FILE:  DC

ANNUAL OPERATING BUDGET

The DeSoto Parish School Board recognizes the importance of sound fiscal planning, as well as the technical relationship of the financial structure to achieving the School Board’s organizational mission.  Formal budgetary integration shall be employed as a management control device during the fiscal year.  In accordance with La. Rev. Stat. Ann. §17:88(C), the School Board shall submit a copy of its adopted annual operating budget to the Louisiana Superintendent of Education no later than September 30th of each year.

The adopted budget shall include the same line items as prescribed by the Louisiana Board of Elementary and Secondary Education (BESE) for inclusion in the financial and statistical report and include a general summary of the adopted budget.  No initial annual operating budget or subsequent budget revision shall be approved where expenditures exceed the expected means of financing.  All budget and financial procedures of the School Board shall comply with all pertinent statutes and administrative rules and regulations.

FORMAT OF THE PROPOSED BUDGET DOCUMENT

In accordance with La. Rev. Stat. Ann. §39:1305(B), the Superintendent, as chief executive officer, shall prepare or cause to be prepared a proposed comprehensive budget for the ensuing fiscal year.  This budget document shall be presented to the DeSoto Parish School Board and shall comply with the following:

• Balanced Budget – The total budgeted expenditures shall not exceed total revenues and monies available in the fund balance within each fund.  Appropriations or use of reserves that is prescribed by the School Board’s reserve policies shall be identified in the budget message and documented in the School Board minutes.
  
  

• Basis of Budgeting – The term “basis of budgeting” is used to describe when events or transactions are recorded and recognized.  In the Modified Accrual Basis, revenues are recognized when they become available, and expenditures are recognized when the liability is incurred.  In the Accrual Basis, revenues are recorded when earned and expenses are recorded when the liability is incurred.  Budgets shall be prepared on the same basis of accounting as what is presented in the audited financial statements and in accordance with Generally Accepted Accounting Principles.  The basis of budgeting for each fund shall be

• Budget Adoption Instrument – In compliance with La. Rev. Stat. Ann. §39:1305(D), the initial annual operating budget shall be accompanied by a proposed budget adoption resolution that has been reviewed and agreed to by the School Board’s attorney.  The adoption resolution shall define the authority of the superintendent to make changes within various budget classifications without approval of the governing authority, as well as those powers reserved solely to the governing authority.
  
  

• Budget Classification and Format – As per La. Rev. Stat. Ann. §39:1305(C)(2)(a), the presentation of the initial annual operating budget shall include estimated fund balances at the beginning of the year, revenues, expenditures (or expenses), other financing sources/uses of funds, and the estimated fund balance at the end of the fiscal year.  Revenues shall be budgeted by source and expenditure (or expenses) by function as defined by the Louisiana Board of Elementary and Secondary Education.  The format shall also include the presentation of actual data from the prior fiscal year, budget data for the current fiscal year and budget data for the proposed budget year.
  
  

• Budget Message – In compliance with La. Rev. Stat. Ann. §39:1305(C)(1), in addition to the initial annual operating budget document, a budget message shall be prepared and signed by the Superintendent.  The budget message should articulate the proposed financial plan, priorities, policies, objectives, assumptions, budgetary basis, the most important issues, and issues for the new year.  The message should also describe significant changes in priorities from the current year and explain the factors that led to those changes.
  
  

• Length of Budget Year – The annual budget year is 12 calendar months, beginning on July 1^st of each year and ending on June 30th of the succeeding year.
  
  

• Funds Budgeted – All funds owned and operated by the DeSoto Parish School Board shall be presented to the School Board for adoption annually.
  
  

• Organization of the Budget – The accounts of the School Board shall be organized on the basis of funds required by Generally Accepted Accounting Principles, each of which is considered a separate accounting entity.

PRESENTATION OF THE PROPOSED BUDGET DOCUMENT

• Draft of Proposed Budget – A draft of the proposed initial annual operating budget document for the ensuing fiscal year shall be presented to the School Board at its regular meeting in May of each fiscal year.  This allows time for School Board Members to review, ask questions, and become familiar with the budget before it is presented to the Budget/Finance Committee for review.
  
  

• Review by Committee – The initial annual operating budget shall be sent to the Budget/Finance Committee for review and/or alterations prior to it being sent to the full School Board for action.
  
  

• Annual Adoption – After the initial annual operating budget is reviewed by the Budget/Finance Committee, the School Board shall take action to approve or defer adoption of the proposed annual operating budget for the ensuing fiscal year at its regular meeting in June of each year.
  
