Superintendent's Budget Message


Official Budget: 2002-03

Leadership Focus and Strategic Direction

The Wake County Public School System budget summarizes our financial plan for fiscal year 2002-2003. It is based on a commitment to academic excellence as reflected in our goal for 2003.

The Wake County Public School System is committed to academic excellence. By 2003, 95% of students tested will be at or above grade level as measured by NC EOG testing at grades 3 and 8.

Wake County has been designated as one of the top ten places for families to live in the United States. The Wake County Public School System is a major reason the area received this recognition. Located in the heart of the Research Triangle, Wake County Public School System serves children from some of the most educated families in the nation. Parents have very high educational expectations for their children. In addition, business leaders expect a world-class education system to fuel continued economic development. Taxpayers and those elected to represent them want to be sure they are receiving high value for their tax dollars. The mission and strategies of the Wake County Public School System respond to this need for accountability.

Our mission is to educate each student to be a responsible and productive citizen who can effectively manage future challenges.

We are committed to academic excellence. We will pursue this goal in the spirit of openness, integrity, and accountability through active communication and collaboration with parents and a demanding and caring community. Student performance is the number one priority in all schools in the Wake County Public School System.

In pursuit of this goal, we will:

The 2002-2003 school year is a watershed year for the Wake County Public School System. Our aim for the past five years has been to meet the academic goal of having 95% of students tested at or above grade level as measured by the North Carolina End-of-Grade (NC EOG) tests at grades 3 and 8 by 2003. To this end, human and financial resources are allocated in the budget and aligned to achieve the mission and goal of the district. We value student success, excellence, diversity, character (courage, good judgment, integrity, kindness, perseverance, respect, responsibility, and self-discipline), communication and collaboration with all stakeholders, teamwork, and continuous improvement. Available resources have been identified and focused on the attainment of our goal based on our shared values.

Based on attainment of Goal 2003, the board establishes a strategic plan and goals for the superintendent. Student and stakeholder needs, our mission, and our values are the core of the process and guide all stages of strategic planning. The superintendent and senior leaders assess system performance on an annual basis in light of the strategic plan and the superintendent's goals for the Wake County Public School System. Strategies to accomplish goals are based on the analysis of gaps between current performance and desired future results. Once strategies have been developed, senior leaders determine how to implement strategies. This includes identifying and communicating improvement priorities, organizing work systems, and allocating resources to align the work of central-level and school processes to support goal attainment.

Trends/Events/ Initiatives

The Wake County Public School System is the second largest school district in North Carolina and one of the largest in the nation. Our customers judge the school system's performance by how well our 101,000 students are learning. The system is one of the fastest growing districts in the nation, with roughly 3,500 additional children entering the system each year, about 4% a year over the last seven years.

The relocation to Wake County of people from other parts of the country and the world brings new educational expectations and standards for district performance. Managing the demand for school facilities and services created by growth, while meeting high educational expectations, continues to be both a challenge and an opportunity.

For over ten years, the system has compared its performance on selected measures with other school systems as well as to state and national norms. Our principle competitors are a growing number of charter, private, parochial/church schools, and an increasing number of families who choose to home school their children. Charter schools are unique competitors because they decrease the amount of funding available for our schools.

The Scholastic Aptitude Test (SAT) is a national exam designed to measure a student's chance of success at the college level. In Wake County, 4,042 seniors or 79% took the SAT, the same percentage as last year. Statewide, 65% of eligible students took the SAT, whereas only 45% of eligible students nationally took the test. This is one percentage point higher than last year at the national level.

After six consecutive years of rising scores, the average SAT score for Wake County Public School System seniors slipped by seven points in 2000-2001. The average SAT score was 1054, compared to an all-time high of 1061 achieved in 1999-2000.

Despite the dip, Wake County's scores remained substantially higher than the state average of 992 and the national average of 1020. North Carolina's SAT average climbed by four points while the national average rose just one point. Wake County's average on the verbal section of the test was 520, two points less than last year. The average on the math section was 534, five points less than last year.

i

The rate of students dropping out of the seventh to twelfth grades in the Wake County Public School System fell to 2.4% in 2000-2001, lower than other metropolitan school systems in the state and the lowest rate for Wake County in more than a decade. A report issued by the North Carolina Department of Public Instruction showed that Wake County's dropout rate for seventh to twelfth grades fell from 3.07% in 1998-1999 to 2.40% in 2000-2001.

