Fall 2014 Workshop State Aid and Financial Planning Service
Agenda 2 Capital Project Forms and Reporting for Building Aid purposes Overview of State Budget / GEA Tax Freeze / Government Efficiency Plans
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Pre Ch.97 Projects 5
6 Building Aid Projects approved prior to 7/1/2011 (Pre Ch.97) Aid commences the later of 18 months after SED approval or notification that a general construction contract was signed (SA-139) Aid is initially based on the lesser of contract costs data or cost allowance aid or 110% of initial cost estimate Amortized over 15, 20 or 30 years (PPU) Statewide average interest rate Aid is adjusted to reflect costs reported on Final Cost Report or cost allowance for aid Adjustments up = Prior year adjustment Adjustments down = overpayment (aid deduct) Pre Ch.97 Projects
SA-4 Notification of Building Project 7 Generated by Office of Facilities Planning Rated pupil capacity Source and amount of financing Estimated costs of construction and incidentals Sent to district along with a blank SA-139 SA-4 data is revised at least twice When contracts are signed and SA-139 submitted When Final Cost Reports are submitted Pre Ch.97 Projects
8 0 0 0 0 Pre Ch.97 Projects
9 SA-139 Request for Building Project Data Filed after general construction contract is signed Reported costs should reflect bids (update estimates) Affects when aid payments will be made on prospective projects Method of financing must match SA-4 If different, district must submit an FPFI to Facilities Planning Total Funding for Project should equal the construction and incidental costs If different, district must submit an FPFI to Facilities Planning Pre Ch.97 Projects
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FPFI- Request for Revision of 12 Financial Information Used to amend SA-4 data after general construction contracts have been signed if: Total project costs to be reported on SA-139 exceed the amounts on SA-4 There is any change in the method or amount of financing as reported on SA-4 Any changes to project budgets must be within voter authorization Pre Ch.97 Projects
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14 SA-777 State Aid Building Project Status Report Pre Ch.97 Projects
15 SA-130 - Cost Allowances & Bond Percentage for Building Aid Purposes For each project, the district receives an SA-130 with the calculation of the maximum cost allowance for the project Sent to district upon filing SA-139 Districts may receive multiple SA-130s Will be sent out with each SA-4 FPFI and revised SA-139 filings Following submission of FCR 110% rule Cost allowance for aid is capped at 110% of SA-4 estimates Can be adjusted with submission of FP-FI Retain ALL copies of SA-130 Pre Ch.97 Projects
16 NEW/ADD actual costs exceeded cost allowances Pre Ch.97 Projects
Cost Allowances 17 Represents the maximum amount of actual expenditures upon which the district will receive Building Aid Maximum cost allowance is determined for both: construction costs incidental costs Maximum cost allowance for incidentals: Secondary schools and Special Education: 25% of the maximum cost allowance for construction Elementary schools: 20% of the maximum cost allowance for construction For projects having construction of a new addition, as well as reconstruction or alterations of an existing building, a separate maximum cost allowance is determined for the construction costs and for the incidental costs for both the addition and the reconstruction or alteration. Pre Ch.97 Projects
SA-130 Cover Sheet 18 Retain ALL copies of SA-130 Cover sheet Indicates how much of total borrowing will be aided at district s Building aid ratio Reasonable = 95% Reflects expenses not allowed for aid Reflects areas of expense with low cost allowance Pre Ch.97 Projects
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Certificate of Substantial Completion (CSC) 20 Starts the clock for Final Cost Report due date Partial CSC will NOT start clock Completed by architect Be sure to retain copy for your records Pre Ch.97 Projects
Final Cost Reports (FCR) 21 Check for Due Date If can t file by Due Date request waiver from Facilities Planning Referendums with multiple project numbers require Final Cost reports for each project number Late filed FCR for pre Chapter 97 projects results in loss of ALL state aid No more amnesty!!! Do NOT submit FCR if all EXCEL funding is not fully disbursed Pre Ch.97 Projects
Final Cost Reports (FCR) 22 Final Cost Reports should be sent to SED s State Aid Unit Produces new SA-4 and SA-130 and cover sheet Be sure to keep copies!!! State Aid Unit enters information from FCR and forwards to Facilities Planning for review SA-4 and SA-130 are sent to district with notations disallowed expenses Cost allowance held to ceiling Pre Ch.97 Projects