  

• Adoption Procedures – In accordance with La. Rev. Stat. Ann. §39:1309(A)(1), all action shall be taken in an open meeting with a simple majority of the School Board voting in favor of the proposed resolution.  The adoption procedures shall also include the following:

REVENUE FORECAST REQUIREMENTS

Projecting the amount of revenue that will be collected from various sources is one of the most important tasks of the budget process, yet it is also one of the most difficult.  Since revenue projections, like other forecasts, are almost never 100% accurate, the overall goal is to make conservative projections that underestimate, rather than overestimate, the amount of revenues that will be available.

Therefore, the Superintendent shall project each revenue separately with more time and analysis given to major, rather than minor, sources.  This revenue projection (i.e. property taxes, sales and use taxes, Minimum Foundation Program funds, etc.) shall cover at least 75% of the total revenues from all funds.  The methods used and any underlying assumptions for the estimates shall be included and discussed in the budget document.

The use of one-time revenues and unpredictable revenues shall comply with the provisions outlined in policy DCF, Long-Term Forecasting policy.

Also in accordance with La. Rev. Stat. Ann. §39:1305(C)(2), revenues should be itemized in accordance with the guidance provided by the Louisiana Department of Education.  A summary presentation for the General Fund and the Special Revenue Fund shall be presented with the budget resolution and shall include a side-by-side detailed comparison for all revenues and receipts itemized by source for:

• actual year-to-date collections thru March 1^st of each fiscal year,
  
  

• estimated collections for the remaining four months in the fiscal year,
  
  

• the total actual year-to-date collections plus all estimated collections for the remaining fiscal year, and
  
  

• the percent change for each item of information.

EXPENDITURE REQUIREMENTS

Expenditures shall be appropriated annually to provide for the health, safety, and welfare of students.  All operating expenditures within a particular fund must be supported by the operating revenue generated by that fund and shall not expand beyond the School Board’s ability to pay for them with current revenues.

Also, budgeted expenditure shall be itemized in accordance with the guidance provided by the Louisiana Department of Education.  Additional expenditure considerations include the following:

• Budgeting for Staff Compensation – Because human resource costs are the largest expenditures, the Superintendent shall budget the full cost of the compensation that includes employer provided benefits for those employees who will continue employment into the new budget year.  Vacant positions shall be budgeted using an average compensation that also includes employer provided benefits.
  
  A schedule or summary table of all positions for the prior, current, and budgeted years shall also be provided.  Significant changes in staffing levels should be explained in the budget message.
  
  

• Year-End Savings – It is not uncommon for administrators to spend less than their budgeted amounts.  To encourage a more strategic use of current year budgets, administrators shall have the opportunity to request a carryover of unspent General Fund budget appropriations from one fiscal year to the next.  Proposals shall be submitted to the Superintendent or his designee on or before July 15th of each year.  The Superintendent is authorized to approve or deny each request, as long as, the projected ending fund balance in the succeeding budget year of the General Fund does not fall below the minimum reserve levels set forth in School Board policy DCBA, General Funds Budget Reserves.  Proposals shall be limited to an item or program that is anticipated to reduce costs in the future and shall be limited to 50% of total General Fund year-end savings from a prior budget year.
  
  

• Funding New Educational Programs – All new educational programs proposed by the Superintendent shall encourage budgeting and resource allocation designed to improve student achievement.  The Superintendent, or his designee, shall maintain detailed records of budget estimates of all costs, as well as, a rigorous evaluation of actual results.
  
  

• Grants and Categorical Funds – The Superintendent is authorized to seek out, apply for, and effectively administer federal, state, and other grants that are consistent with the School Board’s organizational mission and strategic priorities.  Before accepting the grant, the Superintendent shall analyze the long-term costs and benefits.

Also, in accordance with La. Rev. Stat. Ann. §39:1305(C)(2), expenditures should be itemized in accordance with the guidance provided by the Louisiana Department of Education.  A summary presentation of the General Fund and the Special Revenue Fund shall be presented with the budget resolution and shall include a side-by-side detailed comparison of all expenditures itemized by function for:

• actual year-to-date expenditures thru March 1st of each fiscal year,
  
  

• estimated expenditures for the remaining four months in the fiscal year,
  
  

• the total actual year-to-date expenditures plus all estimated expenditures for the remaining fiscal year, and
  
  

• the percent change for each item of information.

PERFORMANCE MEASUREMENTS

The Superintendent is required to integrate performance measures into the budget process and to use these measures to help make budget decisions.  The process shall include a coherent statement of the district’s vision plan, which includes our mission, departmental goal and objectives that are used to support the educational environment.  Additional requirements include:

• Program Review – Departmental goals, objectives and plans for action shall be reviewed annually during the budget process with the objective of identifying programs or services that are no longer affordable or effective.
  
