April 25, 2008
TO THE ADMINISTRATOR ADDRESSED:
Subject: 2006–07 “Final” Summary of Finances
The “Final” Summary of Finances (SOF) for the 2006–07 school year and other related reports have been updated and posted to the School Finance Web site. The reports reflect the following important updates and information:
- Student attendance data – The SOF reflects the final student attendance data submitted by districts through the Public Education Information Management System (PEIMS) in July for the 2006–07 school year. Any changes to average daily attendance (ADA) and full-time equivalent (FTE) student count data submitted and processed since the “Near Final” SOF are reflected on this update. This SOF reflects, if applicable, special education FTEs generated by last summer’s Extended Year Services (EYS) program. The SOF also reflects Public Education Grant (PEG) ADA and non-public residential contract FTEs.
- New Instructional Facility Allotment (NIFA) – A final determination of the New Instructional Facility Allotment (NIFA) amount has been made for the 2006-07 school year. The final amount was based on information about the number of days of instruction in each new campus submitted by the applicant and a final, actual count of ADA at each eligible campus obtained from the Public Education Management System (PEIMS) for each applicable six-week period. Please note that the total amount districts were eligible to receive exceeded the legislative appropriation of $25 million dollars and final awards have been prorated; therefore, the NIFA ADA shown on your Summary of Finances multiplied by $250 will not equal your allotment.
- Total Tax Collections – The summary uses audited tax collections as reported by your district’s independent auditor in Schedule J-1 of your district’s independent audit report for the 2007 fiscal year. If your district received an Instructional Facilities Allotment (IFA) for a lease-purchase agreement, your district’s local share of the IFA allotment has been subtracted from the M&O tax collection amount prior to the calculation of state aid. This net amount is the amount displayed on the front page of the SOF.
- Transportation Allotment – Your district’s 2006–07 transportation allotment is based on the data submitted on the 2006–07 Route Services Report. If your district did not submit this report, the Transportation Allotment has been removed from the SOF.
- High School Allotment – Your district’s high school allotment was calculated by multiplying your district’s high school (grades 9–12) ADA by $275. Your district’s allotment has been updated with high school ADA from the July 2007 PEIMS submission. See page 1 of the SOF for your district’s allotment amount. This allotment is part of your district’s FSP funds, and it makes up a part of each FSP payment.
- Teacher Salary Allotment – Your district’s teacher salary allotment was calculated by multiplying the district’s eligible teachers, librarians, nurses, and counselors by $2,500 or $1,250, depending on their full-time or part-time status. The allotment was updated with 2006–07 average counts submitted via the Web-based Foundation School Program (FSP) Staff Salary Module.
- Staff Salary Allotment – Your district’s staff allotment is calculated by multiplying the district’s eligible staff by $500 or $250, depending on their full-time or part-time status. The allotment was updated with 2006–07 average counts submitted via the Web-based FSP Staff Salary Module.
- State Aid Reduction for WADA Sold – If your district is a Chapter 42 district that entered into an Option 4 agreement with a Chapter 41 district, the reduction in state aid for selling WADA has been recalculated using your district’s “final” revenue per WADA. An updated report entitled State Aid Reduction for WADA Sold shows how this reduction is derived. The number of WADA being sold does not reflect the “final” WADA that the Chapter 41 district must purchase. The number of WADA bought/sold may need to be adjusted depending on the “final” Cost of Options reports now available online to Chapter 41 districts. Revisions for WADA sold should be completed by June 2008.
- Gain from Chapter 41 Partnership – If your district is a Chapter 42 district that entered into an Option 4 agreement with a Chapter 41 district during the 2005-06 school year, the “Gain from Chapter 41 Partnership” line items in the Additional State Aid for Tax Reduction (ASATR) S2 and S3 calculations are based on that agreement. If your district did not keep all of the gain realized during 2005-06, then this gain amount has not been finalized. It is very likely that the final gains in S2 and S3 will be lower than the current numbers. Revisions for this gain amount should be completed by June 2008.
- S3 M&O Tax Collections – The calculation of M&O tax collections used in the S3 scenario of the ASATR calculation has been revised. The new calculation takes the tax collections needed to maintain state and local revenue and applies your district’s average collection rate for the 2003, 2004, 2005 tax years in order to arrive at the effective M&O tax rate. That is the tax rate that would have been levied against your district’s 2006 Local Property Values (DPV) as they existed prior to the adjustment per HB5 in order to maintain the state and local revenue per WADA as the district had in 2005–06. This rate is then used in the following formula to produce the M&O tax collections that will be used to calculate S3:
(2006-07 audited M&O tax collections / 2006–07 adopted M&O tax rate)
x M&O tax rate calculated for S3
- Additional Hold Harmless State Aid – An updated report entitled Calculation of Hold Harmless State Aid is included in this SOF and that reflects the hold harmless state aid for the $15,000 homestead exemption that was authorized in 1997.
- Salary Transition – The report entitled Calculation of Salary Transition Entitlement has been updated. These funds are related to a $3,000 salary increase for teachers and others subject to the minimum salary schedule that was mandated in 1999. The funds are intended to compensate districts for expenses related to delivering that pay raise that are not covered by increases in state aid that resulted from changes in funding components that were authorized in 1999. The number of eligible employees indicated on page 1 of the SOF is derived from 2006–07 average counts submitted via the Web-based FSP Staff Salary Module.
- Additional Aid for School Employee Benefits – These funds are intended to help pay for health care coverage that was mandated in 2001. The “2006–07 Covered TRS Member” data is derived from the counts submitted via the Web-based FSP Staff Salary Module.
- Reduction from the Per Pupil Allotment ($110 per WADA) – For any district that does not receive Tier I state aid from the Foundation School Fund, a report entitled Worksheet for Determining the Reduction of the Per Pupil Allotment is attached to the district’s SOF. This report shows how the “reduction” amount, if any, was derived. The reduction in the per-pupil allotment is based on the increase in the Available School Fund per capita rate from $352 to $394 and increases in current-year recapture amounts.
Page 5 of the SOF shows the amount of each district’s “final” settle-up. If the district has been underpaid, the amount owed the district will be paid in May 2008. If the district has been overpaid, recovery of the amount overpaid will start in May 2008 and will be made by reducing the district’s remaining FSP 2007–08 payments. Districts can review their 2006–07 FSP Payment Ledgers, which are also available on the School Finance Web site.
The State Funding SOF and related reports can be found on the School Finance web page located at
http://www.tea.state.tx.us/school.finance/funding/sofweb7.html
If you have any questions about your district’s SOF or your district’s state funding, please contact a consultant in the Division of State Funding at (512) 463-9238.
Sincerely,
Helen Daniels
Director, State Funding
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