Business Managers Meeting May Revise Alice Miller Carlyn Obringer
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1 Business Managers Meeting May Revise 2018 Alice Miller Carlyn Obringer
2 Agenda State and Federal Updates Budget & Prop 98 Updates LCFF rates and calculations Minimum Wage SB740 Other Updates Legislative Updates Workshops Deadlines Information in this presentation is accurate as of the posting date. Updates will be provided as the budget process continues. Be sure to sign up for our Weekly Member Digest and Capitol Updates for up to the minute information.
3 Major Proposals Fully fund LCFF using almost $3B from previous Prop 98 revenues not yet allocated to K12. Increase COLA to 3% for LCFF Eliminates the Maintenance Factor One-time discretionary grant of $2.02B $344 per ADA based on prior year P2 $100M for a teacher workforce to train and retain Special Education teachers $212M for workforce programs specifically aimed at a K12 CTE program $167M in additional funding for Child Care and State Pre-school to expand services for children up to 5 years of age SB 740 augmenting the program in by $28.3 million to reflect rising lease costs and growth in program participation for a total of $140.4 million dollars (more later) Slight increase in Mandate Block Grant per ADA $16.30 per ADA in grades K-8, and $45.15 per ADA in grades 9-12 Increase to Rainy Day Fund w now be fully 3
4 State Economic Overview Overall positive state economic situation with positive projections through the budget year. UCLA forecast 2018 looks bright, 2019 perhaps not so much. Unemployment will drop below 4% (resulting in fewer costs for support services and additional funds for other programs). Increased employment in Inland Empire, the San Joaquin Valley, and the Sacramento and Delta regions (which typically lag). CA 4.3% US 4.1% in April High wages and employment in BA, LA, and OC, but housing costs prohibitive (resulting in slower growth over time). Uncertainties related to federal policy, including health care, tax reform, immigration, and trade that may have an impact on the projections and the state s liability moving forward. Emphasis on economic volatility and certainty of recession in future in year 9 of economic uptick and if it continues will be the longest running uptick in state history. COLA 2.71% (inflation increasing) LCFF 3% COLA
5 Housing Costs SSC
6 Month That Expansion Started SSC Economy Uptick April 1991 Current (July 2009) March 1961 December 1982 December 2001 Average April 1975 June 1954 December 1970 May 1958 August 1980 Current Recovery Is Approaching The Longest Ever Number of Months
7 Federal Impact Federal tax plan could have huge impact on personal income and spending Limits tax reductions to $10K (CA average $22K) Reduces medical expense deductions from 10% to 7.5% of adjusted income Repeals Renewable Energy Bonds, QZABS 30% increase tariffs on imports of solar panels (230,000 loss of jobs) Reduces energy tax credits from renewable sources Concerns over NAFTA ($1 trillion in trade w/ Mexico and Canada, 4.4M California jobs, our two biggest exporters) Imposition of tariffs on steel and aluminum imports of 25% and 10% respectively some have been repealed or postponed Changes in Federal corporate tax laws could increase corporate tax revenues by 12% or $10.1B
8 Issues We are now at the end of the LCFF implementation phase and can only assume COLA increases moving forward. At least one bill to increase the LCFF target rate has been proposed Proposal to Increase LCFF base rates $1.2B (remove one time funding) and AB 2808 increases may be unlikely The STRS/PERS increased costs will absorb much of the recent increases (25% of increases). PERS board increased employer contributions again no proposed increase in LCFF targeted rate or increase in state contributions Potential teacher shortage estimated by SSC to be 50K, primarily in specialized areas of SPED, high school math and science and STEM expertise. Repeal of Prop 55 increases shortage of bilingual teachers No proposal to increase AB 602 rate for SPED currently 64% funded by local sources Increase reserve levels while you can! 17% district average days of expenses The GFOA recommends minimum of 2 months payroll
9 LCFF Rates LCFF Funding Element LCFF Amounts for Grade TK-3 Base $7,409 Grade K-3 Grade Span Adjustment $771 (10.4% of K-3 target) Grade 4-6 Base $7,520 Grade 7-8 Base $7,744 Grade 9-12 Base $8,973 Grade 9-12 Grade Span Adjustment Supplement per unduplicated Free or Reduced Priced Meal Eligible Pupil, English Learner or Foster Youth $233 (2.6% of 9-12 target) 20% of average base and add-on funding per eligible ADA Concentration Supplement per pupil above 55% of the lesser of total district or charter percent high need 50% of average base and add-on funding per eligible ADA above 55% Percent of gap between current funding and target funded in %
10 LCFF Rates w Grade Spans Grade Span Base Grant Per ADA GSA Adjusted Grant K-3 (10.4%) $7,409 $771 $8, $7,520 - $7, $7,744 - $7, (2.6%) $8,973 $233 $9,206
11 Supplemental and Concentration Grants Grade Span Adjusted Grants Per ADA 20% Supplemental Grant Total UPP 50% Concentration Grant UPP Above 55% K-3 $8,180 $1,636 $4, $7,520 $1,504 $3, $7,744 $1,549 $3, $9,206 $1,841 $4,603
12 AB 2808 Proposal Grades Amount Kindergarten and grades 1-3 $11, $11, $12, $14,289 This will play out in the budget process. Passed out of Appropriations but a massive cost so doubtful. Budget Conference Committee members have been announced.
