So the alternative we're live >> or streaming. How's that? >> Hey, good afternoon. Good. All right. So, we are live. >> All right. You ready? >> Welcome. I'm ready. >> All right. So, we'll have a roll call. >> Mr. Herline, >> I'm here. >> 103. So, we won't be voting on >> We won't be voting on anything. Yes. >> But we will go through uh go through the presentations. >> I had no changes to the minutes. So, we can bring that up at the next meeting. >> Yep. Okay. >> That takes us uh to the bond refinancing. >> Crappy news. >> See how that works. Yep. Uh so I think that was you know as we shared at uh at the board meeting right this was really fantastic news right I think it was the the impact was greater than we anticipated uh and and the feedback we got from investors was good it was a broad range of of buyers um and I think our calls our rating calls with Moody's were very positive positive. So I I try in advance of those uh they sort of send you the questions that are going to come at you and so I try to spend a lot of time preparing for those uh to be answering. You know my goal is to be a question ahead of her every time uh and making sure that we tie them together. Uh so I think that was very good uh maintaining our rating. Um sort of all of those are things that we've been we've been talking about. Um, I think and it's not there. I'm gonna I'm going to jump to here. This is what I wanted to show. I wanted to talk about, right? So, the rating is is the key. As I shared, I had PFM sort of do some back of the envelope. If you were one one step down from that and so you're in an A83, this is the impact. And if you're in an A1, I think is two steps down and the impact of that, right? And that's anywhere between $500,000 and a million on the last two refinancings, right? So on that total last November and this uh last September and this October, those refinances, the difference would have been between a half a million dollars if we were one step lower and it would be a million dollars if we were two steps lower. So that's significant money. >> So if we were a a 2A1, the additional revenue that we've received is not that significant though. Correct. Right. It would be better >> but it would marginally marginally >> um and and that's what I wanted to sort of talk about here. Right. So the the rating math, right? The sort of scorecard if you will and they send that out and tell you sort of where you lie against the you know 10 metrics, right? Um, and I think we have done well in improving the financial health of the district. Right? So, when I got here, as I mentioned before, right, we had a couple hundred,000 in fund. We in in the general capital fund, we had a million dollars maybe in the debt service fund and we had uh our general fund of, you know, $10 million. That that was all the money we had. Um, so if you wanted to fix an air conditioner, you were almost going to need to refinance, right? And we had a refinance that happened just before I did. So, we had some debt money that we had to spend and take care of. Uh, but we didn't have a a healthy fund balance. We significantly improved that uh over time. Uh, and that's one of the things that they called out. Uh, and these are are factors that Moody's identified as as important, right? healthy financial position, strong fund balance, and I have them in green because those are things that we control, right? We control those items. We're making those decisions. The board is making those decisions, whether to utilize, you know, as we go into the budget season, whether to utilize fund balance to offset debt, right, or offset a loss or finding other ways to manage that. That's the key. On the other side, the other part is is the community you live in, right? And so last September's definitely went sort of round and round with the the gentleman at Moody's trying to say, how do I how do I get to there? And and he quite frankly said, you know, Tom, I know you'd like to be in AA1 and be at the top of the the world, but your community plays a factor in that, right? And while you could be maintaining fund balance, you could be doing the best job you can financially, the community you live in limits what that's going to be. So while it's it's good, right? We have a good community, a strong tax base, um those grades are somewhat dependent on things that are outside of your outside of your your uh your own ability, right? So factors that could lead to an upgrade continued growth in reserves. So they would want to see a a move we are like 20 they want to see us like at 25% on the reserve side. >> Isn't there a limit though to what we can from the state have in reserves >> there the there the limit that the state puts on is unassigned general fund balance. Right? So you cannot have an un a large bucket of cash that is unassigned general fund balance. Right? So we manage that through the debt service fund um and and the capital fund. Those are our our outlets to reserve cash. >> What do we have right now in our debt service fund? >> Um I think we we are about we are about 20 we're about 20 cents. So I think there's like 15 in the debt service fund