FY16 Budget Recommendation External Funds DRAFT City Council Budget Hearing May 4, 2015 1 External Funds FY16 External Funds  External funds are both a cause and a solution to our structural imbalance  Reductions grant funding put pressure on the general fund where the reduction in funding would harm an essential program or service  The food services program has required a subsidy from the general fund for many years, where in most districts, the program operates within the funds generated from federal reimbursement  Private funding (through the Boston Educational Development Fund or “BEDF”) and partnerships provide additional resources 2 External Funds FY16 External Funds  FY16 grant funding projections total $119.7M, which represents a decrease of $15.1M or 11.2% over the FY15 external funds total of $134.8M.  Decreases are largely due to historical downward trends in big entitlement grants like Title I, II, III, IDEA, and Perkins.  Decreases are also due to the end of the Investing in Innovation (I3) grant and the loss of the Title I carry forward from FY14 used in FY15.  Food Services is making adjustments to reduce costs to within expected revenue  We are expecting an increase in resources through BEDF in FY16  We are leveraging 3 times the funding paid to partners in services provided to BPS students by those partners 3 External Funds Agenda 1. Grant Funding 2. Food and Nutrition Services 3. Boston Educational Development Foundation (BEDF) 4. Partnerships 4 Grants $328k $32k $71k $21M $25k $21M $23M $22M $124M $123M $111M $94M 5 Grants Grant Funding Changes Grant Source Funding Change: 20132014 Funding Change: 20142015 Projected Change: 20152016 Federal -0.50% -10% -15% State 0.40% 10% -3% Other -90% 121% -65% 6 Grants FY16 Projected Grant Fund Losses Grant Reduction Comments Title I carry-forward -$9M Grant ends Title I -$3.2M Continued 10% loss Investing in Innovation (I3) -$1M Grant ends Title II -$288K Assume 5% loss IDEA -$544K Continued 3% loss Title III -$196K Assume same FY14 9% loss Perkins -$118K Assume same FY15 9% loss Other -$800k Reduction across other grants Total -$15.1M 7 Grants Title I Changes/Impacts External: Anticipated change due to ESEA reauthorization: Title I funding is up for reauthorization this year and is currently moving to the Senate floor. The amendment seeks to change the Title I funding formula and the result of this would be a dilution of these scarce federal funds starting in FY17; and the inability of the district and individual schools to provide programs of sufficient size and scope to produce results. Internal: Change in how Poverty is calculated: For the 2013-2014 school year, Massachusetts began participating in the Community Eligibility Option (CEO), which allows schools to provide meal service to all students at no charge, regardless of economic status. As a result, household applications that have generally been used to determine eligibility for free and reduced lunch prices are no longer being collected. This change meant that for FY16 BPS needed a new method for calculating poverty for allocating both Title I and WSF dollars. 8 Grants FY15 Title I Carry Forward Title I and Title II-A grants are able to access a multi-year feature to extend the life of the grants into the next fiscal year. Funds from Year 1 can be shifted into year 2 and spent on Title eligible activities. BPS takes advantage of this availability by using carry forward dollars to leverage turnaround efforts with our most critical activities. This is a one-time source of revenue based on an evaluation of the use of funding in the current year and a determination that funds could be best utilized by targeting specific activities in year 2. We evaluate our programs and activities every year and shift funding to achieve district goals and priorities. Grant Reduction Title I carry-forward $8,886,682 Comments -$2,787,419 Extended time at Level 3 and 4 schools -$4,267,637 Strategic partners (ie City Year, BELL) -$1,400,000 Acceleration Academies -$431,626 Unplanned liabilities 9 External Funds Agenda 1. Grant Funding 2. Food and Nutrition Services 3. Boston Educational Development Foundation (BEDF) 4. Partnerships 10 Food Services Statement of Revenue and Expenses • • FY10 FY11 FY12 FY13 FY14 *FY15 Total Expenses $27 M $28 M $31 M $33 M $36 M $38 M Revenues $26 M $26 M $29 M $29 M $34 M $36 M Net Profit (loss) - $1.4M - $2.0M - $1.7M - $4.1M - $1.7M -$2.0M As of end of March, 2015 Only includes the main grants which are the part of NSLP (National school lunch program which include lunch & breakfast) Food Services Finance Overview Budget FY15 Projected Grant Total Type of Grant Source of Funding