Finance

Front 1

What is adequacy?

Back 1

Is there enough dollars/money between local and state resources to educate kids?
Where they have found there to be an inadequate funding the state has said you have to find the money to make it fair.
Tax levy of $2.75 is a requirement.
Courts are now focusing on adequacy.
If property were better assessed in non-metropolitan areas there wouldn't be such disparities in adequacy.

Front 2

What is equity?

Back 2

All communities, whether rich or poor, are taxed at similar rates and have equal access to similar amounts of revenue per student.
Districts with lots of property tax wealth have enough to educate students while poor districts do not.
Courts say states can't let poor district suffer. You have to send more money to struggling districts and a minimum to wealthy districts.
courts never have said that states need to send equal amounts.

Front 3

Define Revenue.

Back 3

Money given to school districts.
Local = property tax ( about 45%)
State = formula money, transportation, ECSE (about 38%)
Senate Bill 287--how the state distributes money to schools
Federal = food service subsidies, Title I ( about 7%)
Proposition C = 8%

Front 4

Define Expenditures

Back 4

About 80% of expenditures are for personnel (salaries, benefits, and retirement)

Front 5

Fund Accounting

Back 5

1. Operating Fund
Fund 1--Incidental fund (non-certificated salaries, all other expenses)
Fund 2--Teachers' Fund (only for certified teachers)
Fund 4--Capital Projects (Purchase of equipment)

2. Debt Service Fund (Fund 3)--has separate bank account; principle and interest on g.o. debt)

Budget can't be legally amended by anyone but the board of education.

If your fund balance is less than 3% of expenditures, you are a financially stressed district.

Front 6

Maximizing use of Resources

Back 6

1. Bidding--all expenses have a dollar amount in which it must be bid.
2. Investing--invest all money not being used.
3. Equitable Distribution of Resources--there are students who cost more to educate.
4. Safeguards--procefures in place to protect money; checks and balances

Front 7

What are the Legal Requirements of a school budget?

Back 7

1. Budget adopted prior to July 1.
2. Budget amended during the year.
3. School board must adopt and amend budget.
4. Final expenditures cannot exceed budget by fund.
5. Budget expenditures cannot exceed revenues and available balances by fund.

Front 8

What is the purpose of the budget?

Back 8

1. Fiscal plan to implement education plan.
2. Measure financial health of district.
3. Public relations document.

Front 9

What is the assessed valuation by county?

Back 9

1. New construction and improvement and change in value of existing property.
2. Real Property
a. Residential: 19% of value.
b. Commercial and Industrial: 32% of value.
c. Agriculture: 12% of value
3. Personal property: 33% of value.

Front 10

What is the tax-rate formula?

Back 10

Formula in place before 2005
Reward for effort
Equal opportunity for state aid
Based on the characteristics of the district's taxpayers.

Front 11

What is the student need formula?

Back 11

New formula which has little to do with tax rates.
Aid based on needs of the students population
Reward for need
Based on the characteristics of the district's students.

Front 12

What is the Resource-Oriented Model?

Back 12

Estimates the cost of education based on the best judgment of education professionals in the state.

Front 13

What is the Performance Oriented Model?

Back 13

Actual spending of high performing school districts in the state.