Fluent Essays

Assignment 1 For each term in the list below, write 1–3 sentences in which you define the term, explain its relevance to educational finance, and provide an example of its application within your professional context. Do not copy definitions from your text; articulate your understanding of the terms. · Accounting · Accounts payable · Adequacy · Appropriation · Assessed valuation · Attendance report · Average daily attendance (ADA) · Average daily membership (ADM) · Bonded indebtedness · Budget balance · Categorical programs · Certified personnel · Classified personnel · Consumer price index · Cost-effectiveness · Cost equalization · Cost-of-living adjustment (COLA) · Debt service fund · Elementary and Secondary Education Act · Encumbrances · Foundation program · Fund · General fund · General obligation bonds · Parcel tax · Prior year taxes · Property tax · Reserves · School district tax rate · School site budgeting · Transfer payments · Zero-based budgeting   Glossar yA of School Finance Terms ACb AUGUST 2004 AB: Assembly Bill ADA: Average Daily Attendance API: Academic Performance Index AYP: Adequate Yearly Progress CalPERS: California Public Employees’ Retirement System CalSTRS: California State Teachers’ Retirement System CalWORKs: California Work Opportunity and Responsibility to Kids CBEDS: California Basic Educational Data System CDE: California Department of Education COE: County Office of Education COLA: Cost-of-living Adjustment CPI: Consumer Price Index CSR: Class Size Reduction EIA: Economic Impact Aid EL: English Learner ESEA: Elementary and Secondary Education Act FCMAT: Fiscal Crisis and Management Assistance Team F/RPM: Free/Reduced-price Meals GATE: Gifted and Talented Education G.O. Bond: General Obligation Bond HPSGP: High Priority Schools Grant Program IDEA: Individuals with Disabilities Education Act IEP: Individualized Education Program II/USP: Immediate Intervention/Underperforming Schools Program IMFRP: Instructional Materials Funding Realignment Program JPA: Joint Powers Agreement K–12: Kindergarten through 12th Grade K–14: Kindergarten through Community College K–16: Kindergarten through Undergraduate University LEA: Local Education Agency LEP: Limited English Proficient MPSE: Master Plan for Special Education MTYRE: Multitrack, Year-round Education NCLB: No Child Left Behind Act OPSC: Office of Public School Construction OTL: Opportunity To Learn PERB: Public Employment Relations Board PERS: Public Employees’ Retirement System PL: Public Law (federal) PSAA: Public Schools Accountability Act ROC/ROP: Regional Occupational Center/Program SAB: State Allocation Board SACS: Standardized Account Code Structure SARC: School Accountability Report Card SB: Senate Bill SBE: State Board of Education SEA: State Education Agency SELPA: Special Education Local Plan Area SFID: School Facility Improvement District SIP: School Improvement Program STAR: Standardized Testing and Reporting Program STRS: State Teachers’ Retirement System School Finance Acronyms A Glossary of School Finance Ter ms ● August 2004 © Copyright 2004 by EdSource, Inc. WILLIAMS V. CALIFORNIA August 2004 ● A Glossary of School Finance Ter ms ACADEMIC PERFORMANCE INDEX (API) Academic Performance Index (API) A number summarizing the performance of a group of students, a school, or a district on the state’s standardized tests. A school’s number (or API score) is used to rank it among schools of the same type (elementary, middle, high, or small) and among the 100 schools of the same type that are most similar in terms of students served, teacher qualifications, and other factors. (See Standardized Testing and Reporting Program.) Account Code A number that classifies sources of revenues or purposes of expenditures in either a school district budget or the reports districts submit to the California Department of Educa- tion. The account code classifies expenditures according to the types of items purchased or services obtained, and revenues by the general source and type of revenue. Adequacy An approach to school funding that begins with the idea that the amount of funding schools receive should be based on some estimate of the cost of achieving the state’s educational goals. It tries to answer two questions: How much money would be enough to achieve those goals and where would it best be spent? Adequate Yearly Progress (AYP) A collection of performance meas- ures that a state, its school districts, and subpopulations of students within its schools are supposed to meet if the state receives Title I, Part A federal funding. In California, the measures include: (1) specified percentages of students scoring “proficient” or “advanced” on California Standards Tests in English language arts and math; (2) participation of at least 95% of students on those tests; (3) specified Academic Performance Index scores or gains; and (4) for high schools, a specified graduation rate or improve- ment in the rate. (See No Child Left Behind Act and Title I.) Adult Education Classes offered by school districts, community colleges, and other public and private organizations for residents 18 years or older who are not enrolled in a high school. State law requires that certain courses, including citizenship and English, be provided at no charge, while others may carry a fee. Adult Education revenues and expenditures must be tracked separately from a school district’s general fund. Apportionments Funds that federal or state governments distrib- ute to local education agencies or other governmental units according to certain formulas. Appropriations Funds set aside or budgeted by the state or local school district boards for a specific time period and specific purpose. The state Legislature and local school boards must vote every year on appropriations. Assembly Bill (AB) 1200 Legislation passed in 1991 that defined a system of fiscal accountability for school districts and county offices of education to prevent bankruptcy. The law requires districts to do multiyear financial projections; iden- tify sources of funding for substantial cost increases, such as employee raises; and make public the cost implications of such increases before approving employee contracts. County offices review district budgets, and the state reviews county- wide school districts. Assessed Value The value of land, homes, and businesses set by the county assessor for property tax purposes. It is either the appraised value of any newly built or purchased property or, for continuously owned property, the value on March 1, 1975 plus annual increases. These increases, tied to the California Consumer Price Index, may not exceed 2% annually. (See Proposition 13.) Average Daily Attendance (ADA) The total number of days of student attendance divided by the total number of days in the regular school year. A student attending every day would equal one unit of ADA. ADA is not the same as enrollment. (See Enrollment.) The state uses a school district’s ADA to deter- mine its total general-purpose (revenue limit) funding and some other funding. Basic Aid The minimum general-purpose aid guaranteed by the state’s constitution for each school district in California. The amount is $120 per pupil (ADA), with a minimum of $2,400 per district for very small districts. In 2003 lawmakers decided that the funding schools receive from categorical programs