Ann Wade, Chief Financial Officer
Brenda Martin, Treasurer
Joy Plested, Director of Accounting
Mark Bilby, Director of Purchasing
Dusty Dilldine, Director of Payroll

• '08-'09 Payroll Schedule for Hourly Employees
• '08-'09 Pay Dates

BID NOTICES

Executive Summary

The FY 2007-08 Operating Budget is prepared in accordance with Oklahoma statutes using the Oklahoma Cost Accounting System (OCAS).  This document is designed to give readers a better understanding of the District’s financial budgeting practices and budget management system.  Information is presented in a summary and detailed format by fund, using tables and graphs to present current and historical information.

Preparation of the Budget begins in January, with the gathering of current year data and preparation of the budget calendar.  The calendar includes major benchmarks and timelines for tasks, as well as responsible individuals for each step in the process.  The budgeting cycle takes place during the spring and summer months, with final allocations and funding confirmed in the early fall.  Once the Estimate of Needs is completed and approved by the County Excise Board in October, the district prepares the final budget for approval by the Board of Education.

For FY 2007-08, the Operating Budget consists of the following funds and amounts:

The General Fund budget reflects an increase of $6,215,227, or 7%, from the 2006-07 budget.  This increase is primarily the result of the increase in teacher salaries, and the addition of certified teaching positions.  This and other changes for the new year are discussed in greater detail within this report.

Expenditures in the General Fund are presented at the function, object, and project level.  At the function level, 63% of the budget is allocated to instruction.  The next largest areas are operations and maintenance of plant, school administration, and student support services.   Analyzed by object, 90% of the budget is allocated to salaries and benefits.  Staff positions paid through the General Fund include 1,138 certified and 570 support FTE.

Revenue for the Building Fund is generated by a 5-mill ad valorem levy.  This year, the Building Fund begins the year with a smaller carryover than normal, which will be used in part to fund renovation and repair projects as part of the annual capital plan.   Also, two employee salaries (and corresponding benefits) are paid from the Building Fund.  Other recurring expenses in this fund include costs to repair, operate, and maintain property owned by the District.

The Child Nutrition Fund accounts for all activities of the District’s Child Nutrition program, including the cost of staffing kitchens and cafeterias, food purchases, supplies, kitchen equipment, and cafeteria furniture.  This program is self sufficient, and does not require an operating subsidy from the General Fund.    The district’s Child Nutrition program has a current staffing level of 134 FTE.

The table that follows this section shows a summary of the Operating Budgets for the General, Building, and Child Nutrition Funds.  The maximum amount for each fund is established by the Estimate of Needs.  In a departure from previous years, the budget reflects an anticipated decrease in fund balance in the General Fund which resulted from the addition of new staff positions.  To allow for maximum flexibility during the school year, fund balances are included in the budgets for the Building and Child Nutrition funds. 

The budgets that are set forth in this document, and presented to the Board of Education for consideration, have been prepared with the most current information available.   The work of the Board, Superintendent, and administrative staff in maintaining the financial stability of the district is greatly appreciated.

Revenue and Expenditure Summary

General Fund Revenue
Revenue in the General Fund is classified in one of four categories described earlier: local, intermediate, state, and federal.

Major local sources of revenue include ad valorem taxes, extended school care, tuition & fees, interest earnings, reimbursements, and various district contracts.  For FY 2007-08, the district NAV (Net Assessed Valuation) increased from $532,146,068 to $573,207,682, an increase of 7.7%.  When multiplied by the millage rates for Tulsa and Wagoner counties, the result is an extension (less estimated 5% delinquent taxes) of $20,817,322.    The district’s Extended Day program is expected to generate $808,000 in revenue for the General Fund.  Community Education classes, transportation fees, interest earnings, reimbursements, district contracts, and other local sources are expected to generate a total of $2,999,050 during 2007-08.

Intermediate sources of revenue consist of three items: the county 4-mill ad valorem levy, county mortgage apportionment, and the Vision 2025 program.  The county 4-mill levy is an ad valorem tax collected by the counties, and allocated to school districts within each county based on average daily attendance.  Counties also collect a mortgage tax, which is also distributed among school districts based on average daily attendance. These sources of revenue total $3,397,950.

The single largest source of revenue for the District is the state of Oklahoma, which is expected to provide 62% of the revenue for the general fund.  The largest line items within this group are Foundation & Salary Incentive Aid (i.e. State Aid), Motor Vehicle Collections, Miscellaneous State Revenue, Health Insurance Allowance, and State School Land Earnings.

State revenues fall into two major categories: dedicated revenues and appropriated revenues. Dedicated revenues are certain taxes or other sources of revenue that are dedicated within the statutes as being earmarked for public schools.  Appropriated revenues are those that are debated by the Legislature each year as part of the state budgeting process.

Dedicated revenues include the Gross Production Tax, Motor Vehicle Collections, the Rural Electrification Association (R.E.A.) Tax, and State School Land Earnings.  The largest of these is the Motor Vehicle Collection Tax, which will generate over $5.4 million in revenue for Broken Arrow Schools.

