School Finance: Revenue, Funding Sources, and General Fund Overview
Explore the intricate world of school finance, from understanding revenue sources like state aid, local funds, federal funds, and more to the complexities of the general fund. Delve into topics such as how state funding is determined, the importance of the general fund, and enrollment trends affecting financing decisions.
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Presentation Transcript
SCHOOL FINANCE OVERVIEW It s Complicated
Where does the District get Revenue? State Aid (SSA, State Supplemental Aid) Local Funds, including Property Tax Levies Sales Taxes Federal Funds Program Fees
How complicated is it? Funding Source Property Tax Levies Federal Funds State Aid Program Fees SalesTax Enter: Child Care Enter: Food & Nutrition Special Rev: PERL Debt Service: Debt Service Special Rev: PPEL (Voted) PPEL (Board) Special Rev: Management Capital Projects: Statewide Penny Operating Fund: General Fund Fund Account Uses of Funds
What are the Sources of General Fund Revenue? GENERAL FUND REVENUE SOURCES (FY 2024) State, 61% Local (including Property Tax), 28% Federal, 11%
Why Focus on the General Fund? Largest source of Revenue & Expenditures Pays for Educational Programs Biggest Risk Spending Authority Restrictions % of Annual Revenue 77% % of Annual Expenses 79% Fund General Fund Special Revenue Capital Project Debt Service 7% 6% 7% 6% 4% 4% Enterprise Funds 5% 5%
How is State Funding Determined? Iowa utilizes a Student-Driven Funding Formula Per Student Funding Amount set annually Legislatively through the rate of increase to Supplemental State Aid Regular Programs Categorical Funding Primarily Per Student Funding Funding Based on Student Weight Creates weights for students based on need Weightings increase funding for certain programs (ELL, SPED Certain Programs
At what Rate has the Legislature Set Supplemental State Aid? ANNUAL PERCENT GROWTH IN SSA 16.00% 1973 1994 Average Annual Growth: 6.22% 1995 2014 Average Growth: 2.93% 2015 2024 Average: 1.99% 14.00% 12.00% 10.00% 8.00% 6.00% 4.00% 2.00% 0.00% 7
What is the Districts Enrollment Trend? School Year 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 2024-2025 Cumulative Certified Enrollment 269 fewer students 182 fewer students 985 fewer students 598 fewer students 250 fewer students 416 students ? XXXX fewer students 2,000 Students is the Equivalent of: one large high school OR three middle schools OR six elementary schools
Expenditures by Function (FY2023Actuals) GeneralFund,in Millions 22.6 58.4 Instruction, 57% Instructional Support, 14% General & ExecutiveAdministration, 1% SchoolAdministration, 7% Business& Central Support Services, 4% PlantOperations& Maintenance,12% Other Uses, 5% 20.1 32.2 6.9 282.8 71.5
Costsof Doing Business (FY 2023Actuals) GeneralAdministration Superintendent,Board, SPEDAdmin,T&L Admin GENERAL FUND, IN MILLIONS SchoolAdministration Principal,AP , OfficeStaff,Supplies 6.9 General & Executive Administration, 6% SchoolAdministration, 27% Business& Central Support Services, 17% PlantOperation & Maintenance, 50% Business & CentralAdministration Business& Finance,Talent& Personnel, Purchasing,Technology, Public Information, Printing 32.2 58.4 Plant Operation & Maintenance Facilities, Operation, Custodial, Utilities, Repair/MaintenanceEquip, Public Safety, Student Transportation 20.1
Can a School District Spend its Money on Whatever it Needs / Wants? No! School districts have restricted funding. What if you have a deficit in one fund and a surplus in another fund? How does restricted funding impact schools? What defines an allowable expense? Restricted funds can only be spent on allowable expenses, even if those expenses are not the highest priority State & Federal law dictate allowable expenses, even for General Fund dollars Administrative Rules can further clarify/restrict State law May not be able move money from one fund to another Example 1: Cannot move Food & Nutrition excess to General Fund Example 2: Cannot move money from other funds to cover a negative Student Activity fund If allowed to move funds, requires prior Board approval
How complicated is it? Funding Source Property Tax Levies Federal Funds State Aid Program Fees SalesTax Enter: Child Care Enter: Food & Nutrition Special Rev: PERL Debt Service: Debt Service Special Rev: PPEL (Voted) PPEL (Board) Special Rev: Management Capital Projects: Statewide Penny Operating Fund: General Fund Fund Account Uses of Funds
Where do you fit in? Be curious & actively engage Talk to your neighbors and family/friends Legislative Session SSA increase approved in 2025? How could that impact our district? Preschool funding
JOIN US FOR COFFEE AGAIN Saturday, February 1, 2025 9AM Mitchell Early Learning Center Increase funding for four-year-old preschool students in need Increase in weighted funding for the Statewide Voluntary Preschool Program (SWVPP) for children living at or below 180% of the Federal Poverty Level
DMPS Preschool Funding SWVPP DMPS. 50% SWVPP Partners, 22% Head Start, 21% ECI, 5% Shared Visions, 2%
What is Spending Authority? Spending is limited by the amount of Spending Authority a district has Amount of cash or fund balance is not considered Must account for two things in the General Fund Fund Balance (cash) Spending Authority (state limit on spending) Restriction only applies to General Fund For all other funds, if you have the cash, you can spend it
How much does each fund have in annual revenue? ALL FUNDS BY FUND TYPE (FY 2024) 22,09928,299 41,990 Operating (i.e., General Fund), 77% Special Revenue, 7% 42,552 Capital Projects, 7% Debt Service, 4% Enterprise, 5% 467,975 Amounts in millions
School Expenditures Defined Iowa DE Definition Area General & Executive Administration Activities concerned with establishing and administering policy for operating the school district. Activities associated with the overall general administration of or executiveresponsibility for the entire school district. SchoolAdministration Activities concerned with overall administrative responsibility for aschool. Business& Central Support Services Activities that support other administrative andinstructional functionsincluding fiscal services,human resources,planning,and administrative information technology. Operation & Maintenanceof Plant Activities concerned with keepingthe physicalplant open,comfortable,andsafefor useandwith keeping the grounds,buildings,andequipment in effective working condition andstate of repair. Activities concerned with conveyingstudentsto and from school,asprovided bystate andfederal law. Other Uses A number of outlays of governmental fundsare not properly classified as expenditures,but still require budgetary or accounting control. (AEAFlowthrough & InterfundTransfers)
How does DMPS account for its money? Governmental Funds Proprietary Funds Fiduciary Funds Special Revenue Funds Operating Fund Capital Projects Fund Debt Service Fund Enterprise Funds Internal Service Funds Trust Funds SAVE (Statewide Penny) General Management Debt Service Food & Nutrition Self-Insurance Private Purpose Risk PPEL Child Care Management Pension Home Building Print Shop PERL Custodial (i.e., 91 funds / Agency) Student Auto Body/Mechanic Student Activity Ag Store Governmental Trust
