PARRKKLLAANNDD SSCCHHOOOLL …€¦ · PARRKKLLAANNDD SSCCHHOOOLL DDIISSTTRRIICCTT GENEERRAALL FFUNDD UBBUDDGGEETT ... The actual tax rate for 2012-13 will be ... Earned Income Tax

Presented to the Parkland Board of School Directors

March 20, 2012

PPAARRKKLLAANNDD SSCCHHOOOOLL DDIISSTTRRIICCTT

GGEENNEERRAALL FFUUNNDD BBUUDDGGEETT

FFIISSCCAALL YYEEAARR 22001122--1133

RREEVVEENNUUEE SSTTUUDDYY

RREESSOOUURRCCEESS IINN SSUUPPPPOORRTT OOFF EEDDUUCCAATTIIOONN

GGEENNEERRAALL FFUUNNDD BBUUDDGGEETT

FFIISSCCAALL YYEEAARR 22001122--1133

A. General Overview of the Sources of Revenue, Trends and Assumptions

B. Revenue History

C. Revenue Projections

D. Analysis of All Revenue Sources

E. Supporting Charts and Graphs

CONTENTS

PPAARRKKLLAANNDD SSCCHHOOOOLL DDIISSTTRRIICCTT

GGEENNEERRAALL FFUUNNDD BBUUDDGGEETT 22001122--1133 RREESSOOUURRCCEESS IINN SSUUPPPPOORRTT OOFF OOPPEERRAATTIIOONNSS

HHIIGGHHLLIIGGHHTTSS,, TTRREENNDDSS AANNDD AASSSSUUMMPPTTIIOONNSS

Taxable real estate property value is projected to remain at current levels throughout North Whitehall, South Whitehall and Upper Macungie for 2011 based on (1) number of building permits issued and (2) assessment appeals by industrial and commercial property owners. Although the number of appeals has decreased for 2012 there are still appeals pending that could impact us financially. These assessment appeals are due in most part to the Common Level Ratio (CLR) and will impact Parkland’s 2012-13 budget although the final impact is pending the appeal process.

A countywide reassessment will place more current values on properties which will slow down assessment appeals (at least for one year); properties will be bridged to current values rather than 1991 values which is occurring at this time and has created the large number of appeals especially in the commercial and industrial real estate areas. As of this date, the Lehigh County Commissioners have over-ridden the County Executive’s veto of the reassessment process and assessment letters have been mailed to Lehigh County property owners.

Data presented in 2012 pertaining to assessed valuations of property located within the Parkland School District is preliminary, and will be updated as we move through the budget process.

Property tax collection rate for the 2012-13 budget will be calculated at 97% which is the rate used in the 2011-12 Budget (and prior years).

Interest rates remain at historically low levels; short-term projections are that rates will remain low through 2012. For budgeting purposes, earnings from investments for 2012-13 are projected to remain at low levels based on current and projected interest rate movement. The Federal Reserve has signaled that rates will not be increased through 2014.

Governor’s Proposed Education Budget was unveiled on February 7, 2012 which “bundles” the former Basic Education Funding (BEF), all Transportation funding and Social Security reimbursement into the Student Achievement Education Block Grant (SAEBG). An in-depth breakdown of Commonwealth funding impacting Parkland is presented later in this document. Caution: the Governor’s Proposed Budget is still being analyzed

The Accountability Block Grant was totally eliminated for the 2012-13 Budget, a loss of $144,815; however, no budget adjustment is needed for PSD as the Preliminary Budget included $0 projected for AGB.

Certain federal dollars have been projected for the 2012-13 Budget as future funding amounts are not known or subject to change, i.e. Title I, Title IIA, Title III.

A-1

Programs and services included in the General (Operating) Fund Budget are supported by local, Commonwealth, federal and other financing sources. Fund Balance is not a revenue source; however, it may be appropriated to assist in balancing the Budget. The following graph represents all sources of budgeted revenue:

- Chart reflects Commonwealth revenues per Governor’s Proposed Budget - Chart does not reflect appropriation of Fund Balance

Of the total revenue budgeted for 2012-13, local revenues are the primary source for district-operated programs as shown in the table above. Consequently, financial support of education is increasingly shifted to the largest of the local revenue sectors, (property and earned income).

Of the 84.0% revenue derived locally, the largest component is real property revenue, consisting of current, interim and delinquent real estate tax collections. The estimated assessed valuation of all property, as determined by Lehigh County establishes the district’s tax base. At this time, the total adjusted value of real property for the 2012-13 budget year is projected at $2,420,274,280 (adjusted downward from the February 2012 County Duplicate totaling $2,468,634,900 due to assessment appeals and increased real estate payments in the discount period). See chart on top of page A-3.

A-2

The estimated receipts from other forms of revenue are also budgeted based on historical trends and projected economic activity. Among these are the Earned Income, Local Services, Real Estate Transfer, Interim Real Estate, Delinquent Real Estate and earnings from investments. A cautious budgeting approach was implemented at this stage of the budget process due to several unknowns including the sluggish economy, a slowdown in new construction and unemployment.

The following graph depicts the various projected sources of local revenue that support operations for the 2012-13 fiscal year:

A-3

New Commonwealth Funding Area

2012-13 PSD Preliminary Budget

BEF $6,399,135

Social Security

Reimbursement

Transportation

PSD, Non-Public 1,700,000

& Charter

Totals $10,600,561 vs. $10,727,341 "at first glance"

Totals $10,600,561 vs. $10,627,341 Potential PSD Funding still unknown…stay tuned

PSD responsible for 100% of IU Transportation

(impact on expenditure side of budget)

+$26,780

Former Commonwealth Funding Areas

2,501,426

+$126,780

-100,000

Student

AchievementEducation

Block

Grant (SAEBG)

Other Proposed Changes

- PA Accountability Block Grant eliminated, however no budget adjustment necessary ($144,815 reduction for PSD)

- Special Education Funding remains flat (4th consecutive budget year)

- SAEBG reduced $2,087 since initial budget release of 2/7/12

- Head Start Supplemental Assistance reduced

- Teacher Professional Development reduced

- Reminder...11/12 funding back to 2008-09 levels

Other Unknowns

Placing funding in a "Block Grant"...future concerns

PlanCon construction process...reimbursement uncertain

Social Security...is funding firmly set per SAEBG or contingent upon a reconciliation of salaries which may drive less than SAEBG funding amount initially proposed

As stated above, PSD will pay 100% of IU transportation costs

Will this funding method provide more flexibility as stated by Governor?

