Top 10 Considerations for Building a Solid Multi-Year Projection

Kelley McKasy
Dec 6, 2022
4 min read

Doing a budget is never fun. It is always time-consuming, confusing, and takes a lot of organization. However, CBOs are tasked with this challenge every year when building their Multi-Year Budget Projection (MYP) for their school districts. The top ten list below is a starting point for all educational leaders to begin the conversation.

1. Are all step and column, and statutory compensation increases included in the budget?

Ensure your position control system is fully reconciled and accurate
Calculate appropriate costs for positions that are vacant to ensure no surprises when filling
- Never budget at step 1 of the position
Update the cost of 1% for each bargaining unit
- Include all statutory benefits

Ensure your position control system is fully reconciled and accurate

Calculate appropriate costs for positions that are vacant to ensure no surprises when filling

Never budget at step 1 of the position

Never budget at step 1 of the position

Update the cost of 1% for each bargaining unit

Include all statutory benefits

Include all statutory benefits

2. For Average Daily Attendance (ADA) states is your current year ADA following the projection or are there adjustments needed? For Annual Daily Membership (ADM) states is the enrollment trend following the projections or are adjustments required.

Remember that an ADA change will impact the MYP in all out-years of the budget
- This can reduce or increase revenue in each of those years
For declining enrollment/ADA districts the trend must also be incorporated
- This creates a reduction in revenue in the second and subsequent years of the MYP
Before the pandemic the Median ADA in California was 95.82%;
- In a review of “first look” data of over 1 million students in California and across the nation the current 2022-2023 “new normal” has many districts within a range of 90-93.5%!

Remember that an ADA change will impact the MYP in all out-years of the budget

This can reduce or increase revenue in each of those years

This can reduce or increase revenue in each of those years

For declining enrollment/ADA districts the trend must also be incorporated

This creates a reduction in revenue in the second and subsequent years of the MYP

This creates a reduction in revenue in the second and subsequent years of the MYP

Before the pandemic the Median ADA in California was 95.82%;

In a review of “first look” data of over 1 million students in California and across the nation the current 2022-2023 “new normal” has many districts within a range of 90-93.5%!

In a review of “first look” data of over 1 million students in California and across the nation the current 2022-2023 “new normal” has many districts within a range of 90-93.5%!

3. Have all required benefit categories been accounted for in the MYP? Including:

Property, Liability & Workers’ Compensation, and Unemployment Insurance rates
Retiree contributions (in California this is STRS and PERS)
Increases in required services such as electricity, water, gasoline, and necessary commodities (paper, technology, toilet paper, etc.)

Property, Liability & Workers’ Compensation, and Unemployment Insurance rates

Retiree contributions (in California this is STRS and PERS)

Increases in required services such as electricity, water, gasoline, and necessary commodities (paper, technology, toilet paper, etc.)

4. Have critical services been placed behind the budget firewall?

The firewall ensures these services are untouchable
- If cuts are required, those cuts would exclude these services that are essential. Some examples of expenses that belong behind the firewall are on this list
  - Transportation
  - Technology
    - Infrastructure and refresh of student and staff devices
  - Legal costs
    - When the budget falls and reductions are necessary, these costs almost always go up!
  - External Audit Services
  - Necessary data systems include each of the following, at a minimum:
    - Student Information System (SIS)
    - Management Information System (MIS / ERP)
      - Business and HR data and recruitment
    - Learning Management System (LMS)
      - We learned this is essential clearly in March 2020
    - Facilities Management System (FMS)
      - Traditional SACs and school accounting do not cross fiscal years, but school construction projects do
    - Attendance Management System (AMS)
      - Student attendance is the gateway to student achievement
      - Districts that do not focus on attendance will feel the cost in both academic performance and finances later
    - Business and Student Data Analytics
      - SIS and MIS systems are designed to input and store data and do not connect with each other
      - Having the ability to quickly review data to make informed decisions is essential
    - Substitute Management System
      - In the current state of vacancies and employee shortages, this is an essential tool
    - Special Education Management System
      - With the contribution from the general fund crossing over one-third of many districts’ budgets proper management of services from IEPs is critical
    - Other critical systems such as the following should also be included:
      - Facilities use
      - Work order tracking
      - Transportation routing
      - Textbook tracking
      - Student assessment analysis
      - Online curriculum options
      - Fixed asset inventory
      - Website and public information delivery
      - Home to school communications
      - Electronic forms and workflow
      - Compliance tracking

