2013–2014 Preliminary Summary of Finances

 Word Version

June 24, 2013

Subject: 2013–2014 Preliminary Summary of Finances

TO THE ADMINISTRATOR ADDRESSED:

A preliminary Summary of Finances (SOF) report for the 2013–2014 school year is available at the Texas Education Agency (TEA) School District State Aid Reports web page. This letter explains the changes to funding formulas authorized with the passage of Senate Bill 1 and House Bill 1025, 83rd Texas Legislature, 2013, and provides information on the data we used in this SOF.

Formula elements that have been revised include:

• an increased basic allotment (from $4,765 in 2012–2013 to $4,950 in 2013–2014),
• an increased equalized wealth level in Tier I (from $476,500 in 2012–2013 to $495,000 in 2013–2014),
• an increased regular program adjustment factor (from 0.98 in 2012–2013 to 1.0 in 2013–2014), and
• an increased target revenue reduction factor (from 0.9235 in 2012–2013 to 0.9263 in 2013–2014).

The following paragraphs provide information about the data we used in the 2013–2014 SOF report, including planned updates.

* LPE vs. DPE – The SOF report contains two columns. One is labeled "LPE," which stands for legislative payment estimate. This column includes the property values and student counts that the legislature used during the appropriations process, and these figures form the basis of the Foundation School Program (FSP) payments your school district receives throughout the state fiscal year. The other column in the SOF report is labeled "DPE," which stands for district planning estimate. This column is updated periodically throughout the fiscal year as data are reported to us. This column is intended to provide your district with a more accurate indication of its actual FSP earnings for the fiscal year. After the close of the fiscal year, the DPE column will be updated to reflect actual data, and we will determine final earnings for the fiscal year. There will be a “settle-up” process to correct any over- or underpayments that occurred during the fiscal year. We urge your district to monitor the differences between its FSP payments and its actual earnings by using the state aid template available from the Region XIII Education Service Center. A link to this template is provided on the TEA FSP web page.

Charter Schools: Because charter school attendance is less stable than school district attendance, charter school attendance information is updated in both the LPE and DPE columns of the SOF report throughout the school year based on information submitted through the FSP System. Your charter school's current-year FSP payments are adjusted accordingly throughout the year.

* Student Counts – All student counts (ADA, full-time equivalents [FTEs], and enrollment counts) shown in the LPE and DPE columns are based on the March 2013 student projections that were submitted and approved during the appropriations process. Please note that the payments made to your school district during the year are based on the estimated student counts shown in the LPE column. We adjust the student counts in the DPE column when the fall 2013 Public Education Information Management System (PEIMS) enrollment data are available in March 2014 and again in September 2014. We will use the September 2014 student counts in the DPE column to recalculate funding for year-end settle-up. Your district's budget should be based on the student enrollment and program participation that are expected to actually occur during the year. Your district should carefully monitor its state aid payments during the year, which may differ from actual earnings at year end, creating an overpayment or underpayment.

Charter Schools: Again, because charter school attendance is less stable than school district attendance, charter school attendance information is updated in both the LPE and DPE columns of the SOF report throughout the school year based on information submitted through the FSP System. Your charter school's current-year FSP payments are adjusted accordingly throughout the year.

* 2012 State-Certified Property Value –The state-certified property value used in the LPE column of this SOF is the preliminary 2012 property value assigned by the Texas Comptroller’s Property Tax Assistance Division (PTAD) in January. We will update the SOF with the final 2012 value when it becomes available in August.

* Estimated M&O Tax Collections
* School Districts: To estimate the maintenance and operations (M&O) tax collection amounts that appear in both the LPE and DPE columns, we used the current 2012–2013 DPE tax collections (tax collections reported by your school district through the PEIMS budget data) increased by 4.77 percent. This was the growth factor used in the appropriations process for the current biennium. Unless your school district has successfully completed a tax rollback election (TRE) and changed its M&O tax rate, the LPE column will not be updated until the year-end settle-up for the 2013–2014 school year occurs. As a result, payments to your school district will not reflect updates in tax collections. If your district had a successful TRE, we will adjust your district's LPE collections once data from the Texas Comptroller’s PTAD are available in late January 2014.

* Charter Schools: The estimated M&O tax collections used for school districts have been used to determine the statewide average variables for charter schools.

* Instructional Facilities Allotment (IFA) and Estimated M&O Tax Collections – If your district was awarded an IFA for a lease-purchase agreement, the district’s current share of the IFA allotment has not yet been subtracted from the estimate of M&O tax collections.

* Estimated I&S Tax Collections – For this preliminary SOF, the 2013–2014 interest and sinking fund (I&S) tax collections figure is based on your district’s 2012–2013 budgeted I&S collections submitted to the PEIMS. These collections will be updated in fall 2013.

* EDA and IFA – If your district qualifies for the EDA or the IFA, the preliminary earned allotment appears on line 49 (EDA) or line 50 (IFA) of the SOF. IFA payment details will be made available in fall 2013. Program information can be found on the EDA web page and the IFA web page.

* New Instructional Facility Allotment (NIFA) – The TEC, §42.158, provides for NIFA funding to eligible school districts and charter schools to pay for operational expenses associated with opening new instructional facilities, contingent on appropriations for the allotment. However, the 2013 General Appropriations Act (Senate Bill 1) did not provide appropriations for NIFA awards. Therefore, no awards will be made.

* Transportation Allotment – The transportation allotment is based on your school district’s current estimated 2012–2013 transportation allotment.

* Per Capita Rate – A rate of $255.704 multiplied by the prior-year ADA is used to estimate the per capita allotment. The rate is subject to change during the fiscal year.

* 2013–2014 State Aid Template
* School Districts: A link to the 2013–2014 state aid template developed by the Region XIII Education Service Center is available on the TEA FSP web page.

* Charter Schools: A 2013–2014 Estimate of State Aid Template is available on the TEA Charter School State Funding Worksheets web page.

As always, we strongly advise your school district or charter school to project state aid based on the best available information. Your district or charter school should complete the 2013–2014 state aid template or an equivalent state aid estimation process. The greatest value of the SOF is in explaining the basis of cash distributions to districts and charter schools. Estimates of state aid earned can be significantly impacted by factors not known to the State Funding Division.

If you have any questions about the SOF report, please contact a state funding consultant at (512) 463-9238. Additional contact information appears at the end of this letter.

Sincerely,

Amanda Brownson
Director of State Funding

State Funding Division Contact Information:
General SOF Questions, Chapter 42
 Al Johnson  (512) 463-9260, al.johnson@tea.state.tx.us
General SOF Questions, Chapter 41
 Kim Wall  (512) 463-4809, kim.wall@tea.state.tx.us
Charter School Funding
 Nora Rainey  (512) 463-7298, nora.rainey@tea.state.tx.us
IFA / EDA
  Jacqueline Pree (512) 475-1217 jacqueline.pree@tea.state.tx.us 
Bond Guarantee Program
Cassie Huggins (512) 463-9232, cassie.huggins@tea.state.tx.us
Transportation Funding
 Danny Sanchez (512) 463-9266, danny.sanchez@tea.state.tx.us
Staff Salary Allotment
 Al Johnson  (512) 463-9260, al.johnson@tea.state.tx.us
State Compensatory Education, Optional Flexible Year Program,
Optional Flexible School Day Program
 Kim Wall  (512) 463-4809, kim.wall@tea.state.tx.us
Texas Tax Code, Chapter 313, Agreements
 Nancy Kuhn  (512) 463-6313, nancy.kuhn@tea.state.tx.us

Page last modified on 6/25/2013 09:50:15 AM.