SOUTH HUNTINGTON SCHOOL DISTRICT
BUDGET WORK SESSION
BOARD OF EDUCATION MEETING
MARCH 6, 2024
FISCAL PHILOSOPHY
The district’s fiscal approach, as we go through the budget process, is to address student needs while ensuring fiscal sustainability.
Our recommendations are made through a fiscally prudent and responsible lens as we look to the future and set high expectations for both student and district growth.
ACADEMIC PLANS 2024/25
ACADEMIC PLANS 2024/25
WHAT IS THE TAX LEVY LIMIT
The tax levy limit (“cap”) is the tax increase that School Districts are legally permitted to request from the taxpayers.
This formula is sometimes referred to as the “2% Cap”, despite the formula oftentimes allowing for a legal levy greater than 2%.
RECENT TAX LEVY INCREASE HISTORY
2018/19: 2.15%
2019/20: 2.87%
2020/21: 2.33%
2021/22: 0.99%
2022/23: 0.00%
2023/24: 1.50%
(Pre-Covid (18/19 – 20/21) 3-year Average was 2.45%)
TAX LEVY GROWTH HISTORY�
2018/19 (2.15%) = $ 2,416,162
2019/20 (2.87%) = $ 3,293,745
2020/21 (2.33%) = $ 2,747,582
2021/22 (0.99%) = $ 1,191,065
2022/23 (0.00%) = $ 0
2023/24 (1.50%) = $ 1,827,481
2024/25 ELIGIBLE TAX LEVY CAP
The district’s maximum eligible tax levy increase by formula is 3.42%.
*Note: As was the case in prior years; the Board of Education may choose to move forward with a lower tax levy increase.
TAX LEVY FORMULA - TAX BASE GROWTH FACTOR
The growth factor is based on “quantity change,” such as new construction, newly taxable status of existing property, or measurable improvements to taxable property within the boundaries of the local government or school district.
TAX LEVY FORMULA - INFLATION FACTOR
Within the Tax Levy Formula is a component related to inflation. The allowable tax levy increase is the lesser of 1.02 (2% max) or inflation factor (percent change in CPI for the 12 month period ending December 31). This is where the term 2% Tax Cap comes from
TAX LEVY FORMULA: EXCLUSIONS
KEY EXCLUSIONS CAN BE:
FUND BALANCE
Fund Balance: Carry-over funds from the current year to be allocated in the subsequent year.
The allowable percentage of Unassigned Fund Balance, which is a fiscal standard auditors hold districts to, is 4%. The district is currently at 3.88% as of June 30, 2023.
RESERVES
Districts are not permitted to use “credit” to cover expenses, therefore, they have a modest cushion in the budget lines to safeguard for emergencies and unforeseen expenses. If the budget is underspent, the money is placed in reserves or fund balance. If the budget allocations are insufficient, either cuts are made or reserves utilized. Reserves can also be utilized to reduce the tax levy during the budget process.
Albany wants school districts to budget to the dollar, without leaving much in reserves, while the auditors and Moody’s Investors Services believe budgeting without that modest cushion is bad fiscal practice.
As we see with the Governor’s proposed State Aid package for the 2024/25 school year, Districts must become more self reliant on having reserves, as the increases in state aid may not always be forthcoming in future years.
5-YEAR HISTORY OF RESERVES
| 2018/19 | 2019/20 | 2020/21 | 2021/22 | 2022/23 |
Workers Comp. | $ 2,361,745 | $ 1,952,687 | $ 1,505,195 | $ 927,844 | $ 378,801 |
Unemployment Ins. | $ 335,866 | $ 339,057 | $ 339,099 | $ 339,444 | $ 358,087 |
Insurance | $ 682,709 | $ 689,194 | $ 689,281 | $ 689,981 | $ 727,877 |
Employee Retirement System | $ 5,809,677 | $ 4,184,870 | $ 2,035,395 | $ 1,387,463 | $ 913,667 |
Teachers Retirement System | $ 1,000,000 | $ 1,009,500 | $ 1,009,627 | $ 360,652 | $ 30,461 |
Employee Benefit Accrued Liability (EBLAR) | $ 9,423,925 | $ 9,893,466 | $ 8,894,707 | $ 8,203,743 | $ 7,654,320 |
Assigned – Appropriated Carryover Encumbrances | $ 99,100 | $ 4,040,723 | $ 1,717,259 | $ 1,654,911 | $ 393,128 |
Assigned – Appropriated Fund Balance | $ 5,008,041 | $ 5,100,000 | $ 4,500,000 | $ 3,900,000 | $ 2,990,000 |
Debt Service & Nonspendable | $ 0 | $ 0 | $ 0 | $ 0 | $ 16,521 |
Unassigned Fund Balance (4% Cap) | $ 6,834,978 | $ 4,511,177 | $ 5,089,635 | $ 6,781,150 | $ 8,105,679 |
TOTAL RESERVES | $ 31,556,041 | $ 31,720,674 | $ 25,780,198 | $ 24,245,188 | $ 21,568,541 |
USE OF RESERVES
Between June 30, 2019, through June 30, 2023 we have seen a decrease in our reserves of $9,987,500 approximately 32%.
When the books close this summer, it is estimated that they will be further reduced by an additional $1.980 million based upon current year allocations.
The district’s utilization has been prudent and selective. Reducing this dependency remains a fiscal focus.
STATE AID PROJECTION FOR 2024/25
TRANSPORTATION PLANNING
For 2024/25, the district is currently planning to allocate approximately $1,255,200 for the purchase of additional buses.
FACILITIES PLANNING FOR 2024/25
Based upon the proposed State Aid, the district is currently planning to allocate approximately $1,200,000 for buildings and grounds maintenance as well as $4,000,000 in “Transfer to Capital” for Capital improvement projects.
Potential Capital Projects include:
ENERGY PERFORMANCE CONTRACT
South Huntington closed on our Energy Performance Contract (EPC) last school year, and work began right away. This EPC will help to address many of the district’s needed repairs and replacements for facilities items such as boilers, water heaters, HVAC, lighting, controls, and solar arrays.
The following projects are well underway and nearing completion:
GOALS FOR 2024/2025
partnerships
UPCOMING BUDGET PRESENTATION DATES
March 20, 2024: Budget Work Session/Board of Education Meeting, JKAO
April 16, 2024: Budget Adoption/BOCES Budget Vote/Board of Education Meeting, JKAO
May 7, 2024: Public Hearing of Budget/Board of Education Meeting, JKAO
May 21, 2024
BUDGET/REFERENDUM VOTE & BOARD OF EDUCATION ELECTION
Walt Whitman High School, 2pm - 9pm
Board of Education Meeting, Walt Whitman High School, 7:30 pm