could satisfy this guarantee. Basic Aid School District The historical name for a district in which local property taxes equal or exceed the district’s revenue limit. These districts may keep the money from local property taxes and still receive constitutionally guaranteed state basic aid funding. Benefit Assessment District See Maintenance Assessment District. For a glossary with education terms beyond school finance, go to www.edsource.org and click on the “glossary” button. BLOCK GRANT Block Grant An allotment of money that is the sum of multiple special-purpose funds combined into one. A block grant tends to have fewer restrictions on how the money is spent than the origi- nal, disparate funding streams had; and it often combines funds that have similar purposes. Bond Measure See General Obligation (G.0.) Bonds. Bonus/Performance Pay Extra money for school district employees who perform extra duties or are considered exemplary. In some states, performance pay is being offered as an incentive for teachers to improve their students’ performance. In California, both employee pay and benefits are determined by collective bargaining, according to state law. Budget Act A constitutionally established, one-year statute for the state’s budget appropriations. It is the only bill allowed to have more than one appropriation. The state Constitution requires that it be passed by a two-thirds vote of each house and sent to the governor by June 15 each year. The governor may reduce or delete, but not increase, individual items. Building Fund A fund that districts must use only for buildings. The money comes from sources such as bonds and the sale/rental of property. California Basic Educational Data System (CBEDS) Reports that contain statistics about schools, teachers, and students. CBEDS reports are collected from each school in the fall. California Work Opportunity and Responsibility to Kids (CalWORKs) A welfare program that gives cash aid and services to eligible needy California families. CalWORKs is a state program that is operated locally by county welfare departments. CalPERS See Public Employees’ Retirement System (PERS). CalSTRS See State Teachers’ Retirement System (STRS). Capital Outlay Money spent for major physical changes to a school, such as new buildings, renovations, reconstruction, or certain new equipment. These investments in the physical structure of a school are expected to last for a number of years. Categorical Aid/Categorical Programs Allocations from the state or federal government that generally fall into three categories: specific programs, specific students, and specific characteristics of school districts. All districts receive categorical aid in varying amounts in addition to the funding they receive for their general education program. In most cases, districts have limitations on how they may use these funds. Certificated/Credentialed Employees Employees who are required by the state to hold some type of teaching credentials, including most administrators and full-time, part-time, substitute, and temporary teachers. Charter School A public school operated independently under a performance agreement with a school district, a county office of education (COE), or the State Board of Education. Charter schools are funded on a per-pupil basis, freed from most state regulations that apply to school districts and COEs, usually able to hire their own teachers and other staff, and sub- ject to closure if they fail to meet their promises for student outcomes. Class Size Reduction (CSR) Incentive programs that provide fund- ing to schools with class sizes of no more than 20 students per teacher. CSR was initiated in the 1996–97 school year for kinder- garten through third grade. A separate program supports smaller classes for core academic subjects in 9th grade. Classified Employees School employees who are not required to hold teaching credentials, such as bus drivers, secretaries, custodi- ans, instructional aides, and some management personnel. Collective Bargaining A process for establishing a contract between a school district and its employee organizations. Senate Bill 160 (1975) defined the manner and scope of negotiations and mandated a state regulatory board. (See Public Employment Rela- tions Board.) Con App (Consolidated Application) The application districts can use to apply for about 20 state and federal categorical programs. Most, if not all, districts use the “con app” to secure funding from at least some of the programs on the application. These programs tend to be on roughly the same timeline and are relatively straight- forward to apply for, such as the federal Title I program and the state School Improvement Program (SIP). Consolidation The combining of two or more elementary or high school districts with adjoining borders to form a single district. (See Unification and Unionization.) Consumer Price Index (CPI) A measure of the average change over a short time in the prices paid for a set of consumer goods and serv- ices. Salary adjustments and other costs can be linked to the CPI, which is sometimes used as a factor to measure inflation. A Glossary of School Finance Ter ms ● August 2004 SERRANO V. PRIEST August 2004 ● A Glossary of School Finance Ter ms FREE/REDUCED-PRICE MEALS (F/RPM) Cost-of-living Adjustment (COLA) An increase in funding for schools from the state or federal government to compensate for inflation. In California, the law states that schools should receive a certain COLA based on the Implicit Price Deflator for State and Local Government Purchases of Goods and Services. County Office of Education (COE) The agency that provides, in general, educational programs for certain students; business, administrative, and curriculum services to school districts; and financial oversight of districts. These services are affected by the size and type of districts within the county, the geographical location and size of the county, and the special needs of students that are not met by the districts. Each of California’s 58 counties has an office of education. Deferred Maintenance Major repairs of buildings and equipment that have been postponed by school districts. Some matching state funds are available to districts that establish a deferred maintenance program to proceed with these repairs. Deficit Factor The percentage by which an expected allocation of funds to a school district or county office of education is reduced. The state may apply deficit factors to revenue limits and categor- ical programs when the appropriation is insufficient based on the funding formulas specified by law. Developer Fees A charge per square foot on residential and commercial construction within a school district that is based on the premise that new construction will lead to additional students. School districts decide whether to levy the fees and at what rate up to the maximum allowed by law. Proceeds are used for building or renovating schools and for portable classrooms. Direct Services Services—including business, attendance, health, guidance, library, and supervision of instruction (K–8 only)— performed without cost by county offices of education for small districts, which are defined as fewer than 901 (elementary), 301 (high school), and 1,501 (unified) students based on ADA. Economic Impact Aid (EIA) State categorical funds for districts with