4/19/17 Meeting Notes

CAC for Finance Meeting Notes                  
April 19, 2017 – 4:00 pm
Panorama Village Administrative Center – Room A
240 Villa Crest Drive, State College, PA  16801

Ms. Flynn called the CAC for Finance meeting to order at 4:08 p.m.

Mr. Brown introduced Donna Reinhardt, Accountant, and Dave Bracken, Grant Accountant.

Present:  Dave Bracken, Randy Brown, Marie Caster, Dan Duffy, Marisa Flynn, Donna Reinhardt, Susan Sampsell

Approval of meeting notes:  The February 8, 2017 meeting notes were approved.

2017-18 Budget Development:  Mr. Brown reported the 2017-18 proposed budget is around $150 million with 1.55% tax increase; the Index is 2.5%.  Although the State funding information is not yet available, he reviewed proposed funding increases and decreases, including a slight reduction in transportation funding. Budget iteration details are shown on the handout that was provided to the Committee and is included with the meeting notes.

The proposed budget has remained at $150 million since the beginning of the budget process.  Comparisons since the December proposed budget include an increase in the line for real estate tax due to new assessment information from the County. Proposed changes in school day have been pushed to  18-19 with corresponding proposed costs in salaries and transportation taken out for 17-18.  The increase in capital reserve represents new state money from 16-17 that had not been allocated yet. In summary, new for 17-18 is a psychologist position, Ferguson Township principal, health care was negotiated at a lower rate, International Baccalaureate program, and an IT Specialist.  Members commented:  1.55% is conservative, allows adding to the base for future years, be proactive, suggest increasing income on investments; pension reform and charter schools.  Mr. Brown reported Senator Corman was open to charter school reform and believes it is a system that needs to work. He charged the district to come up with top 3 priorities, which is being prepared.

Capital Financing:  Mr. Brown pointed out several details on the handout provided to members. Page 18 shows changes based upon financing considerations -- numbers in red are just changes, not negative. Page 20 shows changes to capital reserve line to maintain a minimum of 5% to undesignated. Page 22 shows projections for High School borrowing, elementary projects, memorial field and athletic fields. Previous conversations included the HS debt under a wrap scenario. Page 23 shows a more level scenario, which is now being proposed. The last pages are graphs that support assessed value and interim real estate tax. Mr. Brown received comments from the group:  what is the cost of borrowing now, do issuance costs fluctuate based on amount of borrowing, if no need for cash on the front end it doesn’t make sense to do a wrap, level funding makes the most sense.  Mr. Brown stated PFMS renovations could be in 2025-26, but could be closer to 2030 before financing starts.

DWFMP Update:

-        High School:  scheduled to move into the four main towers in December-January timeframe. 

-        Elementary Projects:  60% design review in June, bids awarded in November, construction starts in January.

-        Memorial Field: the latest modification may save Nittany Avenue basement for storage, locker rooms, etc.  Trying to keep scope of project small, but services have a cost.

Future Meetings:  The next meeting will be late August/early September.  We will schedule a meeting if something comes up before then.

The meeting adjourned at 5:30 pm.

Submitted by,

Marie Caster