Tuesday, September 20, 2016

10 Year CPS Budget Analysis

Knowing the many efforts of the district to be fiscally accountable to our patrons, I collected data from the past 10 years for my own analysis. What I found, was that the district has had very minimal yearly expense increases and works with the same total revenue as ten years ago.  However, the funding sources that provides revenue have dramatically changed.

What follows are my notes and opinions.  ~Jerry Mack

Chadron Public School District: 10-Year Budget Trends

2006/07 2015/16
Total Revenue 10,659,116 10,663,572 no significant change
Total Expense 9,424,313 10,569,473 1.2% avg increase per yr

Revenue Sources 2006/07 2015/16
State Aid 4,762,840 4,042,296 1.5% avg decrease per yr
Local Property Tax 2,868,369 4,878,925 7.0% avg increase per yr
Other Income 3,027,907 1,742,351 4.3% avg decrease per yr

It’s interesting when looking at the 10-year trends of the school district, that the total district revenue from last school year is almost identical to the amount from 10 years earlier. It’s assumed that most businesses and school districts would be very happy with only a 1.2% yearly budget increase over the past 10 years. The big issues are the decreasing and unpredictable changes in State Aid and the fact that ‘Other’ funding sources are decreasing, leaving Local Property Taxes to make up the difference.

For the following  illustrations, funding is lumped into three categories:
State Aid - based on a formula controlled by state legislation each year
Local Property Taxes - based on valuation of allowable local property
Other Income - federal programs, state program receipts, grants, etc.

In comparing the ten year revenue differences of the 2006/07 school year and the 2015/16 school year it needs mentioned again, the revenue amounts collected in these two school years (10 years apart) are almost identical. The difference is the decrease of both State Aid and Other funding made up by Local Property Taxes.  The increases in Local Property Tax, nearly exactly fills the void of lost revenue from State and Federal resources.
This graph shows the three funding sources for the total revenue of Chadron Public Schools for each of the past 10 years. The distribution of these funds have significantly changed.  There’s a decreasing trend in the amount of the budget being funded by both State Aid and Other funding sources (mostly federal programs). This decrease has been entirely replaced by Local Property Taxes.

Special Note: Chadron Public Schools has unique characteristics compared to other Nebraska districts due a large percentage of federal and state land located within the district which leads to untaxed property assets.
Chadron Public Schools’ expenses have increased over the past 10 years by a yearly average of 1.2%, much below the state average. Note the decrease in 2010-12 when CPS reconfigured buildings and classrooms to reduced many full-time positions in the district. The very minimal growth in expenses since are attributed to rising inflation costs of materials and services.

Despite any best efforts, it’s probably safe to say that the cost of education doesn’t get less expensive over time.  It would not be feasible to assume that the district can significantly reduce staff every five years without losing quality of education and needed services for students. In addition, there continues to be an increase in mandated (and unfunded) state and federal programs and the ever increasing cost of of inflation resulting in additional expenses for equipment purchases, facility repairs, technological upgrades, or other special service needs for students.

Concluding thoughts:

  • Despite the school district’s expenses increasing at only 1.2% per year, there has been no revenue increase over the past ten years.
  • Revenue amounts have not changed in the past 10 years, however, the distribution of funding sources has dramatically changed.
  • Local Property Tax has replaced the loss of State Aid and Other federally funded programs during the past 10 years.