and service >> in the general fund. So, you know, we're talking um about Harrisburg and and the lack of cash, right? The lack of a budget. Yeah. >> Right. So, we have roughly 26 27 million in cash uh that should should it go the distance, right, we we would begin to use. And as you point out very accurately at every board meeting, that money sitting in Harrisburg earning somebody cash, right? It's not helping us out. So that's that's that's a a problem. >> So what is our annual expenditure for capital that we pay for capital uh or for debt service rather? >> What is what? >> So how much do we pay a year in debt service? $8 million a year. >> Yes. So we have about two years of debt service in reserve. >> Yeah. Yeah. But we we utilize that that that debt service account to to transfer money to where it is needed as we have done. We've looked at it capital or we've looked at it making those other decisions. Right? The other area that would need to change is the m material growth in the full value per capita of over 130. Right? we are at 118. So that distance is what we would need to do to to be the next grade. Um which is, you know, which is what it is, right? So I think we're doing as as good as we can um with with the the tools that we have and the community and the community support uh for us. You know, on the downgrade side, right, I think it's it's a lot easier to fall than move up. um right a material decline in reserves or liquidity that will that could cost us you know a grade uh growth and leverage so we if our debt continues to exceed uh grow and we are then sort of more highly leveraged as an organization we've been working to chip away at it I think looks at that say those guys are you know working to to minimize that and we have a lot of room within that and then significant enrollment losses enrollment is sort of an interesting one um that most most districts are losing enrollment, right? So the when I was speaking with the the lady um in September this year for this most recent she was she was had we are holding andor increasing uh our enrollment and I used for that discussion uh the study that we had done uh two springs ago that we published two springs ago and used that studies. That's wonderful that you guys are doing that. You're you're proactively uh going through this effort. Um so I think that was a good sign as well. And I think we are showing growth. I think the growth at Centennial starts now as we talked about it, right? I think when we look at birth rates and then when they start kindergarten, right? I think that acceleration starts uh this year and really in next year and then it's consistent number of years and that was what the study shared with us. So from a business standpoint, if you lose enrollment, okay, so you now are educating less te less students, >> you have the two directions. Either your teach student toteer ratio goes up, >> right? >> Okay. Or if you do not replace teachers as they retire, >> your expenses go down. Yeah. >> So, with your expenses going down, why then does that play in as a negative to your, you know what I'm saying? I mean, I could see if if you move a thousand students to charter school, that's one thing, but to to see a 100 students or it's kind of counterintuitive. >> It is counterintuitive. Yeah. Is it's an odd one, but it's one that they do look at, right? And I guess it it it probably as I've asked it and I you I've gotten the yes, I get it, right? But it still >> I imagine that it has something to do with the community that you're in. And if they are if they are a community that's sending school sending kids to school that may be a different community than the Greenwoods living on W drive. We don't have any kids, right? And everybody else has. So we're out picketing and complaining, right? But we we understand that. So you know it it's sort of like a neighborhood uh the rollover of a neighborhood, right? So when we moved into our house 20 years ago, we had the youngest kids >> uh and then we sorted grew up now now, you know, now the kids that, you know, had older kids, those guys are moving into the city or they're relocating somewhere else. >> Um and and we're camped out. Uh so I think those are the what gets out of it. >> Yeah. I just like I said it just kind of seems counterintuitive to a a business model of decreasing your expense ratios >> but losing your rating. >> Totally agree. Right. It would cost us sort of less. >> Yeah. >> Um so those were the it was really the these that I wanted to highlight and talk about in this meeting just where the impacts are and the things that we control versus the things that we can't control. >> And I know we've talked about that in mind as we enter the budget cycle. >> Right. I know we've talked about this too before that this is the last punch of the apple for >> y >> seven eight years at least >> we have we have the one this uh spring in February which is small it's like a 600 600,000 a year >> uh refinance so it's not going to it's not going to generate significant savings >> uh but it will be savings savings is savings >> and it's more than the expense of doing it so but yeah