All right. Good evening everybody. Good evening. Thank you so much for coming out to our first of three town halls that we'll be facilitating um uh particularly around some conversations uh with regards to our levy and some finance aspects and some programming aspects as well. Uh it's really important for us to really have that participation from our community. very similar uh to how we did our strategic planning process. We're going to kind of start at the 30,000 foot level and kind of bring the conversation down in incremental levels until we get some um really good concrete uh next steps that we can bring forward um ultimately bringing that into our board of education. Um and uh tonight is our first one. Next week I think we have one during the day uh and then I think the following week or even the following two weeks after that it's on our website. two weeks I think after that last week this month we'll have our last one and the what we're trying to do here is really get some good ideas large big ideas um from our community as it pertains you know to our academic excellence kind of big goal for us and what does that look like what does that mean for you um some of you are parents in our district some of you are community members in our district some of you are business owners or elected officials etc and so you bring very diverse perspectives to the conversation ation and I'm really looking forward to what we can uh learn from you all as we move forward together as a community. And so we are looking at building a blueprint um for academic excellence. And um our uh goals here tonight are to assess our financial reality, have some discussions in that space, um talk a little bit about how we've been managing resources over the uh recent past here, and then gather your input to kind of guide that long range um academic excellence plan. Now, by the show of hands, any of you show up to some of our strategic planning conversations? Okay, several of you. Um, so this is our our strategic plan. This is our northstar. And you've probably heard me say this a lot of times. This is not just a shelf document. This is not just a pretty little brochure that we put on paper. This is a living, breathing document that we become and we try to perfect and get better with that every single day. Um, and I won't read through it for you, but our core priorities are right there in the middle. and everything that we do really guides our daily practice as staff um as well as as a community. And what you'll see tonight is community partnerships. This is a great example of that. Um a couple of people have asked why we have you guys sign in. I don't care if you put Superman. Um it's really just to do a tally count of how are we engaging our our community? And as we're having conversations with our community and with our board, we can say, you know, in this project we had, you know, 300 people kind of touch this conversation in some form or fashion. So that's what we're trying to do is just get a good running tally of how are we reaching our community. Um, and it's just some good metrics that we can share for ourselves and find different ways that we know are working for engagement and maybe where we can tighten up some things to increase our engagement. All right, but everything is centered around that plan and you can see that front and center on our website as well. Now, I'm sure most of you um have gone through iterations um in your life of whether it's an apartment um a home, heck, maybe it's your dorm room or your office space, we've all had visions for making improvements to our spaces. And similar to that blueprint of of a house, our blueprint to academic success is no different. We can dream up a lot of things that would be the ideal in our in our world. But like most families, um when we dream up all the things we would like to do to improve our home, maybe it's new furniture, new paint, carpet, maybe it's a remodeled uh kitchen or like finish out that lower level in the basement for the, you know, big 90in screen TV. Okay, maybe that's just me. Thank you, honey. Um, so, um, but we all have this vision for what we would like to see. And if you're like many of us, you're probably not going to be able to afford to do it all at one time, but you have this blueprint for what you would like to see that remodel, that refresh, or whatever it might look like. That's a lot of the work that we're going to be doing together as a community. you know, at our last board meeting, one of our board directors asked um like what would it take because we were talking about some different levy options and said, you know, considering what we're talking about, we'll share some of that with you all tonight. Um what would it take if we were to pass the levy to do the things that you and the team and the community would really dream to become academic excellence? And it's going to be a lot more than we probably can afford in one levy conversation. Okay. Um I know that um but like we do with our home projects, we have this master plan and then how do we start looking at this in phases over time? Okay. And that's part of the discussion that we want to engage you in today as we design our blueprint for academic excellence here in Prior Lake Savage Area Schools. I'd like to introduce Director Ryder to all of you. Um she manages all things money, planning, ops and support, all kinds of stuff. and uh she um really has a true gift of breaking down school funding in complex you know spreadsheets into digestible you know chunks. So director Ryder will take um the the next portion of this presentation and then I'll kick us off into our table groups. >> Thank you. The >> that's the down button I believe. >> All right. So we're going to talk a little bit about what do the finances look