Superintendent's Recommended 2012-13 Budget Request

Executive Summary

By the Numbers 2012-13
Total operating budget: $626,541,473
Excludes capital outlay, special revenue and enterprise funds. Special revenue funds are restricted in purpose and not intended for the general K-12 population in the district (i.e., magnet funds). GCS has two enterprise funds, child nutrition and ACES (After-School Care Enrichment Services).

Total budget: $688,344,130 (Includes capital outlay, special revenue and enterprise funds.)

Projected K-12 student enrollment for 2012-13: 75,044 
(72,326 GCS students + 2,718 charter school students = 75,044; which represents a total increase of 737 students)

GCS Operating Budget

Budget Development Process
Serving as the district’s financial plan, the budget aligns GCS resources with the vision, mission, goals, objectives and strategies outlined in the district’s strategic plan, which was endorsed by the school board on March 10, 2009.

Loss of One-Time EduJobs Funds
The Federal Education Jobs Fund legislation, known as EduJobs, was enacted in August, 2010, and $10 billion was dedicated to help states and school systems across the nation weather the current economic downturn. The 2010-11 EduJobs allocation for GCS was $14,388,283.  

The funds were available for use in 2010-11, but after careful consideration and deliberation with both internal and external groups, the Board approved the superintendent’s recommendation to allow the administration to spend no more than $1 million of the EduJobs funding in 2010-11 to address class size/school-based issues and to retain the remainder of the funds for the 2011-12 school year to partially offset the pending funding shortfall the state and school districts faced in 2011-12 when the ARRA (American Recovery and Reinvestment Act) funds ended.  

GCS used approximately $451,300 of the EduJobs funds in 2010-11 to address class size/school-based issues. In 2011-12, GCS used $192,985 in EduJobs funds for 20 additional days of instruction at Washington Montessori; $473,685 for positions funded with Magnet School Assistance Program (MSAP) funds expiring June 30, 2011; and the remaining $13.27 million to fund/retain school-based positions.

Subtotal for loss of one-time EduJobs funds used in 2011-12 = - $13.27 million

Potential State Funding Reductions
Anticipating significant reductions in state funding, the superintendent’s recommended budget reflects the following:

Anticipated state reductions for 2012-13
Continuation of 2009-10 state reductions = - $20.72 million
Continuation of 2010-11 state reductions = - $10.42 million
Continuation of 2011-12 state reductions = - $11.05 million
Subtotal for recurring 2009-10, 2010-11 and 2011-12 state reductions = +$42.19 million
GCS’ share of projected 2012-13 losses in state funds = - $5.21 million
Subtotal for all recurring and anticipated state reductions = - $47.40 million

Potential GCS Budget Increases
The superintendent’s recommended budget includes some increases in operating costs, as well as items that were previously funded privately and new initiatives (denoted with a double asterisk**) that are to be addressed via redirection of existing resources:

• **Operational costs associated with adding five instructional days to the 2012-13 academic school year = +$1.19 million
• Energy and custodial costs associated with additional square footage coming online in 2012-13 = +$707,597
• Fund former MSAP (Magnet School Assistance Program) positions and +20 academic days at Washington Montessori paid from EduJobs dollars in 2011-12 = +$673,239
• Reimburse child nutrition fund for anticipated unpaid meal charges = +$500,000
• Offset elimination of federal risk pool funds (funds for “high need” students with disabilities served in local education agencies) = +$326,681
• Offset reduction in interest earnings = +$320,000
• **Fund African American Male Achievement initiative project = +$300,000
• Fund Cumulative Effect recruitment and performance incentives at Eastern and Southern High Schools previously funded privately = +$222,943
• **Implement various incentives targeted to enhance continuity and stability of principal leadership = +$175,000
• **Develop and implement a plan that provides additional compensation for certain Academic Services specialists = +$175,000
• Offset elimination of sliver funds (funds reserved by states for local capacity building grants to improve services provided to students with disabilities)  = +$164,069
• Fund portion of AP Exam fee costs previously funded privately = +$157,233
• **Position to plan/coordinate technology initiative = +$102,760
• +$1 per student increase in fees for field trips to the Natural Science Center = +$37,000

Subtotal for cost increases + new initiatives to be funded via redirection of existing resources = - $5.05 million

Total estimated 2012-13 budget impact to GCS = - $65.72 million

Potential GCS Budget Reductions and Redirections
The superintendent’s recommended budget reflects the following potential budget reductions and redirections:

Reductions and redirections for 2012-13

• Continuation of 2009-10, 2010-11 and 2011-12 budget reductions = +$42.19 million
• 2011-12 reserve for operational expenses = +$10.66 million
• 2012-13 WSF (Weighted Student Formula) dollars (allot 50 percent; hold 50 percent) = +$5.93 million
• Recurring central office reductions/redirections from 2011-12 = +$4 million
• Central office reductions/redirections for 2012-13 = +$2.54 million
• Additional savings from multi-tier transportation system implemented in 2011-12 = +$400,000

Total reductions and redirections = +$65.72 million

Class-size adjustment 
The superintendent’s recommended budget also includes savings of $1.14 million due to increasing class size by .25 student in grades K-12.

Total savings from increasing class-size = +$1.14 million

Additional Operating Funds Requested from County Commissioners
The superintendent’s recommended budget includes a request for additional funding from the County Commissioners for the following anticipated increases in sustaining operations costs:

• Student enrollment growth (+130 GCS students; +607 charter school students) = +$1.74 million
• Increase in employer-paid retirement and health insurance rates = +$1.46 million
• Increase in electric/natural gas/water/sewer public utilities costs = +$1.39 million
• Increase in gas/diesel fuel costs = +$462,609
• Increase in general/vehicle liability insurance costs = +$105,675
• Increase in property insurance costs = +$82,735
• Four months of principal salaries for Autism Wings opening at two sites in the fall of 2013 = +$74,945
• Increase in interscholastic/extra-curricular activities insurance coverage costs = +$22,020
• Increase in cost-per-copy program dollars for school-based copiers = +$3,655
• Increase in U.S. Postal Service rates = +$2,773
• Increase in graduation expenses = +$2,000
• Increase in N.C. School Boards Association membership dues/fees = +$1,330
• Increase in ConnectED (mass message/notification service provider) costs = +$390

Subtotal for anticipated increases in sustaining operations costs = + $5.35 million, which represents an increase of 3.05 percent in county appropriated funds for operating expenses

The superintendent’s recommended budget also includes a request for additional funding from the County Commissioners for a one-percent recurring salary increase for all employees (excluding the superintendent) = +$4.48 million.

Subtotal for 1 percent recurring salary increase for all employees = +$4.48 million, which represents an increase of 2.56 percent in county appropriated funds for operating expenses

Total request for additional operating funds from county commissioners = +$9.83 million, which represents an increase of 5.61 percent

Achieving Educational Excellence
Reducing significant expenses from a budget that is already lean has been – and will continue to be – a painful process for all concerned.

However, by keeping the district’s collective focus on academic excellence, particularly literacy and character development, we will continue to make gains in student achievement. When excellence is the goal, nothing short of excellence will suffice.