ORGANIZATIONAL INFORMATION

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Introductory Section Outline ...1

Organizational Information Highlights ...2

Financial Information Highlights ...12

Supplemental Information Highlights ...27

ORGANIZATIONAL INFORMATION Organizational Section Outline ...39

Organizational Structure ...40

Budget Process and Management ...50

Budgetary and Accounting Policies ...54

School Board Financial Policies ...56

Strategic Plan ...65

FINANCIAL INFORMATION Financial Section Outline ...127

Budget Overview ...128

Revenue Summary – All Funds ...130

Expenditure Summary By Object – All Funds...132

Expenditure Summary by Generic Objects – All Funds...133

Expenditure Summary – All Funds By Category ...134

Expenditure Summary – By Fund...135

Expenditure Summary by Sub-Function – All Funds ...137

Expenditures by Object – Fund 5 Only Less CIP ...138

Full-Time Equivalent (FTE) Summary Data ...142

Operating Budget Revenue and Expenditure Highlights ...145

Major Budget Changes in Expenditures ...152

A List of Unapproved Budget Requests ...153

Retiree Health Insurance (GASB 45) ...154

Fund Statements ...157

Operating Budgets by Department ...173

Supplemental Schedules ...231

School Based Allocation Budgets ...240

Grant Programs ...302

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Three-Year Budget Forecast ...340

Outstanding Bonds Listing...342

Student Enrollment Trends and Forecast ...343

Projected Student Enrollment by Grade ...344

Projected Student Enrollment by School ...345

Percentage of Special Education Program Students ...346

School Based Allocations Formula ...347

Student and County Demographics...348

Performance Results ...349

Division-Wide Accomplishments...354

Staffing Standards ...358

Special Education Staffing Standards ...363

Personnel Resource Allocations ...364

FY 2013 Authorized Student Fees ...367

FY 2013 Supplement/Rate Schedule ...368

Local Tax Information ...371

FY 2013 Pay Scales ...374

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Budget Team LaShahn Gaines, CPA, CPM

Chief Financial Officer Marcia Stevens, CPA Accounting Manager Barbara Stombock Director of Finance

Don Bruce

Supervisor of Data Mining Leah Underwood Programmer Analyst Doreen Flint Accounting Technician Donna F. P. Jones Graphic Designer

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May 14, 2012

Mrs. Ann Heidig, Chair

Spotsylvania County Board of Supervisors P.O. Box 99

Spotsylvania, VA 22553 Dear Mrs. Heidig:

The School Board is pleased to share with the Board of Supervisors (BOS) its budget for fiscal year 2013. The School Board and the administration have approached the FY 2013 budget process in an atmosphere of open dialogue between staff, parents, and the community-at-large. The division’s budget process is a thoughtful one as we serve approximately 24,000 students and employ over 3,000 individuals. This makes Spotsylvania County Schools the 11th largest of 134 school divisions in Virginia and the largest employer in Spotsylvania County.

The division is most proud of having achieved full state accreditation for all schools for the last few years and 99.9% of our teachers are highly qualified. We also have dedicated school/central office administrators, maintenance employees, transportation staff, food service workers, instructional, finance, human resource and technology staff who do a great job supporting classroom instruction. The division’s goal is to continue to improve student learning and achievement, attract and retain high quality staff, and preserve the division’s assets.

The School Board’s FY 2013 Adopted Budget for all funds including the Capital Project Fund totals $271.1 million, an increase of $12.1 million over the FY 2012 Adopted Budget. The major expenditure highlights include:

• Funding unprecedented increases inVRS rates. • Providing a 5.8% offsetting pay raise for employees below the director level • Providing a 5.0% offsetting pay raise for employees at the director level and above • Electing full-time employees to pay the 5% VRS employee share • Restoring thirteen classroom teaching positions from state funding • Funding 17.3% of the employer’s share of the health insurance increase • Funding 15.3% of the employee’s share of the health insurance increase and having employees pay the remaining 2% increase based on survey results

The School Board’s goal in developing its budget continues to be maintaining the overall strength of Spotsylvania County Schools as a high-performing school division. Your continued support in this effort is most appreciated as we work through this very important process for all our kids’ success.

Sincerely,

Linda Wieland

tDD 540.834.2557

Administration

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1 SCS FY 2013 School Board Adopted Budget

FY 2013 Management Structure FY 2013 Organization Chart Budget Process and Timeline Budget Calendar

Significant Process, Policy, and Practice Changes Financial Policies and Practices

Financial Information

Combined Fund Statements Revenue Summary

Expenditure Summary Budget Allocation

Major Budget Changes in Expenditures Mandatory Costs

Capital Improvement Plan Budget Results Allocation of Positions

Retiree Health Insurance (GASB 45) Cost Per Pupil

Budget at a Glance Supplemental Information

Three-Year Budget Forecast

Student Enrollment Trends and Forecast Spotsylvania and Student Demographics Performance Results using NCLB FY 2012 Accomplishments

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School Board

Spotsylvania County Schools (SCS) is governed by seven elected School Board members. Members are elected on staggered four-year terms and one member represents each of the county’s seven districts. Board members select a Chair and a Vice-Chair at the organizational meeting at the beginning of every calendar year. The School Board is charged by Virginia law and the regulations of the Virginia Board of Education to establish policies, guidelines and rules that will ensure the proper administration of the school division. In addition, all board members subscribe to and sign a Code of Ethics.

FY 2012 Senior Staff

• Dr. Shelley Redinger, Superintendent • Mrs. LaShahn Gaines, Chief Financial Officer • Dr. Scott Baker, Assistant Superintendent of Instruction • Dr. Stephen Covert, Assistant Superintendent of Human Resources • Mr. William Flaherty, Assistant Superintendent of Technology Services • Dr. Scott Worner, Assistant Superintendent of Administrative Services • Mrs. René Daniels, Director of Public Information

From left to right above: Mr. J. Gilbert Seaux, Berkeley District; Chair: Mrs. Linda Wieland, Battlefield District; Vice-Chair: Dr. James Meyer, Courtland District; Mrs. Amanda Blalock, Lee Hill District; Mr. Ray Lora, Livingston District; Ms. Dawn Shelley, Chancellor District; Mr. William M. Blaine; Jr., Salem District

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document contains the four major sections listed and defined below.

The Introductory Section contains a comprehensive summary of the three main sections

(i.e. organizational, financial, and supplemental information). The Executive Summary is included in this section. The Organizational Information Section includes the school division’s organizational and management structure, organization chart, Strategic Plan (vision, mission, goals, and strategies), budget development process, and significant policy changes.

The Financial Information Section includes budget data by both summary and detail level for all school division funds. This section is subdivided into the Commonwealth Governor’s School Fund, the Rappahannock Regional Detention Center Fund, the Food Service Fund, the Regional Adult Education Fund, the Operating Fund (which includes Debt Service), the Capital Project Fund, and the Fleet Service-Internal Service Fund sections. Included within the Debt Service data are summary and individual bond and Literary Fund Loan amortization schedules for all current indebtedness. The Capital Project Fund section includes a summary of the Capital Improvements Plan (CIP), which is the school division’s five-year long-range plan for capital projects.