Commonwealth sources of revenue from various funding

areas, subsidies and reimbursements are projected in the Governor’s Proposed 2012-13 Budget.

Following is a summary of some of the major sources of

revenue from the Commonwealth:

Updated 2/22/12

A-4

2012-13 Commonwealth Funding Based on Governor’s Proposed Budget

The Commonwealth’s support for education has steadily declined shifting the

remaining revenue burden from the Commonwealth to the local level. State and federal mandates regarding curriculum, assessment, and other aspects of education place more reliance on local property taxes as the primary revenue stream to fill the void of unfunded and under-funded obligations. Simultaneously, the Act I Index limits our ability to fill this revenue gap by capping local real estate increases.

Federal sources of revenue are budgeted based on the most up-to-date data we have at this time; federal grants are primarily in the form of restricted grants to be used for specific programs with expenditures, to a great extent, mandated by the federal government.

Comment: The actual tax rate for 2012-13 will be determined following a review

of proposed expenditures and the final determination of a balanced budget. The Preliminary Budget approved by the Parkland School Board on January 24, 2012 reflected a preliminary millage rate of 41.70, or a 4.96% increase. However, the Act 1 Index as determined by PDE, sets the district’s allowable millage increase at 1.7% for 2012-13. Parkland has applied for exceptions from the Pennsylvania Department of Education (PDE) to permit an increase in millage beyond the index to accommodate specific mandated expenditures (these exceptions were approved by PDE). Together, the Act 1 Index plus Exceptions will cap the final millage increase at 1.46 mills to a rate of 41.19 mills or 3.67% over the current 39.73 millage rate. Millage rates above do not include the 0.30 mills levied on behalf of the Parkland Community Library.

A-5

GENERAL FUND REVENUE HISTORY

2006-07 2007-08 2008-09 2009-10 2010-11

Actual Actual Actual Actual Actual

REAL ESTATE ASSESSMENT FOR BUDGET PURPOSES 2,271,523,000 2,336,469,968 2,398,992,550 2,420,274,280 2,420,274,280

34.94 35.84 36.67 37.20 38.27

6000 LOCAL SOURCES

6111 Current Real Estate Tax 76,331,065 80,569,079 82,839,139 85,512,307 85,972,301

6112 Interim Real Estate Tax 2,202,471 2,953,160 1,442,728 1,732,865 2,824,057

6113 Public Utility Realty 130,616 127,972 122,328 135,537 139,465

6114 Payments in Lieu of Taxes 4,000 4,000 9,350 9,538 4,000

6143 Local Services Tax 644,775 388,820 522,194 539,681 546,597

6151 Earned Income Tax 7,638,874 8,888,493 8,668,757 8,292,425 8,940,454

6153 Real Estate Transfer Tax 2,559,451 1,998,804 1,415,263 1,878,383 1,484,695

6400 Delinquent Taxes 2,231,946 1,503,004 2,362,310 2,266,890 2,489,878

6500 Earnings on Investments 2,228,676 1,980,472 961,632 218,623 81,245

6700 District Activities N/A N/A N/A N/A 52,252

6821 State Rev. from LEAs 0 30,000 30,000 25,000 134,306

6830 Federal Rev. from LEAs/IDEA 1,275,341 1,347,912 1,430,506 1,567,363 1,974,426

6910 Rentals 34,758 28,848 38,170 34,033 36,388

6940 Tuition 602,182 609,587 474,597 386,605 530,009

6990 Miscellaneous Local Revenue 58,005 340,631 260,932 123,024 360,719

95,942,160 100,770,782 100,577,906 102,722,273 105,570,792

7000 STATE SOURCES

7110 Basic Instructional Subsidy 6,006,709 6,126,320 6,309,748 5,797,986 5,739,981

7140 Charter Schools 119,641 173,369 209,488 225,469 240,711

7160 Tuition for Court-Placed Children 227,205 223,781 197,378 158,926 120,370

7210 Homebound Instruction 1,167 1,712 896 N/A N/A

7240 Drivers Education 14,065 20,325 19,805 19,835 19,835

7271 Special Education 3,191,775 3,279,066 3,380,148 3,306,225 3,339,560

7310 Transportation 1,960,069 1,717,127 1,713,288 1,509,151 1,529,543

7320 Rental/Sinking Fund Payments 1,067,113 1,068,627 753,293 1,638,100 2,079,932

7330 Health Services 176,917 177,977 181,611 181,822 185,998

7340 State Property Tax Reduction Allocation N/A N/A 1,748,979 1,745,556 1,728,780

7500 Extra Grants (Incl. Accountability Grant) 391,396 431,871 412,059 399,365 375,833

7810 Social Security Payments 1,985,774 2,080,470 2,220,381 2,354,078 2,517,981

7820 Retirement Payments 1,675,254 1,962,908 1,354,542 1,529,623 2,104,620

7920 Classrooms for the Future N/A 954,330 174,073 N/A N/A

16,817,085 18,217,884 18,675,689 18,866,137 19,983,143

8000 FEDERAL SOURCES

8513/14 Title I Improving Basic Programs/IDEA 952,047 974,887 984,608 811,223 950,226