2000-2001 was the fifth year of the ABC Accountability program results for elementary and middle schools, and the fourth year of results for high schools. In Wake County Public Schools, 58% achieved exemplary growth, 33% achieved expected growth but did not reach exemplary, 11% did not meet expected growth but showed adequate performance, and none of the schools were low performing. The source of this data is Measuring Up E&R Report No. 01.42. This compares with the statewide growth for elementary, middle, and high schools; 24% achieved exemplary growth, 36% achieved expected growth but did not reach exemplary, 39% did not meet expected growth but showed adequate performance, and 1% of the schools were low performing.

Wake County Public School System End-of-Grade results for 2000-2001 showed increases at all grade levels in both proficiency and average scale score in reading. In math, results showed increases in proficiency at all grade levels. Math scale score ranges were recalculated by North Carolina Department of Public Instruction for 2001 and comparisons to previous years are not valid.

Existing educational initiatives include the Accelerated Learning Program (ALP). This program includes the development of an individualized learning plan for each student and extended learning time.

The district has a five-year technology plan in place which is designed to advance teaching and learning. The plan was a collaborative effort of district administrators, business and community leaders, and teachers who share the vision that technology is a tool to enhance learning not a replacement for academic endeavor. This vision calls for ongoing comprehensive technology training programs for teachers and administrative personnel; providing a networking infrastructure (both voice and data) that will connect classrooms and administrative personnel to each other and to the Internet; and providing the proper "tools" in the way of hardware, software, and an email messaging service. Email is provided to all faculty and staff and rollout of services to students has begun at the secondary level. The district manages both an Internet and Intranet site which are consistently updated with pertinent information. All technology initiatives being utilized should enable the school system to graduate students who are armed with the skills needed to succeed in the global information economy, whether the path leads to higher education or the working world.

Wake County Public School System is strengthening partnerships and building new alliances. The Wake Education Partnership has taken a significant leadership role in galvanizing community support. Other alliances, such as the Business Education Leadership Council, are also increasing their involvement. The district is working closely with the Department of Human Services and other community groups to better align options and opportunities for students.

The opening of new schools and development of new programs have impacted the capacity of some magnet programs to attract students. In addition, year-round schools have not attracted a diverse student population under the voluntary application process. The magnet programs will begin another continuous improvement cycle to create new program models to increase student and parent interest.

The most significant and far-reaching effort has been the progress of a single, community-driven goal. By 2003, 95% of students tested will be at or above grade level as measured by NC EOG testing at grades 3 and 8. Our goal has had a dramatic impact on the focus and clarity of our continuous improvement efforts. The district envisions a collaborative journey from being an exemplary school system to a school system that serves as a benchmark for all others in the nation.

Budget Process

Budget development is a year-round process, beginning in the fall and culminating with the adoption of the official budget in June by the Wake County Board of Education. Participation in the process of development includes input from schools and central office departments, as well as other stakeholders. The process of budget development for the past five years has been focused by our efforts to reach Goal 2003.

The superintendent's management team develops the budget request to be delivered to the board of education. Following review, a public hearing, and action, the board approves a budget request to be delivered to the Wake County Board of Commissioners by May 15. The official budget is adopted following action by the board of commissioners.

The base budget for 2002-2003 closely resembles the budget for 2001-2002. Any increases to the base budget were presented in light of additional expenditures related to growth and inflation and attainment of Goal 2003.

The issues of growth and inflation continue to challenge the school system and the county. As a result, there have been contentious debates between the two boards related to the adequacy of funding for the Wake County Public School System to reach Goal 2003, while also addressing the needs presented due to growth and inflation. The county appropriation for the 2001-2002 school year was increased over the amount required by the 1997 mediation agreement, by mutual agreement of the school and county boards. An additional $10 million was appropriated by the county from fund balance and the school system increased fund balance used in the budget to $10 million as well. It was agreed that a Citizens Advisory Committee, consisting of seven members selected by each board, and two co-chairs, would make recommendations regarding the adequacy of funding to reach Goal 2003, and a factor for addressing growth and inflation to be used in future years. This citizens' group contracted with MGT of America to conduct an audit related to these two areas of concern. Upon receipt of a summary of the report from MGT, the Wake Education Partnership will employ a community summit activity to broaden the exposure of the summary within our community.