13 COLA Increases of 2.71% to: SPED ($14.66 per ADA) Child Nutrition Foster Youth American Indian Childhood and Education programs
14 STRS Year Employer CalSTRS Rates Pre-PEPRA Employees Post-PEPRA Employees % 10.25% 9.205% % 10.25% % % 10.25% % % 10.25% %
15 PERS Year Previously Released Employer Contribution Rates Employer Contribution Rate* % % % 20.8% % 23.5% % 24.6% % 25.3% % 25.8% % 26.0% Increases in Employer Contribution rates, please note
16 Minimum Wage Another issue that schools should factor in to longer range budget planning is the increase in the minimum wage over the next several years to reach $15.00 per hour. Schools will need to plan for both the wage increase, and related benefits related to wages for minimum wage employees. Some local jurisdictions may have increases not reflected here, so schools should also monitor any local action on minimum wage.
17 Exempt Employees Impact Minimum wages have a direct impact on the minimum salaries paid to exempt employees. Essentially two times the minimum wage.
18 Other Funding Factors SSC School Services crystal ball DOF provided COLA estimates
19 Teacher Shortage SPED (SSC) $100 M in one-time funding Teacher Residency Grant Program $50 million To support locally sponsored, one-year intensive mentored and clinical teacher preparation programs Local Solutions Grant Program $50 million One-time competitive grants to develop and implement new, or expand current, local solutions to address the need for special education teachers
20 Teacher Residency Grants develop new or expand existing teacher residency programs that recruit and support the preparation of special education teachers. Must work with CTC-accredited teacher preparation programs but can also include work with other community partners Funds may be used for stipends for teacher candidates and mentor teachers, and for mentoring and induction costs $20K per SPED teacher candidate LEA must provide a dollar to dollar match Must ensure candidates can get preliminary credential in SPED and must provide support for clear credential Include training in curriculum planning, assessments, language supports, and disability supports Preferences to low income schools, high teacher turnover, 5% or more with non fully credentialed teachers Teachers must make 4 year commitment to remain with LEA Competitive and apply to the CTC
21 Teacher Local Solution Grant develop and implement new, or expand existing, locally identified solutions that address a local need for special education teachers. Funds used for recruitment, teacher career pathways, student debt payments, signing bonuses or living stipends solutions that address the local needs of the LEA $20K stipend per teacher Dollar to dollar match OR in-kind contribution Applications through the CTC which will determine criteria Unclear how criteria will change as budget process is completed
22 Title IV Title IV new flexibilities and significant increase in funding Title IV being funded again to support a "well rounded" education -- lots of options Compliance not as difficult now that we have LCAP (fold expenditures into existing LCAP goals and actions ) $10K minimum entitlement for schools. New schools in 1st year of operations not eligible because the allocation is based on prior year Title I Another option is for schools to apply for Title IV and transfer to another title program. Deadline to apply February was 28, 2018, but keep on radar! Include in new Federal Addendum for 2019
23 State Child Care Rates Daily Per ADA Annual Per ADA Part-Day $29.90 $5,233 Full-Day $48.28 $12,071 Early Education $167.2M in expansion programs for Special Needs and low income students. More information forthcoming if approved.
24 SB Budget Proposal Creates More Uncertainty -$28.3 million more ongoing, starting ! -No CY increase proposed -Removes automatic backfill (would require proration in CY of up to 20%) -Caps grant increase to COLA rate -Prioritizes leases for full funding
25 SB 740 Update Con t Trailer bill language after the January budget proposal indicated CY funding would not be covered. This past week, both the Assembly and the Senate approved the increase in ongoing SB740 funding and the one-time funding that is required to keep schools whole in the current fiscal year. Should make it through the budget process
26 SBE Updates Adopted LCAP addendum that allows an LEA to complete a single plan together with the consolidated funding application to meet both state and federal requirements, align state and federal resources, and help minimize duplication of effort at the local level pfedadd.docx Due in Sept. Separate from the LCAP s and renewals. CCSA workshop coming up soon
27 Federal Program Monitoring Several charters have been notified of a program audit CDE has trainings for schools to review on the above website which we highly recommend Questions please contact us!