8515 Title IIA, Improving Teacher Quality 219,611 218,359 220,277 241,971 225,048

8516 Title III, LEP & Immigrant Students 41,246 34,787 22,678 47,844 38,697

8517 Drug-Free Schools 35,283 21,689 21,459 27,721 8,974

8518 Title V, Innovative Programs 8,408 8,390 N/A N/A N/A

8700 Other Federal Grants/ARRA N/A N/A N/A 2,474,746 1,475,251

8810 Medical Assistance (ACCESS) 686,491 540,925 594,469 808,195 466,323

1,943,086 1,799,036 1,843,492 4,411,700 3,164,519

TOTAL REVENUE 114,702,331 120,787,702 121,097,087 126,000,110 128,718,454

9000 OTHER FINANCING SOURCES

9400 Sale of Fixed Assets 5,354 10,300 875,000 306,500 322,117

5,354 10,300 875,000 306,500 322,117

TOTAL REVENUE AND OTHER

FINANCING SOURCES114,707,685 120,798,002 121,972,087 126,306,610 129,040,571

TOTAL REVENUE FEDERAL SOURCES

TOTAL OTHER FINANCING SOURCES

MILLAGE RATE

TOTAL REVENUE LOCAL SOURCES

TOTAL REVENUE STATE SOURCES

Note: The Interim Real Estate amount reported here is based on the School District's Financial Statements. Approximately $2M of this

amount is represented by “rebillings” to commercial / industrial taxpayers that were appealing their Assessment Values and were billed

after the court process. This approximate $2M amount does not represent Interim Revenue based on new construction. This portrays

the opinion of our auditing firm.

B-1

2011-12 PCT OF 2012-13 PCT OF

BUDGET TOTAL BUDGET TOTAL

REVENUE -

From Local Sources -

Real Estate Taxes Incl. Delinquent Collections* $96,365,731 69.8% $100,677,445 72.7%

Earned Income Tax at 1/2 Percent 8,700,000 6.3% 8,700,000 6.3%

Real Estate Transfer Tax 1,500,000 1.1% 1,500,000 1.1%

Local Services Tax 620,000 0.4% 570,000 0.4%

Interest Earnings 300,000 0.2% 200,000 0.1%

Revenue from Intermediate Sources 1,500,000 1.1% 1,500,000 1.1%

Other Local Sources - Tuition, Rent, Misc. 680,000 0.5% 730,000 0.5%

Total From Local Sources 109,665,731 79.4% 113,877,445 82.2%

From State Sources -

State Subsidies, All Categories 13,052,814 9.4% 12,962,814 9.4%

State's Share of Social Security and Ret. 4,808,934 3.5% 6,726,377 4.9%

Total from State Sources 17,861,748 12.9% 19,689,191 14.3%

From Federal Sources -

Federal Subsidies and Grants 1,895,953 1.4% 1,863,637 1.3%

Total From Federal Sources 1,895,953 1.4% 1,863,637 1.3%

TOTAL REVENUE 129,423,432 93.7% 135,430,273 97.8%

OTHER FINANCING SOURCES 300,000 0.2% 50,000 0.0%

TOTAL REV. AND OTHER FIN. SOURCES 129,723,432 93.9% 135,480,273 97.8%

USE OF BEGINNING BALANCE, JULY 1 8,500,000 6.1% 3,000,000 2.2%

C-1(a)

PARKLAND SCHOOL DISTRICT

2012-2013 PRELIMINARY GENERAL FUND BUDGET

REVENUE COMPARISON BY SOURCE OF TOTAL FUNDS

INCLUDES FUND BALANCE APPROPRIATION

PSD Preliminary Budget approved January 24, 2012

*State Property Tax Allocation (7340) made up of gaming dollars in the amount of $1,737,104 is backed out of State

Sources and added to Current Real estate Tax (6111) for comparison purposes; gaming dollars not known until Spring

2012.

SOURCE OF FUNDS

TOTAL REVENUE AND FUND BALANCE

AVAILABLE FOR APPROPRIATIONS$138,223,432 100.0% $138,480,273 100.0%

2011-12 2012-13 2012-13 2012-13

Budget Budget Change % Change

2,420,274,280 2,420,274,280 0 0.0%

39.73 41.70 1.97 4.96%

6000 LOCAL SOURCES

6111 Current Real Estate Tax* 93,281,734 * 97,893,445 4,611,711

6112 Interim Real Estate Tax 1,199,997 900,000 -299,997

6113 Public Utility Realty 130,000 130,000 0

6114 Payments in Lieu of Taxes 4,000 4,000 0

6142 Local Services Tax 620,000 570,000 -50,000

6151 Earned Income Tax 8,700,000 8,700,000 0

6153 Real Estate Transfer Tax 1,500,000 1,500,000 0

6400 Delinquent Taxes 1,750,000 1,750,000 0

6510 Interest on Investments 300,000 200,000 -100,000

6830 Federal Rev. from LEAs 1,500,000 1,500,000 0

6910 Rentals 50,000 50,000 0

6940 Tuition 600,000 650,000 50,000

6990 Miscellaneous Local Revenue 30,000 30,000 0

109,665,731 113,877,445 4,211,714 3.8%

7000 STATE SOURCES

7110 Basic Educational Funding 6,399,135 6,399,135 0

7140 Charter Schools 0 0 0

7160 Tuition for Court-Placed Children 186,000 186,000 0

7210 Homebound Instruction 1,000 1,000 0

7240 Drivers Education 0 0 0

7270 Special Education 3,276,903 3,276,903 0

7310 Transportation 1,790,000 1,700,000 -90,000

7320 Rental/Sinking Fund Payments 1,214,485 1,214,485 0

7330 Health Services 185,291 185,291 0

7340 State Property Tax Allocation* 0 * 0 0

7500 Extra Grants 0 0 0

13,052,814 12,962,814 -90,000 -0.7%

7800 Subsidies for State-Paid Benefits -

7810 Social Security Payments 1,855,759 2,501,426 645,667

7820 Retirement Payments 2,953,175 4,224,951 1,271,776

4,808,934 6,726,377 1,917,443 39.9%

17,861,748 19,689,191 1,827,443 10.2%

Notes: Real Estate Tax rate shown does not include the 0.30 mills levied on behalf of Parkland Community Library.