Recommendations from the Citizens Advisory Committee and MGT will have minimal impact on the development of the budget for 2002-2003. It is anticipated that any recommendations from the committee will be considered in the budget development for 2003-2004.

Total Budget

The total budget adopted for 2002-2003 is $874,132,019. This is composed of current expense, capital outlay, and capital improvement dollars. The current expense budget includes items of a recurring nature covering salaries, services, and supplies. The capital outlay budget includes the purchase of property; the purchase, construction, or renovation of buildings; and the purchase or replacement of furniture, equipment, and vehicles. Capital improvement dollars include local funds identified solely for the building program.

Current Expense $748,967,346
Capital Outlay $4,599,481
Operating Budget $753,566,827
Capital Improvements (building program) $120,565,192
Total Budget $874,132,019


Total Budget FY 2002 - 2003
Current Expense Capital Outlay Total
State $ 459,099,494 61% $0 0% $ 459,099,494 53%
County Appropriation $198,600,519 27% $4,399,481 4% $203,000,000 23%
Local Capital Improvements 0 0% $120,565,192 96% $120,565,192 14%
Federal $38,731,836 5% 0 0% $38,731,836 4%
Enterprise Funds $23,956,181 3% 0 0% $23,956,181 3%
Other Local $28,579,316 4% $200,000 0% $28,779,316 3%
Totals $748,967,346 100% $125,164,673 100% $874,132,019 100%

Where Do Funds Come From?

Total Budget
$874,132,019

Operating Budget
$753,566,827

 

Where Are Funds Spent?

State Funding

State allotments are funded on a formula basis. The state funds schools with three basic types of allotments: position allotments, dollar allotments, and categorical allotments. Due to our phenomenal growth rate, we continue to receive additional state funding. The state budget is expected to increase by 6% in 2002-2003.

Ninety-four percent of state funding is spent on salaries and employee benefits. We anticipate 4,439.13 new months of employment based on growth in student projections:

2,329.00 Regular Education Teacher months
247.00 School-Based Clerical months
224.00 School-Based Custodial months
44.00 Principal months
65.50 Assistant Principal months
70.00 Media Specialist months
105.78 Counselor months
10.00 Audiologist months
63.64 Psychologist months
10.00 Social Worker months
380.21 Vocational Education Teacher months
170.00 Teacher Assistant months
210.00 Children with Special Needs Teacher months
60.00 Children with Special Needs Teachers Assist. months
30.00 Academically/Intellectually Gifted Teacher months
210.00 Limited English Proficiency Teacher months
20.00 Minimum Competency Teacher months
10.00 In-School Suspension Teacher months
10.00 At-Risk Teacher months
160.00 Novanet Teacher months
10.00 At-Risk/Alt. Programs Social Worker months

In addition, 170.00 school-based clerical months were shifted to local, 10.00 librarian months and 20.00 counselor months were eliminated due to decreases in lapsed salaries, 24.00 months were eliminated from the COACH team, and 41.60 speech pathology months were added to state funding from Medicaid funding.

State Months of Employment Comparison
FY 2001-02 FY 2002-03 Increase Percent
Administration 3,505.36 3,614.86 109.50 3%
Professional Educator 61,830.14 65,352.73 3,522.59 6%
Professional - Other 1,525.70 1,619.34 93.64 6%
Technical 17,494.70 17,724.70 230.00 1%
Office/Clerical 6,450.79 6,527.79 77.00 1%
Crafts/Trades 700.00 924.00 224.00 3%
Other 11,762.54 11,762.54 0.00 0%
Total 103,269.23 107,525.96 4,256.73 4%


Budget 2002-2003 $452,433,442
Budget 2001-2002 $428,334,373
Increase $24,099,069

County Appropriation

Development of the 2002-2003 budget presented a great challenge. Projections for new student growth for the coming year exceed 4,000. Three new schools, adding over 800,000 square feet of space, are opening. Health insurance premiums are projected to increase 30% and dental, property, and liability insurance premiums are also increasing. The school system has utilized resources efficiently and has reallocated available financial and human resources in order to support efforts to reach Goal 2003. As a result, the impact of growth and inflation on budgets has been substantial.

The amount of revenue projected from Wake County for 2002-2003, based on the mediation agreement, is $191,746,000. The budget development process resulted in a budget request based on several assumptions.

(1) Additional expenditures projected for the 2002-2003 school year are based on growth and inflation.