I mean so unless we are taking and I don't want to say our rating doesn't become important because it affects other things. But unless we're going to be doing some type of bond or some type of bond issuance for something else, you know, which >> schools are now 20 years old, >> which you very well could do, right? So, if we we utilize that capital and we're not maintaining any degree of surplus or any amount of money that we can feed into that, then the only other way to fund uh capital is through bond, right? and that those will be a that will that'll be I would imagine a slightly different picture. The questions when we did that in uh 2019 when I started the fall of 2019 we had a small uh uh uh bond issuance >> um covered uh the turf at the high school and some some facilities were right. It wasn't the the questions weren't dramatically different. But the outcomes weren't dramatically different, but it did increase and add to our debt. Okay. All right. Any questions on that? No. Seeing none, I'm going to jump to questions. >> No. >> No. >> Feel free. >> Feel free. >> Um uh to to sort of the treasurer's report. Um Vera has done a great job of of sort of maintaining the report inventory uh for us. Um we are going to as we you know sort of started the year a little bit in the hole. I think the the budget delay uh hits us gets sort of everything is I think I said the last meeting everything has a season. um when it gets out of season between that and more importantly the audit which sort of stretched into into you know August and September um really has us sort of out of sync a little bit. I'm going to get back to the forecast five modeling and we'll be able to get those things rolling. uh for now these are uh you can see the FY 2526 fiscal year-to- date uh revenue of 87,687 uh against 21 uh 21.5 million in expenses coming across those groups right we'll talk in a second about the state side um you can see uh there's $1.6 6 million from the state. That is really the u the homestead farmstead payment uh number one. Um so we'll get the I think we get the next one in October. >> October. >> Um and that'll be those. But those that's the only money of matter that's coming in. >> I'm sorry. You said October 3rd. >> 23rd. >> 23rd. Okay. Thank you. Okay. She's like an encyclopedia. Borrow her memory. Right. She's What's the date? 23rd. How much is the money? 1.69. >> Okay. Right. For um you're going to do expenses next. I'm going to ask why are what accounts for the fact that only 40 or 50,000 of a budgeted 10.8 8 of other operating and financing expenditures has been spent so far. Well, because I mean so that that's a great question, right? Uh this includes only one month of teachers, >> right? So teachers just started in September, right? Or the very end of August. So when we look at compensation and and that's certainly our largest share, right? September uh is is the shortest, you know, it's just a month's worth uh in in all practicality, right? So it's maybe five weeks worth of uh salary uh because they start at the end of August and then they move forward. So it's probably total of three payrolls worth of uh teacher expense and and and support staff expense in many cases, right? So IAS, PCAS, they're not working necessarily over the summer. The teachers aren't working over the summer as we've talked about before. teacher pay who if teachers get paid out over the summer that gets rolled back and expensed in in the year of the contract. >> Okay. >> But what what else is included in other expenditures and financing as far as >> uh so there are there are um that's the uh 5,000. So there are some uh some uh payments that we make on like leased equipment, things like that that hit that bucket that part of that 46. Um there are uh some minor charges like that. >> Yeah, it just it makes up 8% of the budget. So uh budgeted 10 million or 15 million. So 50. So these are are the this is sort of the detailed list of uh on the revenue side and again sort of the 7,000 numbers right you know excluding really any state uh money short of that uh uh the the homestead farmstead rebate money on the expense side. Um, so there's some uh 5,000. So it's it's a minor debt service as I said, right? So they are uh sort of leased and other loans that we have that we're making payments towards. Okay. >> Um and so just because we have, you know, it's the the elephant in the room. uh the the budget uh stalemate in Harrisburg. This just shows sort of this year compared to last year in where we stand. Um you know, last year through September we had uh $5 million in in revenue collected from the state. We're at 1.6 million. So that difference of 3.4 million is is sort of real uh you know waiting to get money. Um and as importantly uh we would have expected the last of the FY25 subsidy payments from PE the pasers subsidy payments from the state for peasers right they get pay about half of it we would have expected that lags we typically get it in August or September and then we account for it sort of like salaries right we push it back into FY25 but you know the world today we're were as much cashbased thinking. We put