*

C-2(a)

Function Subfunction

REAL ESTATE ASSESSMENT

MILLAGE RATE


SUBTOTAL REV. - STATE SOURCES

TOTAL REVENUE STATE SOURCES

*State Property Tax Allocation (7340) made up of gaming dollars in the amount of $1,737,104 is backed out of

State Sources and added to Current Real estate Tax (6111) for comparison purposes; gaming dollars not

known until Spring 2012.

REVENUE - STATE-PAID BENEFITS


GENERAL (OPERATING) FUND

REVENUE BY LOCAL, STATE, FEDERAL & OTHER SOURCES

2011-12 2012-13 2012-13 2012-13



8514 Title I, Improving Basic Programs 955,476 930,677 -24,799

8515 Title IIA, Improving Teacher Quality 197,477 199,180 1,703

8516 Title III, LEP & Immigrant Students 43,000 33,780 -9,220

8517 Drug-Free Schools 0 0 0

8701 ARRA - IDEA, Part B 0 0 0

8703 ARRA - Title I, Part A 0 0 0

8705 ARRA - Title II, Part D Ed. Tech. 0 0 0

8708 ARRA - State Fiscal Stabilization 0 0 0

8800 Medical Assistance (ACCESS) 700,000 700,000 0

Other Federal Grants 0 0 0

1,895,953 1,863,637 -32,316 -1.7%

TOTAL REVENUE 129,423,432 135,430,273 6,006,841 4.6%


9200 Long-Term Financing 0 0 0

9400 Gain/Loss Relating to Fixed Assets 300,000 50,000 -250,000

9500 Refund of Prior Year Exp. 0 0 0

9611 Received from Other LEAs 0 0 0

300,000 50,000 -250,000 100.0%

C-3(a)


4.4% FINANCING SOURCES


TOTAL REVENUE FED. SOURCES


TOTAL REVENUE AND OTHER129,723,432 135,480,273 5,756,841


REVENUE BY LOCAL, STATE, FEDERAL & OTHER SOURCES

2011-12 PCT OF 2012-13 PCT OF

BUDGET TOTAL BUDGET TOTAL

REVENUE -

From Local Sources -

Real Estate Taxes Incl. Delinquent Collections $96,365,731 69.7% $100,677,445 72.7%

Earned Income Tax at 1/2 Percent 8,700,000 6.3% 8,700,000 6.3%

Real Estate Transfer Tax 1,500,000 1.1% 1,500,000 1.1%

Local Services Tax 620,000 0.4% 570,000 0.4%

Interest Earnings 300,000 0.2% 200,000 0.1%

Revenue from Intermediate Sources 1,500,000 1.1% 1,500,000 1.1%

Other Local Sources - Tuition, Rent, Misc. 680,000 0.5% 730,000 0.5%

Total From Local Sources 109,665,731 79.3% 113,877,445 82.2%

From Commonwealth Sources -

Commonwealth Subsidies, All Categories 13,052,814 9.4% 15,591,020 11.3%

Commonwealth's Share of Retirement 4,808,934 3.5% 4,224,951 3.0%

Total from State Sources 17,861,748 12.9% 19,815,971 14.3%

From Federal Sources -

Federal Subsidies and Grants 1,895,953 1.4% 1,853,056 1.3%

Total From Federal Sources 1,895,953 1.4% 1,853,056 1.3%

TOTAL REVENUE 129,423,432 93.6% 135,546,472 97.8%

OTHER FINANCING SOURCES 300,000 0.2% 50,000 0.0%

TOTAL REV. AND OTHER FIN. SOURCES 129,723,432 93.9% 135,596,472 97.8%

USE OF BEGINNING BALANCE, JULY 1 8,500,000 6.1% 3,000,000 2.2%

C-1(b)


Based on Governor's Proposed Budget

REVENUE BY SOURCE

INCLUDES FUND BALANCE APPROPRIATION

BASED ON GOVERNOR'S PROPOSED 2012-13 BUDGET

SOURCE OF FUNDS

TOTAL REVENUE AND FUND BALANCE

AVAILABLE FOR APPROPRIATIONS$138,223,432 100.0% $138,596,472 100.0%

2011-12 2012-13 2012-13 2012-13


2,420,274,280 2,420,274,280 0 0.0%

39.73

6000 LOCAL SOURCES

6111 Current Real Estate Tax* 93,281,734 * 97,893,445 4,611,711

6112 Interim Real Estate Tax 1,199,997 900,000 -299,997

6113 Public Utility Realty 130,000 130,000 0

6114 Payments in Lieu of Taxes 4,000 4,000 0

6142 Local Services Tax 620,000 570,000 -50,000

6151 Earned Income Tax 8,700,000 8,700,000 0

6153 Real Estate Transfer Tax 1,500,000 1,500,000 0

6400 Delinquent Taxes 1,750,000 1,750,000 0

6510 Interest on Investments 300,000 200,000 -100,000

6710 District Activities 0 50,000 50,000

6830 Federal Rev. from LEAs 1,500,000 1,500,000 0

6910 Rentals 50,000 50,000 0

6940 Tuition 600,000 600,000 0

6990 Miscellaneous Local Revenue 30,000 30,000 0

109,665,731 113,877,445 4,211,714 3.8%

7000 COMMONWEALTH SOURCES (Based on Governor's Proposed 2012-13 Budget)

7000 Student Achieve. Edu. Block Grant N/A 10,727,341 10,727,341

7110 Basic Educational Funding 6,399,135 6,399,135 -6,399,135

7140 Charter Schools 0 0 0

7160 Tuition for Court-Placed Children 186,000 187,000 1,000

7210 Homebound Instruction 1,000 0 -1,000

7270 Special Education 3,276,903 3,276,903 0

7310 Transportation 1,790,000 1,700,000 -1,700,000

7320 Rental/Sinking Fund Payments 1,214,485 1,214,485 0

7330 Health Services 185,291 185,291 0

7340 State Property Tax Allocation* 0 * 0 0

7500 Extra Grants (ABG) 0 0 0

13,052,814 15,591,020 2,628,206 19.4%

7800 Subsidies for Commonwealth-Paid Benefits -

7810 Social Security Payments 1,855,759 2,501,426 -2,501,426

7820 Retirement Payments 2,953,175 4,224,951 1,271,776

4,808,934 4,224,951 -1,229,650 -12.1%

17,861,748 19,815,971 1,398,556 10.9%

Notes: Mandatory PSERS obligation; Reimbursement vs. Funding

*

C-2(b)