The additional expenditures in the budget request include:

Increase Cost per New Student
(if applicable)
Salary and Benefit Increases
Salaries $2,759,260
Hospitalization insurance $1,670,941
Dental insurance $278,881
49 fewer positions will be funded from lapsed salaries $1,500,000
$6,209,082
School-Based Increases
Local supplement and dental insurance on new state positions $1,274,512 $315
Months of employment to maintain current allotment formulas $3,005,140 $744
Dollar allotment increases to maintain current formulas $243,014 $60
Charter school increases $1,225,088
Early dollars for new schools $220,214
Maintenance and operation dollars for three new schools $434,115
15 Bus drivers and 15 buses $1,370,285
Technology costs for new schools $19,000
Content filtering $8,000
$7,799,368
Systemwide Increases
Insurance (property, liability, accident, fidelity) $250,200
Utilities $464,960
Microsoft District License $1,000,000
Antivirus Software $70,000
$1,785,160
Division Increases
SACs dues for Wakefield and Middle Creek High $1,000
NC Wise $645,000
Technology support for schools $462,000
Disaster recovery $220,275
Web development tools $70,181
Customer support analyst II $35,889
Children with Special Needs teachers $1,007,434
Children with Special Needs teacher assistants $353,523
Teacher assistants for students with 504 plans $43,549
Occupational therapists $125,917
Audiologist $65,343
OSHA required exhaust equipment/inspection equipment $54,000
Lead paint inspections and abatement and indoor air quality remediation projects $44,300
Security investigator $44,437
Postage increases $23,300
$3,196,148
Total increases $18,989,758

(2) Substantial reductions in expenditures from the base budget for 2002-2003 were necessary. Services have been significantly reduced or eliminated while attempting to protect core instructional programs and the personnel associated with them. The cuts from the base budget include:

Item Decrease
Technology base budget reductions ($5,197,227)
Eliminate summer academy beginning in summer of 2003 ($3,179,927)
Auxiliary Services base budget reductions ($1,404,024)
Remove early dollars for new schools that open in 2002 ($1,135,711)
Administrative Services base budget reductions ($686,059)
Instructional Services base budget reductions ($732,364)
Decrease high school tutoring dollars ($600,000)
Shift school-based instructional supply dollars to state funding ($434,410)
Reduce telephone costs ($304,379)
Legal fees ($300,000)
Eliminate after-school assistance program ($216,288)
Eliminate custodial overtime pay ($199,455)
Operational Services base budget reductions ($178,189)
Eliminate teacher home visit allotment ($126,610)
Eliminate principals' and assistant principals' out-of-system travel ($116,230)
Superintendent's Office base budget reductions ($51,542)
Total ($14,862,415)

(3) Expenditure reductions were necessary in the third and fourth quarters of the 2001-2002 fiscal year to replenish fund balance for subsequent year use.

In February, budget managers were informed that actions to reduce expenditures were effective immediately and for the remainder of the fiscal year. The actions included elimination of central office overtime, out-of-system travel, and food purchases. Purchasing deadlines were moved up and carry forward of funds was limited. The anticipated result of the actions taken is an increase of $8.6 million in fund balance.

(4) Wake County Public School System must use $10 million from fund balance to balance the 2002-2003 budget. Beginning budget development projections included $3.4 million from fund balance. It quickly became evident that an additional amount must be included in order to maintain people and programs directed toward the attainment of Goal 2003.

(5) A county appropriation greater than the amount generated by the mediation agreement is necessary.

The budget development process is based upon a strategic plan to maintain personnel and programs. The focus of the budget has been, and continues to be, attainment of Goal 2003. New expenditures do not represent new program initiativesÑthey reflect needs stemming from growth and inflation. Expenditure reductions in the current year are the basis for increasing fund balance available for use in the 2002-2003 budget. The use of $10.0 million from fund balance is clearly necessary and represents the strong commitment of the Wake County Public School System to apply all available resources toward the attainment of Goal 2003. As a result of these methodical and thoughtful steps, a county appropriation of $203 million was requested and funded for 2002-2003.