The Supplemental Information Section includes the following information of interest to school division employees and the community-at-large:

- Three-Year Budget Forecast - County and Student Demographics - Performance Results

- Division Accomplishments - Local Tax Information

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Organizational Information

With short-term and long-term planning being an integral component of all school division functions for effectiveness of services, a Strategic Planning Committee, (which consisted of more than 120 teachers, administrators, parents, students, and community members), met throughout the 2007-08 school year to update the division’s Six-Year Strategic Plan. During FY 2009, the School Board adopted the new mission and vision statements as well as the strategic priorities listed below, which will move the school division forward in the 21st century. During FY 2010 and FY 2011, the School Board adopted minor revisions to the six-year strategic plan. In addition, for FY 2012, under the Superintendent’s leadership, the division began revising the current strategic plan. The School Board is scheduled to approve the revisions during fiscal year 2013. Vision Statement Spotsylvania County Schools provides a premier education of world class distinction in a positive, collaborative environment with high levels of community engagement. All organizational structures support the primary purpose of preparing students to be responsible and productive citizens.

Mission Statement To prepare all students to excel in a dynamic global society.

Strategic Priorities Priority #1 - Effective Instructional Services

• Provide high quality instruction through collaboration and flexibility to maximize student achievement; • Prepare all students for the challenges of the future;

• Address the individual needs and abilities of our growing and diverse population; • Ensure that students are good stewards and active participants in the global community. Priority #2 - Positive and Effective Learning Environment

• Facilitate an ongoing commitment to the effective and efficient delivery of high-quality services; • Ensure a safe, respectful, and responsible environment for students and staff;

• Create a culture where ongoing professional and personal developments are embraced. Priority #3 - Parent Engagement and Dynamic Community Partnerships

• Believe that parent engagement is critical to student success;

• Support the development of productive and positive partnerships with businesses and the greater community; • Share ownership for student learning with all stakeholders.

Priority #4 - Supportive Organizational Structure • Attract and retain high quality professionals;

• Ensure that all available resources are directed toward organizational efficiency.

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of Instruction directly oversees the instructional operations of the schools. The Executive Director of Operations oversees school food service, pupil transportation, fleet services, maintenance, and capital improvement projects (CIP). The Executive Director of Human Resources oversees recruiting and personnel management. The Chief Financial Officer oversees the budget, accounts payable, payroll and accounting functions. The Public Information Director provides support for media relations, community relations and County partnerships; as well as, promotes the Division through social media, traditional media, and community ties. Also, the Public Information Director oversees the printing for the organization.

The organizational structure of SCS is focused on meeting the needs of its diverse student population while managing the various schools and programs within the division. A summary organizational chart for Fiscal Year 2013 is below.

As a part of the Superintendent’s streamling plan, the Assistant Superintendent for Technology position was eliminated throught retirement, the Assistant Superintendent for Administration was reclassed to Executive Director of Operations and the Assistant Superintendent for Human Resources was reclassed to Executive Director of Human Resources.

FY 2013 Organizational Chart

School Board

Superintendent Assistant Superintendent of Instruction Executive Director of Operations

Executive Director of Human Resources

Chief Financial Officer

Public Information Officer Clerk of the Board

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Budget Process and Timeline

The Code of Virginia provides that school divisions must prepare annual budgets. Spotsylvania County Schools’ FY 2013 budget planning process began September 2011. The FY 2013 School Board Adopted Budget was developed based on revenue increases and expenditure increases noted in the General Assembly Budget for Biennium 2012-2014 and assumed level funding by the Board of Supervisors (BOS) as well as access to $481,990 in prior year School holdback funds and includes the County Administrator’s debt service proposal for the schools. In addition, the FY 2013 School Board Adopted Budget was developed based on a minimal increase in student enrollment (less than 0.5%, from 23,775 students to 23,783 students) over FY 2012. The estimated Average Daily Membership (ADM) for school year 2012 - 2013 is 23,139. Moreover, the FY 2013 School Board Adopted Budget was compiled with input and feedback from a variety of stakeholders and key source documents, including: • Principals, teachers, and staff; • Budget Review Committee members; • Parent Advisory Council members; • Spotsylvania Education Association (SEA) officers and members; • Citizen input at public hearings; • Public comments in regular School Board meetings; • The school division’s 2008-2014 Strategic Plan; and • The revised 2013-2017 Capital Improvement Plan. In an effort to provide transparency in the budget process, each year the school division compiles a budget document that provides an executive summary of budget priorities, a rationale for the budget increases, highlights of student/ school successes, and cost saving efforts of the division. For the FY 2013 budget, the same documents listed have been prepared and included in the FY 2013 School Board Adopted Budget book.

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Activity Timeframe

Budget Planning – The budget planning process starts when the School Board adopts the budget calendar. The calendar includes the dates, times, and location

of activities related to the budget development process. September 2011 Budget Formulation – The preparation of the budget is the process of projecting

student enrollment; estimating expenditure needs to support schools, programs, and services; and projecting revenues as well as estimating capital project improvement needs and its impact on the operating budget.

October 2011 - December 2011

Budget Engagement – During the budget development process, approximately four to seven Budget Review Committee meetings are held with teachers, parents, business leaders, school administrators, and central oﬃce staﬀ collectively.

November 2011 – January 2012

Budget Preparation – Based on input from various sources, including the Budget

Review Committee, the Superintendent’s Recommended Budget is prepared. January 2012 Budget Approval – Based on recommendations made by the Superintendent,

input from the community and information shared at School Board budget work

sessions, the School Board’s Approved Budget is prepared. March 2012 Budget Adoption – Prior to adopting the ﬁnal budget, the School Board

participates in a joint work session with the local governing board. The governing board adopts the tax rate and the County’s budget prior to May and the School Board adopts its budget in May.

April 2012 – May 2012

Budget Evaluation –The results of operations for the ﬁscal year are set forth annually in the County’s and school division’s combined Comprehensive Annual

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Significant Process Changes

This is the fifth consecutive year that the school division has faced budget shortfalls (meaning the net increase in mandatory costs outweigh the net increase in revenues). These budget shortfalls are attributed to mandatory costs such as increases in health insurance, retirement benefits, group life benefits, and rising utility/fuel costs. To strategically address the budget shortfalls, the School Board utilized a tiered reduction approach for past budget cycles. Tier One through Tier Six reductions were executed as a part of the FY 2010 and FY 2011 budgets, some of which included eliminating vacant positions, eliminating categories of positions, aligning staffing standards to reflect the decline in student enrollment, reducing debt service expenditures by eliminating the issuance of bonds, eliminating programs (elementary Spanish, etc.), after-school activity buses, and instituting athletic fees. The FY 2012 budget included the reduction of 41 positions and the FY 2013 budget included a net decrease of 4 positions. A detailed list of the FY 2013 budget adjustments are contained in the Financial Information section of this budget document.

In addition, the Budget Review Committee (BRC), a valuable tool in the budget development process, continues to expand as public interest heightens due to the funding shortfalls. The FY 2013 BRC consisted of approximately 50 members, and included district representatives, at-large representatives, parents, school principals, teachers, support staff, county finance staff, school administrators, and business partners.

The budget development process has always incorporated the contributions of the community-at-large as essential stakeholders in the success of all students. The framework of the BRC was revamped in FY 2011 with a direct emphasis on focus groups to elicit dialogue and promote a higher level of thinking to problem solve the financial constraints facing the division. The new format included utilizing specific informational areas of the division’s website, such as Spotsylvania County Online Resource Education (SCORE), an internal communication resource, with all meeting materials and handouts accessed and stored electronically. Through paperless budget meetings, the school division gained efficiencies, saved on paper and printing costs, and modeled a 21st Century global learning community. These practices were continued for the FY 2013 BRC process.

Maintaining student achievement is the top priority and finding unique ways to support this goal is invaluable to ensure that all students are given access to the education to which they are entitled as efficiently and effectively as possible. Given that this is not only a Spotsylvania County issue, but also a regional, state, and national crisis, finding unique ways to uphold the mission of preparing all students to excel in a dynamic global society may be difficult, but attainable, especially when all stakeholders are informed and involved in the process.