like right now and what would be the reasons why those finances look tight right so you can see that we have some bars there for the revenue compared to the expenditures and when we conducted um I I've rolled forward our current year expenditures and then adjusted for certain assumptions right and in that process I can see that our revenue is between zero and 2% increase that's assuming a 2% % on that gened formula but unfortunately the gened formula is not the whole amount of revenue right it's a small portion so with that then um as you take a look at that gened formula and 2% is added on to that you'll note in another slide that the it just hasn't kept pace with what inflation is right so part of our issue is that revenue the state funding not keeping pace if it had kept pace with inflation we'd be looking at 13 plus million more in a year. Okay, that's how much of a difference there is. It's $1,420 per pupil unit that we could have seen if it had kept pace with inflation. That's per student. So that's $13.4 million. And when you have um declining enrollment, that tends to offset any increase in the formula. And so you end up with somewhere between that 0 and 2%. Okay. So, we have um declining enrollment occurring at this point in time at a slower pace um but it is there and often times you'll find a lot of our neighboring districts are experiencing very similar. So, let's take a look at what that gap looks like. So this is the lower light blue line is where our formula has been from 2003 through 2026 and the darker blue on top is what inflation would have done to it. Okay. So that gap you're seeing over there is that $1,420 per student pupil unit. So that's where we come up with that 13 plus million. So there is that level of state makes that decision. That's where the investment needs to happen as well. We can do what we can to promote for that and you know advocate for that. Um this is not a local decision. Okay. All right. So revenue growth has slowed while costs continue to rise. Kind of the the story that you'll see across all the future five years that got projected. We have to find a way to balance our immediate needs and also consider our long-term sustainability. Right? It doesn't necessarily pay to put all the money you may want to into a particular area if you cannot sustain it. Right? And we are just coming off from how many years that I suppose three years of federal funding that was, you know, provided to us during the co years. But at the same time, you know, this is going away. This is onetime funding. So, if you use it for something that's going to be brand new, you got to be able to sustain it or it's gone, right? So, keeping that in mind as we do our long-term planning is very important. And this does mean, as you heard Dr. Thomas speak to, it's about implementing improvements in thoughtful stages. Trying to figure out what is it that we are going to do in this next stage, then what's next? That kind of approach. Okay. All right. So, this one gets a little bit filled the screen. I'm going to walk us through what this all is. We have been talking with our board, our school board about various different possibilities. And so, what this is doing is it's taking five years. And you see a dot for every one of those years. I'm going to explain a few of these these um lines and and colors. You see the the um dashed line that is blue here is the fund balance that is 8%. That is what our policy calls for us to strive to have in unassigned fund balance. The dotted line you see going across is zero. Okay? Meaning you have no fund balance, you're at zero. The green line that you see is the top line there. And that is reflective of our current referendum being revoked and renewed with one that is $377 per year more on the average home valued um homestead. Okay, which in today's world I think it's around 5 533,000 according to the stats. That same home at $100, $180 per year increase from where we currently are now would be the red line you see. Okay. The other line that is the lower one here where that's more teal, that is our current referendum with no changes but renewal. Okay. So, we have some concern because clearly anything below zero um as soon as you get to about here that's operating debt. We do not want that. This is already taking into um it's taking into consideration a reduction of expenditures on an annual basis of $3 million. Meaning, you're going to roll forward your revenue with a 2% increase on the GenEd formula. You're going to account for any decline in enrollment. On the expenditure side, you're going to roll forward those expenditures with the necessary percentage increase assumptions for salaries, for benefits, and then you're going to reduce from that $3 million for sure every year. The idea is we have to be able to control our expenses. Typically, in a given year, your expenses will increase about 4%. because of salary increases, benefit increases, utilities, things like that, right? Um, so that 4% has to be mitigated somehow. $3 million isn't 4%, but it's it it's a way to kind of measure that, right? So every year from here forward, we assumed a $3 million reduction in addition to the roll forward. Our numbers do not necessarily land where we'd like to see them. But as you've heard talked about, this is where we have to determine the priorities that we have and what we're trying to do in these stages. Okay. At this point, I just want to check in and see is there anything for a point of clarity that we want to touch base on right now. What percentage that three that 3 million reduction annual reduction >> what percentage does that represent of the whole >> um of the whole expenditures it's just shy of the four 4% so it's around three and a half okay and that that gets a little less each year just because