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“FORMULA 2.0” Understanding the Calculation

2016/2017 – NVUSD FORMULA

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Why Have A Formula?

  • Both the District and the Employee Groups have interests around:
    • Transparency;
    • Stability;
    • Clarity about salary expectations;
    • Formula flexibility;
    • Fair, sustainable and competitive salary schedules.

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From NVEA’s Point of View

  • Formula is foundation of over 30 years of great labor relations in NVUSD;
  • Allows time at the table for other important issues to be resolved;
  • Continues and builds trust!!

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Article 4:Wages

4.1 Preamble: For each school year the basic supplemental and summer school salary schedules shall be adjusted as determined by the District/NVEA Formula (hereafter Referred to as FORMULA) and as set forth in the yearly salary schedules available in the Office of Human Resources.

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New Funding = New Formula

  • Original Formula could not be used because:
    • No funded COLA allocation comes from State;
    • Most State categorical programs now rolled into “Base” funding;
    • A large portion of general fund dollars are now classified as “Supplemental” funds and use of these funds is dictated by the Local Control Accountability Plan (LCAP).

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Formula 2.0

  • In Concept and In Application:
    • NVEA’s portion of certain identified revenues should remain constant year after year –
    • District and NVEA will agree on which revenues are part of the calculation and which expenses are part of the calculation –
    • The other groups (CSEA, NAPS, Supervisory, Confidential, MGMT) will have the option of how the Formula % is implemented for their members.

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Formula Timeline

July

Aug.

Sept.

Oct.

Nov.

Dec.

Jan.

Feb

March

April-May

June

Closing PY Books

Closing PY Books

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PY Books Closed –

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Unaudited Actuals Reported-

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CY Formula calculated based on the following:

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  • Final Approved State Budget and any District budget adjustments needed;
  • True-Up of PY formula, unaudited actuals required for this transaction;
  • Formula % announced –retroactive to July 1st of the current fiscal year.

Retro payroll calculated and audited

Retro paid on Nov. warrant

First Interim Report to Board by Dec. 15th (includes) payroll adjustments to service Formula

Gov. proposed budget released;

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District works on staffing for next FY;

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First draft of next FY Formula started

If needed, layoffs/other staffing adjustments are decided for next FY

Second Interim report presented – including multi-year projection with projected Formula increased costs.

Budget developed and staffing

finalized

Budget Adopted with assigned fund balance to implement the projected Formula

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Formula at 35,000 Feet

  • Total GF Local Control Funding Formula (LCFF) Revenues PLUS
  • Unrestricted Lottery;
  • 50% of Lease and Rental Income;
  • Unrestricted Interest Earned;
  • Mandated Cost Block Grant (on-going);
  • Federal and State Special Education Revenues;
  • Special Education revenues from other LEA’s

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MINUS

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Revenues Identified for:

-Transportation;

-Supplemental Programs;

-Deferred Maintenance;

-Restricted Maintenance;

-Community Day School;

-Non-public School placements.

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  • Total NVEA expenses:
    • Total Monthly Salary;
    • Total Statutory costs, including retirement costs STRS/PERS;
    • Total Health and Welfare benefits costs/or Cash in Lieu costs;
    • Total Substitute costs;
    • Total Hourly, Stipends, Honorarium costs

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MINUS

NVEA Expenses identified But Funded Via

-Supplemental Funding;

-Federal Funding (non-SPED);

-Local / Gift funded;

-Teacher In Charge Costs;

Identified Expenses as a Percentage of Identified Revenue should be equal to and held constant at 61.33%

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Formula Revenues

  • Starting Point:
    • Total General Fund (01)LCFF Revenues:
      • Fund/Resource/Object:01/0***/80**
      • Transportation Funds: 01/0230,0240
    • Remove from this amount – “Off The Top Allocations”:
      • Supplemental Funds Allocation:01/0003/8***
      • Transportation Allocation

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Formula Revenues

  • REVENUE ADJUSTMENTS(cont.)
    • Remove from this amount – “Off The Top Allocations”:
      • Deferred Maintenance Allocation (½ of 1% of Total GF expense budget);
      • Restricted Maintenance Allocation (2 ½% of the Total GF expense budget);
      • Community Day School estimated costs;
      • Non-Public School estimated costs.

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Formula Revenues

  • Starting Point: Total LCFF Revenues
    • Add to this amount:
      • Unrestricted Lottery Revenues
      • Lease and rental Revenues at 50%
      • Interest earned Revenues
      • Mandated Cost Block Grant Revenues
      • Other Special Education Revenues:
        • Federal Revenues
        • State Revenues
        • Revenues from other districts

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Formula Revenues

  • Revenue always outside the formula calculation:
      • Federal Revenues:
        • Title Programs
        • Magnet Funds
        • Other Federal Programs
      • Local Revenues:
        • Local donations / gifts
      • One-off, one-time receipt of Funds:
        • Example - Microsoft settlement

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Source of Each GF Dollar in 15/16

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Formula Revenues

  • Revenue always outside the formula calculation:
      • Any legally restricted funding:
          • State Categorical Program (Example Educator Effectiveness Grant)
          • Restricted Lottery
          • Medi-Cal Funds
          • Cafeteria Funds
          • Construction Funds
          • Developer Fees
          • Funds from sale of property

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NVEA’S SIDE OF THE FORMULA

  • NVEA salary schedule driven assignment costs:
    • Salary for all NVEA members – Teachers, Counselors, Librarians, Nurses (including adv.degree, hourly, longevity, other enhancements);
    • Associated statutory costs paid by the District, including retirement costs (STRS or PERS) and worker’s compensation;
    • Costs of any NVEA early retirement incentive packages;
    • Substitute teacher costs, including all leaves;
    • Costs for Post Employment Retiree Benefits.

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NVEA’S SIDE OF THE FORMULA

  • Adjustments to the NVEA salary schedule driven assignment costs:
    • Exclusion of all NVEA costs funded from supplemental grant (resource 0003);
    • Exclusion of costs, both salary and benefits, of Teacher In Charge assignments;

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Issues Impacting Formula 2.0

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FORMULA ADJUSTMENTS

  • Considerations and Restraints--LCFF:

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      • Some program funding is part of LCFF but;
      • Certain programs are required and have set (MOE) requirements, like Transportation and Restricted and Deferred Maintenance;
      • If the District overspends a categorical or self-contained program, the contribution from the General Fund is now not charged back to the Formula;

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Moving Forward - Other Issues Impacting Formula 2.0

  • Addressing the District’s unfunded post employment retiree benefit costs will directly impact funds available for the Formula;
  • Change in State implementation timelines for the LCFF and LCAP could impact the Formula;
  • Planned increases in STRS and PERS statutory costs WILL impact the Formula.

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