Significant Policy Changes

Based on legislation approved by the General Assembly for the 2012 - 2014 Biennial budget, the School Board elected to have its employees pay the 5% employee VRS share instead of implementing a phased in approach for fiscal year 2013. As such, employees below the director level will receive a 5.8% offsetting pay raise and employees at the director level and above will receive a 5% offsetting pay raise.

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those teachers who were on steps 0 to 5 to ensure that they received the same salary as in previous years when steps were frozen. Therefore, in FY 2011, teachers with up to eight years of experience received a career incentive in August 2010.

After much deliberation, the School Board adopted revised teacher pay scales for FY 2012, which included

embedding the career incentives into the teacher pay scale and converting from steps to years of experience. As a result of this change, teachers on step 0-8 receive a higher Virginia Retirement System (VRS) contribution because the former career incentive pay was not considered VRS creditable.

Effective July 1, 2011, pay scales for teachers no longer reflect steps, but rather years of experience. Pay scales for all employees are included in the Supplemental Information section of the FY 2013 Adopted School Board Budget book.

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Financial Policies and Practices

Accounting Policies and Practices

All funds are accounted for using the modified accrual basis of accounting except for the School’s Fleet Service - Internal Service Fund which uses full accrual basis of accounting. For all other funds, revenues are generally recognized when they are both measurable and available. SCS considers all revenues available if they are collectible within 60 days after year-end. However, intergovernmental revenues, consisting primarily of Federal, State and other grants, for the purpose of specific funding, are recognized when earned or at the time of the specific reimbursable expenditure. Expenditures are generally recognized under the modified accrual basis of accounting when the related fund liability is incurred, except for certain compensated absences and principal and interest payments on general long-term debt, both of which are recognized when paid.

Budgetary Policies and Practices

According to the Code of Virginia, the State, in conjunction with the Auditor of Public Accounts, shall establish and require of each school division a modern system of accounting for all school funds. Consequently, SCS maintains a chart of accounts that fulfills the requirements of the State Department of Education and the annual school report as prescribed by the auditor of public accounts. The chart of accounts is composed of the following elements: funds, functions, cost centers, objects, programs, and projects. In order to maintain the integrity of the account structure, SCS maintains distinct funds to account for financial transactions that remain separate from other transactions. SCS maintains the following six (6) funds:

1 – The Commonwealth Governor’s School 2 – Juvenile Detention Center

3 – School Food Service Program 4 – Regional Adult Education Program 5 – Regular Education Operating Fund

7 – Fleet Maintenance – Internal Service Fund

The revenue accounts are charted according to the sources below. Revenues for the various funds are included on the fund statement sheets and the operating sheets of this budget document.

200 – State Sales Tax 300 – State Funds 400 – Federal Funds 500 – County Funds 700 – Other Funds 800 – Loans, Bonds and Interest The expenditure accounts are divided according to function/sub-function as prescribed by the Auditor of Public Accounts. In order to record transactions, expenditures are charted according to cost center, object, program, and project. The functions (categories) of expenditures are listed below which defines the type of activity. 1000 – Instruction 2000 – Administration, Attendance and Health 3000 – Pupil Transportation Services

4000 – Operation and Maintenance Services 5000 – School Food Services

6000 – Facilities and Technology

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• The object code identifies the actual good or service purchased. Object codes are grouped into two main categories, compensation and non-compensation. This budget document contains the compensation and

non-compensation reports for each department and school.

• The program code identifies the revenue or expenditure as an elementary, secondary, or administrative activity.

• The project code identifies the source of funds for the activity.

Overall, SCS operates under a quasi site-based management philosophy where schools and departments have full authority to plan and expend their non-compensation budgets while the compensation budgets are controlled and monitored by the central office.

Compensation budgets, which are salaries and benefits, include the expenditures listed below:

Object 1000 – Compensation - Contracted pay, overtime pay, non-contracted pay, substitute pay, supplemental pay. Object 2000 – Benefits - FICA, health/dental insurance, retirement benefits, group life insurance, annual and sick

leave payoff.

Non-compensation budgets include the expenditures listed below:

Object 3000 – Purchased Services - Services, professional development, lease/rental contracts, etc. Object 5000 – Other Charges – Utilities, memberships, travel, dues and licenses, etc. Object 6000 – Materials and Supplies - Office supplies, medical and dental supplies, commodities that are consumed and minor equipment that is not capitalized, etc. Object 7000 – Payment to Joint Operations – Not used by SCS. Object 8000 – Capital Outlay - New equipment, replacement equipment and furnishings in excess of $5,000.

Object 9000 – Other Uses of Funds – This series of codes is used for debt service and accounting control purposes

(e.g., hold back accounts).

The school division, as a part of the county audit process, assists with the preparation of a Comprehensive Annual Financial Report (CAFR) to report results of all funds under School Board authorization. The school division prepares the Annual School Report for the Virginia Department of Education. Summary listings of individual school and

department critical functions and activities as well as a discussion of their budgeted major changes for the coming year are presented for each department in the Financial Section of this budget document.

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Combined Fund Statements

The School Board Adopted FY 2013 Budget for all funds totals $271,141,778, an increase of $12,092,377 or

4.7% more than the FY 2012 Adopted Budget. The total budget consists of six funds for which operating and capital expenditures are accounted for in the same fund by differentiating budget codes.

Fund 1 - Commonwealth Governor’s School (CGS) Fund accounts for a regional program that serves gifted students from the school districts of Caroline, King George, Spotsylvania, and Stafford.

Fund 2 - Rappahannock Regional Juvenile Detention Center (RRJDC) Fund accounts for activity associated with providing detained youth a quality education and the skills necessary to transition from the program into their regular school.

Fund 3 - Food Service Fund provides for all of food service’s operating and administrative costs, which are primarily supported by federal, state, and café sales revenues.

Fund 4 - Regional Adult Education Fund accounts for the two adult education programs, which are the Rappahannock Area Regional Adult Education (RARAE) Program and the Apprenticeship Education (AE)

Program.

Fund 5 - Operating Fund provides for the day-to-day operation of the school division and debt service payments. It is the largest fund.

Fund 5 - Capital Project Fund includes funds borrowed through the Virginia Public School Authority (VPSA), Literary Fund loans, Economic Development Authority (EDA) bonds, Qualified School Construction Bonds (QSCB), and bonds issued as a result of the local bond referenda.

Fund 7 - Fleet Service Fund provides for the day-to-day operations of the Joint Fleet Maintenance Facility with the County.