concentrations of children who are transient, from low-income families, or need to learn English. Education Code The body of law that regulates education in Cali- fornia. Additional regulations affecting education are contained in the California Administrative Code, Titles 5 and 8, the Govern- ment Code, and general statutes. Elementary and Secondary Education Act (ESEA) The principal federal law affecting K–12 education. The No Child Left Behind Act (NCLB) is the most recent reauthorization of ESEA. (See No Child Left Behind Act.) Enacted in 1965 as part of the War on Poverty, ESEA supports the education of the country’s poorest children. Congress must reauthorize it every six years. Encroachment The expenditure of a local education agency’s general-purpose funds for mandated special-purpose programs in which the cost of providing the programs exceeds the state or federal funding provided. English Learner (EL) Students whose home language is not English and who qualify for extra help. EL students were formerly known as “limited English proficient” (LEP). Enrollment A count of the students enrolled in each school and district on a given day in October. The number of pupils enrolled in the school is usually larger than the average daily attendance (ADA) due to factors such as students’ moving, drop- ping out, or staying home because of illness. (See Average Daily Attendance.) Equalization Aid Funds allocated, on occasion, by the Legislature to address perceived inequalities and raise the funding level of school districts with lower revenue limits toward the statewide average based on size and type of district. Expenditures Per Pupil The amount of money spent on education by a school district or the state divided by the number of students educated. For most purposes in California, the number of students is determined by average daily attendance (ADA). (See Revenues Per Pupil.) Fiscal Crisis and Management Assistance Team (FCMAT) A state- funded agency that provides fiscal advice, management assistance, training, and other related school business services, with a particular emphasis on districts facing fiscal insolvency. FCMAT operates from the office of the Kern County Super- intendent of Schools under contract with the California Department of Education and the governor’s office. Free/Reduced-price Meals (F/RPM) A federal program to provide food—typically lunch and/or breakfast—for students from low-income families. The number of students participating in the National School Lunch Program is often used as a way to measure the poverty level of a school or district population. The number of children in this program can affect schools’ or districts’ eligibility for grants or other funding aimed at helping lower-income families. Almost half of California’s public school children are eligible for free/reduced-price meals. GANN LIMIT Gann Limit A limit on the amount of tax money that state and local governments, including school districts, can legally spend. Califor- nia voters approved the late Paul Gann’s Proposition 4 in November 1979. The implementing legislation, Senate Bill 1342, minimized the proposition’s impact on K–12 education. General Fund The primary, legally-defined fund used by the state and school districts to differentiate general revenues and expendi- tures from those placed in other funds for specific uses. General Obligation Bond (G.O. Bond) A form of borrowing commonly used to fund school facilities. Local G.O. bonds, financed through an increase in local property taxes, can be used for renovating, reconstructing, and building new facilities and for certain new equipment. School districts can seek either two- thirds or 55% voter approval, the latter with additional accountability requirements. A simple majority of state voters can approve a state G.O. bond, which is repaid by state funds and has no impact on property tax rates. Although both state and local bonds are G.O. bonds, people often use the term “G.O. bond” to refer only to local bonds for school facilities. General-purpose Funding Money granted to school districts for general purposes, with the largest portion of it based on a per- pupil revenue limit amount. Districts can decide how the money is spent, within the constraints of certain laws and contracts with employees. (See Revenue Limit.) Gifted and Talented Education (GATE) A program that provides sup- plemental, differentiated, challenging curriculum and instruction to California public school students who are deemed by districts to be intellectually gifted or especially talented in leadership or visual and performing arts. Healthy Start A state grant program in which schools work with community organizations to provide children and families with access to health and human services, often at schools. The state approved the last round of new grants in 2002. High Priority Schools Grant Program (HPSGP) A program to support schools in the lower half of the state rankings (deciles 1 through 5) based on the Academic Performance Index (API). However, the initial emphasis is on Decile 1 schools, which are at the bottom of the state’s ranking system. (See Academic Performance Index.) Immediate Intervention/Underperforming Schools Program (II/USP) A component of California’s Public Schools Accountability Act (PSAA) designed to provide assistance and intervention for schools identified as underperforming. Three cohorts of 430 schools were chosen—one each in 1999, 2000, and 2001—for the three-to-four year program. In 2002 lawmakers funded instead a similar program. (See High Priority Schools Grant Program.) Impact Aid See PL 81-874. Implicit Price Deflator A measure of inflation used to compare expenditures over a period of time. The state uses the Implicit Price Deflator for State and Local Government Purchases of Goods and Services to calculate increases to revenue limits. Individualized Education Program (IEP) A plan developed for a specific student that outlines what that student needs to learn in a specified period of time and what special services need to be provided based on the student’s ability or limitations. Special Education students have IEPs that may also exempt them from tests or allow accommodations, such as an exam in Braille. Individuals with Disabilities Education Act (IDEA) A reauthorization of the federal Education For All Handicapped Children Act of 1975, which guarantees children with exceptional needs a free and appropriate public education and requires that each child’s education be determined on an individual basis and designed to meet his or her unique needs in the least restrictive environment. It also establishes procedural rights for parents and children. (See Special Education.) Inflation Factor See Cost-of-living Adjustment. Instructional Materials Funding Realignment Program (IMFRP) A program created by the state in 2002–03 to pay for textbooks and related materials, including in some cases professional develop- ment and assessment materials. The IMFRP requires districts to provide standards-based materials for each pupil by the start of the school year that begins within two years of the adoption of mate- rials by the state for K–8 and by the district for 9–12. J-90 An optional salary information report that most districts and county offices of education submit to the California Department of Education. The main focus is