your expenditures increase right yeah >> yep anything else >> what's the revoke renew really entail >> okay thank you for that >> repeat the question when you hear Oh yes, I'm sorry. What does the revoke and renew really entail? So, we have some options we've laid out before the board. The board has the ability to renew our existing referendum by taking board action with no change in inflationary clause or anything like that, but to renew it for another 10 years. Okay, that's a possibility. Voter approval is required if you want to add an inflationary clause to it. Voter approval is required if you're going to revoke the existing and replace it with some other referendum dollar amount. We are showing you these are the costs in addition to what is currently in place. Okay. So you would revoke and replace for these two because you do need to end what you've got and then replace it with the with the other option for voters to approve. If it's voted down, then the the option that would be remaining for the board would be to renew what we have in place with no inflation because they can't change that. to piggy back on that. What was the last referendum? What was that asking for? We would have put it on the spread. >> Yeah. Um, let's see here. Question. I >> think that's coming up here. Let's go to that. Can >> you repeat that question a little bit? >> Yes. So, the question is, what does this look like for the current referendum? Right. >> For the >> the existing >> for the last one we just asked for that got voted down. What would that have looked like? Oh, for the last one >> wouldn't be here. >> Okay. The last one, the last one would have been more than this 377 and would have been about I think it was 400 and some. >> I just want to make sure. Yeah. I thought it was like 450 or something. >> Yes. Okay. >> Yes. Everyone good on that? Okay. So, let's um let's go to this next slide. We have already taken significant steps to adjust our spending at this point. In 2425, uh, $4 million were reduced. 2526, $4.1 million for reduced. And in 2627, we're looking at another 4.1 needed to get us where we wanted to be, which is at the 8% unassigned fund balance. Um these were the items that were identified in each of those years and we know coming into 2627 we have a site consolidation. So that's already been considered with addressing our um planning for the kindergarten through fifth grade and how many um sections and everything we're going to need there and the selling of the district service center. So that's all kind of in the works of being part of our plan, but in whole we got to make sure it comes up to that to meet our goal. So those items above are are part of making up that 4.15 million. >> They are part of the sale and calculated. >> No, we're in the process of trying to fine-tune that and figure out what exactly we haven't. Okay. >> Yep. >> Yes. >> Just for context, what's the budget number? >> Okay. Um, our total expenditure budget is around $120 million. Sure. >> Anything else? >> Okay. >> Oh, question. Sorry. >> Sorry. Yes. >> Is the uh district service center is that sold already? >> There is a purchase agreement that was approved by the school board. So now it's a matter of working through the timelines because there is a discovery period and once we get past a certain um point in time then that would be um a very large pro um real possibility. That make sense. It's not final and done yet. We're in the process of working through that. >> Just to get some good uh some context to that. Um so uh the board accepted the purchase agreement. Um yes it's a it's a really good offer. Um and uh and I know that this um company or the the buyer is also interested in that vacant lot that's been um uh adjacent to our uh parking lot for many years. Um so they're also um retaining a contract for that as well to develop kind of a bigger space back in there. Um, so they have up to 270 days uh to work through all the details, titling, surveying, um, zone kind of stuff. Um, but as I've been having conversations um, with our mayor, um, having conversations with the buyer, um, sounds like things are tracking really well, um, and that, uh, you know, we've not hit any snag. So, um I wouldn't be surprised if they wouldn't be ready to come to the table for a final close sooner than 270 days, but that's the maximum that they that they can take. So, we are planning right now um as a central services center um for uh end of after graduation to really start that process of moving everything out cuz even if we're still working through the details of that sale, um we can at least shut down the cooling services uh cuz we can be in the old uh Greenwood building, you know, until we get through the process of that. And then one caveat I just want to share as well is that when we sell um that building, that building um the the proceeds from that sale um align to our capital uh components. That's and and so there's restrictions on what capital dollars can be used for. And and so for us primarily that's a lot of the hardware services you see inside our schools, a lot of the tech inside our schools and all of our curriculum in our schools. So that's where we would be able to cuz right now we are cost subsidizing from general fund the capital needs because unlike some other districts, we don't have a capital led. So, we would look at ways that we might be able to offset some of the capital that we could kind of stop the cross subsidy from fund one um to help offset and realize some of those savings that we're talking about in that total 4.1. Okay. All right. So, let's talk about our current referendum. And anytime people hear the phrase inflation adjustment, it makes them nervous, right? Cuz that is an unknown until it occurs, right? So what we wanted to do is