FY09 FY10 FY11 FY12 FY13 $ %

Fund Description Actual Actual Actual AdoptedBudget AdoptedBudget Variance Change

1 GOVERNOR'S SCHOOL 714,671 1,713,699 1,668,921 1,683,396 1,832,327 148,931 8.8% 2 DETENTION CENTER 849,827 867,106 780,702 996,247 999,136 2,889 0.3% 3 FOOD SERVICES 8,725,437 8,773,004 9,265,917 9,118,193 9,872,292 754,099 8.3% 4 REGIONAL ADULT ED 497,792 655,769 606,523 596,676 728,673 131,997 22.1% 5 CIP* 18,064,415 14,865,312 4,317,463 4,835,670 6,724,104 1,888,434 39.1% 5 OPERATING 257,155,861 246,876,789 237,455,989 239,680,246 248,646,069 8,965,823 3.7% 7 FLEET SERVICE 1,939,757 1,928,619 2,068,153 2,138,973 2,339,177 200,204 9.4% Grand Total $ 287,947,760 $ 275,680,298 $ 256,163,667 $ 259,049,401 $ 271,141,778 $ 12,092,377 4.7%

Expenditure Budget Overview by Fund - All Funds

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Many factors impacted the overall expenditure level in the development of the FY 2013 budget, some of which include: health benefit plan provisions; student enrollment; staffing ratios at the elementary and secondary schools, including special education services; formula–based allocations for schools; the rate of change of employee retirement benefits including employees paying the 5% VRS employee share; a 5.8% offsetting pay raise for employees below the director level and a 5% offsetting pay raise for employees at the director level and above; restoring 13 classroom teacher positions; and changes in the cost of doing business, such as utilities, fuel, maintenance, and repair contracts. Overall, the FY 2013 budget is focused on maintaining the school division’s current momentum toward high performance and serving students. Despite the slow economic recovery and a flat student enrollment trend, the School Board’s challenge is to continue providing sustainable programs and services to ensure quality education, and to do so efficiently and effectively. The School Board and administration will continue to set priorities to ensure a quality education for the students in our community which included hiring and retaining highly qualified teachers and employees, providing sound finances, upholding excellent safety procedures, and maintaining quality schools. Governor's School 0.7% Detention Center 0.4% Food Service 3.5% Regional Adult Ed 0.3% Operating 91.7% CIP 2.5% Fleet 0.9%

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Revenue Summary

The School Board Adopted FY 2013 Revenue Budget for all funds totals $271,141,778, an increase of $12,092,377 or 4.7% more than the FY 2012 Adopted revenues budget. This is only the second increase to the division’s revenue budget since FY 2009. The FY 2013 revenue increase, less loans and bonds funding for capital projects, is $10,203,943. Of this amount, $481,990 represents prior year hold back funds currently held in the County’s fund balance. The total revenues budget consists of six revenue sources: state sales tax, other state funds, federal funds, city-county funds, other funds, and loans and bonds funds. Sources of Revenue

The primary sources of revenue for SCS are State Funds and City-County appropriations. The chart below has combined State Sales Tax and other State Funds, which represent 44.5% of SCS’s FY 2013 revenues. The chart below shows State Funds increased by a net total of $9,138,865 or 8.2%. This is the result of decreases in the division’s composite index decreasing from by .0267 from .3593 to .3326, which resulted in additional state funding for the division. The school division will receive additional state funding to support the increase in VRS and other educational initiatives. Federal funds total $17,246,884, an increase of $66,846 or 0.4% from FY 2012 to FY 2013 as a result of an increase in Adult Education grant funding. The majority of federal funds are either entitlement grants or FY 2013 Education Jobs Funding, both of which are restricted. Federal revenues represent 6.4% of SCS’s FY 2013 revenues. This budget includes a City-County appropriation of $115,312,329 and also assumes level funding from the County for FY 2013 plus $481,990 of one-time holdback funds not previously appropriated. The City-County’s appropriation to Schools is 42.5% of the SCS’s total budget in FY 2013. Other revenues are projected to be $11,238,927, an increase of $516,243 or 4.8%. The increase is primarily due to the increases in field trip fees, projected additional fleet services revenue, tuition receipts, and Food Service revenues. Other revenues represent 4.1% of SCS’s total budget in FY 2013. Loans and bonds funds total $6,724,104, an increase of $1,888,434 or 39.1% in FY 2013. Loans and bonds revenues are projected to increase due to the School Board’s planned purchase of additional school buses, and technology equipment, as well as undertaking additional maintenance projects. Loans and bonds revenues represent 2.5% of SCS’s total budget in FY 2013.

FY09 FY10 FY11 FY12 FY13 $ %

Actual Actual Actual Adopted Adopted Variance Change

Budget Budget

Revenue

STATE SALES TAX $ 20,898,170 21,389,896 22,470,531 23,193,232 23,014,633 (178,599) -0.8% STATE FUNDS TOTAL 110,750,885 91,626,656 83,512,791 88,287,437 97,604,901 9,317,464 10.6%

Subtotal 131,649,055 113,016,552 105,983,322 111,480,669 120,619,534 9,138,865 8.2%

FEDERAL FUNDS 11,612,496 28,288,462 20,524,750 17,180,038 17,246,884 66,846 0.4% CITY-COUNTY FUNDS 117,040,749 112,664,388 113,956,434 114,830,340 115,312,329 481,989 0.4% OTHER FUNDS 10,110,286 9,901,296 11,744,207 10,722,684 11,238,927 516,243 4.8% LOANS, BONDS, ETC 482,300 362,853 2,662,721 4,835,670 6,724,104 1,888,434 39.1%

Subtotal 139,245,831 151,216,999 148,888,112 147,568,732 150,522,244 2,953,512 2.0% Grand Total $ 270,894,886 264,233,551 254,871,434 259,049,401 271,141,778 12,092,377 4.7%

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Intervention initiative for 100 percent of eligible third graders instead of the current 25 percent. The increase in State funds also provides assistance to the school division in paying the mandated employer increases in VRS contribution rates, the elimination of support non-personal inflation, and changes in the funding methodology for the Virginia Preschool Initiative. New legislation requires school divisions to adopt and implement policies for the possession and administration of epinephrine. To support this mandate, State funding includes approximately $100 for all school sites and centers in the division. Finally, a significant portion of the State budget increase was also due to the Governor’s executive amendment pertaining to K-3 class size program funding. This funding was based on October 2010 school-level free lunch eligibility percentages.

Last year, the federal government released a second round of federal funding called Education Jobs Funding. The division used $2.2 million of this funding in FY 2012 for an employee bonus and to offset increases in teacher health benefits. For FY 2013, the $2.9 million in Education Jobs funding will again be used to offset the increase in teacher salaries. The FY 2013 City-County budget included level funding of $114.8 million, the County Administrator’s FY 2013 Debt Service Proposal for the Schools saving $951,126, $481,989 in one-time holdback funds, and release of $1.2 million in recurring County holdback funds for the schools on July 1, 2012. Also, due to increases in VRS and health benefits, the division provided over $200,000 in additional local support to various division-wide grants. Overall, the School Board’s goal in developing its budget continues to be maintaining the overall strength of

Spotsylvania County Schools as a high-performing school division and to maximize its available resources. This goal is being realized because of the Board of Supervisors’ financial support and through the dedicated efforts of students, parents, teachers, principals and staff that make up our community. $0 $20,000,000 $40,000,000 $60,000,000 $80,000,000 $100,000,000 $120,000,000 $140,000,000

Sales Tax & State Funds

Federal Funds City-County Funds Other Funds CIP

FY 2013 Revenue Summary - All Funds

$120,619,534 $17,246,884 $115,312,329 $11,238,927 $6,724,104 TOTAL $271,141,778

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Revenue Summary (Continued)

Spotsylvania County Schools, like other school division’s across the nation, has faced unprecedented revenue declines over the last few years. Specifically, state revenues for the division have declined from $135 million in FY 2009 to $121 million in FY 2013, a decrease of $14 million. In addition, City-County revenues for the school division have declined from $120 million in FY 2009 to $115 million in FY 2013, or a decrease of $5 million. Despite the challenging economic times, the school division has remained focused on ensuring that every student in the division has the opportunity to succeed academically.

