COMMONWEALTH OF VIRGINIA
DEPARTMENT OF EDUCATION
P.O. BOX 2120
RICHMOND, VIRGINIA 23218-2120
SUPTS. MEMO NO. 62
March 19, 2004
Jo Lynne DeMary
Superintendent of Public Instruction
Table 15 from the Superintendents Annual Report for Virginia - Fiscal Year 2003
Section 22.1-92, Code of Virginia, requires school divisions to prepare and distribute notification of the estimated average per pupil cost for public education in the school division for the coming year as well as actual per pupil state and local education expenditures for the previous school year. This memorandum provides data related to actual per pupil expenditures for fiscal year 2003 as well as a methodology that school divisions may use to estimate per pupil expenditures for fiscal years 2004 and 2005.
Attachment A of this memorandum contains Table 15 (Sources of Financial Support for Expenditures, Total Local Expenditures for Operations and Total Per Pupil Expenditures for Operations) from the Superintendents Annual Report for Virginia for fiscal year 2003. Table 15 shows the total and per pupil expenditures for public school operations by fund source. The source for this table is the fiscal year 2003 Annual School Report (ASR) data submitted by school divisions.
In addition to Attachment A, an Excel file is provided that contains Table 15 for fiscal year 2003 as well as a worksheet displaying additional detail on the calculation of the per pupil amounts in Table 15. The Excel file contains four worksheets:
Table 15 for fiscal year 2003 This worksheet contains Table 15 data for all school divisions.
Fiscal Year 2003 Worksheet This worksheet contains detailed calculations of individual school division expenditure and per pupil amounts by fund source. The worksheet automatically calculates division-specific information after a school division is selected from the drop-down box. Please note that this worksheet uses sales tax reported on an accrual basis to match data reported on the ASR.
Fiscal Year 2004 Worksheet This worksheet also contains detailed calculations of expenditure and per pupil amounts by fund source; however, school divisions must enter estimated revenue, expenditures, beginning year and ending year balances, capital expenditures, and end-of-year average daily membership (ADM) amounts for fiscal year 2004. Estimated sales tax (cash basis) is automatically included in the worksheet, but school divisions may enter their own sales tax estimates if they want to report a different estimate.
Fiscal Year 2005 Worksheet Like the fiscal year 2004 worksheet, this worksheet contains detailed calculations of expenditure and per pupil amounts by fund source. School divisions must enter estimated revenue, expenditures, beginning year and ending year balances, capital expenditures, and end-of-year ADM amounts for fiscal year 2005. Projected sales tax (cash basis) is automatically populated into the worksheet.
For the fiscal year 2003, fiscal year 2004, and fiscal year 2005 worksheets, per pupil expenditures for each fund source are derived in the following manner:
End-of-Year Average Daily Membership (ADM) The spreadsheet contains school division end-of-year ADM, which is used as the denominator for each per pupil expenditure amount. School divisions enter an estimate of end-of-year ADM for fiscal years 2004 and 2005.
State Expenditures State expenditures used to derive a state per pupil expenditure amount are calculated by adding state beginning year revenue balances to total state revenue collections for fiscal year 2003 (or estimates for fiscal years 2004 and 2005) and deducting ending year balances and state funds used for capital expenditures. This figure is then divided by end-of-year ADM to yield the state per pupil expenditure amount.
State Sales Tax This figure represents sales tax revenues distributed to school divisions and is divided by end-of-year ADM to yield the state sales tax per pupil amount. Please note that actual sales tax on an accrual basis is used for fiscal year 2003, while estimated sales tax on a cash basis is used for fiscal years 2004 and 2005.
Federal Expenditures Federal expenditures used to derive a federal per pupil expenditure amount are calculated by adding federal beginning year revenue balances to total federal revenue collections for fiscal year 2003 (or estimates for fiscal years 2004 and 2005) and deducting ending year balances and federal funds used for capital expenditures. This figure is then divided by end-of-year ADM to calculate the federal per pupil expenditure amount.
Local Revenues In order to calculate local revenues, total state expenditures for operations, state sales tax, and total federal expenditures for operations are deducted from total expenditures for operations. The remainder is local revenue for operational expenditures. This figure is then divided by end-of-year ADM to calculate the local per pupil expenditure amount.
Total Expenditures Total expenditures for operations are divided by end-of-year ADM to yield the total per pupil expenditure amount for operations.
Attachment B of this memorandum provides instructions for using the fiscal year 2003, fiscal year 2004, and fiscal year 2005 worksheets. The Excel file is located on the departments website and may be downloaded from the following address:
Please note that, beginning in fiscal year 2001, the department changed the methodology for calculating total expenditures for operations in Table 15 to account for the following factors:
Beginning and end-of-year balances - Total support from state and federal sources now takes into account beginning and end-of-year balances as well as revenue collected during a particular fiscal year. The methodology now calculates these sources of support by adding beginning-year balances to current-year revenues and then subtracting end-of-year balances as reported on the Annual School Report. This change in methodology is required to reflect accurately the ability to carry over certain state funds (e.g., SOL remediation, lottery, and school construction grants program) and to recognize that portions of federal funds may be carried over as well. This methodology provides a more accurate calculation of the amount of funds actually expended from these revenue sources and, therefore, yields a more accurate calculation of local funds expended for public school operations.
Capital Expenditures - The methodology for calculating total expenditures for operations in Table 15 has been revised to reflect more accurately total operational costs by deducting state, federal, and local capital expenditures (as reported in Supplemental Schedule G of the Annual School Report) from total expenditures. Therefore, expenditures related to object codes 8200, 8210, and 8220 are excluded from Table 15 calculations.
Additional Functions - Total expenditures for operations in Table 15 now reflect the technology function (68000), which was added beginning with the 2000-2001 Annual School Report. In addition, Table 15 now reflects operational expenditures related to the inter-agency fund transfers function (67300) and to the facilities function (66000, all objects of expenditure except 8100). Objects 8200, 8210, and 8220 in the facilities function were already excluded under the change related to capital expenditures.
Based on changes made to the fiscal year 2003 ASR, the Table 15 methodology incorporates the following additional changes:
Additional Function - Total expenditures for operations in Table 15 now reflect the Contingency Reserve function (69000).
Additional Capital Expenditure Exclusions In addition to the previous exclusions for debt service (Function 67100), the formula for Total Expenditures for Operations also excludes the debt service sub-functions in Technology (68900) and Contingency Reserve (69900).
Additional Facilities Exclusions The formula for Total Expenditures for Operations now excludes the capital object codes 8100, 8110, and 8120 from the Facilities sub-functions (68800 and 69800).
Fund Transfer Exclusions The following fund transfer expenditures have been excluded from the calculation of Total Expenditures for Operations:
Intra-Agency Fund Transfer Deposits to Escrow (Function 67200 Object 9400)
Inter-Agency Fund Transfer Capital purchased by Locality (Function 67300 Object 9600)
Inter-Agency Fund Transfer Transfer to Regional Program (Function 67300 Object 9700)
We hope that you find this information helpful in complying with the reporting requirements of Section 22.1-92, Code of Virginia. If you have any questions, please contact budget office staff at (804) 225-2025.