REVENUE BY SOURCE


TOTAL COMMONWEALTH SOURCES

*State Property Tax Allocation (7340) made up of gaming dollars in the amount of $1,737,104 is backed out of

State Sources and added to Current Real estate Tax (6111) for comparison purposes; gaming dollars not

known until Spring 2012.



REAL ESTATE ASSESSMENT

MILLAGE RATE


SUBTOTAL - COMMONWEALTH SOURCES

COMMONWEALTH-PAID BENEFITS

2011-12 2012-13 2012-13 2012-13



8514 Title I, Improving Basic Programs 955,476 910,056 -45,420

8515 Title IIA, Improving Teacher Quality 197,477 199,638 2,161

8516 Title III, LEP & Immigrant Students 43,000 43,362 362

8517 Drug-Free Schools 0 0 0

8701 ARRA - IDEA, Part B 0 0 0

8703 ARRA - Title I, Part A 0 0 0

8708 ARRA - State Fiscal Stabilization 0 0 0

8800 Medical Assistance (ACCESS) 700,000 700,000 0

Other Federal Grants 0 0 0

1,895,953 1,853,056 -42,897 -2.3%

TOTAL REVENUE 129,423,432 135,546,472 5,567,373 4.7%


9200 Long-Term Financing 0 0 0

9400 Gain/Loss Relating to Fixed Assets 300,000 50,000 -250,000

300,000 50,000 -250,000 100.0%

C-3(b)

4.5% FINANCING SOURCES


GENERAL (OPERATING) FUNDREVENUE BY SOURCE



TOTAL REVENUE AND OTHER129,723,432 135,596,472 5,873,040


TOTAL REVENUE FEDERAL SOURCES

PPRROOJJEECCTTEEDD RREEVVEENNUUEE –– DDEETTAAIILL

66000000 -- PPRROOJJEECCTTEEDD LLOOCCAALL SSOOUURRCCEESS

2011-12 2012-13 CHANGE 6111 CCUURRRREENNTT RREEAALL EESSTTAATTEE TTAAXX $93,281,734 $97,893,445 $4,611,711

Below is the development of the projected total property assessment figures to be used for the July 1, 2012 tax billings based on information obtained from the Lehigh County Assessment Office.

Historical projections have been very close to final actual numbers.

Date Description Total Assessment Value of 1 mill

January 24, 2012 Preliminary Budget 2012-13 $ 2,420,274,280* $2,347,666 February 14, 2012 County-Issued Duplicate 2,468,634,900 November 1, 2011 County-Issued (Nov. Letter) 2,460,550,850 June 30, 2011 Final Budget 2011-12 2,420,274,280 February 15, 2011 Preliminary Budget 2011-12 2,420,274,280 2,347,666 January 30, 2011 County-Issued Duplicate 2,462,192,500

Breakdown of property assessments by municipality per January Duplicate:

January 2011 January 2012 Change

Parcels Assessment Parcels Assessment

City of Allentown 522 98,218,100 522 98,601,150 +.39% South Whitehall 7,975 756,187,850 8,008 757,030,700 +.11% North Whitehall 6,615 453,973,300 6,615 457,052,250 +.68% Upper Macungie 8,090 1,153,813,250 8,165 1,155,950,800 +.19%

Total 23,202 $2,462,192,500 23,310 2,468,634,900 +.26%

Adjusted Assessment total for Budgeting Purposes

2/15/11 $2,420,274,280 2/14/12 2,420,274,280 0.00%

*Adjusted for Assessment Appeals / Projected Reduction in Real Estate Revenue for payments made in the discount period

D-1

LLOOCCAALL SSOOUURRCCEESS ((ccoonntt..))

Composition of the district’s assessed and taxable property values –

2011-12 2012-13 CHANGE

6112 IINNTTEERRIIMM RREEAALL EESSTTAATTEE TTAAXXEESS $1,199,997 $900,000 ($ 299,997)

Interim taxes are those issued on new construction or property improvements following the issuance of the July 1 school real estate tax billing. Interim Real Estate Revenues are projected to decrease for the 2012-13 Budget. Total Revenue depends on the value and timing of new construction.

Actual interim tax collections over the last five years are as follows:

Note: The Interim Real Estate amount reported here is based on the School District's Financial Statements. Approximately $2M of this amount is represented by “rebillings” to commercial / industrial taxpayers that were appealing their Assessment Values and were billed after the court process. This approximate $2M amount does not represent Interim Revenue based on new construction. This portrays the opinion of our auditing firm.

D-2

Year Actual/Est.