understand, let's look back and see what if we had had an inflation adjustment on our current referendum. What would that have looked like? Okay, so we know a couple things. We know that that would have provided over this 10-year period $12.6 million more for just inflation. We also know that the bottom line you see that I see as blue, that is what was actually the tax impact for the average valued home that you see each year. The values listed here. So, it started out at a $333,000 home is now a $536,000 home. And you can see the amount of tax impact each year for the referendum. Okay, it actually went down. Why did it go down? Because the valuation overall for the community increased, right? And there was enough of a spread for that increase that the actual impact to the average value home owner went down. Okay. If instead that language had had that inflationary clause, you would have seen the red line being the tax impact over that period of time. So as you look at it, you start out with the same, right? 371. And that's why in the future any any voter um is going to see on a question that has inflation, they're only going to see at this point, right? Because you can't you can't tell them what this is going to look like exactly when you're sitting here. It's much easier when you look back to see well what would have happened, right? And so in that first year there um the impact would have gone up, come down a little, down a little, back up, you know, but it would have landed essentially $24 more than it had been 10 years earlier. And the impact would have been $12.6 million more. I personally was surprised by that. I didn't realize it could equate to that much. All right. So, how do we compare with our other districts in the metro area? This is voter approved operating levy comparison. And you have some different colored bars here. Down here on the bottom are all these names that I encourage you to take a look at when you can. Um, so you've got all the names of these different school districts. These are their operating levy operating levies. And the darker colored ones are those that are districts that are similar to us where 75% or more of their tax base is residential. Okay. So, when that's the case, that means you don't have commercial industrial helping to to pay that bill as much. And so that's what you see on the darker bars. Okay. Prior Cemetery Schools is right here. >> I'm going to pause again. Is there anything else? Yes. those districts that are in the dark bar like this districts like Shi Lakeville um others are they seeing the same percentage of decline enrollment that prior like Savage area schools in um we would have to to take a look at each of them because every district's going to see a different picture in that regard right for example Lakeville is listed here they're one of the darker bars so they're largely residential like we are. Might they have more um an increase in residential or student population? Possibly because of the span of area that they still are building, right? And so it just kind of depends on the development. [clears throat] Some communities may be at a different stage of development than others, right? So you do have to look at that on an individual basis. >> Yeah. And generally speaking, um, we are, you know, Minnesota is an aging state and, uh, the K12 demographic population in our state is is continually continually going down. And yes, there will be some districts that are growing. You know, I think two that come to mind, Lakeville is one, Yisetta is another one that just seems to be booming right now. But then many of us are in this situation where we are literally just kind of training kids across different school boundaries with the open enrollment and you know if if we've got an immersion program or somebody has a different magnet program whatever that attractant might be we see that eb and flow um in a net for us thankfully we actually net more open enrollment than we have um families that actually choose to open and roll out. Um so that actually affects us positively. Um and when you take a look at these districts and just to stress the point um to kind of build off the question of some of the cities you know when you think about a city like Edina or Bloomington or Hopkins for example um there's two couple of things that ring true rightale the Mall of America and a district that spans 10 different municipalities and they can really spread any kind of levy asked across 10 different cities. So, it's not impacting a rural concentrated area. But literally a district like Bloomington, you know, could sneeze for a levy because literally people from around the world shopping at the Mall of America pays for the levies, right? Cuz that's such a huge tax base. Um and then that new fivestar wing at Southale of Blueberry and all the other high-end shops, you know, that's going to pay for Dina um levies. So yes, the disproportionality of commercial base and when you have very extensive commercial base, um it's very little impact to our homeowners. Um and one of the things I've talked about with our community, and I really caution folks, both our community and our staff, you know, this isn't about families not caring or valuing Prior Lake Savage Area Schools. I don't believe that for a minute. But I also remind folks, we're not the only tax show in town. We know we have county taxes, city taxes, you have life expenses. So, at the dinner table, it's the total conversation that families are having, not just what we're talking about here. And that's the reality. And we can't be naive to that. And we have to accept that in that total package conversation at the dinner table when we say why can't we have this a lot of reasons are visually right here for you. The amenities and experiences and courses and