2008

2009

2010

2011

2012

2013

State 127

135

123

109

112

121

Local 118

120

114

115

0

20

40

60

80

100

120

140

160

State and County Revenue Trend

$

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• Providing a 5.8% offsetting pay raise for employees below the director level • Providing a 5.0% offsetting pay raise for employees at the director level and above • Electing full-time employees to pay the 5% VRS employee share • Restoring thirteen classroom teaching positions • Funding 17.3% of the employer’s share of the health insurance increase • Funding 15.3% of the employee’s share of the health insurance increase and having employees pay the remaining 2% increase based on survey results

Expenditure Adjustments by Category

This budget includes: a $9,384,103 increase in the instruction category primarily due to adding teaching positions and increases in salaries and benefits; a $505,668 increase in the administrative/attendance and health category primarily due to increases in health insurance; a $1,238,880 increase in the transportation category primarily due to increased gasoline prices and increasing the driver’s pay over 20 hours compensation line; a $703,358 increase in the maintenance category primarily due to an increase in non-compensation lines (utilities, maintenance contracts, etc.); a $800,574 increase in the food service category due to increases in VRS, health insurance, and projected increases in fees and related services; a $1,888,434 increase in the capital projects category due to the School Board engaging in more capital maintenance projects and purchasing more technology equipment and buses in FY 2013; a $331,135 decrease in the technology category due to the elimination of four positions; and a $2,097,504 decrease in the debt service category due primarily to the retirement of old debt and the Board of Supervisor’s funding new FY 2013 capital projects with the County’s reserve fund balance.

FY09 FY10 FY11 FY12 FY13 $ %

Actual Actual Actual Adopted Adopted Variance Change

Description Budget Budget

Expenditures INSTRUCTION $ 173,448,023 $ 164,967,169 $ 157,579,126 $ 161,420,564 $ 170,804,667 $ 9,384,103 5.8% ADMINISTRATION 8,395,217 8,015,437 8,002,884 8,357,732 8,863,400 505,668 6.1% TRANSPORTATION 15,682,455 16,151,867 16,487,406 17,242,238 18,481,118 1,238,880 7.2% MAINTENANCE 21,444,788 21,564,084 20,578,934 20,034,132 20,737,490 703,358 3.5% FOOD SERVICE 8,677,010 8,725,089 9,218,664 9,019,944 9,820,518 800,574 8.9% CAPITAL PROJECTS 18,064,415 14,865,312 4,317,463 4,835,670 6,724,104 1,888,434 39.1% TECHNOLOGY 8,757,350 9,527,508 8,021,900 7,624,180 7,293,045 (331,135) -4.3% DEBT SERVICE 33,478,502 31,863,833 31,957,290 30,514,941 28,417,437 (2,097,504) -6.9% Grand Total $ 287,947,760 275,680,298 256,163,667 259,049,401 271,141,778 12,092,377 4.7%

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Expenditure Summary (Continued)

Budget Allocation

The total budget for all funds is $271,141,778, of which 73.5% or $199,302,828 is compensation and 26.5% or $71,838,950 is non-compensation. The operating fund budget, less debt service and CIP, is $220,228,632, of which 87.5% or $192,698,812 is compensation and benefits and 12.5% or $27,529,820 is non-compensation. For all funds, the major non-compensation expenditures are:

Purchased Services of $18,850,047 or 7.0% of the total budget includes contracted services, professional development, lease/rental contracts, tuition for special education students attending other schools, etc. Other Charges of $9,839,653 or 4.0% of the total budget includes utilities, memberships, travel, dues, and licenses, etc.

Materials and Supplies of $11,210,194 or 4.0% of the total budget includes instructional supplies, medical and dental supplies, and minor equipment that is not capitalized office supplies, and textbooks. Capital Outlay of $3,553,619 or 1.0% of the total budget includes new equipment, replacement equipment, and furnishings in excess of $5,000 per unit cost. Debt Service of $28,385,437 or 10.5% of the total budget represents loan payments on borrowed debt for school construction projects, which does not include $32,000 in other charges. See the “Other Charges” line above. The total FY 2013 debt service cost is $28,417,437.

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Salaries/Wages

52.2%

Employee Benefits

21.3%

Purchased Services

7.0%

Other

Charges

3.6%

Materials &

Supplies

4.1%

Capital Outlay

1.3%

Debt Service

10.5%

FY 2013 Generic Budget Allocation

Total $ 201,638,140 $ 191,452,484 $ 183,085,988 $ 187,323,320 $ 199,302,828 $ 11,979,508 6.4%

3000 PURCHASED SERVICES $ 18,165,445 $ 20,300,242 $ 20,014,328 $ 19,328,069 $ 18,850,047 $ (478,022) (2.5%) 5000 OTHER CHARGES 9,078,092 9,096,731 9,361,443 9,087,465 9,839,653 752,188 8.3% 6000 MATERIALS & SUPPLIES 8,461,027 12,975,164 11,252,355 10,269,571 11,210,194 940,623 9.2% 8000 CAPITAL OUTLAY 17,149,453 10,018,015 826,877 1,358,035 3,553,619 2,195,584 161.7% 9000 DEBT SERVICES 33,455,602 31,837,663 31,622,676 30,482,941 28,385,437 (2,097,504) (6.9%)

9000 DISTRICT HOLDBACK - - - 1,200,000 - (1,200,000) (100.0%)

Total _$ _{86,309,620 $} _{84,227,814 $} _{73,077,679 $} _{71,726,081 $} _{71,838,950 $} _112,869 _0.2% Grand Total $ 287,947,760 $ 275,680,298 $ 256,163,667 $ 259,049,401 $ 271,141,778 $ 12,092,377 4.7%

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Major Budget Changes in Expenditures for All Funds

The School Board’s goal in developing its budget continues to be maintaining the overall strength of Spotsylvania County Schools as a high-performing school division. However, it has become more difficult given the financial strain at the state and national levels as it pertains to costs associated with increases in utility costs, health insurance costs, and unprecedented increases in VRS.

The FY 2013 School Board Adopted Budget includes the major budget changes below:

• Providing a 5.8% pay raise to employees below the Director level while electing that these same employees pay 5% of the employee VRS share.

• Providing a 5.0% pay raise to employees at the Director level and above while electing that these same employees pay 5% of the employee VRS share.

• Continuing to pay the employer share of VRS for the professional group at 11.66%, which represents a 49% increase and the non-professional employer group share at 8.33%.

• The school division is paying the 15.3% of the employee’s 17.3% increase in health insurance premiums, as well as the employer’s share of the entire 17.3% increase.

• Based on survey results, the school division elected to have employees pay the 2% of the employees 17.3% increase in health insurance premiums.

• Restoring 13 teaching positions using State funding. • Funding utility increases.

• Executing the Superintendent’s Streamlining Proposal.

• Increasing the school field trip fees from 50 cents per mile to 75 cents per mile while maintaining the $20 hourly bus driver rate.

• Converting 5 bus aides and 19 bus drivers from 4-hour contracts to 5-hour contracts. • Increasing the high school transportation supplement from $37,000 to $39,000 and the middle school transportation supplement from $4,550 to $6,050. • Expanding the Head Start bus aide contract from 162 days to 167 days. • Increasing the Food Service breakfast meal price by five cents and lunch meal price by ten cents. • Add the Career and Technical Center to the outsourced custodial services contract with the resignation/ retirement of four custodial personnel.

• Eliminating three clerical central office bookkeeper positions (one vacant position and two positions through attrition). • Reducing non-compensation accounts for each department by targeted amounts excluding school sites. • Restoring the Joint Fleet Services department’s Service Writer position. • Increasing the Special Services tuition budget based on actual pricing. • Increasing the Rappahannock Juvenile Detention Center part-time bookkeeper/secretary to full-time status based on State approval.

• Increasing the School Resource Officer budget based on projections from the County.

• Increasing the Health Services medical supply budget for the partially funded mandate to purchase epi-pens. • Modifying the transportation summer hotline rate of pay from $15 to $10 per hour to match the level of responsibility.