2001-2002 2002-2003 Inc. (Dec.) %
County Appropriation
Current Expense $194,529,600 $198,600,519 $4,070,919 2%
Capital Outlay $0 $4,399,481 $4,399,481 0%
Total $194,529,600 $203,000,000 $8,470,400 4%
Student Membership
WCPSS 101,397 105,437 4,040 4%
Charter Schools 2,630 3,225 595 23%
Total 104,027 108,662 4,635 4%
Allocations per student $1,870 $1,868 $(2) 0%

Local Current Expense Fund

The local current expense budget includes all local revenues of the school system. The largest of these is the county appropriation. Others include fines and forfeitures, interest earned, indirect costs, vending contract, fund balance appropriation, and categorical programs. The "Budget by Funding Source" section of this document shows budget line items by source of funds whether state, federal, enterprise, other local, or county appropriation.

The local current expense budget for 2002-2003 is $234,155,887, which is a decrease of $1,886,962 from 2001-2002.

Ongoing, rapid growth and efforts to reach Goal 2003 continue to be the most significant fiscal challenges for our school system. Student membership projections from Wake County total 105,437 students (excluding 3,225 students projected to be enrolled in charter schools). Our net increase in students for 2002-2003 would be 4,040 students or 4 percent.

The Wake County Public School System manages resources in an efficient and effective manner. When compared to other urban North Carolina districts, Wake County Public School System operates at the lowest per pupil expenditure of any of the North Carolina districts. We are proud of our efficiency, and we continually seek ways to make the best use of every dollar spent. We utilize a purchasing card throughout the system to decrease the time between order and delivery by teachers and other staff, as well as to reduce purchase orders and accounts payable transactions. We utilize a systemwide email system to reduce paper transactions and improve timeliness of communication.

We budget positions to be funded by lapsed salaries. In 2001-2002, we budgeted 136 positions to be paid from lapsed salary dollars. Wake County Public School System is experiencing a decrease in lapsed months. In 2002-03, we have reduced the number of positions to be paid from lapsed salaries to 87 positions, including 17 custodians, 10 special education teachers, 17 regular education teachers, 20 clerical positions, 20 teacher assistants, and 3 central office administrators. This is very aggressive and can vary based on turnover. We constantly monitor these areas throughout the year to make sure we will be within budgeted dollars.

We continually monitor state funding. We shift local costs onto state dollars whenever possible to make the most of state funding.

We charge indirect costs on all enterprise programs to help support the local budget.

Schools process conversions during the year within state ABC transfer policies. This allows schools to move dollars between program codes as defined in legislation in order to meet the needs of that particular school. Funds checking rules have been expanded on the local budget to allow central office departments to gain the use of lapsed salary dollars. These processes allow schools and departments to make the best use of all dollars budgeted.

We allocated fund balance as part of our beginning budget. At the same time, we attempt to maintain a reserve at a level we feel is necessary to support the district in cases of emergency, unusual circumstances, or negative budget variances.

We constantly seek additional sources of revenue. The grants office supports schools and assists with identification of new sources of funding. We entered a vending agreement in 2001 that will generate revenues over a five-year period in excess of $6.0 million. We have entered into cellular tower agreements. We adjust fees annually as needed for tuition and parking fees.

Revenues By Source Increase/Decrease
2001-2002 2002-2003 Dollars Percent
County Appropriation $194,529,600 $198,600,519 $4,070,919 2%
Fund Balance Appropriated $18,188,565 $10,973,463 $(7,215,102) (40%)
Local Sources-Unrestricted $9,553,875 $9,777,597 $223,722 2%
State (Grants) $5,132,827 $6,666,052 $1,533,225 29%
Local Sources-Restricted $4,126,551 $3,543,789 $(582,762) (14%)
Operating Transfers In $3,312,482 $3,629,804 $317,322 9%
Local Sources - Tuition/Fees $673,819 $654,663 $(19,156) (3%)
Federal (Impact Area Grants, ROTC) $525,130 $310,000 $(215,130) (40%)
Total $236,042,849 $234,155,887 $(1,886,962) (1%)


Local Months of Employment Comparison
FY 2001-02 FY 2002-03 Increase or Decrease Percent
Administration 2,877.39 2,879.39 2.00 0%
Professional Educator 6,651.50 7,442.90 791.40 12%
Professional - Other 714.50 703.50 (11.00) (2%)
Technical 2,356.80 2,925.80 569.00 24%
Office/Clerical 3,272.27 3,471.27 199.00 6%
Crafts/Trades 1,380.00 1,380.00 0.00 0%
Other 4,119.70 4,345.70 226.00 5%
Total 21,372.16 23,148.56 1,776.40 8%

Federal Funding

The federal funding budget for 2002-2003 is $29,248,707, which is a decrease of $8,981,892 or 24% from 2001-2002.