schedules that come in many of these districts come with a price. Okay, it is a value proposition and yes, I'm going to reiterate their value proposition conversations look different based upon maybe the local of their community. And then even when we think about a district like uh Lakeville, so Lakeville is right about here in the middle of the pack. Um, so yep, they have some commercial but still 75% residential. And the fundamental diff the fundamental difference that I'll emphasize that director Ryder pointed out is that the sheer landmark of expansion, you know, director White and I were driving down there for a I don't know where we're going, student board event, and I'm getting a a a schooling in in history of what Lakewell used to be, right? and it he couldn't even recognize anymore, right? Some of the places that are just just booming with houses. So, the plus side for them, even though they're still 75% like we are, their geog geographic uh space is significant. So, for us, what does that mean? We our kind of anchor cities prior lake and Savage, they're pretty well built out. There's several hundred acres in Prior Lake from the farm and things of that that I know have gone back and forth over the years as to it's going to sell, it's not going to sell. But that's about 300 or so acres that are in existence in in prior lake kind of proper. But our biggest growth, folks, is going to come from our townships. It's going to come from the city of Credit River. um that's where we're going to have the actual geographic space to build whether it's commercial or residential because we're kind of tapped out in the immediate Prior Lake Savage area. That's yet another challenge. So I want us to be mindful and just I can't stress it enough. I don't believe for a second anyone in this room or our community are anti-par Lake Savagerary Schools. I think the value that people say about our schools, they they love our schools because we know strong schools equals strong communities. Um, and that synergy between that is is critically important. And we have some work that we have to do collectively as a community to make some critical decisions. And that's part of what we're going to get into in the next phase of our conversation um this evening. Now, uh, we also asked for an RCP to kind of know how to plan the staging of a room. And we've got a lot more people that showed up today. And we know that not everybody's an RCP. Um, but what I'm going to attempt to do here as we get ready to go into some um, table conversations. We've got a couple of our uh, staff, our district staff that are here. Um, our district staff, can you give a quick raise of your hand? 1 2 3 4 5 6 7. Oh, good. We got seven of you. Um, so ideally, we would split up into about six tables of 10. And as we did with the strap plan sessions, we've got some overflow over here, and we've got some overflow right out here if we needed to kind of spread out a little bit. Um but what we're going to do now um probably for the next uh 30 minutes or so is have some conversation in our table groups about three big question and I don't have my questions with me. Thank you Mr. Dr. Anderson. Thanks. um three big questions to just open up the dialogue. And I'm going to encourage you all to think big picture. We're not trying to land the plane yet. We're still going to circle at about 30,000 ft before we hit that runway. So, I want you to be thinking big picture. Um and the three questions, oh, actually, we have it up here. I I'm sorry, Dr. Anderson, we did add it. I forgot we did add last night. Now, the three questions are why do you continue to choose Prior Lake Savage Area Schools for you and your family and or what keeps you in the community? Maybe you don't have kids in our school, maybe you're retired, but there's a value add. Maybe it's our strong community ed programs that are just bursting through the seams and that's true. Um, but what keeps you here coming back day after day? Second question, what do you see as the greatest challenge in helping our students find academic success? We know there's no perfect school system. There's going to be barriers into learning that come up, the experiences that some of you may have had. We want to surface some of those things that might become future roadblocks that we would want to consider and take into consideration as we have these longer term conversations for academic excellence. And then lastly, what are one or two changes or new ideas that you would suggest to improve how our district delivers instruction and students learn in Prior Lake Savage area schools? Big vision thinking if you had the magic wand, picture desk, whatever it is, what would that look like? Okay, what would that be um for our for our students? And so those are going to be the three grounding questions and we'll spend time at each of those. Um and and our table facilitators will be vigiously taking notes. Okay. And I should also say we will be posting this presentation online. So some of you you've been taking pictures and whatnot to zoom in and read that fine print. This will be posted online after tonight. Okay. So you will have that as well as the video um that will be um available as well um for the opening session. Um so [clears throat] I'll ask you to do that. Table facilitators, can you do me a favor? Do a quick round of introduction. Who's who? Um and this I don't know how many you got here, but just Okay, you got 10. Okay, so just kind of look where we have natural groups of 10. and we might have to kind of shift tables a bit, but we'll do that for the next 30 minutes. Um, and then we'll come back together as a large group for some of our next steps. So, table facilitators, if you can stand and wave a hand and summon 10 people to follow you. and table facilitators.