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expenditure reductions. Mandatory Costs SCS’s participation in the Virginia Retirement System (VRS) plan totals $16,054,457 for FY 2013 of the Operating Fund. Health benefits for active and retired employees, including prescription drug premium adjustments total $26,574,830 for FY 2013. The Group Life Insurance (GLI) is $1,529,398 for FY 2013. The total cost for FICA is $9,954,873 for FY 2013. In addition, worker’s compensation costs are $642,953 and the total utility costs for FY 2013 are $10,845,704, which includes telephone, data communications, electricity, fuel oil, water/sewer and gasoline. The total of fixed operating costs outlined above is $65,602,215, which represents 30% of the operating budget.

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Capital Improvement Plan (CIP) Budget Results

The FY 2013 School Board Adopted Budget reflects a capital project expenditure increase of $1,888,434 or 39.1% more than the Adopted FY 2012 Budget. The completion of major capital projects at the end of school year 2011 - 2012 includes a number of energy conservation projects funded with Qualified School Construction Bonds (QSCB), as well as the replacement of HVAC systems. The goal of these projects was the realization of cost savings. The Board of Supervisor’s Adopted Budget includes funding the FY 2013 School CIP expenditures with cash from the County’s fund balance; therefore, the school system will save $951,126 in debt service for FY 2013. The FY 2013 CIP plan includes the purchase of replacement buses, technology purchases, and school maintenance projects. Overall, student enrollment has remained flat and no additional construction projects are planned. As such, the CIP budget has a direct correlation to the operating budget, whereby debt service payments are declining annually due to debt retirements as no new funding is being borrowed.

2009 Actual 2010 Budget 2011 Budget 2012 Budget 2013 Adopted $ Variance % Change CIP 18,064,415 15,043,000 3,831,293 4,835,670 6,724,104 1,888,434 39.1% Debt Service 33,478,502 31,871,919 30,013,646 30,514,941 28,417,437 (2,097,504) -6.9%

CIP vs. Debt Service

-5,000,000 10,000,000 15,000,000 20,000,000 25,000,000 30,000,000 35,000,000 40,000,000

2009 Actual 2010 Budget 2011 Budget 2012 Budget 2013 Adopted

CIP vs Debt Service Analysis

CIP Debt Service 2009 Actual 2010 Budget 2011 Budget 2012 Budget 2013 Adopted $ Variance % Change

CIP 18,064,415 15,043,000 3,831,293 4,835,670 6,724,104 1,888,434 39.1% Debt Service 33,478,502 31,871,919 30,013,646 30,514,941 28,417,437 (2,097,504) -6.9%

CIP vs. Debt Service

-5,000,000 10,000,000 15,000,000 20,000,000 25,000,000 30,000,000 35,000,000 40,000,000

2009 Actual 2010 Budget 2011 Budget 2012 Budget 2013 Adopted

CIP vs Debt Service Analysis

CIP Debt Service

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cafeteria, bus drivers/aides, mechanics and maintenance, etc.) constitute approximately 833 FTEs or 27.5% of the total FTEs. School Board members and other administrators constitute approximately 79 FTEs or 2.6% of the total FTEs.

FY12 FY13 FY13 %

Revised Adopted Change Change

Object Description Budget Budget

1110 COMP OF DIRECTORS 16.0000 16.0000 - 0.0% 1111 COMP OF BOARD MEMBERS 7.0000 7.0000 - 0.0% 1112 COMP OF SUPERINTENDENT 1.0000 1.0000 - 0.0% 1113 COMP OF ASST SUPS 5.0000 2.0000 (3.0000) -60.0% 1116 RECERTIFICATION SPECIALIST 1.0000 1.0000 - 0.0% 1117 SPECIALISTS 5.0000 4.0000 (1.0000) -20.0% 1121 COMP OF TEACHERS 1695.3300 1707.3300 12.0000 0.7% 1123 COORDINATOR 16.0000 14.0000 (2.0000) -12.5% 1124 COMP OF INST SUPERVISORS 9.0000 9.0000 - 0.0% 1126 COMP OF PRINCIPALS 32.0000 32.0000 - 0.0% 1127 COMP OF ASST PRINCIPALS 37.0000 37.0000 - 0.0% 1130 COMP-PROF SUPV PERSONNEL 28.0000 28.0000 - 0.0% 1131 COMP OF SCHOOL NURSES 30.0000 30.0000 - 0.0% 1132 COMP OF PSYCHOLOGISTS 10.0000 10.0000 - 0.0% 1134 COMP OF SOCIAL WORKERS 17.5000 17.5000 - 0.0% 1135 SUPERVISOR 1.0000 1.0000 - 0.0% 1139 COMP OF THERAPISTS 12.3000 12.3000 - 0.0% 1140 COMP-TECHNICAL PERSONNEL 24.0000 22.0000 (2.0000) -8.3% 1141 COMP OF TEACHER ASSTS 338.6000 338.6000 - 0.0% 1142 COMP-HEALTH/SAFETY OFFICER 11.0000 11.0000 - 0.0% 1145 COMP-CAFETERIA WORKERS 49.0000 48.0000 (1.0000) -2.0% 1146 NURSE PRACTITIONER 1.0000 1.0000 - 0.0% 1147 EDUCATIONAL DIAGNOSTICIAN 2.0000 2.0000 - 0.0% 1150 COMP OF CLERICAL STAFF 157.5333 156.0000 (1.5333) -1.0% 1161 COMP OF MAINT EMPLOYEES 63.0000 62.0000 (1.0000) -1.6% 1165 COMP OF MECHANICS 16.0000 16.0000 - 0.0% 1170 DRIVER PAY 307.0000 307.0000 - 0.0% 1191 COMP OF CUSTODIANS 76.2664 72.2664 (4.0000) -5.2% 1340 DRIVER AIDE 62.0000 62.0000 - 0.0% Grand Total: 3030.5297 3026.9964 (3.5333) -0.1%

FY 2013 FTE Summary by Object - All Funds

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FY12 FY13 FY13 %

Revsied Approved Change Change

Object Description Budget Budget

1100 CLASSROOM INSTRUCTION 1876.5300 1886.5300 10.0000 0.5% 1210 GUIDANCE SERVICES 77.0000 77.0000 - 0.0% 1220 SCHOOL SOCIAL WKRS SVCS 18.5000 18.5000 - 0.0% 1230 HOMEBOUND INSTRUCTION 1.0000 1.0000 - 0.0% 1310 IMPROVEMT OF INSTRUCTION 42.8500 38.3500 (4.5000) -10.5% 1312 TESTING SERVICES 1.0000 0.0000 (1.0000) -100.0% 1320 MEDIA SERVICES 63.0000 63.0000 - 0.0% 1410 OFFICE OF THE PRINCIPAL 158.5333 159.0000 0.4667 0.3% 2110 BOARD SERVICES 8.0000 8.0000 - 0.0% 2120 EXECUTIVE ADMIN SERVICES 4.7000 4.7000 - 0.0% 2130 PUBLIC INFORMATION 2.5000 2.5000 - 0.0% 2140 HUMAN RESOURCES 11.0000 11.0000 - 0.0% 2150 PLANNING SUPPORT 0.0000 0.5000 0.5000 0.0% 2160 FISCAL SERVICES 14.0000 15.0000 1.0000 7.1% 2170 PURCHASING 2.0000 2.0000 - 0.0% 2220 HEALTH SERVICES 43.3000 43.3000 - 0.0% 2230 PSYCHOLOGICAL SERVICES 10.0000 10.0000 - 0.0% 3100 TRANSP-MGMT & DIRECTION 13.3500 13.3500 - 0.0% 3200 VEHICLE OPERATION SERVICES 369.0000 369.0000 - 0.0% 3400 VEHCILE MAINTENANCE SVCS 18.0000 19.0000 1.0000 5.6% 4100 MAINT-MGMT & DIRECTION 4.0000 4.0000 - 0.0% 4200 BUILDING SERVICES 138.2664 133.2664 (5.0000) -3.6% 5100 SCHOOL FOOD SERVICES 72.0000 70.0000 (2.0000) -2.8% 6820 TECHNOLOGY-INSTRUCT. SUPPORT 69.5000 67.0000 (2.5000) -3.6% 6830 TECHNOLOGY-ADMINISTRATION 8.0000 7.0000 (1.0000) -12.5% 6850 TECHNOLOGY-TRANSPORTATION 3.0000 3.0000 - 0.0% 6860 TECHNOLOGY-MAINTENANCE 1.0000 1.0000 - 0.0% 6870 TECHNOLOGY-FOOD SERVICE 0.5000 0.0000 (0.5000) -100.0% Grand Total 3030.5297 3026.9964 (3.5333) -0.1%