The District receives state appropriated revenue in several forms.  By far, the largest of these is the Foundation and Salary Incentive Aid.  The budget for this revenue item is $43,496,707, which represents the projected mid-year allocation, and reflects the increase in NAV as a chargeable.  Another significant source of state funds is the Flexible Benefit Allowance ($5,640,194), which provides certified and support staff with 100% of the single premium cost per month to offset employee insurance premiums.  The District receives several other forms of state appropriated revenue for specific programs, including Alternative Education ($387,719), Professional Development ($57,604), Textbooks ($808,385), Driver’s Education ($50,000), Advanced Placement ($91,100), and Parents as Teachers ($48,500).

Revenue from Federal Sources makes up approximately 7% ($6,741,338) of the General Fund budget.  The largest of these programs include the Individuals with Disabilities Education Act (IDEA-B) ($3,712,474), Title I, ($1,310,359), Title VII ($542,475), and various other federal programs.

According to the 2006 Digest of Education Statistics, published by NCES, in 2003-04, school districts in the United States collected $462 billion in revenue, and (on average) 47% came from state sources, 44% from local and intermediate sources, and 9% from federal sources. 

Expenditures

As with all financial transactions, expenditures are coded to conform to the Oklahoma Cost Accounting System (OCAS).  Expenditures require (at most) a 26-digit coding classification.  However, the most significant dimensions for coding expenditures are project, function, and object.  For the General Fund, budgeted expenditures are presented by each of these dimensions.

Expenditures are also classified by function code, which is used to identify the purpose for which an expense is incurred.  The six main function classifications are instruction, support services, operation and maintenance of plant services, student transportation services, central support services, and other district support services.  For 2007-2008, 63% of the General Fund is budgeted for instruction.  The next largest area is operation and maintenance of plant services, which represents 9% of the budget.

For FY 2007-08, salaries and benefits make up 89% of the General Fund budget.  Expenditure items of note in the budget include the addition of 20 elementary teaching positions, 12 secondary teaching positions, 10 special education teaching positions, 2 ELL teaching positions, 6 support positions, and 2 additional certified positions for a total cost of $2,273,350.  Certified staff salary increases with a total cost of approximately $1.8 million, and a pay increase for administrative and support staff with a total cost of $280,000 is also included in the budget. 

General Fund 2007-2008 Budget Issues

Each year, as the budget is developed and finalized, several issues and new initiatives are identified for priority funding.  This year, the following items are included within the budget:

1.     A recommendation for salary increases for the administrative staff in the amount of 1.5%.  The estimated cost for this item is $90,051.

2.     A recommendation for salary increases for the support staff in the amount of 1.5%.  The estimated cost for this item is $190,326.

3.     The addition of teaching positions at various sites throughout the district, with a total cost of $2,045,500.00.

4.      The addition of support positions in the following areas:  Special Ed support (4 FTE) with a total estimated cost of $74,050, and ELL support (2 FTE) with a total estimated cost of $38,800.

5.     The addition of administrative positions in the following areas:  Social Studies Coordinator (1 FTE) with a total estimated cost of $54,000, and Elementary Principal (1 FTE) with a total estimated cost of $61,000.

Building Fund

Under the Oklahoma Constitution, school districts may levy up to 5 mills in ad valorem taxes for the Building Fund.  Under the statutes, the Building Fund can be used for:

Erecting, remodeling, repairing, or maintaining school buildings;

Purchasing furniture, equipment, or computer software;

Paying energy or utility costs;

Purchasing telecommunication services;

Paying fire and casualty insurance premiums;

Purchasing a security system; and,

Paying salaries of security personnel.

For 2007-08, budgeted revenue in the Building Fund includes $2,702,809 in ad valorem revenue, $56,066 in other local sources of revenue, $8,500 in state revenue, and $117,583 in federal revenue (prior year FEMA claim).  In addition, the building fund carryover of $785,060, provides sufficient resources to carry out the district’s operations for the year.

Bond Funds

The Bond Funds are used to account for revenues and expenditures related to the District’s annual General Obligation (G.O.) Bond issues.  For 2007-08, there are six bond issues included within the Operating Budgets:

Bond 35 – Originated from the sale of $10,800,000 in G.O. bonds in August 2004.  Of the original proceeds and accrued interest, the remaining balance of $103,634.70 is included within the budget.

Bond 36 – Originated from the sale of $8,000,000 in G.O. bonds in May 2005.  Of the original proceeds and accrued interest, the remaining balance of $164,567.41 is included within the budget.

Bond 37 – Originated from the sale of $7,000,000 in G.O. bonds in December 2005.  Of the original proceeds and accrued interest, the remaining balance of $149,569.05 is included within the budget.

Bond 38 – Originated from the sale of $7,700,000 in G.O. bonds in May 2006.  Of the original proceeds and accrued interest, the remaining balance of $1,374,657.60 is included within the budget.

Bond 39 – Originated from the sale of $15,000,000 in G.O. bonds in March 2007.  Of the original proceeds and accrued interest, the remaining balance of $5,281,944.76 is included within the budget.

Sinking Fund

The Sinking Fund is used to account for the ad valorem tax revenue that is dedicated to bond interest and principal payments.  The amount approved in the Estimate of Needs, which is determined by the various debt service schedules, is $11,157,303.42.

Other Funds

The final funds included in the Operating Budget are the Gifts Fund, and the Endowments Fund, both of which fall into the category of expendable trust funds.

The Gifts Fund includes all financial gifts given to the districts, including some scholarship funds.  The budget for the Gifts fund is $55,332.95.  The Endowments Fund includes only those gifts designated as legal endowment funds (i.e. principal cannot be expended), and has a budget of $14,414.67.