together a good uh spreadsheet and analysis. It looks at really uh the the district on a cash side. So, what are we spending out? What are we what's our AP going out the door every day? How much is our payroll? What's our debt service going to be like in December because that's our next date debt service payment. And how is that going to shift if we're receiving these buckets of money uh going forward? So, she's done a great job around that. But this is one of those numbers that doesn't show up on the P&L because it's revenue for last year. Uh, but the cash is is coming out this year. So, the lack of cash, >> right? So, but so if we're looking at last year's ending numbers on the budget, are we going to be 3.4 short until that comes in or is that payment's already been made? Therefore, it's it's >> so on a cash basis you you you won't you won't see right. So the balance sheet is is sort of the governor to that right. So in last year it it appears in our financial statements last year as a receivable right that we then get in September and we wash it out right >> so it it is it's not in our cash the end of uh the year >> right and it's not in our cash today. Okay. >> Because it was sort of a cashbased thinking now as opposed to modified approval basis that we govern sort of public schools. >> Okay. >> Makes sense. >> Makes sense. >> Okay. Any other questions? >> Hopefully they'll get off their butts and do something. >> Yeah. Um and and I have I this is a slide that we've shown in various budget presentations. uh if I have this one in the the deck to share with the CDA today and just as a reminder of of how you know where my where where the money comes and and what timing it is. So what this report shows is this is for last year. So sort of for the full 12 uh 12 11 12 months of last year uh cash balances and as that money comes in right the dotted line is uh two years ago the blue line is last year um you can see it's sort of interesting because it you know it does reflect the reality um as we delayed uh last year's budget was delayed a little bit our our date for um the discount date was September 8th or 9th a year ago. It was September 15th this year, right? But it actually changes the marker on on where that cash is coming in. Right? So, you're actually getting a little more cash later in the cycle because people have a little bit more time to give it to you. They don't need to get it in by August 30th. They can get it in September. So, as long as we get the budget, soon as we get the budget finalized really marks that, right, that difference between um you know the an August 31st discount date, which is really where you get the majority of your cash, right, all of the loans, uh all the mortgage banks out there, they're sending us checks inside of that 2% window um for the discount uh and not waiting till you just pay the face or much less a penalty. So that just shows uh sort of the picture of where we are. So we we store up cash and then we lose it sort of like the P&L does, right? So we have 8 million in in uh 80,000 in in expenses when we were going in here. Sorry. Right. And we only have 21 million in expenses. So we made 61 million. But that that goes away as the year rolls on. Okay, any questions? >> So, what determines the discount amount at 2%. Are there any districts out there that are 3 or 4% or one or half a percent or is 2% of legislation? >> The number. >> That's the legisl Okay. It's the number. >> Okay. Okay. >> Um I know we're set uh to meet next Friday. Yes. Uh morning. So, uh, you know, again, if there was a more crowded room, I was seeking to get gotten your feedback from you. Uh, we'll have some more feedback. >> Um, you sort of understanding the the the request from the board, uh, which is is, you know, authorizing by December, um, a three-year budget proposal, I guess, strategy is is what I'm thinking of it. And I'm trying to make sure that that's consistent um with what that expectation is. It may not be a dollars and cents plan, but a strategy relative to items that we should be working through. >> Yeah. I think if we we my the way I take it is that um all right, we have a $5 million deficit this year. um which it's because of the state we can't actually decide whether or not we're on target for a 5 million, a 3 million, a 7 million at this point. Um but that we look at that and say next year, you know, we have we're cutting cutting books by 28%. >> Yeah. and then we're, you know, the plan to go into more digital literature at that point and that's going to save us this amount over so many years and it's that percentage of the budget. That's kind of the way that I'm looking at it. I mean, I would like us to take a a a you know, top to bottom look at this and see what we can do. Obviously, every year as we pay down our debt, the percentage that our debt services of our budget becomes less. good thing. Um, you know, our special education costs are through the roof. >> Y, >> you know, that that is something that, you know, and you know, we have to be very cognitive of not wanting to affect the education of our students, but we need to find if there's a better