teachers’ salaries, but the J-90 also includes other certificated staff. J-200, J-380 Financial (J-200) and program cost accounting (J-380) reports that school districts and county offices of educa- tion submit to the California Department of Education. When all districts converted to SACS (see Standardized Account Code Structure) in 2003–04, CDE discontinued the J-200 and J-380 software. A Glossary of School Finance Ter ms ● August 2004 OFFICE OF PUBLIC SCHOOL CONSTRUCTION (OPSC) August 2004 ● A Glossary of School Finance Ter ms Joint Powers Agreement (JPA) An agreement among local education agencies (LEAs) (and/or sometimes the California Department of Education) to share services or responsibilities. A joint powers board made up of representatives of the LEAs governs the JPA. Joint School Districts School districts with boundaries that cross county lines. Limited English Proficient (LEP) See English Learner. Local Education Agency (LEA) A public board of education or other public authority within a state that maintains administrative control of public elementary or secondary schools in a city, county, township, school district, or other political subdivision of a state. School districts and county offices of education are both LEAs. Sometimes charter schools function as LEAs. Local Miscellaneous Revenues School funding from locally gener- ated sources, such as community contributions, interest income, developer fees, and revenues from local parcel tax elections. Lottery Gambling games approved by California voters in Novem- ber 1984. The minimum of 34% of lottery revenues distributed to public schools, colleges, and universities must be used for educa- tional purposes. Half of any increase of lottery income to school districts and community colleges—as compared to funding in the 1998–99 school year—must be used only for instructional mate- rials, such as textbooks. Lottery income comprises less than 2% of K–12 education funding annually. Maintenance Assessment District An area in which fees charged to property owners are used to provide a service of benefit to all fee payers, such as the maintenance of public parks and recreation areas. Districts must hold an election before fees are levied. It is sometimes called a Benefit Assessment District. Mandated Costs School district expenditures that are required because of federal or state law, court decisions, administrative regulations, or initiative measures. Since the passage of Proposi- tion 4 in 1979 (the Gann Limit), the California Constitution has required the repayment of mandated costs to school districts. Master Plan for K–16 Education A long-term, strategic plan for a single, seamless system of education from prekindergarten through postsecondary education that will provide better schools and higher levels of student achievement in every school, college, and university, and will prepare students to enter the workforce. The main objectives of the plan are to focus the education system on student success and guide education policy and budget decisions over the next 20 years. This master plan has been in place since August 2002. For the most part, legislation to implement the plan has not been enacted. Master Plan for Special Education (MPSE) California categorical program for the education of all children with disabilities, enacted in 1980 and modified frequently since then. (See Special Educa- tion and Individuals with Disabilities Education Act.) Mello-Roos Community Facility District A portion of a school district, often a new housing development, that can be taxed if two-thirds of property owners vote to approve it. Under Mello-Roos, prop- erty owners pay a special tax that is not based directly on the assessed value of the property. Migrant Education Special federal funds for districts with students who are children of migrant workers. Multitrack, Year-round Education (MTYRE) Schools with classes that take place throughout the calendar year. Individual students attend school for nine months, but on staggered schedules. Districts typically choose MTYRE to fully utilize school facili- ties. (A few districts have single-track, year-round education—in which students have shorter vacations spread throughout the year—for educational reasons.) National School Lunch Program See Free/Reduced-price Meals. Necessary Small Schools Schools that need to have small popula- tions, usually because they are in sparsely populated areas or serve special populations (such as Juvenile Court schools). These schools receive extra funding because they cannot realize economies of scale. No Child Left Behind Act (NCLB) The 2002 reauthorization of the Elementary and Secondary Education Act (ESEA). NCLB’s provisions represent a significant change in the federal govern- ment’s influence in public schools and districts throughout the United States, particularly in terms of assessment, accountability, and teacher quality. It increases the federal focus on the achieve- ment of disadvantaged pupils, including English learners and students who live in poverty, provides funding for innovative programs, and supports the right of parents to transfer their chil- dren to a different school if their school is low-performing or unsafe. (See Titles I–X.) Office of Public School Construction (OPSC) The agency that imple- ments and administers the School Facility Program and other programs of the State Allocation Board (SAB). OPSC also verifies OPPORTUNITY TO LEARN (OTL) that all school districts applying for state funding to modernize or build new facilities meet specific criteria based on the type of funding requested. Opportunity To Learn (OTL) Standards that measure the extent to which key education resources—such as experienced teachers, adequate materials, rigorous courses, and safe, clean, uncrowded facilities—are provided at a school site. Parcel Tax An assessment on each parcel of property—not based on assessed value—that must be approved by two-thirds of the voters in a school district. When proposing parcel tax elections, districts indicate how the money will be used. Money from parcel taxes is generally used for educational programs, not for school construction or renovation, which is normally financed through a general obligation (G.O.) bond measure. Per Capita Personal Income Total personal income from all sources prior to taxation divided by the number of residents in, for exam- ple, a state. PL 81-874 (Public Law 81-874) The federal program that provides funds to districts with children whose families live or work on federal property, such as military bases. (See Title VIII.) PL 94-142 (Public Law 94-142) A federal law that mandates a “free and appropriate” education for all children with disabilities. (Also see Individuals with Disabilities Education Act.) Property Tax A tax on local residential and commercial property that is part of a school district’s income based on a formula set by the Legislature and signed by the governor in 1978. These taxes, which vary by district, are part of the district’s revenue limit income. (See Revenue Limit). Proposition 13 An amendment to the California Constitution passed by voter initiative in June 1978 that limits property taxes to no more than 1% of full assessed value (plus any additional rates approved by local voters, such as general obligation bonds). Annual increases in assessed value are capped at 