June 4, 2008
Subject: 2006–07 Revised “Final” Summary of Finances
TO THE ADMINISTRATOR ADDRESSED:
The Revised “Final” Summary of Finances (SOF) for the 2006–07 school year and other related reports have been updated and posted to the School Finance website at http://www.tea.state.tx.us/school.finance/funding/sofweb7.html. The reports reflect the following important updates and information:
- S2 Maintenance and Operations (M&O) Tax Collections – A change has been made in the calculation of M&O tax collections used in the additional state aid for tax reduction (ASATR) S2 funding scenario.
The old formula was:
- (2006–07 Audited M&O Tax Collections – Payment to TIF – Local Share of IFA Lease Purchase)
÷ 2006–07 Adopted M&O Tax Rate
= M&O Collections per Penny
- M&O Collections per Penny
X 2005–06 Adopted M&O Tax Rate
= S2 M&O Collections
The new formula is:
- 2006–07 Audited M&O Tax Collections
÷ 2006–07 Adopted M&O Tax Rate
= M&O Collections per Penny
- M&O Collections per Penny
X 2005–06 Adopted M&O Tax Rate
= 2006–07 Unadjusted M&O Collections
- 2006–07 Unadjusted M&O Collections
– Payment to TIF – Local Share of IFA Lease Purchase
= S2 M&O Collections
- 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. We should complete revisions for WADA sold by July 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 ASATR 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 been revised to more accurately reflect the terms of the agreement as they existed for the 2005–06 school year. Our previous calculations overstated the gain amounts for a number of districts. This correction will reduce the revenue targets for those districts.
Page 5 of the SOF shows the amount of your district’s revised “final” settle-up. If your district has been underpaid, the amount owed the district will be paid in June 2008. If your district has been overpaid, recovery of the amount overpaid will start in June 2008 and will be made by reducing the district’s remaining Foundation School Program (FSP) 2007–08 payments. You can review your district's 2006–07 FSP Payment Ledger, which is also available on the School Finance website.
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