School Lunch $36 M Reimbursement Funded from Federal & State Reimbursement based off of meals served Summer Food Program $1.2 M Reimbursement Funded from Federal & State Reimbursement based off of meals served Fresh Fruit & Vegetable Program $800 K Competitive Agreement between USDA and Food & Nutrition Services to source more foods locally Summer Meals Expansion $66 K Competitive State Funded Summer Start Up $20 K Competitive State Funded FNS Grants $38.3 M FY15 Staffing Total Staff = 528 • Central Office Staff = 33 School Based Staff = 495 • Diversity: 42% Black, 37% Hispanic, 18% White, 1% other FY15 Reimbursement rates Breakfast - $2.03 Lunch - $3.12 Food Services Adjustments for FY16 Budget  The Budget for FNS for FY16 is $38 M with a reduction of $4M in expenses from the FY16 baseline  Increase use of USDA Food (commodities)~ $1M  Realign staffing model by ensuring equitable and efficient allocation of food service workers across all sites and a total re-organization of the FNS central office ~$2.1M  Align offerings to decrease food waste, and to improve operations while providing quality, healthy menu choices that kids like ~ $300K  Administrative efficiencies and reduction in non food costs ~$600K 13 External Funds Agenda 1. Grant Funding 2. Food and Nutrition Services 3. Boston Educational Development Foundation (BEDF) 4. Partnerships 14 BEDF Recent Organization Improvement and Reforms Operations • Passed 2% Indirect Policy to balance operational budget • Reduced Accounts Payable and Accounts Receivable processing time to a 5-7 business day turnaround time • Implemented new payment forms and payroll procedures Governance • Revised bylaws to transition Board of Directors to a controlling majority of non-BPS employees • Recruited new Board of Directors • Purchased Board of Directors Insurance Administrative • Hired a permanent Director of Finance and Administration and appointed Acting Executive Director • Created employee benefits package and BEDF conditions of employment • Purchased General Liability Insurance Marketing & Communications • Created new BEDF Logo • Developed and launched new BEDF website and marketing materials • Created and distributed quarterly BEDF Bulletin Newsletter 15 BEDF BEDF Income Statements FY2014-FY2016 Private External Funds- BEDF (as of 03/31/15) Source/ FY 2014 2015 YTD 2015 EOY 2016 (budge t) (Es tim ate ) REVENUE Contributions and s upport $6,630,706 Governm ent contracts $175,838 and awards United Way Other reim burs em ents and charges for s ervices Facilities us e revenues Inves tm ent incom e Indirect rate charge Total $2,485,341 $120,184 $33,734 - $7,039,220 $8,500,000 $9,300,000 $380,780 $395,000 $385,000 180,000 $187,000 $60,000 $1,300,000 $2,000,000 $1,200,000 $35,256 144,345 - - $45,000 $65,000 $165,000 $190,000 $9,445,803 $8,979,601 $10,592,000 $12,000,000 $9,340,156 $8,443,576 $10,500,000 $11,500,000 $233,563 $167,616 $212,000 $478,850 $9,573,719 $8,611,192 $10,712,000 $11,978,850 -$127,916 $368,409 -$120,000 $21,150 16 EXPENSES Program Services Support s ervices Total Surplus (deficit) External Funds Agenda 1. Grant Funding 2. Food and Nutrition Services 3. Boston Educational Development Foundation (BEDF) 4. Partnerships 17 Partnerships Partner Organizations Leverage BPS Investment at 3:1 Ratio $30,000,000 $27,901,702 $25,000,000 $20,000,000 $15,000,000 $10,000,000 $9,751,280 $5,000,000 $0 District Contibution Partner Contribution $169,000 $441,000 Network Contribution School Contributions 18 Partnerships Partner’s Collective Impact & Return on Investment School Quality Domain Outcome Metric(s) Student Performance Increase academic growth in ELA and/or math  Increase Student Engagement Family, Community and Culture Indicator ELA and Math median Student Growth Percentile & Academic Performance Levels  MCAS  PARCC  DIBELS  Student answers to questions about engagement  BPS Student Climate Survey School attendance  Average daily attendance records  Program Attendance and Retention   Program attendance/retention records Family, Community and Culture Increase Student Initiative  Student answers to questions about initiative  BPS Student Climate Survey Family, Community and Culture Improve relationships with peers  Student answers to questions about relationships with peers  BPS Student Climate Survey Family, Community and Culture Improve school climate  Student, teacher, and parent questions about school climate  BPS Student, Parent, and Teacher Climate Survey Student Access and Opportunities Increase Access to High Program Quality  Student enrollment in programs  Partnership Registration Portal APT program quality score   Assessment of Program Practices (APT) 19