FY 2013 FTE Summary by Function - All Funds

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technology positions, one Instructional Director, one Math Specialist, three Instructional Coordinators, and the Energy Manager position.

Retiree Health Insurance (GASB 45)

In June 2004, the Government Accounting Standards Board (GASB) released Statement 45, which revised the Generally Accepted Accounting Principles (GAAP) accounting standards for post-employment benefits other than pensions. This standard applies to post-employment medical benefits that are provided to school and government employees. Prior to the new standard, these benefits were accounted for on a pay-as-you-go basis. The new standard requires that these benefits be accounted for on an accrual basis. On June 27, 2011, the School Board established a trust fund with the contribution of $1.4 million. This trust fund contribution was funded by FY 2010 carryover funds. SCS’s retiree health, dental, and prescription insurance premium expenses in FY 2009, FY 2010, FY 2011, and FY 2012 were $1.8 million, $2.3 million, $2.7 million, and $3.2 million, respectively. The retiree health insurance budget for FY 2013 is $3.7 million. Over the past few years, the School Board has taken several actions to reduce its retiree health liability. Several School Board policies were revised to modify retirement eligibility requirements and the division’s retiree health insurance contribution amounts. In addition, efforts have been made to outsource custodial services and dining services. As medical costs continue to increase, the School Board will continue to implement initiatives to lower the school division’s retiree costs over time.

FY09 FY10 FY11 FY12 FY13 FY13 %

Actual Actual Actual Revised Adopted Change Change

Description Budget Budget

INSTRUCTION 2,411.3633 2,342.9133 2,240.6633 2,238.4133 2,243.3800 4.9667 0.2% ADMINISTRATION 97.0000 98.5000 97.3000 95.5000 97.0000 1.5000 1.6% TRANSPORTATION 395.5000 405.5000 403.5000 400.3500 401.3500 1.0000 0.2% MAINTENANCE 168.8663 171.3996 149.8663 142.2664 137.2664 (5.0000) -3.5% FOOD SERVICE 91.0000 89.0000 80.0000 72.0000 70.0000 (2.0000) -2.8% CAPITAL PROJECTS 3.0000 3.0000 - - - - 0.0% TECHNOLOGY 87.0000 87.0000 83.0000 82.0000 78.0000 (4.0000) -4.9% Grand Total 3,253.7296 3,197.3129 3,054.3296 3,030.5297 3,026.9964 (3.5333) -0.1% FY 2013 FTE Trend by Category - All Funds

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Cost Per Pupil

As per the Virginia Department of Education definition, “Operations” include regular day school, summer school, adult education, and other education, but does not include pre-kindergarten, non-regular day school programs, non-local education programs, debt service, or capital outlay additions.

Figures below for the 2008, 2009, 2010 and 2011 cost per pupil calculations were taken from Table 15 of the Superintendent’s Annual Report for Virginia for the respective years.

The figure for 2012 is from the FY 2012 Adopted Budget and the 2013 cost per pupil is an estimate based on budget data included in this budget book.

The 3% decrease in the cost per pupil expenditure from FY 2010 to FY 2011 is primarily due to the significant

reduction in stimulus funding. The 7% increase in the cost per pupil expenditure from the FY 2012 Adopted Budget to the FY 2013 Adopted Budget is due to increases in State funding coupled with lower student enrollment.

$7,500 $8,000 $8,500 $9,000 $9,500 $10,000 $10,500 2008 2009 2010 2011 2012 2013 $9,822 $9,790 _$9,624 $9,324 $9,381 $10,040

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Full-Time Equivalent (FTE) Employees

3,031

Professional

1,897

Classiﬁed

1,134

Total Classroom Teachers

1,696

Operating Budget FY2012 (less debt service)

Total Op

ng Budget

$

212,441,625

(Increase of $227,089 from FY2011)

Projected Cost Per Pupil

$

9,381

Funding Sources FY2012 (less debt service)

State

41.46%

County Op

ng

39.66%

State Sales Tax

10.92%

Federal

6.49%

Other

1.47%

Operating Expenditures by Category FY 2012 (less debt service)

Instruc

75.98%

Maintenance

9.41%

Transporta on

7.11%

Technology

3.57%

Adm

2.41%

endance & Health

1.52%

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Three-Year Budget Forecast

Objective of the Three-Year Budget Forecast

• To protect all employee groups.

• To maintain “core” instructional programs and services. • To provide quality services to approximately 24,000 students.

• To complete all critical capital projects identifed in the latest Capital Improvement Plan (CIP). The three-year cost of meeting these objectives is calculated using assumptions for inflation and growth.

Long-Range Budget Assumption Plans

• State and Sales Tax funding for FY 2014 uses the state’s calculation tool and is based on the VDOE Average Daily Membership (ADM) projection of 23,021. • Federal Education Jobs Funding of $2,876,284 is eliminated in FY 2014. • A VRS rate increase of 25% in FY 2015, projected to remain constant for FY 2016. • ADM decreases by .5% based on VDOE projections. • Sales Tax funding to increase by 3.8% in FY 2014, and increase by 3% in both FY 2015 and FY 2016. • A 1% increase each year in non-utility/fuel costs. • A 1% increase each year in materials and supplies and capital outlay. • A 2% increase each year in utilities/fuel accounts. • Assumes funding of the 2013-2017 CIP plan. • Projected health insurance increases of 10% each year. • No increases in employee compensation through FY 2016. • County transfer increases of 2.25% in FY 2014, 3.0% in FY 2015, and 2.50% in FY 2016.

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FY14

FY15

FY16

State Sales Tax

$

23,907,467

$

24,624,691

$

25,363,432

State Funds

$

97,211,539

$

98,385,450

$

98,028,887

Federal Funds

$

14,370,600

$

14,370,600

$

14,370,600

City-County Funds

$

118,195,137

$

121,740,991

$

124,784,516

Other Funds

$

11,238,927

$

11,238,927

$

11,238,927

Loans, Bonds, Etc.