There are many changes in the federal grants area for 2002-2003. As we receive more specific information, the federal grants will be adjusted to reflect a better estimate of funding for 2002-2003. We did not receive planning allotments from NC Department of Public Instruction in time to include those estimates in this document.

Federal IDEA 1997 legislation promised that the federal government would provide 40% of the average yearly per pupil cost to educate a child with a disability. The National School Boards Association (NSBA) reports that cost to be $7,320.00. NSBA figures also report that the federal government currently provides 17% of the promised 40% or $1,244.40.

The actual amount received by the Wake County Public School System is somewhat less than $1,244.40. The allocation formulated from the state to LEA is specified by IDEA 1997 and incorporates the LEA 1999 headcount, the federal poverty index, and the system ADM to a maximum of 12.5%. Since the Wake County Public School System exceeds the 12.5% funded percentage of ADM, and since 95% of the funds from the federal government flow through the State to the LEA, the effective funding per identified student in the Wake County Public School System is closer to $817.00.

If the federal funding were at 40%, based on 12.5% of our ADM and NSBA figures (an additional 23%, ~$1,683.60 per student), the Wake County Public School System would receive more than $20 million additional dollars each year.

This is not an issue we have neglected to recognize. During the 2000-2001 school year, Wake County Public School System representatives met with our congressmen, David Price and Bob Etheridge. We shared our concerns about the federal failure to live up to the promise made in IDEA 1997 and the impact on the school system. They expressed verbal support for improving the funding, but did not leave the representatives with encouragement that it would be widely supported. Perhaps this effort by NSBA will help.

Federal Months of Employment Comparison
FY 2001-02 FY 2002-03 Decrease Percent
Administration 141.60 117.60 (24.00) (17%)
Professional Educator 3,474.50 3,387.00 (87.50) (3%)
Professional - Other 326.00 303.40 (22.60) (7%)
Technical 551.00 527.00 (24.00) (4%)
Office/Clerical 134.30 106.30 (28.00) (21%)
Crafts/Trades 0.00 0.00 - -
Other 18.00 12.00 (6.00) (3%)
Total 4,645.40 4,453.30 (192.10) (4%)


Budget 2002-2003 $29,248,707
Budget 2001-2002 $38,240,599
Decrease $(8,991,892)

Multiple Enterprise

The multiple enterprise fund includes the Child Nutrition program and other self-supporting programs such as Before- and After-School Care, Tuition Summer School, Summer Camp, and Preschool Programs. Tuition or fees solely support these programs. We charge indirect cost at the unrestricted maximum rate of 12.98% on all these programs.

The multiple enterprise funding budget for 2002-2003 is $33,129,310, a decrease of $2,567,111 or 7% from 2001-2002. The budget includes $27,797,364 for the Child Nutrition program and $5,331,946 in tuition and fee-supported programs. The Print Shop became an enterprise fund in 2000-2001.

The Child Nutrition budget includes salary increases of $62.50 per month of employment and inflationary increases for food and supplies. Any reduction of federal funds for this program will require us to implement one or more of the following: reduce costs where possible, increase meal prices, reduce meal offerings, implement more satellite meal programs, and eliminate breakfast programs. Student full-paid lunches have been increased by $0.15 for grades K-12. No increase is included in student full-paid breakfast for grades K-12.

Breakfast 2000-01 2001-02 2002-03 Inc./Dec.
Student Full-Paid K-5 $0.80 $0.80 $0.80 N/A
Student Full-Paid 6-8 $0.90 $0.90 $0.90 N/A
Student Full-Paid 9-12 $0.90 $1.00 $1.00 N/A
Student Reduced $0.30 $0.30 $0.30 N/A
Adult A la carte A la carte A la carte N/A


Lunch 2000-01 2001-02 2002-03 Inc./ Dec.
Student Full-Paid K-5 $1.60 $1.60 $1.75 $0.15
Student Full-Paid 6-8 $1.70 $1.70 $1.85 $0.15
Student Full-Paid 9-12 $1.85 $1.85 $2.00 $0.15
Student Reduced $0.40 $0.40 $0.40 N/A
Adult A la carte A la carte A la carte N/A


Budget 2002-2003 $33,129,310
Budget 2001-2002 $35,696,421
Decrease $(2,567,111)

Capital Outlay

The proposed capital outlay budget for 2002-2003 totals $125,164,673. The budget includes $200,000 interest earned, $4,399,481 county appropriation, and $120,565,192 in building program funds.