Final Building Project Report Due Dates 23 Calendar Year of Final Substantial Completion of School Construction Project School Year in Which Final Building Project Report is Due Project Report Can be Accepted (Statute of Limitations) 2012 2012-13 June 30, 2014 2013 2013-14 June 30, 2015 2014 2014-15 June 30, 2016 2015 2015-16 June 30, 2017 2016 2016-17 June 30, 2018 2017 2017-18 June 30, 2019 2018 2018-19 June 30, 2020 Pre Ch.97 Projects
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25 Pay attention to SED notes! Pre Ch.97 Projects
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Building Aid Projects approved after 7/1/2011 (Chapter 97) 27 Aid commences the later of 18 months after SED approval date or when the Certificate of Substantial Completion (CSC) AND the Final Cost Report (FCR)are filed Aid is based on the lesser of FCR data or maximum cost allowances Amortized over 15, 20 or 30 years (PPU) Statewide average interest rate No more prior year adjustments or overpayments No more deadlines for FCRs FCR due dates still apply for capital outlay, emergency and small cities waiver projects Building Aid will start later than in past for some but not all projects
28 Early Aid Start Request for Chapter 97 Projects Districts may request an Early Aid Start from Facilities Planning if CSC and FCR cannot be submitted due to circumstances beyond the control of the district: The project is a significant construction or renovation that was not designed or intended to be complete within 18 months; or The project is delayed by items beyond the District's control such as liens, litigation, declared natural disaster, or acts of God; or Quality of work is currently unsatisfactory and corrective action is required; or Other Application form available on Facilities Planning website Aid would commence on the effective date of the Early Aid Start approval http://www.p12.nysed.gov/facplan/subinfo.htm
Chapter 97 Projects 29 SA-139 should still be filed immediately after signing of general construction contracts (by October 15 th to be included in coming year aid projections) 1 st year of state aid will be projected Building aid will not begin if SA-139 is not received in time for projection purposes even if the CSC and FCR are submitted SA-4 and SA-130 Refer to when you complete FCR
PRE CHAPTER 97 CHAPTER 97 Aid commences the later of 18 months after SED approval date OR: Aid commences the later of 18 months after SED approval date OR: Notification that a general construction contract was signed (SA-139 submission) Aid is initially based on the lesser of cost allowance or costs reported on SA- 139 Aid is adjusted to reflect costs reported on FCR or cost allowance for aid Adjustments up = Prior year adjustment Adjustments down = overpayment (aid deduct) FCR Deadlines Apply FPFI submitted to align construction costs and financing with SA-139 submission When the CSC AND the FCR are filed (unless Early Aid Start Request approved) Aid is based on the lesser of FCR costs or maximum cost allowances No prior year adjustments or overpayments No longer FCR Deadlines (Except for Capital Exception Projects) FPFI only submitted for adding or changing EXCEL allocation 30
Multi Year Cost Allowance 31 SED has implemented a 5 year rolling maximum cost allowance Looks back 5 years and deducts costs of prior years projects from cost allowance calculation Could potentially limit the Building Aid paid on a project Construction and incidental cost allowances will be calculated using this method Check with Project Manager during planning stages to determine available cost allowance for projects
2014-15 NYS State Budget 32 January 21 st Governor Cuomo proposed the 2014-15 Executive Budget $21.28 billion in formula-based school aid March 31st 2014-15 State Budget Approved $21.83 billion in formula-based school aid Additional aid for Smart Schools, Full Day Pre-K and other grants and programs Property Tax Freeze Credit
2014-15 NYS State Budget 33 COMPUTERIZED AIDS 2013-14 Actual 2014-15 Proposal $ Increase % increase $20.713 b $21.833b $1.1b 5.3% $22.00 $21.50 $21.00 $21.117 $21.317 $20.713 $21.833 $20.50 $20.00 $20.057 $19.894 $19.50 $19.258 $19.00 $18.50 $18.00 $17.50 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15
2014-15 State Budget by Regional Shares 34 2014-15 Regional Shares of Computerized Aids $21.833b LOWER HUDSON 6% $1.2B LONG ISLAND 12% $2.7B NYC 40% $8.7B OTHER BIG 4 8% $1.7B REST OF STATE 34% $7.5B
2014-15 Foundation Aid 35 Foundation Aid - $15.43b (+$250.63m) 2013-14 Foundation Aid + [(2014-15 Formula Foundation Aid 2013-14 Foundation Aid Base) x Foundation Increase Factor] Minimum Increase: 0.85% over 2013-14 Foundation Aid Maximum Increase: 15% over 2013-14 Foundation Aid Foundation Increase Factor: NYC = 0.0432 If: 2014-15 Formula Foundation Aid 2013-14 Foundation Aid Base is >22% 2014-15 Formula Foundation Aid And the CWR < 0.35, then the Foundation Increase Factor = 0.07 Rest of the State = 0.0431