$

19,397,717

$

9,522,594

$

6,926,283

Totals

$

284,321,387

$

279,883,253

$

280,712,645

FY14

FY15

FY16

Instruction

$

172,264,696

$

178,009,887

$

180,521,940

Administration

$

8,927,732

$

9,209,354

$

9,347,706

Transportation

$

18,615,256

$

19,202,468

$

19,490,946

Maintenance

$

20,888,005

$

21,546,910

$

21,870,608

Food Service

$

9,891,797

$

10,203,830

$

10,357,122

Capital Projects

$

19,397,717

$

9,522,594

$

6,926,283

Technology

$

7,345,979

$

7,577,705

$

7,691,545

Debt Service

$

26,990,205

$

24,610,505

$

24,506,495

Totals

$

284,321,387

$

279,883,253

$

280,712,645

FY14

FY15

FY16

1000 Salaries/Wages

$

141,699,211

$

142,017,328

$

141,863,231

2000 Employee Benefits

$

59,648,938

$

66,832,973

$

70,197,519

3000 Purchased Services

$

31,636,208

$

21,761,085

$

19,164,774

5000 Other Charges

$

10,010,275

$

10,181,127

$

10,355,269

6000 Materials & Supplies

$

10,372,267

$

10,475,989

$

10,580,749

8000 Capital Outlay

$

3,996,283

$

4,036,246

$

4,076,608

9000 Debt Service

$

26,958,205

$

24,578,505

$

24,474,495

Totals

$

284,321,387

$

279,883,253

$

280,712,645

Revenue Sources

Three Year Expenditure Projections

Student Demographics

The school division served approximately 23,775 students as of September 30, 2011, a decrease of 93 students from school year 2010-2011. SCS is the 11th largest of 132 school divisions in Virginia. Student demographics are anticipated to remain fairly constant. Special education enrollment has averaged 11% of the total student enrollment for the past five years. However, the number and percentage of students with disabilities has fluctuated slightly over the past five years with a high of 3,317 or 14% of the overall enrollment in 2006 to a low of 2,698 or 11% of the overall enrollment in 2011 (12/1/2010). The number of students who speak English as a second language (ESL) increased from FY 2005 to FY 2009 by 318 students, or from 2.71% to 3.82% of the total SCS population. This increase is expected to remain consistent in FY 2013. The number of students eligible for free and reduced price lunches has increased from 11% in FY 2002 to 35.4% in FY 2012. This increase is anticipated to remain consistent.

The ethnic composition of Spotsylvania County Schools’ student enrollment is shown in the chart below. The largest group continues to be white students followed by black students. White 64.4% Black 18.2% Hispanic 10.3% American Indian/Alaska Native 0.3% Asian 2.7% Two or More Races 4.0% Native Hawaiian or Other Pacific Islander 0.1%

Student Ethnic Distribution

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Performance Results using NCLB

With that in mind, the School Board and the administration see a direct correlation between challenging economic times and a transformation in the way education is delivered to ensure students can succeed in a 21st century global workplace. Steady and significant progress has been made in increasing the use of technology to enhance the availability of data on every teacher’s desktop. With all schools fully accredited, and 9 of 29 or approximately 31% of all schools meeting or exceeding Annual Yearly Progress (AYP), Spotsylvania County Schools is convinced that student information system and assessment results (SOL and benchmarks) are excellent tools for guiding lesson plans, intervention and enrichment opportunities and creating ways to better tailor instruction to meet the needs of individual students. With the investment in Business Objects software, smart boards, Data-Projectors and big screen monitors, teachers and school administrators have powerful technology tools that have increased, and will continue to increase, student achievement divisionwide, while meeting requirements set forth by the No Child Left Behind Act (NCLB).

Division Accomplishments

SCS is very excited about its future, but it is important to take a moment to reflect on the past. Highlighted below are major accomplishments for Fiscal Year 2012.

Instruction • Achieved Full State Accreditation for all schools since 2008.

• Received “District Accreditation”, the top rating awarded through AdvancED.

• Maintained Gateway Academy to serve the needs of autistic children. Developed Gateway Primary for elementary students.

• Received statewide recognition for four schools through the Virginia Index of Performance Program. • Redesigned elementary summer school program to meet individual student’s needs by focusing on specific skill deficits.

• Developed a new kindergarten, first, and second grade report card to be implemented during the 2012-2013 school year.

• Instituted an early entrance to kindergarten protocol allowing students that meet criteria to be enrolled.

• Expanded the division’s support of students under the McKinney-Vento Homeless Assistance Act with the leadership of social workers.

• Elementary School recognized for teacher leadership and innovation using interactive whiteboard technology (SMART) to support student engagement and learning.

• Courthouse Road Elementary School is now one of 198 schools in the nation designated as a SMART Showcase school.

• Provided foundational supports of current best practices to support Professional Learning Communities (PLC Models) and a shift towards embedded professional learning models.

• Established a “Response to Intervention” (RtI) committee to review best practices for monitoring student progress and providing instructional modifications and interventions as necessary.

• Promoted and supported several STEM initiatives during and after the school day (NSTAR, “Mad about STEM” Club).

• Implemented “Retool For School”, an instructional professional learning symposium for schools and teacher leaders.

• Obtained funding to purchase Read 180 at the middle school level to support students struggling in the area of literacy.

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• Maintained highly qualified instructional staff at 99.9%. • Increased National Board Certified Teachers to 54. • Successfully coordinated the third annual Regional Teacher Job Fair with six participating school divisions. • Created and distributed informational materials for all employee groups regarding various types of available benefit options. • Created and implemented a Winter Safe Driving and Winter Safety Program. • Collaborated with the Virginia Municipal League to create a workplace safety video for all employee groups. • Participated in Student and Employee Wellness Taskforce to increase awareness of preventative health care measures. • Expanded the Division Safety Committee to reduce number and severity of workplace injuries. • Successfully implemented Division’s streamlining initiatives for increases in efficiency and cost savings. • Continued to maintain the automated Division-wide substitute management system (AESOP). • Began implementing a revised Evaluation System for 2012-2013 in alignment with adopted Uniform Standards. Technology Services • Designed and developed the Electronic Employee Evaluation System for principals and teachers. • Implemented electronic bill payments to vendors. • Designed a process to automate data collection and report collection for the Annual School Report. • Designed and developed teacher and school level testing in SOLO. • Designed and developed processes to collect data for VDOE Master Schedule Collection. • Designed and developed web-based period attendance system for teachers in middle and high schools. • Designed and developed Teacher/Student Remediation Tracking System. • Designed and developed KG-2 Electronic Report Card system. • Implemented a web-based email communication tool - LOOPS. • Assisted Technology Support and Transportation departments in moving systems to new servers. • Doubled Internet connection bandwidth to 200mb. • Made mobile email, calendar, and contacts available for every staff member. • Established platform for streamlining of school board meetings, work sessions, etc. (All FY 2012 high school graduations will be streamlined).

• Upgraded Pearson TestNav SOL Testing Delivery Solution - proctor cache servers, networks upgraded, and clients configured.

• Migrated cafeteria point of sale (POS) equipment and data from Cafe Manager to Nutri-Kids.

• Implemented an IP based cable TV solution that will allow cable TV to be viewed from within any computer browser.

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Finance • Earned the Association of School Business Officials (ASBO) International’s Meritorious Budget Award for achieving the highest standards of school budgeting and issuing a quality budget document for FY 2010, FY 2011, and FY 2012. • Earned the “Excellence in Achievement” Award for 2011 issued by the Universal Public Purchasing Certification Council (UPPCC) for the Purchasing Agent maintaining an active certification as a Certified

Professional Public Buyer.

• Developed the annual budget by working with the administration, School Board, Board of Supervisors and County staff. • Offered Long-Term Care Insurance to school employees. • Facilitated budget review committee meetings to solicit public engagement for the FY 2013 budget development process. • Worked with the division’s third party administrator (TPA) to implement a more efficient way of transmitting salary redirection agreements for retirement contributions.

• Actively participated in focus group sessions and provided input for the VRS Modernization project.

• Continued to work with schools and administrative departments to complete another successful year in obtaining quality goods and services at the best available price through competitive practices for the benefit

of the tax payers.

• Recognized an employee for earning the Virginia Contracting Associate certification. • Processed approximately 34,000 invoices per year for schools and departments. • Implem