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School Budget Glossary

 

Administrative Budget Component
One of three categories that must be reported by school districts. These expenditures
include: office and administrative costs; salaries and benefits for certified school
administrators who spend 50 percent or more of their time performing supervisory
duties; data processing; supplies; legal fees; property insurance; and school board
expenses.

Appropriated Fund Balance

Any portion of a district's fund balance from the previous fiscal year that is applied as
revenue to the district's following year's budget. This reduces the amount of money
that must be generated by taxes.

Board Budget

Spending plan adopted by the Board of Education.

Bond

A written promise to pay a specified sum of money, called the face value or principal
amount, at a specified date in the future (the maturity date), together with periodic
interest at a specified rate.

Budget

A plan of financial operation outlining the estimates of proposed expenditures for a
fiscal year and the proposed means of financing them.

Budget Calendar

The schedule of key dates that the school district, Board of Education, and
administrators follow in preparation, adoption, and administration of the budget.

Budget Cap

State law prohibits school districts from increasing spending annually by more than
four percent. Some areas, such as paying for debt, are excluded from that cap.

Budget Year

The fiscal year immediately following the current year.

Capital Budget Component

One of three categories that school districts must show in their proposed budgets, this
covers: all transportation capital, debt service, and lease expenditures; legal judgments
and settled claims; custodial costs and all facility costs, including service contracts,
supplies, utilities, maintenance, repairs, construction, renovation, debt and leasing
costs.

Capital Outlay

An expenditure that is generally more than $20,000 and results in the ownership,
control or possession of assets intended for continued use over long periods of time.
Examples: the construction or acquisition of buildings and equipment, initial
equipment of buildings or additions or the initial acquisition of library books and
research periodicals for a new school building.

Consumer Price Index (CPI)

An index of prices used to measure the change in the cost of basic goods and services in
comparison with a fixed base period. Also called "cost-of-living" index.

Contingent Budget

Under state law, school boards can submit a budget to voters a maximum of two times.
If the proposed budget is defeated twice, the board must adopt a contingency budget,
which would put a cap on new spending. Under a contingent budget, the district may
not increase spending by more than 120 percent of the Consumer Price Index or four
percent, whichever is lower. The items exempt from this cap are tax certiorari
settlements, debt service (mortgage payments) and costs associated with enrollment
growth.

Employee Benefits

Amounts paid by the district on behalf of employees. These amounts are not included
in the gross salary. They are fringe benefits, and while not paid directly to employees,
are part of the cost of employees. Employee benefits include the district cost for health
insurance premiums, dental insurance, life and disability insurance, Medicare,
retirement, social security and tuition reimbursement.

Expenditure

Payment of cash or transfer of property or services for the purpose
of acquiring an asset or service.

Fiscal Year

A fiscal year is the accounting period on which a budget is based. The New York State
fiscal year runs from April 1 to March 31. The fiscal year for all New York counties
and towns and for most cities is the calendar year. School districts in the State operate
on July 1 through June 30 fiscal years.

Fund Balance

A fund balance is created when the school district has money left over at the end of its
fiscal year from either under spending the budget or taking in additional revenue. Part
of the fund balance (appropriated fund balance) may be applied as revenues to the
district's following year budget. A portion may also be set aside (unappropriated fund
balance) to pay for emergencies or other unforeseen occurrences.

Program Budget Component

One of the categories that must be presented in the district's proposed budget, this
portion includes: salaries and benefits of teachers and supervisors who spend the
majority of their time teaching; instructional costs such as supplies, equipment, and
textbooks; and transportation operating costs.

Proposed Budget

Also called Administrative Proposal. Spending plan developed by school
administrators prior to Board adoption. School districts are required by New York
State to show their proposed budgets in three categories: administrative, program, and
capital.

Reassessment

A reassessment is a systematic analysis of all locally assessed properties (both
commercial and residential) to achieve a stated uniform percentage of value. The goal
of a reassessment is to assure that each assessment reflects current market prices and
that each property owner pays only their fair share of the tax burden. With a
reassessment comes a shift in the tax burden to those whose property values have risen
faster than average. This process does not result in a windfall of new revenue for the
town, county, or school district nor does the reassessment change the total amount of
taxes that the school district must collect; it merely redistributes who pays them. In
theory, rising assessments will result in a decrease in the tax rate (everything else being
equal), as there is now a larger tax base from which the school may generate the same
amount of tax dollars. If a property owner's assessment doubles, their tax bill will not
double - in fact, it may remain about the same, increase slightly, or even decrease
depending on the final tax rate.

Revenue

Sources of income financing the operation of the school district.

Salaries

The total amount paid to an individual, before deductions, for services rendered while
on the payroll of the district.

STAR

The New York State School Tax Relief (STAR) Program provides exemption for
school taxes for all owner-occupied, primary residents, regardless of income. Senior
citizens with combined 2005 incomes that do not exceed $66,050 may qualify for an
enhanced exemption.

State Department of Education

The New York administration department that oversees public elementary and
secondary education.

Supplies

Consumable materials used in the operation of the school district including food,
textbooks, paper, pencils, office supplies, custodial supplies, material used in
maintenance activities and computer software.

Support Services

The personnel, activities, and programs that enhance instruction and provide for the
general operation of the school district. This includes attendance, guidance, and health
programs; library personnel and services; special education services provided by speech
and language pathologists, physical therapists and occupation therapists; professional
development programs, transportation, administration, buildings and ground operations,
and security.

Tax Base

Assessed value of local real estate that a school district may tax for yearly operational
monies.

Tax Certiorari

The legal process by which a property owner can challenge the real estate tax
assessment on a given property in attempt to reduce the property's assessment and real
estate taxes.

Tax Levy

The total sum to be raised by a tax, or the legislative measure by which an annual or
general tax is imposed.

Tax Rate

The amount of tax paid for each increment (usually $1,000) of assessed value of
property.

Unappropriated Fund Balance

A school district is permitted to keep up to two percent of its fund balance in an
unappropriated fund. This money may be used to pay for emergency repairs and other
unforeseen occurrences.