The firewall ensures these services are untouchable

If cuts are required, those cuts would exclude these services that are essential. Some examples of expenses that belong behind the firewall are on this list
- Transportation
- Technology
  - Infrastructure and refresh of student and staff devices
- Legal costs
  - When the budget falls and reductions are necessary, these costs almost always go up!
- External Audit Services
- Necessary data systems include each of the following, at a minimum:
  - Student Information System (SIS)
  - Management Information System (MIS / ERP)
    - Business and HR data and recruitment
  - Learning Management System (LMS)
    - We learned this is essential clearly in March 2020
  - Facilities Management System (FMS)
    - Traditional SACs and school accounting do not cross fiscal years, but school construction projects do
  - Attendance Management System (AMS)
    - Student attendance is the gateway to student achievement
    - Districts that do not focus on attendance will feel the cost in both academic performance and finances later
  - Business and Student Data Analytics
    - SIS and MIS systems are designed to input and store data and do not connect with each other
    - Having the ability to quickly review data to make informed decisions is essential
  - Substitute Management System
    - In the current state of vacancies and employee shortages, this is an essential tool
  - Special Education Management System
    - With the contribution from the general fund crossing over one-third of many districts’ budgets proper management of services from IEPs is critical
  - Other critical systems such as the following should also be included:
    - Facilities use
    - Work order tracking
    - Transportation routing
    - Textbook tracking
    - Student assessment analysis
    - Online curriculum options
    - Fixed asset inventory
    - Website and public information delivery
    - Home to school communications
    - Electronic forms and workflow
    - Compliance tracking

If cuts are required, those cuts would exclude these services that are essential. Some examples of expenses that belong behind the firewall are on this list

Transportation
Technology
- Infrastructure and refresh of student and staff devices
Legal costs
- When the budget falls and reductions are necessary, these costs almost always go up!
External Audit Services
Necessary data systems include each of the following, at a minimum:
- Student Information System (SIS)
- Management Information System (MIS / ERP)
  - Business and HR data and recruitment
- Learning Management System (LMS)
  - We learned this is essential clearly in March 2020
- Facilities Management System (FMS)
  - Traditional SACs and school accounting do not cross fiscal years, but school construction projects do
- Attendance Management System (AMS)
  - Student attendance is the gateway to student achievement
  - Districts that do not focus on attendance will feel the cost in both academic performance and finances later
- Business and Student Data Analytics
  - SIS and MIS systems are designed to input and store data and do not connect with each other
  - Having the ability to quickly review data to make informed decisions is essential
- Substitute Management System
  - In the current state of vacancies and employee shortages, this is an essential tool
- Special Education Management System
  - With the contribution from the general fund crossing over one-third of many districts’ budgets proper management of services from IEPs is critical
- Other critical systems such as the following should also be included:
  - Facilities use
  - Work order tracking
  - Transportation routing
  - Textbook tracking
  - Student assessment analysis
  - Online curriculum options
  - Fixed asset inventory
  - Website and public information delivery
  - Home to school communications
  - Electronic forms and workflow
  - Compliance tracking

Transportation

Technology

Infrastructure and refresh of student and staff devices

Infrastructure and refresh of student and staff devices

Legal costs

When the budget falls and reductions are necessary, these costs almost always go up!

When the budget falls and reductions are necessary, these costs almost always go up!

External Audit Services

Necessary data systems include each of the following, at a minimum:

Student Information System (SIS)
Management Information System (MIS / ERP)
- Business and HR data and recruitment
Learning Management System (LMS)
- We learned this is essential clearly in March 2020
Facilities Management System (FMS)
- Traditional SACs and school accounting do not cross fiscal years, but school construction projects do
Attendance Management System (AMS)
- Student attendance is the gateway to student achievement
- Districts that do not focus on attendance will feel the cost in both academic performance and finances later
Business and Student Data Analytics
- SIS and MIS systems are designed to input and store data and do not connect with each other
- Having the ability to quickly review data to make informed decisions is essential
Substitute Management System
- In the current state of vacancies and employee shortages, this is an essential tool
Special Education Management System
- With the contribution from the general fund crossing over one-third of many districts’ budgets proper management of services from IEPs is critical
Other critical systems such as the following should also be included:
- Facilities use
- Work order tracking
- Transportation routing
- Textbook tracking
- Student assessment analysis
- Online curriculum options
- Fixed asset inventory
- Website and public information delivery
- Home to school communications
- Electronic forms and workflow
- Compliance tracking

Student Information System (SIS)

Management Information System (MIS / ERP)

Business and HR data and recruitment

Business and HR data and recruitment

Learning Management System (LMS)

We learned this is essential clearly in March 2020

We learned this is essential clearly in March 2020

Facilities Management System (FMS)

Traditional SACs and school accounting do not cross fiscal years, but school construction projects do

Traditional SACs and school accounting do not cross fiscal years, but school construction projects do

Attendance Management System (AMS)

Student attendance is the gateway to student achievement
Districts that do not focus on attendance will feel the cost in both academic performance and finances later

Student attendance is the gateway to student achievement

Districts that do not focus on attendance will feel the cost in both academic performance and finances later

Business and Student Data Analytics

SIS and MIS systems are designed to input and store data and do not connect with each other
Having the ability to quickly review data to make informed decisions is essential

SIS and MIS systems are designed to input and store data and do not connect with each other

Having the ability to quickly review data to make informed decisions is essential

Substitute Management System

In the current state of vacancies and employee shortages, this is an essential tool

In the current state of vacancies and employee shortages, this is an essential tool