way for both them and for us. You know, that is something that's important. We need to look at what our long-term capital expenditures plan to be are realistic. I mean, in the past, we had had a a rolling list of things that we wanted to get done, >> you know, and and as we look at those things, are there large ticket items on that? Are there items that are, you know, oneoffs that we do as we get things done? Um, you know, and our I mean, our maintenance staff, we talked about it during the meeting, you know, saving the the district money and doing repairs and stuff is just phenomenal. You know, we used to talk about when we actually supported three pools in the district. The fact that the maintenance team kept the diving boards and the pump equipment and the exhaust equipment all running at a level that, you know, where we weren't replacing or they needing a replacement every 5 years like other districts, we were doing it every 12 years because it just wasn't wearing out because they were doing a great job on it. I mean, all you need to do is look at the gymnasium floors to see. >> Yeah, for sure. the work that that is done. Um, you know, we need to look at transportation. You know, hopefully the adjustments that we make, we're going to be able to bring down the expenditures and and overtime in transportation and be able to kind of even that out. I mean, that to me also is a bit of a security issue. if you're having individuals work 60 70 hours a week, you know, there's a fatigue factor there and we don't want anything to happen to our students and we don't want anything to happen to our our either. I mean, it's, you know, so that's kind of where on that one. >> Okay. >> Questions, suggestions? I mean, I'm open to anything, folks. >> Um, no, that's that's good. That's a good it's good insight and and will allow us to sort of plan uh plan for that as we start. So >> I mean we're always obviously I mean we're always looking to cut costs for insurance for health insurance. >> I mean that that's that goes without saying. Um if the if the first look I got for my health insurance for next year is any indication, it's going to be a rough year. >> Yeah. Mine is looking to go up. I I think they're proposing a 15 to 18% increase. >> Wow. >> In mine. And we've had no claims. >> Say that again. >> My health insurance. I have private market health insurance. >> Yeah. >> Our first look was a 15 to 18% increase. >> Yeah. Wow. >> And we had no significant claims this year other than basically wellness checks. Fortunately, >> that's amazing. That's amazing. So, you know, we've been fortunate. uh back on with the the health trust. >> Yes. >> Uh sort of managing those costs. Um uh we'll continue to to reach out to them as they begin to create their their looks. >> Um we are still challenged >> uh on the specialty drug side, right? We do have increased >> co-ayments, but they're still it's a marginal number. I think some of the specialy drugs are starting to come down because you're starting to see some competition. Uh like the GL GL1s and those types of things. >> Those are the big spenders right now. >> But you know, but >> you're advertising during the World Series. >> Yeah. You know, >> you can afford >> you know, you know, the bill is not coming down fast enough. But, you know, but we still do have individuals or individuals with family members that have serious medical conditions that eat up a lot of, you know, and that's that's the part of point of the community of a collective health insurance plan. >> No, I I as we shared with CA and the healthc care forum a week or so ago, right, we have about 20 users of specialty drugs, right? that out of the 500 plus >> right >> members within it and that's using half of the uh half of the the expense half of the spend for those drugs. So it's a it's a challenge everybody's faced with. Does the health insurance trust have a compounding pharmacy that they deal with that they may have a discount? You know, so like I know some there are compoundingies out there and if they have one that is cavitated towards or licensed with the trust, we may be able to get those drugs for those 20 individuals through that compounding pharmacy at a reduced rate. I've uh I've done >> I know I know you bounced this a thousand ways to no that's that's a new one right so in years of of negoti you know whether big companies or small companies you know dealing with health insurance I've never heard the term compounding pharmacy >> so they they're privateies that do drug that that that will make the drugs so um you know if you s very similar to um chemotherapy companies where they make the chemotherapy specific to the individual compoundingies will make the drug formulation. I mean, it doesn't happen a lot, >> but with some of the specialty drugs, it may be out there. >> I don't know. >> Just thought. >> I will I will uh be my first message tonight. >> Go, huh? It's enough. Yeah. >> Okay. So, you again, I think we'll we'll jump into that both feet >> next week and I'll I'll try to prepare some at least historical numbers around that so that we can uh begin. I mean, if we could get