2% or the percent- age growth in the state’s Consumer Price Index (CPI), whichever is less. For individual properties, the assessed value is also raised when new construction or the sale of property occurs (with a few exceptions). Proposition 13 and implementing legislation caused a shift in support for schools from local property taxes to state general funds. Local voters can levy a uniform dollar tax per parcel of land, but they cannot increase property taxes based on value except by issuing general obligation … 1 Glossary of Glossary of Wisconsin School Wisconsin School Finance Terms and Finance Terms and AcronymsAcronyms Compiled by the WASBO Accounting CommitteeCompiled by the WASBO Accounting Committee January 2012January 2012 WISCONSIN 2 School fi nance can be daunting to understand, even for seasoned administrators. Some terms can have different meanings, depending on the context in which they are used. Frequently, school board members, interested parents and community members are asked for their opinions or to support topics ranging from approving the budget at the Annual Meeting of Electors to supporting or opposing proposed legislation that will impact their school district. In an effort to help increase the understanding of common school fi nance terms and acronyms, the Wisconsin Association of School Business Offi cials (WASBO) Accounting Committee, chaired by Ken Mischler, and the Wisconsin Department of Public Instruction (DPI) produced this Glossary of Wisconsin School Finance Terms and Acronyms for the layperson. The purpose of this publication is to provide defi nitions of terms that are currently used in school fi nance discussions. The defi nitions used herein are written for the layperson. The defi nitions are appropriate for this intended purpose; however, in their simplifi cation they lose some of their accuracy for the practicing administrator. This document should not be used as a technical guide for professionals with responsibility for implementing the many regulations associated with management of school district fi nances. Each school district and school fi nance conversation is unique; therefore, every term that is encountered may not be included in this publication. In the event that you encounter a term for which you would like clarifi cation, contact your local school district administrator, the Wisconsin Department of Public Instruction (DPI) website at http://dpi.wi.gov/sfs/sectj.html or feel free to contact the Wisconsin Association of School Business Offi cials at [email protected] or 608.249.8588. Sincerely, Woodrow Wiedenhoeft WASBO Executive Director Copies of this publication may be purchased from the Wisconsin Association of School Business Offi cials (WASBO) 4797 Hayes Road, Suite 101 Madison, WI 53704 www.WASBO.com 608.249.8588 Forward 3 Acronym Acronym Description 220 Chapter 220 Program (Integration Transfer Program) 4K Four Year Old Kindergarten AAL Actuarial Accrued Liability ADA Average Daily Attendance ADM Average Daily Membership ACH Automated Clearing House AICPA American Institute of Certifi ed Public Accountants AODA Alcohol and Other Drug Abuse APB Accounting Principles Board ARC Annual Required Contribution ARRA American Recovery and Reinvestment Act BAB Build America Bond BAC Benefi t Adjustment Cost BAN Bond Anticipation Notes CAFR Comprehensive Annual Financial Report CCDEB County Children with Disability Education Board CD Cognitively Disabled CESA Cooperative Educational Service Agency CFDA Catalog of Federal Domestic Assistance CHOICE Milwaukee Parental Choice Program COA Chart of Accounts COOP Cooperative CPI Consumer Price Index DCF Data Collection Form DHS Department of Health Services DOE Department of Education DPI Department of Public Instruction ED Emotionally Disturbed EDGAR Education Department General Administrative Regulations EFT Electronic Funds Transfer ERRP Early Retiree Reinsurance Program ES Education Services ESEA Elementary and Secondary Education Act FTE Full-Time Equivalency FLSA Fair Labor Standards Act FMLA Family Medical Leave Act GAAP Generally Accepted Accounting Principles GAAS Generally Accepted Auditing Standards GAGAS General Accepted Governmental Auditing Standards GASB Governmental Accounting Standards Board Acronym Acronym Description GED General Educational Development (GED) GEPA General Education Provisions Act GPFS General Purpose Financial Statements GS Government Services HI Hearing Impaired HRA Health Reimbursement Arrangements HSA Health Savings Account IDEA Individuals with Disabilities Education Act IEP Individual Education Plan IPA Independent Public Accountants ITP Integration Transfer Program (Chapter 220 Program) LAB Legislative Audit Bureau LEA Local Educational Agency LD Learning Disability MD&A Management’s Discussion and Analysis MOE Maintenance of Effort MPCP Milwaukee Parental Choice Program NAN Note Anticipation Notes NCES National Center for Educational Statistics NPEFS National Public Education Financial Survey NSLP National School Lunch Program OIG Offi ce of Inspector General OMB Offi ce of Management and Budget OPEB Other Post-Employment Benefi ts OT Occupational Therapy P5 Preschool to Grade 5 Program PARS Personal Activity Reports PCard Purchasing Card PILT Payment in Lieu of Taxes PLTW Project Lead the Way PO Purchase Order PT Physical Therapy QSCB Qualifi ed School Construction Bonds QZAB Qualifi ed Zone Academy Bonds REAP Rural Education Achievement Program RFP Request for Proposal RSI Required Supplementary Information SA Single Audit SAFR State Aids Financial Reporting SAGE Student Achievement Guaranty in Education program SAP School Age Parent SAS Statement of Auditing Standards SBS School Based Services Common School Finance Acronyms 4 Acronym Acronym Description SEA State Educational Agency SEFA Schedule of Expenditures of Federal Awards SFS School Financial Services SFSF State Fiscal Stabilization Fund SPED Special Education Aid program TEACH Technology for Educational Achievement TID Tax Incremental District TIF Tax Incremental Financing TOS Transfer of Service TRAN Tax and Revenue Anticipation Notes USDA United States Department of Agriculture WASBO Wisconsin Association of School Business Offi cials WIAA Wisconsin Interscholastic Athletic Association WICPA Wisconsin Institute of Certifi ed Public Accountants WRS Wisconsin Retirement System WTCS Wisconsin Technical College System WUFAR Wisconsin Uniform Financial Accounting Requirements YCA Youth Challenge Academy Common School Finance Acronyms 5 Term Defi nition Absence Nonattendance of a student on a day or half-day when school is in session. Account A descriptive heading under which are recorded fi nancial transactions that are similar in terms of a given dimension, such as fund, function, object, or source. Accounting Period A period at the end of which and for which fi nancial statements are prepared (for example, July 1 through June 30). Wisconsin school districts prepare fi nancial statements for a fi scal year beginning July 1st and ending June 30th. Accounting Procedure The policy and systematic arrangement of methods and operations for recording accounting information so as to provide internal control and produce accurate and complete records and reports. Accounting System The total process of recording, retrieving, and reporting information on the fi nancial position and operations