2006-07 $2,202,471 2007-08 2,953,160 2008-09 1,442,728 2009-10 1,732,865 2010-11 2,824,057

2011-12 estimate $ 900,000


2011-12 2012-13 CHANGE 6113 PPUUBBLLIICC UUTTIILLIITTYY RREEAALLTTYY TTAAXX $130,000 $130,000 $ 0

Under the Public Utility Realty Tax Act (PURTA), there is a tax on the gross receipts of all public utilities operating within the Commonwealth, in lieu of a real estate tax. The tax is passed on through utility bills to customers, then sent to the Commonwealth for distribution. The distribution is based on the total of all taxes collected by each taxing body as a percentage of total of all taxes collected statewide, and not based on the value of utility property located within that municipality. Utility properties were exempted from the property tax in municipalities and school districts. That is, while municipalities could not tax utilities, each one received a payment from the Commonwealth in lieu of property taxes. However, following the deregulation of electric utilities in the Commonwealth, legislation now allows for a property tax levy against electric generating and related facilities. Non-generation facilities remain in the pool for a gross receipts tax. Though the PPL Service Center, valued at $15.9 million, is located in South Whitehall, it is exempted for property tax purposes. Under changes made in the taxation of utility-owned properties, it will remain so, as it is not considered a generating facility. The “winners” in this shift of taxation were municipalities with generating facilities located within their borders.

2011-12 2012-13 CHANGE 6114 PPAAYYMMEENNTTSS IINN LLIIEEUU OOFF TTAAXXEESS $ 4,000 $ 4,000 $ 0

Money received from a special resolution adopted by Lehigh County to enable residents of Cedarview Apartments to qualify for the state’s low-income rent rebate.

2011-12 2012-13 CHANGE 6140/ TTOOTTAALL AACCTT 551111 TTAAXXEESS $10,820,000 $10,770,000 ($50,000) 6150

This includes all taxes enabled by Act 511, including the Local Services Tax, ½% Earned Income Tax and ½% Real Estate Transfer Tax.

2011-12 2012-13 CHANGE

6142 LLOOCCAALL SSEERRVVIICCEESS TTAAXX $620,000 $570,000 ($50,000)

This total represents the district’s share of the Local Services Tax and the agreed upon collection fee.

D-3

LLOOCCAALL SSOOUURRCCEESS ((ccoonntt..)) 2011-12 2012-13 CHANGE

6151 EEAARRNNEEDD IINNCCOOMMEE TTAAXX $8,700,000 $8,700,000 $ 0

The district collects the 1% tax and shares it on a 50/50 basis with the three townships. Any increase is dependent on the factors of (1) population change, (2) the level of employment (number who have jobs) and (3) increases in the average wage. No increase in EIT (budget to budget) is projected at this time as unemployment trends are impacting this revenue source. We are currently studying the “NIZ” matter and impact on Parkland.

2011-12 2012-13 CHANGE 6153 RREEAALL EESSTTAATTEE TTRRAANNSSFFEERR TTAAXX $1,500,000 $1,500,000 $ 0

The district shares with each township this 1% tax imposed on the sale of all property located within the district’s boundaries. The total sale of properties within any future period as well as the price of properties being sold is unpredictable. The budget for 2012-13 will remain at 2011-12 levels for Real Estate Transfer Tax.

2011-12 2012-13 CHANGE 6400 DDEELLIINNQQUUEENNTT TTAAXXEESS $1,750,000 $1,750,000 $ 0

This account represents the collection of delinquent property taxes following the normal six-month collection period handled by the three township tax collectors. Portnoff Law Associates replaced the Lehigh County Delinquent Tax Bureau as the collector of this delinquent tax for the Parkland School District. The budget number for 2012-13 does not project any change in Delinquent Real Estate Tax revenue at this time. In the end, most taxes not collected on a current basis are eventually collected and remitted to the district.

2011-12 2012-13 CHANGE

6500 EEAARRNNIINNGGSS OONN IINNVVEESSTTMMEENNTTSS $ 300,000 $200,000 ($100,000)

The majority of our cash flow available for investing occurs in the months of August through November as property tax monies are invested to provide funds for the balance of the year. Projected investment earnings for the 2012-13 year are based on interest rate trends which began decreasing in the second half of 2008. The following chart indicates the rates in effect at budget preparation time:

YEAR BUDGET ACTUAL AVE. RATE

2005-06 $ 825,000 $1,430,611 4.50%

2006-07 1,700,000 2,228,676 5.13%

2007-08 1,700,000 1,980,472 4.17% (Jan 08)

2008-09 1,751,000 961,632 1.0% (Jan 09)

2009-10 1,000,000 218,623 <1.0% (Jan 10)

2010-11 300,000 $ 81,245 <1.0% (Jan 11)

2011-12 $ 200,000 Est. <1.0% (Jan 12)

D-4

Year Actual / Est.

2006-07 $ 2,559,451 2007-08 1,998,804 2008-09 1,415,263 2009-10 1,878,383 2010-11 1,484,695

2011-12 estimate $ 1,500,000


2011-12 2012-13 CHANGE 6710 DISTRICT ACTIVITIES $ 0 $ 50,000 $ 50,000

This revenue represents gate receipts for athletic events. It was formerly a part of Student Activities Funds, but due to GASB 54 is now included in the General Fund.

2011-12 2012-13 CHANGE 6800 RREEVVEENNUUEE FFRROOMM IINNTTEERRMMEEDDIIAATTEE $1,500,000 $1,500,000 $ 0

SSOOUURRCCEESS –– CCOOMMMMOONNWWEEAALLTTHH AANNDD FFEEDDEERRAALL

This revenue classification includes Commonwealth and federal funds received from intermediate sources. This can be money passed through various agencies. In the present case, it represents projected funding passed through Intermediate Units for IDEA funds.

2011-12 2012-13 CHANGE

6940 TTUUIITTIIOONN $600,000 $600,000 $ 0 Includes (1) tuition from non-resident students, summer school, summer camps,

driver education, the after-school elementary world language program and (2) tuition received from other school districts for the Detention Center, the Deal Program, mainstreamed students from other districts in Intermediate Unit classes located in our buildings and group homes.

2011-12 2012-13 CHANGE 6900 AALLLL OOTTHHEERR LLOOCCAALL RREEVVEENNUUEE $80,000 $80,000 $ 0

6910 RREENNTTAALLSS

6990 MMIISSCCEELLLLAANNEEOOUUSS RREEVVEENNUUEE Includes (1) rental of school facilities, (2) sale of surplus goods at auction,

(3) donations from private and corporate sources, (4) sale of recyclable materials and (5) other miscellaneous receipts.

