State General Fund
• 90 General Fund state income tax, sales tax
• 10 Special Revenue Fund lottery

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2000-2001 School Funding Facts

• 56 State Aid to districts was unrestricted
  general aid
• 15 State Aid was designated for students with
  disabilities
• 29 transportation, capital projects, higher
  learning standards, etc.

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Local Revenue Facts

• BOE can levy taxes on residential and commercial
  properties
• Big 5 cities do not levy taxes but are bound by
  constitutional limits
• Buffalo, Rochester, Syracuse, Yonkers, NYC
• Small City School Districts can vote on school
  budgets since 1997.

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Administering a School Budget

• The Budget
• A financial plan that involves
• Planning
• Receiving funds
• Spending funds
• Evaluating results
• Fixed time period
• the translation of educational needs into a
  financial plan which is interpreted to the public
  in such a way that when formally adopted it
  expresses the kind of educational program the
  community is willing to support, financially
  morally, for a one year period.

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Purposes of Budgetary Practices

• Projects the educational plan of the district,
  and informs the community.
• Presents the sources of funding, anticipated
  expenditures, and allocation plan for disbursing
  the funds
• Guide for evaluating a years program.
• Motivation for careful planning, systems of
  control, expenditure of funds
• Frames the relationship of the state, federal and
  local support for education.

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Phase 1 Budget Planning

• Determining the needs of the educational program
• What are the goals of the school?
• What services of the school need to be increased?
• What is the state and/or federal issue, this
  year?
• Effect of cost of living on salary needs?
• What else?

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Phase 1 Budget Planning

• Cooptating support for a budget plan
• Involving constituents
• Working with the community, PTOs, community
  organizations, etc.
• Planning sessions with the BOE
• Community meetings
• What else?

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Phase 1 Budget Planning

• Preparing the needs and wants
• Building and department requests
• Comparison of information from previous years
• Equipment and supply needs
• Comparing the costs for the wish list with
  reality figures
• Cost of living
• Knowledge of the community

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Phase 1 Budget Planning

• Salary Schedules, benefits, etc
• Statistical summary of data
• Enrollment
• Staffing
• Average Daily Attendance
• Pupil-Teacher ratio
• Sectioning of HS courses
• State aid provisions
• Insurance
• Transportation needs
• Retirement and social security needs

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Phase 1 Budget Planning

• Budget Workshops
• Budget Hearings
• Budget Vote

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Phase 2 Receiving Funds

• Responsibility of local authorities through a
  system of taxation, debt collection, and legal
  resources.
• Funds are transmitted to a school district for
  use by community approval
• Budget becomes effective on the first day of the
  new fiscal period.

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Phase 3 Spending Funds

• Budget adoption leads to posting of line items.
• Purpose of the budget is not to save money, but
  spend it wisely, and expeditiously.

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Phase 3 Spending Funds

• Purchase Order Form (voucher)
• Request or requisition form for ordering
• Decision where funds can be drawn and approved by
  Principal (CEO)
• Mailing of P.O.
• Order completed, invoice received and approved by
  designee.
• Payment fulfilled by check.
• PO, invoice, copy of check filed together.

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Phase 4 Evaluating

• Superintendent responsible for ensuring that the
  budget is well-conceived summary of the
  districts educational plan.
• Supt. must be able to demonstrate that it is
  constructed around specific purposes, objectives
  and guidelines that support the mission of the
  school.
• Supt. must keep the BOE informed about the
  operation and effectiveness of the budget.

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Phase 5 Time-line

• July Budget year begins
• September Quarterly revision
• October Data projections
• Population
• Staffing
• Program changes
• Facilities
• November Staff requisitions

• December Budget revisions
• January Rough draft of budget needs
• February equipment priorities
• March budget workshops, sessions
• April budget revisions
• May Budget Vote
• June Adoption of budget or contingency plan

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Building Level Budget Matters

• Principal provides data to the superintendent
• Student enrollment, pupil-teacher ratios, course
  enrollments, projections for class size
• Principal (Chief Education Officer) must
  supervise and maintain the line item expenditures
  assigned to his/her building.

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Budgeting Systems for Education

• Planning/Programming/Budgeting Systems (PPBS) c.
  1960s
• Cycle of planning including
• Establishing goals
• Determining the financial cost of alternatives
• Evaluating results
• Improving the objectives
• Improving the alternative plans to reach the
  objectives

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Budgeting Systems for Education

• Zero-Base Budgeting (ZBB) c. 1970s
• Construction of a new budget each year from a
  zero base.
• Every program, if it is to received continued
  funding, must be justified during each budget
  development.
• A program provides a defense of its budget
  request that makes no reference to the level of
  previous appropriations.
• Bottom-up organization of the budget.

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Budgeting Systems for Education

• Site-based Budgeting c. 1980s
• Development of a budget through the involvement
  of teachers, community, and administration at the
  school level.
• Matching student needs to available resources.
• Giving the principal and instruction staff more
  control over the budget, personnel, and
  organization at the site level.

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Budgeting Systems for Education

• Strategic Planning c. 1990s
• Goal setting program (2, 3 or 4 year visions)
• Mission statement and district goals
• Total Quality Management (TQM)
• Total organizational control by all constituents.

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Budget Administration Issues

• Auditing
• Procedure for verifying financial operations of a
  school district
• Independent examiners
• Internal Audits qualified personnel employed by
  the district
• State Audits government examiners
• External Audits qualified examiners outside of
  district personnel

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Dark Side of School Leadership

• http//nysosc3.osc.state.ny.us/press/releases/jan0
  6/012406a.htm
• http//newyorkmetro.com/nymetro/urban/features/990
  8/

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Cycle of Auditing
F.O.B
Internal Auditor
External Audit
Auditing Committee
Board of Ed