of an organization. Accounts Payable A liability account refl ecting amounts owed to private persons or organizations for goods and services received. Accounts payable is a current liability on the balance sheet. (Amounts due to other funds of the same government or to other governments are not included here.) Accounts Receivable An asset account refl ecting amounts due to the government by private individuals or organizations for goods or services rendered. Accounts receivable is a current asset on the balance sheet. (Amounts due from other funds of the same government or to other governments are not included here.) Accrual Basis of accounting under which revenues are recognized when earned and expenditures are recognized when incurred, regardless of the timing of related cash fl ows. Most formal fi nancial statements prepared on behalf of school districts are prepared using the accrual or modifi ed accrual basis of accounting as contrasted with the cash basis. Actuary A professional statistician that calculates and analyzes statistics, make forecasts, provide the most accurate information to clients. The actuary is most commonly used by school district to help calculate the post-employment benefi ts. Adult/Continuing Education Instruction designed to meet the unique needs of adults and youth beyond the age of compulsory school attendance. This may be provided by a school system, technical college district school, college, or other agency or institution through activities and media such as formal classes, correspondence study, radio, television, lectures, concerts, demonstrations, and counseling. Advance Refunding Debt issued to refi nance existing debt where the proceeds are received by the school district more than 90 days prior to the date the existing bonds will be retired. These proceeds are put into a “trust” and invested until they are utilized to pay off the existing debt. These transactions are typically done to either save money by refi nancing at lower interest rates or to restructure the payment streams of the existing issue to more favorable terms. NOTE: Tax-exempt municipal debt issued after 1986 may not be advance refunded more than once. Aggregate Days of Attendance The total numbers of days pupils are enrolled and actually present for all pupils for all days in session during a reporting period. For instance; if a school has 100 pupils who were enrolled the entire year, 180 days of school and perfect attendance, the aggregate days of attendance would be 1800. If the total number of absences for all pupils was 100 days, the aggregate days of attendance would be 1700. If 1 of the pupils did not enroll until the 5th day of school, the aggregate days of attendance would be reduced by 4. Aggregate Days of Membership The total numbers of days pupils are actually enrolled for all pupils for all days in session during a reporting period. A pupil may be counted in membership even if not in attendance. However, the fi rst and last days of enrollment for any pupil are determined as the fi rst and last days, respectively, of that pupil’s attendance during a given reporting period. For instance; if a school has 100 pupils who were enrolled and present on the fi rst and last days during a 180 day school year, the aggregate days of membership would be 1800. Membership would be unaffected by pupil absences that occur during the year, however, if 10 of those pupils did not enroll or were not present until the 11th day of school, the aggregate days of membership would be reduced by 100 (10 pupils times 10 days). Amortization of Debt Gradual payment of an amount owed according to a specifi ed schedule of times and amounts. Annual Report A formal fi nancial report fi led with the DPI at the end of each fi scal year. The data in this report is used to calculate most state aids. School Finance Terms (Absence - Annual Report) 6 Term Defi nition Annual Required Contribution The employer’s required contributions for the year, calculated in accordance with certain parameters, and includes (a) the normal cost for the year and (b) a component for amortization of the total unfunded actuarial accrued liabilities (or funding excess) of the plan over a period not to exceed thirty years. Appropriation A legal authorization granted by a governing body to make expenditures and to incur obligations for specifi c purposes. Arbitrage The difference between the combined interest rates on the investment of bond or note proceeds and the combined interest rates of the bonds or notes themselves. The ability of a school district to earn arbitrage is heavily regulated by federal income tax regulations. Assessed Valuation See “Property Valuation.” Assessment Ratio See “Property Valuation.” Asset A resource with economic value that an individual or organization owns or controls with the 1. expectation that it will provide future benefi t. A balance sheet item representing what an organization owns. 2. Attendance See “Pupil Count.” Attendance Area The geographic area wherein reside the pupils normally served by a particular school. Audit An examination of records and documents, and the securing of other evidence, for one or more of the following purposes. (a) To attest to the fairness of management’s assertions in fi nancial statements, (b) Evaluate whether management has effi ciently and effectively carried out its responsibilities, (c) Determining the propriety of transactions, (d) ascertaining whether all transactions have been recorded, and (e) determining whether transactions are accurately recorded in the accounts and in the statements drawn from the accounts. Auditor’s Report In the context of a fi nancial audit, a statement by the auditor describing the scope of the audit and the auditing standards applied in the examination, and setting forth the auditor’s opinion on the fairness of presentation of the fi nancial information in conformity with GAAP or some other comprehensive basis of accounting. Automated Clearing House (ACH) An electronic network for fi nancial transactions in the United States. ACH processes large volumes of credit and debit transactions in batches. ACH credit transfers include direct deposit payroll and vendor payments. ACH direct debit transfers include consumer payments on insurance premiums, mortgage loans, and other kinds of bills. Average Daily Attendance (ADA) See “Pupil Count.” Average Daily Membership (ADM) See “Pupil Count.” Balance Sheet A formal statement of assets, liabilities, and fund balance as of a specifi c date. Bank Qualifi ed Debt A debt issued in a year where the school district issues less than $10 million of general obligation debt. Because there are certain tax benefi ts for banks that purchase bank qualifi ed debt, banks may offer a lower interest rate. Basic Financial Statements The basic fi nancial statements as required by GASB Statement 34. Basic fi nancial statements include: 1. Government- wide fi nancial statements providing information about reporting government as a whole, except for its fi duciary activities; 2.) Fund fi nancial statements providing information about the government’s funds; and 3.) Notes to the fi nancial statements. The basic fi nancial statements should be proceeded by a “management’s discussion and analysis” that introduces the basic fi nancial statements and provides an analytical overview of the government’s