D-5

77000000 - CCOOMMMMOONNWWEEAALLTTHH SSOOUURRCCEESS

Governor Corbett unveiled his Executive Budget plan for 2012-13 on February 7, 2012. Adjustments in all areas of Commonwealth revenue sources will be made once the Governor’s Budget is finalized. Accountability Block Grant funding was eliminated entirely for the 2012-13 Budget as well as other reductions previously mentioned.

7000 SSTTUUDDEENNTT AACCHHIIEEVVEEMMEENNTT EEDDUUCCAATTIIOONN BBLLOOCCKK GGRRAANNTT ((SSAAEEBBGG))

2011-12 2012-13 N/A $10,727,341 PROPOSED

The Governor’s Executive Budget proposes a Student Achievement Education Block

Grant (SAEBG) that replaces three separate line items previously listed in the Commonwealth’s Education Budget.

The Governor’s administration stated the objective of bundling these funding areas is to provide flexibility for school districts to utilize their financial resources as well as to eliminate the required reporting tied to these specific line items.

While this revenue source is projected to remain at 2011-12 levels, there are several unknowns as mentioned on page A-4 of this document.

2011-12 2012-13 7100 BASIC EDUCATION FUNDING $6,399,135 $ 0 ELIMINATED

Basic Education Funding (BEF) is proposed to be rolled into “Component A” of the proposed Student Achievement Education Block Grant.

2011-12 2012-13 7810 SOCIAL SECURITY PAYMENTS $1,855,759 $ 0 ELIMINATED

STATE SHARE

Social Security reimbursement was formerly calculated at 50% of the employer’s share of social security contribution, or 3.825% of gross wages. It is proposed to become “Component B” of the SAEBG. At this time, it is unknown if the Component B allocation will be subject to revision based on finalized figures for 2011-12 salaries.

2011-12 2012-13

7310 TRANSPORTATION $1,790,000 $ 0 ELIMINATED

This subsidy area was previously a formula-driven calculation plus a supplement for

each non-public student transported. Under the proposed SAEBG, this subsidy is comprised of “Component C” Parkland School District pupil transportation and incorporates the amount formerly paid by the Commonwealth’s directly to the IU’s; and “Component D” Non-Public and Charter School pupil transportation. Since IU’s would no longer receive transportation subsidy from the Commonwealth, we anticipate an increase in our IU expenditure.

D-6

CCOOMMMMOONNWWEEAALLTTHH SSOOUURRCCEESS ((ccoonntt..)) 2011-12 2012-13 CHANGE 7270 SSPPEECCIIAALL EEDDUUCCAATTIIOONN $3,276,903 $3,276,903 $ 0 SSCCHHOOOOLL--AAGGEEDD PPUUPPIILLSS

This revenue source is reflected in the Governor’s Proposed 2012-13 Budget. Under the current Commonwealth funding plan, the District is responsible for (and

must budget for) the total costs of all special education students in district programs and Intermediate Unit programs, as well as all other public and private institutions. However, funding is unrelated to the actual number of students served or the costs of the programs. Rather, it is formula-driven, based on an expected statewide incident rate for special education and a fixed amount per-pupil.

The current formula for distributing Commonwealth aid for special education is a

simple calculation: fixed dollar amounts (annually determined by state) multiplied by percentages of a district’s pupil population. The Commonwealth’s percentage figures are intended to reflect the average assumed incidence rate of children with disabilities and/or exceptionalities in every school district. In other words, the current special education funding system completely separates Commonwealth aid from the actual costs incurred by school districts. The formula allocates aid as if students with special education needs are evenly distributed across the Commonwealth. Further, the fixed dollar reimbursement assumes all special education costs are the same not only across a broad range of disabilities, but also in different regions of the Commonwealth.

Essentially, the Commonwealth funding system for special education assumes every

district is affected and impacted by the same percentages and expenses per student.

2011-12 2012-13 CHANGE 7140 CCHHAARRTTEERR SSCCHHOOOOLLSS $ 0 $ 0 $ 0

This revenue source was eliminated in the 2011-12 Commonwealth budget, and has not been reinstated for the 2012-13 Budget.

2011-12 2012-13 CHANGE 7160 TTUUIITTIIOONN –– CCOOUURRTT PPLLAACCEEDD CCHHIILLDDRREENN $187,000 $187,000 $ 0

Payments from the State for the education of non-resident children placed in private homes by court order or by an agency, and for non-residents in orphan homes or correctional institutions.

D-7

CCOOMMMMOONNWWEEAALLTTHH SSOOUURRCCEESS ((ccoonntt..))

2011-12 2012-13 CHANGE 7320 RREENNTTAALL SSUUBBSSIIDDYY $1,214,485 $1,214,485 $ 0

The total subsidy is calculated by multiplying the total of principal and interest payments on outstanding bonds (Including the LCTI project), times the reimbursable percentage of each project financed through those bonds, times the District’s overall capital reimbursable percentage of 29.98%. On average, the District is receiving approximately 7 cents in reimbursement for every $1.00 paid out as debt service.

2011-12 2012-13 CHANGE

7330 HHEEAALLTTHH SSEERRVVIICCEESS $185,291 $185,291 $ 0 A reimbursement for medical, dental and nurse services provided to pupils, except for

first aid treatment.

2011-12 2012-13 CHANGE

7501 AACCCCOOUUNNTTAABBIILLIITTYY BBLLOOCCKK GGRRAANNTT $ 0 $ 0 $ 0

This revenue source was reduced in 2011-12 and has been eliminated entirely for the 2012-13 Budget.