Special Education Management System

With the contribution from the general fund crossing over one-third of many districts’ budgets proper management of services from IEPs is critical

With the contribution from the general fund crossing over one-third of many districts’ budgets proper management of services from IEPs is critical

Other critical systems such as the following should also be included:

Facilities use
Work order tracking
Transportation routing
Textbook tracking
Student assessment analysis
Online curriculum options
Fixed asset inventory
Website and public information delivery
Home to school communications
Electronic forms and workflow
Compliance tracking

Facilities use

Work order tracking

Transportation routing

Textbook tracking

Student assessment analysis

Online curriculum options

Fixed asset inventory

Website and public information delivery

Home to school communications

Electronic forms and workflow

Compliance tracking

5. Incorporates a Facilities Master Plan

Identifies and estimates costs for the required maintenance of all facilities
Failure to follow a plan on deferred maintenance becomes a “pay me now or pay me more later” issue
- Corporate America also struggles with this issue.
For each operating site there should be a schedule created:
- Roofing
- Flooring
- Exterior Painting
- Fields and Grounds
- Parking lots and Asphalt
- Playground equipment
- Vehicle and end-of-life equipment replacement

Identifies and estimates costs for the required maintenance of all facilities

Failure to follow a plan on deferred maintenance becomes a “pay me now or pay me more later” issue

Corporate America also struggles with this issue.

Corporate America also struggles with this issue.

For each operating site there should be a schedule created:

Roofing
Flooring
Exterior Painting
Fields and Grounds
Parking lots and Asphalt
Playground equipment
Vehicle and end-of-life equipment replacement

Roofing

Flooring

Exterior Painting

Fields and Grounds

Parking lots and Asphalt

Playground equipment

Vehicle and end-of-life equipment replacement

6. Incorporates a long-term demographic projection

Includes enrollment trends which include at least 10 years of future projections
This should be updated yearly
In declining enrollment districts, the cost of declining enrollment should be calculated and identified as “cost” in the MYP

Includes enrollment trends which include at least 10 years of future projections

This should be updated yearly

In declining enrollment districts, the cost of declining enrollment should be calculated and identified as “cost” in the MYP

7. The MYP Aligns with the LCAP

Priorities that have been listed along with identifying full costs of implementation of new programs.
This plan is written to outline the necessary strategies to improve student learning outcomes.
As a CBO, involvement in the planning is essential and keeps the focus where it belongs on student achievement
- As a best practice, I have found successful organizations have the compliance/State and Federal programs team as part of the Business Office
- While it may be assumed that this is an Educational Services function, the reality is that the CBO spends a significant amount of time working with auditors and addressing Federal Program Monitoring
  - Following this best practice, CBOs can be more thoroughly involved in supporting academics

Priorities that have been listed along with identifying full costs of implementation of new programs.

This plan is written to outline the necessary strategies to improve student learning outcomes.

As a CBO, involvement in the planning is essential and keeps the focus where it belongs on student achievement

As a best practice, I have found successful organizations have the compliance/State and Federal programs team as part of the Business Office
While it may be assumed that this is an Educational Services function, the reality is that the CBO spends a significant amount of time working with auditors and addressing Federal Program Monitoring
- Following this best practice, CBOs can be more thoroughly involved in supporting academics

As a best practice, I have found successful organizations have the compliance/State and Federal programs team as part of the Business Office

While it may be assumed that this is an Educational Services function, the reality is that the CBO spends a significant amount of time working with auditors and addressing Federal Program Monitoring

Following this best practice, CBOs can be more thoroughly involved in supporting academics

Following this best practice, CBOs can be more thoroughly involved in supporting academics

8. Appropriately includes the cost of education for special needs students.

This includes staffing and support contracts.
The increases in low incident cases create a long-term increase in costs
- This trend needs to be included in MYP

This includes staffing and support contracts.

The increases in low incident cases create a long-term increase in costs

This trend needs to be included in MYP

This trend needs to be included in MYP

9. The projected cost of living increases and state increases in revenue are conservative

These are updated immediately if current events change scenarios for upcoming years:
The common guidance from the County Offices is the best practice to align to when each Dartboard is updated.
School Services of California uses this guidance to produce the budget Dartboard in California that provides guidance for these critical calculations

These are updated immediately if current events change scenarios for upcoming years:

The common guidance from the County Offices is the best practice to align to when each Dartboard is updated.

School Services of California uses this guidance to produce the budget Dartboard in California that provides guidance for these critical calculations

10. Addresses deficit spending

Identifies required changes in the budget as one-time funding decreases to ensure that the costs are eliminated along with the funds.

Identifies required changes in the budget as one-time funding decreases to ensure that the costs are eliminated along with the funds.

Chief Business Officials should operate like how a master craftsman has for centuries when completing the MYP. Managing a budget requires constant revisions (especially with the transparency requirement), patience, and communication with each stakeholder group.

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Top 10 Considerations for Building a Solid Multi-Year Projection

Top 10 Considerations for Building a Solid Multi-Year Projection

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