fi nancial activities. Bond A written promise, generally under seal, to pay a specifi ed sum of money, called the face value, at a fi xed time in the future, called the date of maturity, and carrying interest at a fi xed rate, usually payable periodically. Bond Anticipation Note Short-term debt incurred to provide funds on an interim basis in anticipation of long-term debt being issued on a future date. This type of note is most commonly issued to provide interim funds for a capital project. School Finance Terms (Annual Required Contribution - Bond Anticipation Note) 7 Term Defi nition Bond Counsel A law fi rm experienced in the Wisconsin Statutes applicable to the issuance of school district obligations and federal income tax law applicable to debt transactions. Bond counsel usually prepares the documents for a debt transaction, and gives an opinion that the obligations are properly issued, are enforceable under state law, and are exempt from income taxation under federal tax law. Bond Insurance Insurance that protects the purchaser of the bonds in the event the school district defaults. This added security results in the bond issue receiving the highest possible credit rating, which results in lower interest rates on the bonds. School districts may decide to obtain bond insurance when the cost to do so is less than the interest savings. Budget A plan of fi nancial operation embodying an estimate of proposed revenues and expenditures for a given accounting period. Budget Amendments School boards may amend the adopted budget during the fi scal year with a two-thirds vote of the school board. Such amendments must be published in the district’s offi cial newspaper within 10 calendar days for common school districts. Budget Report A formal report fi led with the DPI each fall that details the school board approved budget for the fi scal year. Also known as the Fall Budget Report. Budgetary Control The control or management of business affairs in accordance with an approved budget for the purpose of keeping expenditures within the authorized amounts. Business Manager A staff member performing assigned activities which have as their purpose the management of the organization’s business administration functions. Capital Assistance Formula A reference in various proposals for school fi nance reform that provides state fi nancial assistance for qualifi ed capital projects. Capital Expansion Fund A fund that may be authorized at an Annual Meeting of Electors in a common school district or by the school board of a unifi ed school district for the purpose of accumulating monies to be used for acquiring, remodeling or maintaining buildings and sites, and maintenance or repair expenditures that extend or enhance the service life of the building and building components, sites and site components. Monies budgeted into this fund are included in the district’s total revenue limit. Capital Expansion Fund expenditures are amortized over the number of year a tax is levied into the fund. Capital Outlay Expenditures that result in the acquisition of or addition to capital assets. Capital assets are generally characterized as those having a useful life of greater than one year and a cost greater than an amount established by the school district’s business department. Cash Balance The actual cash on hand at a specifi c point in time. Many school districts will have a negative cash balance at some point in the year unless they borrow. Cash balance is contrasted to Fund Balance in that it includes only cash. Cash Basis The basis of accounting under which transactions are recognized only when cash changes hands. An example of cash basis is an individual’s income tax return that reports only cash received and paid, but does not recognize future earnings or amounts owed to others. Categorical Aid State or federal aid which is intended to fi nance or reimburse some specifi c category of instructional or supporting program or to aid a particular target group of pupils. The district may use the aid only for the purpose for which it is paid. (Also see “General Aid.”) Wisconsin categorical aids include special education, library (Common School Fund), driver education aid, integration aid, food service, bilingual/ bicultural and other state aids. Federal categorical aids include No Child Left Behind, IDEA (special education), vocational education, food service, and other programs. CCDEB A county children with disabilities education board. (Formerly known as CHCEB.) Certifi cation The general process by which the DPI provides a license to an individual indicating qualifi cation and employability. CESA A cooperative educational service agency. Chart of Accounts A list of fi nancial account names and numbers used to record fi nancial transactions. The Department of Public Instruction prescribes the use of a chart of accounts called the Wisconsin Uniform Financial Accounting Requirements. (WUFAR). The WUFAR uses a multi-dimensional coding structure that allows for recording transactions in such a manner as to allow fi nancial reporting and analysis based on several characteristics. School Finance Terms (Bond Counsel - Chart of Accounts) 8 Term Defi nition Chief State School Offi cer The chief executive of a school education agency (SEA). In Wisconsin, the State Superintendent of Public Instruction, which is a publicly elected position. Children With Disabilities (CWD) The offi cial classifi cation, specifi ed by the federal government, to describe students requiring special education services based on their disability. Choice See “Milwaukee Parental Choice.” Class A setting in which organized instruction of course content is provided to one or more students for a given period of time. Class Period The portion of the daily session set aside for instruction in classes, when most classes meet for a single such unit of time. Class Size The enrollment in a class as of a given date. (Also see “Pupil Count.”) Classroom Teacher A staff member, assigned to the professional activities of instructing pupils in classroom situations. Common School Fund It is one of the State of WiconsinsTrust Funds managed by the Board of Commissioners of Public Lands and available for loans to school districts and municipalities. The interest earned on the loans is disseminated as Library Aid each year to public school districts for the purchase of school library materials. Competitive Sale A sale of obligations where bids are received from interested underwriters at a certain time and date. Most of the terms of the obligations are set prior to the competitive sale, and are announced in an offi cial notice of sale. The bids of each underwriter refl ect the interest rates proposed by such underwriter, with the lowest combined interest rate being the winner. Continuing Disclosure Important information about a municipal bond that arises after the initial issuance of the bond that needs to be reported periodically. This information generally would refl ect the fi nancial or operating condition of the issuer as it changes over time, as well as specifi c events occurring after issuance that can have an impact on the ability of issuer to pay amounts owing on the bond, the value of the bond if it is bought or sold prior to its maturity, the timing of repayment of principal, and other key features of the bond. Each bond will have its own unique