2011-12 2012-13 CHANGE 7810 RREETTIIRREEMMEENNTT CCOONNTTRRIIBBUUTTIIOONNSS $2,953,175 $4,224,951 $1,271,776

SSTTAATTEE SSHHAARREE

The State and the district share employer contributions for the Public School Employees’ Retirement System (PSERS) equal to a percentage of qualified employee wages. The district pays the entire bill, and the Commonwealth reimburses the district for its one-half share. A combined rate of 12.36% of payroll will be in place for the 2012-13 Budget. (Note: the rate in 1990-91 was a combined 19.18%). Rates, which are determined through an actuarial determination using projected investment rates and retiree payments, are projected to rise rapidly over the next few years.

The State and local school districts share this cost on a “market value/income aid

ratio” formula. That is, the “poorer” the district, the more of the total that is paid for by the Commonwealth. However, there is currently a minimum guarantee of 50% support by the Commonwealth. The full contribution rate is budgeted locally, and the Commonwealth provides its share in the form of reimbursements to the district.

D-8

88000000 -- FFEEDDEERRAALL SSOOUURRCCEESS

2011-12 2012-13 CHANGE

88551144 TTIITTLLEE II PPRROOGGRRAAMM $955,476 $910,056 ($45,420)

The Title I provides funds to be used for remediation programs in the elementary schools, as well as funds directed to KidsPeace for their programs. The final allocation for the current school year is $910,056, with $508,966 for the district’s programs, and the remaining amount divided between KidsPeace ($387,617) and services to St. Joseph the Worker School ($13,473). At this time we have not been notified of our funding for next year. The budget may be updated as we receive current funding information which usually is sometime after June 1st; however, it will have no impact on the net budget. The district is required to expend the allocation or return the difference; as such, we budget the same figure in both revenue and expenditures.

2011-12 2012-13 CHANGE

88000000 OOTTHHEERR FFEEDDEERRAALL GGRRAANNTTSS $940,477 $943,000 $2,523

All other direct federal funds budgeted to be received include: 1.) Title II-A Grant for Improving Teacher Quality of $199,638, 2.) Title III Grant for

Language Instruction for Limited English Proficient and Immigrant Students (ESL) in the amount of $43,362, and 3.) ACCESS Funds in the projected amount of $700,000.

At this time, we have not received notification of our final allocations for federal grants

for 2012-13. As with Title I, the budget may be updated as we receive current funding information, which is expected sometime after June 1st; however, it will have no impact on the net budget. The District is required to expend the allocation or return the difference; as such, we budget the same figure in both revenue and expenditures.

2011-12 2012-13 CHANGE

99000000 OOTTHHEERR FFIINNAANNCCIINNGG SSOOUURRCCEESS $300,000 $50,000 ($250,000) Installment payments for Lone Lane property. Payments are $25,000 per month

through September 1, 2012.

D-9

COMPARISON OF LEHIGH COUNTY SCHOOL REAL ESTATE TAX RATES

2011-2012 SCHOOL YEAR

2010-11 2011-12 CHANGE CHANGE

DISTRICT (alphabetic) MILLAGE MILLAGE IN MILLS IN PCT.

Allentown 45.592 48.082 2.490 5.5%Catasauqua Area 50.560 51.470 0.910 1.8%East Penn 45.320 46.150 0.830 1.8%Northern Lehigh 64.373 64.373 0.000 0.0%Northwestern Lehigh 50.660 50.660 0.000 0.0%PARKLAND 38.270 39.730 1.460 3.8%

Salisbury Township 45.445 46.854 1.409 3.1%Southern Lehigh 45.300 45.550 0.250 0.6%Whitehall-Coplay 44.720 46.290 1.570 3.5%AVERAGE (9 DISTRICTS) 47.804 48.795 0.991 2.1%

30.540

28.009

30 40 50 60 70

PARKLAND

Southern Lehigh

East Penn

Whitehall-Coplay

Salisbury Township

Allentown

AVERAGE (9)

Northwestern Lehigh

Catasauqua Area

Northern Lehigh

39.730

45.550

46.150

46.290

46.854

48.082

48.795

50.660

51.470

64.373

TOTAL MILLS

SCHOOL REAL ESTATE TAX RATES (IN MILLS) 2011-2012

0.000 0.000

0.250

0.830 0.910 0.991

1.409 1.460 1.570

2.490

0.000

0.500

1.000

1.500

2.000

2.500

3.000

MIL

LS

TAX INCREASE IN MILLS 2011-12

E-1

PARKLAND SCHOOL DISTRICT

REAL ESTATE TAX RATE (MILLS)

1999-00 THROUGH 2011-12

Incr. Incr.

Year Millage (Mills) (Pct.)

1999-00 25.77 1.47 6.0%

2000-01 27.07 1.30 5.0%

2001-02 27.07 0.00 0.0%

2002-03 28.67 1.60 5.9%

2003-04 30.44 1.77 6.2%

2004-05 31.94 1.50 4.9%

2005-06 33.56 1.62 5.1%

2006-07 34.94 1.38 4.1%

2007-08 35.84 0.90 2.6%

2008-09 36.67 0.83 2.3%

2009-10 37.20 0.53 1.4%

2010-11 38.27 1.07 2.9%

2011-12 39.73 1.46 3.8%

Note: Above rates do not include

the 0.30 mill Parkland Community

Library Tax imposed beginning

1999-2000

E-2

25.77 27.07 27.07 28.67 30.44 31.94

33.56 34.94 35.84 36.67 37.20 38.27 39.73

0.00

10.00

20.00

30.00

40.00

50.00

MIL

LS

Total Millage

6.05%

5.04%

0.00%

5.91% 6.17%

4.93% 5.07%

4.11%

2.58% 2.32%

1.45%

2.88%

3.81%

0.0%

2.0%

4.0%

6.0%

8.0%

PE

RC

EN

T I

NC

RE

AS

E

Increase in Millage (Percent)

Documents

PARRKKLLAANNDD SSCCHHOOOLL …€¦ · PARRKKLLAANNDD SSCCHHOOOLL DDIISSTTRRIICCTT GENEERRAALL FFUNDD UBBUDDGGEETT ... The actual tax rate for 2012-13 will be ... Earned Income Tax