INFORMATIONAL

TO:

Division Superintendents

FROM:

Jo Lynne DeMary

Superintendent of Public Instruction

SUBJECT:

Amendments to the Fiscal Year 2006 Direct Aid to Public Education Budget as Proposed by Governor Warner (the Caboose Bill)

Governor Warners proposed amendments to the fiscal year 2006 state budget (the Caboose Bill) were presented on Friday, December 16, 2005, before a joint session of the Senate Finance, the House Appropriations, and the House Finance committees. These amendments to the fiscal year 2006 (July 1, 2005, through June 30, 2006) budget will be considered by the 2006 Session of the General Assembly, which is scheduled to convene on January 11, 2006.

The recommendations made by the Governor regarding the Direct Aid to Public Education budget primarily include technical adjustments to the Standards of Quality (SOQ), incentive, and categorical accounts. The Governors introduced budget provides funding for the state share of all Standards of Quality (SOQ) programs and continuation of all existing incentive and categorical programs.

Attachment A to this memorandum provides summary information on the funding changes proposed by the Governor for fiscal year 2006 that affect the Direct Aid accounts.

Attachment B to this memorandum provides the estimated school division entitlements for fiscal year 2006 for the SOQ, incentive, and categorical accounts based on the Governors proposed amendments. These revised entitlements use the Department of Educations latest projections of March 31, 2006, average daily membership (ADM). The entitlements shown in Attachment B do not include the direct grants (Group IV accounts) authorized by the General Assembly that are unique to certain school divisions.

Several of the categorical account entitlements shown in Attachment B (Group III accounts) are funded on a reimbursement basis and represent the departments latest projected entitlements; however, final payments on these accounts for fiscal year 2006 will be based on actual reimbursement requests submitted by school divisions.

In addition to the entitlement information contained in Attachment B, a downloadable Excel file has been created to assist school divisions in calculating projected fiscal year 2006 state entitlements and local matches for most Direct Aid programs. This file gives divisions the opportunity to change ADM to test the effect on state funding and projected local match requirements using the departments projected ADM or a local projection of ADM. (Attachment B contains projected entitlement information for each school division in PDF format based on the departments projected ADM and cannot be modified.)

Although we have confidence in the accuracy of our ADM projections on a statewide basis, experience has shown that the accuracy of our projections for individual localities may vary. When divisions believe that they have more accurate projections of their March 31 ADM, they are encouraged to substitute their estimates for those provided in this memorandum when using the Excel calculation file. Also, please note that changing the ADM in the Excel calculation template only changes the estimated funding for accounts that are funded on the basis of ADM. The estimated funding for all other accounts is unaffected by changing ADM in the file and, therefore, remains the same.

Attachment C to this memorandum provides detailed instructions for accessing the Excel calculation file from the Department of Education Web site. The Excel file may be downloaded from the following address:

http://www.doe.virginia.gov/VDOE/Finance/Budget/calctools.html

Special Note

A school division has recently submitted a corrected 2005 triennial school census count. This count is higher than the original count submitted by the division. The Department of Education has approved the corrected census count submitted by the division and has recalculated projected fiscal year 2006 entitlements for all divisions using the corrected data. In isolation, this correction reduces the projected fiscal year 2006 entitlements for all other school divisions as a result of the redistribution of sales tax. The projected division entitlements shown in Attachment B and in the Excel calculation template reflect this census revision.

The updated Excel calculation file posted on December 21, 2005, should be used in place of the version that was originally posted on Friday, December 16, 2005. The original Excel file that was posted did not reflect the latest entitlements based on the approved census correction. If you downloaded this version of the calculation template prior to December 21, 2005, please stop using it and replace it with the corrected Excel file. In addition to this revision, please be aware that the revised 2005 triennial census data will be used for the distribution of actual sales tax proceeds beginning on the January 16, 2006, electronic funds transfer.

It is important to remember that Attachment B and the Excel calculation template provide information that relates to the Governors proposed budget amendments for fiscal year 2006 as introduced. The House of Delegates and the Senate will have the opportunity to amend the Governors budget proposals during the 2006 General Assembly session. The General Assembly will adopt a final fiscal year 2006 budget before the end of the session, which is scheduled for March 11, 2006; therefore, the estimated entitlements contained in Attachment B and in the Excel calculation template are projections only and are subject to change as a result of legislative action by the General Assembly. The department will provide additional information during the General Assembly session as changes to the estimated fiscal year 2006 Direct Aid entitlements occur. After the conclusion of the session, projected entitlements based on final General Assembly actions will be sent to you in another Superintendents Memorandum.

Please note, the actual fiscal year 2006 entitlement payments will not be finalized until they are recomputed using actual March 31, 2006, ADM and other final program participation information.

Questions regarding the proposed fiscal year 2006 budget amendments and revised fiscal year 2006 Direct Aid entitlements may be directed to Dan Timberlake, assistant superintendent for finance, or budget office staff at (804) 225-2025.

JLD/mec

Attachments

http://www.doe.virginia.gov/administrators/superintendents_memos/2005/inf250a.pdf

http://www.doe.virginia.gov/administrators/superintendents_memos/2005/inf250b.pdf

http://www.doe.virginia.gov/administrators/superintendents_memos/2005/inf250c.pdf