28 Teacher Effectiveness Grants Don t forget this is the report year Last year of a three year program Must file a report with the CDE no later than July 1 st, 2018 on how monies were spent Required Board approval Include information on numbers of teachers, paraprofessionals and administrators and the expenditures Expenditures must also be differentiated by subject area
29 PCSGP PCSGP applications have been reviewed Schools have been notified if they passed the peer review process Budget questions continue to come to our Help Desk so please let us know if you need additional help We can help with interpretations Another round of funding will be available this fall
30 Attorney General Guidance on Immigration Enforcement at Schools California Attorney General Xavier Becerra issued sweeping guidance for K-12 schools on March 30, 2018, seeking to ensure public schools remain safe and accessible to all California residents, regardless of immigration status entitled: Promoting a Safe and Secure Learning Environment for All: Guidance and Model Policies to Assist California K 12 Schools in Responding to Immigration Issues" Addresses several critical topics for school administrators, including: *Responding to On-Campus Immigration Enforcement *Responding to the Detention or Deportation of a Student s Family Member *Parental Notification of Immigration Enforcement Actions *Collecting, Retaining, and Sharing Student Information A K-12 schools in California, including charter schools, must be fully compliant with the Guidance by July 1, 2018
31 Legislative Update AB 2635 (Weber) Lowest Performing Subgroup - Released from the committee with unanimous vote. The bill will next move to the floor. See our statement on the action taken by the Assembly Budget Subcommittee on this issue and SB 740 here. AB 1871 (Bonta) Free or Reduced-Price Meals Released from committee with amendments. The bill will next move to the floor. We have switched from an oppose position to a support position with the amendments. See our statement on this bill here. AB 3048 (Irwin) Teacher Credentialing Misassignment Held in committee. We were gearing up on this issue for a potential floor fight, so this bill being held was great news. This issue will likely be back next session. 31
32 Leg Update 2 AB 3222 (O Donnell) Prevailing Wage for Conduit Bonds Released from committee with Republicans voting no. The bill will next move to the floor where we have prepared for a floor fight on this issue next week. AB 3167 (O Donnell) CARSNET Funding Bill Released from committee with Republicans voting no. AB 2891 (Holden) Including Charters in Dual Enrollment CCAP Programs Held in committee. This is an unfortunate result, we were supporting this legislation to fix issues charters attempting to access this program have been having. SCA 22 (Allen) Parcel Taxes No action taken by Senate Appropriations. They will be taking action on SCA s likely later in the year. Thursday Capitol Updates to keep current!! 32
33 Governor s Race!! June 5 th primary is critically important for charter schools! This is the first time in our 25 year history that we may have an anti-charter school governor. Please ensure your families are aware of the importance of this election and the need to vote. VOTE!! 33
34 May 2018 Deadlines 29 Deadline for charter schools to submit an appeal to the SBE to be reviewed at the September SBE meeting Physical Fitness Test testing window closes ELPAC testing deadline. Every pupil in California whose native language is not English is required to be tested by this date.
35 June 2018 Deadlines 4 Applications for the Charter School Facility Grant Program (SB740 Program) are due to the California School Finance Authority: 8 The Charter Schools Annual Information Survey is due to the CDE Deadline for charter schools whose petitions will be reviewed at the September SBE meeting to submit their Charter Submission Packages to the CDE Certification of the Second Principal Apportionment 30 FY California Renovation and Repair Loan Program applications due to the CDE CARS (Consolidated Application and Reporting System) Spring Reporting Data due to the CDE Child Care Facilities Revolving Fund General Facilities Application FY due to the CDE by this date.
36 June 2018 Deadlines (continued) 30 Charter schools interested in exploring LEA status or negotiating alternative special education arrangements for the school year must submit a letter notifying their existing SELPA of their intent to exit the SELPA Summer Food Service Program applications due to the CDE Child and Adult Food Care applications due to the CDE School Nutrition Program applications due to the CDE Title III, Part A, Language Instruction for English Learners applications due to the CDE by this date Education Technology K-12 Voucher applications due. $50-$100 per student. Late month Third quarterly lottery apportionment expected from the state. Late month Certification of the Fourth Quarterly Apportionment for the Education Protection Account (EPA) and entitlement schedule.
37 July 2018 Deadlines 1 Preliminary budgets must be submitted to the chartering LEA and county superintendent of schools. Education Code (a)(1) 1 Charter schools must adopt a Local Control and Accountability Plan. Education Code 52060; California Code of Regulations, Title 5, Chapter Late month Pupil Estimates for New or Significantly Expanding Charters (PENSEC) for Fiscal Year are due to the CDE.
38 Alice Miller Questions? Carlyn Obringer Nikole Wilson (workshop support, presentation copies)
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