2014-15 Foundation Aid by Regional Shares 36 2014-15 Foundation Aid $15.43B Lower Hudson 5% $795M NYC 42% $6.5B LI 12% $1.9B Big 4 8% $1.2B Rest of State 33% $5.1B
2014-15 Gap Elimination Adjustment (GEA) 37 Gap Elimination Adjustment (GEA): -$1.036b -$1.63b (2013-14 GEA) + $602.12m (2014-15 GEA Restoration) = 2014-15 GEA Restoration: greater of Tiers I. through IV. No greater than 70% of 2013-14 GEA Where are the GEA and GEA Restoration going? 2010-11 GEA - $1.412b, $725m (ARRA) 2011-12 GEA - $2.556b, $229m 2012-13 GEA - $2.156b, $400m 2013-14 GEA - $1.638b, $517m 2014-15 GEA - $1.036b, $602m
2014-15 GEA by Regional Shares 38 2014-15 GEA ($1.036B) LOWER HUDSON 9% $89M NYC 24% $249M LONG ISLAND 21% $218M REST OF STATE 44% $456M BIG4 2% $23M
SMART Schools Initiative- $2 billion 39 $2 billion general obligation bond act - to be brought before the voters in November 2014. Bond proceeds would fund enhanced education technology in schools. Smart Schools allocation displayed on bottom of aid runs Smart School Investment Plans reviewed by Smart Schools Review Board Projects may include: Expansion of instructional space for prekindergarten Expansion of broadband or wireless connectivity School Safety & Security Technology Classroom technology projects to expand high speed broadband or wireless connectivity or to acquire learning technology hardware including but not limited to whiteboards, computer servers, computers and tablets. Smart Schools expenses are not eligible for aid. Certain school districts will be required to loan Smart Schools classroom technology to non-public schools
Statewide Universal Full-Day Pre- Kindergarten Program ($340 Million) - NEW 40 To incentivize & fund innovative Full-day Pre-K programs $300 million dedicated to NYC; $40 million to the rest of the state $1.5 billion to be allocated over 5 years Awards announced on August 18, 2014
Property Tax Freeze Credit 41 Homeowners must be STAR eligible (primary residence) Districts must comply with tax levy limit (including exclusions) in 2014-15 and/or 2015-16 Rebate checks issued by NYS Tax Department in Fall of 2014 and 2015 2014 Credit: Greater of 2014-15 increase in school taxes or 1.46% of 2013-14 school tax bill 2015 Credit: Rebate received in 2014 plus the greater of the increase in school taxes in 2015-16 or 2014-15 school taxes multiplied by the lesser of 2% or the CPI applicable to the tax levy limit in 2015 2015 Eligibility: State approved government efficiency plan Regional, multi-district, or individual Achieves 3 years of savings & efficiencies of 1% per year of 2014 school tax levy in each of 3 years starting in 2016-17 BOCES may convene and facilitate development of an efficiency plan for each BOCES region Plans may include efficiencies already implemented Savings plans to be submitted to the Director of the NYS Budget by June 1, 2015
2014 Tax Freeze 42 For STAR-eligible homeowners in a tax freeze compliant district, the 2014-15 rebate credit will be equal to the greater of: the actual 2014-15 increase in school taxes OR 2013-14 school taxes x (the lesser of 2% or the CPI applicable to the tax levy limit in 2014) For 2014-15 = (1.46% x 2013-14 school tax bill)
2014 example 43 If tax increase is greater than CPI: 2013-14 Tax Bill = $2,500 2014-15 Tax Bill = $2,550 Increase in Taxes = $50 1.46% x 2013-14 Tax Bill = $36.50 2014 Rebate to Homeowner = $50 If tax increase is less than CPI: 2013-14 Tax Bill = $2,500 2014-15 Tax Bill = $2,525 Increase in Taxes = $25 1.46% x 2013-14 Tax Bill = $36.50 2014 Rebate to Homeowner = $36.50
2015 Tax Freeze 44 For STAR-eligible homeowners in a tax freeze compliant district with an approved efficiency plan, the rebate will be equal to: the rebate received in 2014 PLUS the greater of the increase in school taxes in 2015-16 OR (2014-15 school taxes x the lesser of 2% or the CPI applicable to the tax levy limit in 2015).
45 2015 Example (if tax increase is greater than CPI) 2014 Rebate to Homeowner = $50 2014-15 Tax Bill = $2,550 2015-16 Tax Bill = $2,625 Increase in Taxes = $75 CPI up to 2.00% x 2014-15 Tax Bill = $51 (2% is used for this example) 2015 Rebate to Homeowner = $50 + $75 = $125
2015 Tax Freeze 46 STAR-eligible homeowners in a school district that does not comply with the tax cap in 2014 will be eligible for the rebate in 2015 if: the school district complies with tax cap in 2015 AND has a government efficiency plan approved in 2015 The 2015 rebate will be based only on the increase in the school tax bill in 2015 as compared to 2014.