The development of the budget requires a coordinated plan of the needs of several departments. The overriding board Goal of 2003 requires that the focus of improvement be in the classroom. Our staff and support personnel deliver the services to power the education of our children.

The development of the long-term strategic plan of any department's operations helps the group decide the priority of expenditures and the focus of the department's resources. The need for improvement of the maintenance services to the school and the classroom is critical. By identifying the long-term plan of needs of the system, the resources are effectively applied.

The recent report to the board of education and board of commissioners, titled "Strategies to Optimize the Planning, Design, Construction, Repair and Maintenance of School and County Facilities" identified thirty-six recommendations. Some can be addressed immediately, whereas others are long-term strategies that will require additional funding or directive.

Major efforts for the coming year include an increase in "clustered maintenance teams," which have shown through a three-year pilot study, to improve the quality of the maintenance, decrease response time, and increase the number of work orders performed on the school campus. Another change is the reorganization of the maintenance and operations department to support clustered maintenance, project planning, and safety.

Fortunately, the support and voter approval of building program funding over the last fifteen years has helped Wake County Schools address the impact of student growth and reduce the deferred maintenance of our existing facilities. PLAN 2000 dedicates over half of the funds to existing school renovations and replacement of equipment. It is vital to develop the long-term needs of every building in order to create the needs of a capital project budget versus the costs associated with the operating budget.

The operating budget addresses the maintenance and repair of the existing facility. This would include items such as housekeeping, general repair, and grounds maintenance. There is a small component dedicated to minor renovations or changes of space. The capital budget is developed to address the larger projects with a budget of $100,000 or more.

The current capital budget plan contains funds for the minor improvements that will need to be made in the schools and administrative area. The major portion of the capital budget is for mobile unit relocations or leases.

The replacement of roofs, carpet, mechanical, electrical, and computer network systems are being covered in the bond-funded building program. It is critical that as the proportion of bond-funded replacement projects decrease, the capital budget increases. Otherwise, Wake County Public Schools starts the cycle of "deferred" maintenance again. The planned replacement of infrastructure is critical to maintain and extend the useful life of a facility. Our community expects us to keep our facilities clean and useful for many generations. The capital fund should cover the scheduled replacement of building systems, and the operating fund provides for the maintenance and repair of the building.

Major capital spending results in additional facility and grounds square footage requiring maintenance and utilities. The maintenance consists of custodial, preventive maintenance, mowing, landscaping, storm water drainage, solid waste management, energy management/scheduling (rental of school property, after-hour usage, etc.), audiovisual support, vehicle maintenance, pest management, and minimal unscheduled maintenance. The utilities consist of electrical, gas, water, sewage, and fuels.

These functions require additional manpower, supplies, phones, computerized maintenance management, and vehicle support. If adequate resources are not provided for maintenance, the facility life is dramatically reduced, unscheduled work will increase, facility maintenance efficiency will be reduced, and energy costs will increase.

Major capital expenditures for deferred maintenance and replacement can save the school system operating dollars. Permanent fixes to long-term maintenance problems result in a reduction of the deferred maintenance backlog. An improvement in mechanical systems or structural integrity increases each part's life expectancy and reduces energy costs.

This reduces the inefficiency caused by unscheduled maintenance calls and allows the workforce to concentrate more on scheduled work such as preventive and routine maintenance. These savings will be short lived if adequate resources for preventive maintenance are not provided.

PLAN 2000, the current school building program, is the fifth in a series of building phases that began in 1985. Despite building 44 new schools and expanding dozens of existing school facilities since 1986, the system needs more space to accommodate the influx of more than 3,000 new students each year and funding to address its aging facilities.

The PLAN 2000 (2001-2004) school building program, provides 14 new schools to accommodate more than 10,400 new students expected in our schools by 2004. Additionally, 33 schools will receive major renovations and expansions. Another 63 schools will get much needed maintenance and repair. PLAN 2000 will cost $550.0 million. A $500.0 million bond referendum to finance this plan was supported by a special citizens commission and approved by voters on November 7, 2000. The remaining $50.0 million is being provided by Wake County government from general revenues. No tax increase is required to pay for this building program.