set of continuing disclosures, and not all types of continuing disclosures will apply to every bond. Cooperative Educational Service Agency (CESA) A grouping of school districts, headed by a board of control, charged with implementing and operating cooperative programs among member districts and insuring proper school district organization. Each school district in Wisconsin except Milwaukee, Racine and Kenosha is in a CESA area. (Also see “IEA.”) School Finance Terms (Chief State School Offi cer - Coop Educ Service Agency) 9 Term Defi nition Cost In general, an expenditure for goods (supplies, materials, equipment, land, buildings) or services (salaries, benefi ts, utilities, professional fees). In determining costs, care must be taken to avoid double counting. For example, if a school building is fi nanced from borrowed money, the total cost should include either the payment to the building contractor or the repayment of the borrowed money, but not both. Similarly, if a school district spends money for a school lunch program out of the food service fund and also transfers money from the general fund to the food service fund to help pay for the school lunch program, it should not count the transfer as an additional cost. Depending on the grouping being examined, a given expenditure can be a cost in one case but not in another. For example, if one looks at a single school district, payments by that district to other school districts are counted as costs, since they are not otherwise counted by that district. The various costs are as follows: • Current Educational Cost (CEC) - This measure attempts to identify overall instructional and instructional support service costs attributable to district residents. It can generally be described as the cost of the district’s General and Special Project funds, excluding transportation and facility acquisition expenditures, less inter - fund transfers and revenues for instructional services the district provides to non - resident pupils such as tuition receipts, CESA and cooperative agreements, and state inter - district integration aid. • Gross Cost - The sum of all non - duplicative expenditures and transfers out of a fund or a school district. • Net Cost - The gross cost of a fund or a school district minus costs paid for by certain receipts (typically federal aid, state categorical aid, and local non - tax receipts) of that fund or district. • Primary Cost - That portion of the shared cost which is within the primary cost ceiling, and in which the state shares using the primary guaranteed valuation per member. • Secondary Cost - That portion of the shared cost which is above the primary cost ceiling, but not more than the secondary cost ceiling, and in which the state shares using the secondary guaranteed valuation per member. • Shared Cost - The cost used as the basis for computing state general aid. This cost is funded by a combination of property taxes and state general aid. It is equivalent to the net cost of the general fund plus the net cost of the debt service fund. • Tertiary Cost - That portion of the shared cost which is above the secondary cost ceiling and in which the state shares using the tertiary guaranteed valuation per member. • Total District Cost (TDC) - This is the TEC plus food and community service costs. It should be noted that food and community service activities are usually funded with fees and other program revenue, requiring little or no property tax subsidy. • Total Education Cost (TEC) - This is the CEC plus transportation, expenditures for facility acquisitions charged to the General, Special Project, and Capital Expansion (Tax Levy Financed “Sinking”) funds, and debt service principal and interest. County Children with Disabilities Education Board (CCDEB) A branch of county government that provides instructional and therapeutic services to handicapped pupils. (Also, see “IEA.”) Course An organization of subject matter and related learning experiences provided for the instruction of pupils on a regular or systematic basis. Credit toward graduation or completion of a program of studies generally is given to pupils for the successful completion of a course. Credit Rating A rating that establishes the school districts relative risk to a purchaser of debt in comparison with other debt issued by other entities. Debt of public entities is rated by one or more of three rating agencies – Moody’s Investors Service, Standard and Poor’s and Fitch Investment Services. Current Refunding Debt issued to refi nance existing debt where the proceeds are received by the school district less than 90 days prior to the date the existing bonds will be retired. These transactions are typically done to either save money by refi nancing at lower interest rates, or to restructure the payment streams of the existing issue to more favorable terms. Unlike advance refunding issues, tax-exempt municipal debt may be current refunded as many times as deemed practical by the issuer. Day in Session A day on which the school is open and the pupils are under the guidance and direction of teachers. On some days, school may be closed and all pupils may be engaged in school activities outside school under the guidance and direction of teachers. Such days should be considered as days in session. Days on which the teaching facility is closed for such reasons as holidays, teachers’ conventions, and inclement weather should not be considered as days in session. School Finance Terms (Cost - Day in Session) 10 Term Defi nition Debt Limit The maximum amount of debt that a school district is legally permitted to incur. The school district debt limit is 10% of equalized value for K-12 school districts and 5% of equalized value for K-8 and union high school districts. Debt Margin The difference between the debt limit and total outstanding debt. Debt Service Expenditures for the retirement of principal and payment of interest on debt. Defeasance The irrevocable setting aside where a borrower sets aside cash or assets for repayment of a debt without actual retirement of the debt. Deferred Income Income received in a given fi scal year but not earned until after the fi scal year has ended. For example, monies collected from parents for their child’s food service account that remain in the account for use in the next school year. Defi cit Spending The amount by which total expenditures exceed total revenues for the fi scal year. Defi cit spending results in a reduction of fund balance. Department of Public Instruction (DPI) The state agency, headed by an elected state superintendent, charged with the supervision and guidance of elementary and secondary education in Wisconsin. (Also see “SEA.”) Diploma A certifi cate conferred by a high school Board of Education or similar agency as offi cial recognition for the completion of a program of studies or for other attainment. Disbursements Payments in cash. District Administrator A staff member who is the chief executive of a school district; a superintendent of schools. DPI The Department of Public Instruction. (Also see “SEA.”) Due to Other Funds Amounts owed by one fund to another. The recognition of interfund payables in one fund requires the recognition of an interfund receivable in another fund. Because of this relationship, the aggregate amount of interfund payables must equal the aggregate amount of …