  

• Alternative Service Delivery – The Superintendent shall also be required to consider other approaches of providing alternative services or programs, as long as, the expected cost is less than or equal to the present cost of the service or program that is offered.

LINE ITEM TRANSFER AUTHORITY

Once the initial annual operating budget is adopted by the School Board, the Superintendent or his/her designee is authorized to transfer:

• Amounts between line-items within any fund and in accordance with proper legal and accounting procedures without seeking additional approval of the School Board.
  
  

• Any favorable excess reserves at the end of the fiscal year between funds in accordance with proper legal and accounting procedures without seeking additional approval of the School Board as long as the residual amount being transferred does not exceed the minimum levels prescribed by the School Board’s reserve policies.

PERIODIC BUDGET RECONCILIATION

The initial adopted annual operating budget and any duly authorized amendments shall form the framework from which the Superintendent or his/her designee shall monitor revenues and control expenditures.  The Superintendent shall advise the School Board in accordance with La. Rev. Stat. Ann. §39:1311, when any of the following conditions exist:

• Actual total revenue collections plus projected total revenue collections for the remainder of the year, within a fund, are failing to meet estimated annual budgeted revenues by five percent (5%) or more.
  
  

• Actual total expenditures plus projected total expenditures for the remainder of the year, within a fund, are exceeding the estimated budgetary expenditures by five percent (5%) or more.
  
  

• Actual beginning fund balance or net position, within a fund, fails to meet estimated beginning fund balance or net position by five percent (5%) or more.

BUDGET AMENDMENT

As required by La. Rev. Stat. Ann. §39:1310, when the School Board has received notification pursuant to the above section, or there has been a change in operations upon which the original adopted budged was developed, the School Board shall adopt a budget amendment in an open meeting to reflect such change.  Such amendment should be published in the official journal as described in La. Rev. Stat. Ann. §39:1307(B).

PUBLIC INVOLVEMENT IN THE BUDGET

Upon completion of the initial proposed annual operating budget and its submission to the School Board, the Superintendent shall publish a notice in the newspaper stating that the initial proposed annual operating budget is available for public inspection.  The notice shall also state that a public hearing on the initial proposed annual operating budget shall be held with the date, time and place of the hearing specified in the notice.  As directed by La. Rev. Stat. Ann. §39:1307(B), the notice shall be published in the official journal of the School Board at least ten (10) days prior to the date of the first public hearing.  If the School Board has no official journal, the notice shall be published in the official journal of the parish.  The guidelines following public involvement shall apply as follows:

• Public Inspection of the Proposed Budget – The proposed budget document shall be made available for public inspection at least fifteen (15) days prior to the date for budget adoption by the School Board.  Also, it shall be made available to the public at the School Board Office, 201 Crosby Street, Mansfield, Louisiana during regular office hours Monday through Friday, excluding holidays.
  
  

• Public Hearing on the Proposed Budget – The DeSoto Parish School Board shall conduct at least one public hearing prior to the adoption of the proposed budget at its regular meeting in June.  Anyone interested in participating in the public hearing can speak directly to the School Board at that time.
  
  

• Publishing a Notice – As required by La. Rev. Stat. Ann. §39:1307(D), the School Board shall certify completion of the actions required by this section by publishing a notice in the same manner as required for the notice of availability of the proposed budget and public hearing.

Retention of Budget Records

The Superintendent or his/her designee shall retain and file certified copies of the adopted initial annual operating budget, the initial budget adoption resolution, any duly authorized budget revisions or amendments, and other necessary information related to the budget as directed by La. Rev. Stat. Ann. §§39:1309(D) and 39:1313.

STAFF INVOLVEMENT IN THE PREPARATION OF THE BUDGET

The Superintendent or his/her designee shall assign various budgetary areas to members of the administrative staff.  Each staff member who is assigned a budget area shall recommend what items are placed in his/her area of the budget, and shall also be held responsible for seeing that expenditures in those areas stay within budget boundaries.  Should any administrative staff member encounter problems in any budget area after the budget has been adopted by the DeSoto Parish School Board, the Superintendent or his/her designee shall be promptly notified in order that adjustments might be made according to School Board policy.

Ref:    La. Rev. Stat. Ann. §§17:88, 17:89, 39:1301, 39:1302, 39:1303, 39:1304, 39:1305, 39:1306, 39:1307, 39:1308, 39:1309, 39:1310, 39:1311, 39:1312, 39:1313, 39:1314

Board minutes, 11-3-88, 4-1-99, 1-3-02, 12-4-08, 4-6-14, 10-13-22

DeSoto Parish School Board