In 2000-2001, the county passed a resolution for $370.6 million for PLAN 2000. In 2001-2002, the county is scheduled to approve resolutions that total $58.8 million for PLAN 2000. In 2002-2003, the county is scheduled to approve resolutions that total $120.6 million. The total of all PLAN 2000 resolutions will equal $550.0 million and authorize funds for projects for multiple years. The PLAN 2000 appropriations through 2001-2002 will equal $429.4 million and we anticipate spending $116.0 million by the end of 2001-2002. This would leave a roll-over balance for 2002-2003 of approximately $313.4 million. We expect to spend approximately $206.0 million in 2002-2003. This reflects almost a 100% increase in expenditures and will be our most aggressive building period of any previous program. The remaining dollars, at that time, will roll forward to 2003-2004. The carryover for 2002-2003 will not be recognized until after June 30, 2002.

Budget 2002-2003 $125,164,673
Budget 2001-2002 $515,248,685
Decrease $(390,084,012)

Competitive Factors

The school system has faced many challenges over the past ten years. During this time, we have successfully managed a building program, which is one of the largest in the nation. We have received an "unqualified" audit opinion each of the last thirteen years.

For the past twelve years, we have received the Certificate of Excellence in Financial Reporting from both the American School Business Officials (ASBO) and the Government Finance Officers Association (GFOA). We have also received the Distinguished Budget Presentation Award from the GFOA the past nine years. This award is the highest form of recognition in governmental budgeting. We have received the Meritorious Budget Award from the ASBO for the past three years. In 1998, our school system was the only one in North Carolina to receive the Advancement Award of the N.C. Quality Leadership Foundation - a process similar to the Malcolm Baldrige award criteria. We have aggressively managed our budget and wisely invested available resources. These accomplishments are the result of a dedicated and competent staff, a supportive board, and a caring and supportive community. The end result of all this has been continued improvement of programs and outcomes for our students.

Conclusion

Twenty-five years ago, the Raleigh City Schools and Wake County Schools merged. The Wake County Public School System arose from the vision and bold leadership of members of our community. When many questioned the wisdom of the merger, those forward-thinking community leaders persevered and stayed the course. Those same community leaders faced constant criticism and skepticism, yet courageously pursued the merger of two strong, independent school districts. The foundation on which our school system is built was formed from the courage and wisdom of those leaders of twenty-five years ago.

Over the course of the past quarter-century, our school district has grown explosively. Fueled by a healthy local economy, strong business development, and our nationally recognized school system, Wake County has experienced growth unlike many other communities in our nation. Clearly, the need for increased infrastructure capacity and services has been substantial as a result of the growth we have experienced. Schools have been constructed through the faithful support of our community in passing bond referenda at the polls. Even with aggressive building programs, we have struggled to keep up with the growth.

The strong support for our schools is the key as we have responded to the demands of our community to provide a high quality education to every child. In 1998, we adopted the goal, established through a community-led summit, that 95% of students tested in grades 3 and 8 will be at or above grade level by 2003. Since that time, our efforts have been aligned, focused, and intense. Through perseverance and bold leadership, we have made substantial progress toward Goal 2003.

The 2002-2003 school year represents a watershed for the Wake County Public School System. It is at the end of this school year that we will measure ourselves against the goal we have so passionately embraced. We do not ask if we will reach our goal, because great progress is evident. The question we must ask is when we will reach our goal. The answer to that question, along with a glimpse into our future, is expected in the recommendations of the Citizens Advisory Committee currently reviewing our operating budget to determine adequacy of funding to meet Goal 2003 and to recommend a growth and inflation factor for subsequent years' funding.

At a time when the State faces a deep budget deficit, when local governments are struggling to maintain services in the wake of revenue shortfalls, and when many businesses in our community are fighting for survival, we know that we, too, must do our part. The budget presented for 2002-2003 attempts to maintain status quo for the Wake County Public School System. We have cut expenditures, reduced services, and added fund balance, yet additional local funding is necessary to maintain programs and personnel necessary to meet the academic needs of our students. The budget presented does not advance us toward Goal 2003, it merely keeps us from regressing.

As was the case in the past, when courageous leaders of great vision made decisions that resulted in the merged Wake County Public School System of today, commitment to children and to meeting their needs must again be demonstrated as we chart the course of the Wake County Public School System for the next twenty-five years.

Bill McNeal, Superintendent