Assessment Increases 47 Rebate will NOT include the increase in taxes due to assessment increases as a result of: property improvements OR loss of exemption(s) Increases in tax bills due to a general town or municipality wide re-evaluation, the rebate will be calculated as follows: If the home s assessment increased more than the average assessment increase for the municipality, the rebate will be based on the average increase in assessment; If the home s assessment increased less than the average assessment increase for the municipality, the rebate will be based on the actual reassessed value of the home.
Approved Government Efficiency Plans 48 Identifies cooperation agreements, shared services and or mergers or efficiencies to be fully implemented by one or more eligible school districts that are signatories of the plan. Submitted to the Director of the NYS Budget by June 1, 2015. Division of Budget will notify Tax and Finance of approval of government efficiency plans by July 31, 2015. NOTE: Additional guidance on the form and procedures for submitting Government Efficiency Plan will be issued at a later date. http://www.tax.ny.gov/pit/property/property_tax_freeze.htm
Developing Efficiency Plans 49 Plans may be regional, multi-district, or individual school district BOCES may convene and facilitate development of an efficiency plan for each BOCES region. School districts and local governments may jointly undertake efficiency actions and include the savings in their respective efficiency plans. However, school districts may only submit Government Efficiency Plans with other school districts or individually. Plans may include past efficiencies, shared services and reforms implemented since July 1, 2012 (tax cap statute). In order for such efficiencies to be included in the Government Efficiency Plan, such past efficiencies, shared services and mergers, school districts will be required to submit documentation of the specific actions that were implemented and the savings associated with such actions.
Plans Submitted by Lead District 50 The following must be submitted to Division of Budget by June 1, 2015: o o o Government efficiency plan List of eligible districts All certifications from each participating district o Analysis of aggregate amount of savings achieved if all initiatives in the plan are fully implemented by the end of the 2016-17 school year Plans must demonstrate savings & efficiencies equivalent to at least 1% of the aggregate 2014-15 school year tax levies for all eligible school districts that are signatories of the plan in each 3 years starting in 2016-17 o o o Savings realized in 2016-17 = at least 1% of 2014-15 aggregate levy Savings realized in 2017-18 = at least 1% of 2014-15 aggregate levy Savings realized in 2018-19 = at least 1% of 2014-15 aggregate levy
Plans Submitted by Lead District 51 By May 15, 2015 Superintendents of participating districts will certify to the superintendent of the lead district (in writing) That they will undertake and fully implement the shared services and efficiencies identified in the plan by the end of the 2016-17 school year. Chief Financial Officers will certify: That in his/her professional opinion full implementation will result in the savings for his/her district identified in the plan. That in his/her professional opinion full implementation will result in the aggregate savings for all districts identified in the plan.
Individual District Plans 52 Must demonstrate school district will achieve savings and efficiencies equivalent to at least 1% of their 2014-15 school tax levy in each 3 years starting in 2016-17 as a result of: Shared services, cooperation agreements Mergers or efficiencies
Individual District Plans 53 By June 1, 2015 Superintendent of district will certify to the Director of the Division of Budget (in writing) : That he/she will undertake and fully implement the shared services and efficiencies identified in the plan by the end of the 2016-17 school year. Chief Financial Officers will certify: That in his or her professional opinion full implementation will result in the savings for the district as identified in its plan In addition, an analysis of the savings set forth in such plan must also be submitted. By July 31, 2015, DOB will notify Tax and Finance of school district compliance with Gov t Efficiency Plan requirements
Functions or Services (not limited to): 54 Procurement, real estate and facility management, fleet management Business and financial services, administrative services, payroll administration, time and attendance, benefits administration and other transactional human resources function, Contract management, grants management, Transportation services, facilities and functions, Human services facilities and functions, Customer services facilities and functions, Information technology infrastructure, process, services and functions
Reporting requirements for 2014 55 April/May 2014 School districts report 2013-14 school tax data to NYS Tax and Finance July 21, 2014 - School districts report compliance with tax cap to OSC via Online Services Portal August 2014 School district s report tax warrant information is sent to NYS Tax and Finance 10 days after execution of warrant Districts that have October tax warrants will submit info to NYS Tax and Finance after October warrant is finalized October 2014 Rebate checks mailed by NYS Tax and Finance to eligible homeowners
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Closing Remarks 57 Questions? Evaluations Online at http://sap.questar.org/
58 State Aid and Financial Planning Service Questar III 10 Empire State Blvd. Castleton, NY 12033 (518) 477-2635 (315) 839-6429 Fax (518) 477-4284 http://sap.questar.org twitter.com/qiiisap