numbers from the trust sooner than, you know, at the last minute, >> yeah, >> that would be great. >> That we could, you know, I I know that they're constantly negotiating, but um, you know, getting numbers in in May for a June budget or something. Be nice to have them sooner so that we have some idea. >> We pushed back a year or so ago on that very subject, right? And I think we're now getting them in that March window. >> Uh but that was a big uh we were getting them way too late in the past. We were getting them in Aprilish uh before we were able to get them squared away. So I think I think they've worked to get those looks happening sooner in the cycle u as we've shared with them. Rated if if we had a calendar year then it's fine. But that's not where we're at. You have a bunch of small entities with that calendar. We have a couple a few big school districts that are working off a different calendar. We need to have that view. >> I say and our open enrollment is going to be on schedule this year because last year wasn't a little off. We had a we had two separate open enrollments and >> um >> because of the way the contract negotiations went >> we did a year that was is that just last year wasn't it this past year last year >> uh because that followed the CA contract right so that would have been the 24 25 school year >> right so that would have been >> yeah last year would November of 24, we would add that extra open enrollment. >> Yeah. >> Okay. >> So, we should be right on schedule this year. >> Should be. We should be. >> Hopefully, that'll help as well. >> Yep. Yep. >> Um uh the the last things that we have uh and make sure I didn't miss anything on the uh on the agenda. Um budget discussion. No. So is is thoseformational items uh that we'll have u the PISLAF reports uh the department of education issued the base act one index which is 3.5 uh% there's a number of uh schools in Bucks County that get the additional leeway uh that's giving them a little bit more points. I was going to put that up. I don't know if that's helpful for people to see. Um or the three and a half is is our number and >> it's I mean the surround the surrounding districts that some of them are you know have the option to go higher as a Sure. >> I don't think it's harmful to put it out there. >> I I'll make sure to include that. I have that >> and maybe a brief Yeah. And and the brief explanation as to why they have a different index. Okay. Excellent. Um and then I also have the the timeline uh for the budget. So >> based on if uh this is the notice uh that we get from uh from the state we've included a little bit of history uh on on the sideways look so sort of where we have been on the act one. Um, and then kind of feel like Vanna White here. Uh, and then we've included uh sort of the generic uh PTE timeline for schools. Uh, there isn't a presidential election, so we're not consolidated up front. Um and uh you know the the date if you were to look for a a an exception fees are or act one exception that's still the end of uh end of January that would like to be made in. >> All right vote on the accepting the budget timeline. I don't remember. uh we will we will uh we'll accept it but we don't we I typically have a one more tailored to us >> right >> that we put in and that that is uh I think that's mentioned >> uh in here >> I thought I saw something >> right so detailed district plan uh will be shared in November for the the board to adopt as our plan right >> just wanted to make sure it wasn't something we had >> put on the agenda regarding Um, and then the other the only other two items we had uh that we'll be we'll still bring to the school board uh for review uh is uh Lori Denny attending the Hasbbo food service conference. Um she went to that last year and she found great value in it. Uh so she'd like to return. Um I think that's in the hundreds of dollars range. Yeah. >> And then the approval uh with for the agreement with the Box County IU to issue our homestead uh exclusion notices, right? So, anyone who hasn't registered doesn't have that, they send them a letter every year uh to see if they can get them enrolled. Uh so that's uh it's a dollar uh 7 cents 7.8 8 cents is what that's going for. It's bit of a higher number than it was last year when I broke it down, >> but I think uh postage has gone up. >> The the the number isn't on the postage side. You look at it. >> Um it's uh it's really so they they they provide uh this update, right? The numbers really in the processing fee has jumped considerably. I sent them an email uh when I got it and they said that's what their provider gave them. So it is an estimate uh of that number. Um and I think we are I think it's roughly $4,000 a little over $4,000 >> uh for Centennial based on 3,716 parcels which is the number we used last year. All right. And I think that's all we got. >> Anything could be recorded. >> Thank you all very much. >> Uh, next meeting November >> 14th. >> 13th. >> November 13th. >> 13. Oh, there we go. >> Right. >> I guess you can adjourn the meeting. >> I say we will adjourn the meeting and you can push the button. >> Thank you.