School and district budgets may seem like static and mysterious PDF files posted once a year on district websites, but that’s just the finished product of a near-constant process in which budgets are created, reviewed, and modified across the district year-round. Our latest blog series will break down the budgeting process throughout a typical calendar year. Let's get started with the fall.
Fall (September-November) How much money are we talking about?
Didn’t we just pass our budget for this year? Yep, but it’s already time to start planning for next school year. I bet you are starting to appreciate your local district CFO more already!
Enrollment projections are a critical part of the budgeting process. Districts use a variety of data to inform their enrollment forecasts, including prior-years’ trends, Census data, and other local datasets that can help predict an increase or decline in enrollment. Enrollment serves as the basis for state revenue. Most states fund school districts based on their student enrollment, and increasingly states are funding districts not only based on how many students they have, but also based on student characteristics, such as English Language Learners, Special Education, or qualifying for Free and Reduced-Price Lunch. These variable funding weights are critical for ensuring resource equity, but they can make forecasting tricky if the district has a rapidly shifting population.
Most districts also receive substantial resources from local taxes, primarily from property taxes. Budget and finance staff also begin to review anticipated revenue from the local tax base, reviewing changes in assessed property value and the likely tax rate within their district. The best district budget and finance staff also need to be experts on local housing markets!
Enrollment is a key factor for how school districts allocate resources within the district. Many districts have target or required class sizes or student to faculty ratios. Changes in enrollment can change both the overall number of staff and their distribution within the district. Non-position expenses are also frequently provided for based on student enrollment and characteristic. Whether or not your district uses a method like weighted-student funding, student enrollment impacts how many resources are available to the district and what schools they are used at.
With students now attending schools, budget and finance staff review actual student enrollment in September and October to determine if any adjustments will be required because of differences with the prior year enrollment projections. And now armed with new current year enrollment data, the projection process starts again so that they can start making projections to estimate the needs for next school year’s budget.
|A Seasonal Guide: How are school budgets made? *Winter Edition*||A Seasonal Guide: How are school budgets made? *Spring Edition*|