Quarterly Newsletters 17/18 Second Quarter Newsletter | Page 10

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NMPED Update

School Budget &

Finance Analysis Bureau

It is by no means certain that a request of this nature would be viewed favorably or automatically granted. PED is acting in the best interest of all stakeholders when trying to strike a balance between ensuring the unit value is set accurately and ensuring mid-year budget reductions do not occur because of a unit value reduction.

Membership Projections

According to state law (22-8-12.1 NMSA 1978), membership projections are due on October 15th of each year. If you do not upload your membership projections into the SHAREPoint program by this date, you are in violation. It is a hard deadline without the ability for PED staff to grant extensions. Recent conversations with the Public Education Department’s independent public auditor (IPA) revealed that not every school district meets this statutory obligation in a timely fashion. Though the onus to comply with the state law lies with the school district or charter school, the data plays an important part of Operating Budget and appropriation development. Further, the School Budget and Finance Analysis Bureau have a vested interest in promoting compliance.

Some school district and charter school officials have indicated compliance is prevented because of first reporting period STARS data not being reviewed and verified by this date. It is recommended that school districts and charter schools use the initial data as submitted to inform the submittal in the SHAREPoint program. Additionally, some school districts and charter schools have indicated that they did not receive notifications about the due date from the Bureau. It is recommended that you check your junk or spam email filters, but the due date is a requirement regardless of reminder emails.

Interim Unit Value

As members may recall, the Legislature granted PED the authority to raise the unit value in the interim one more time before the final unit value in January. PED examined whether the possibility existed in advance of the November SEG, given the information available and understanding that the school districts could always use as much money at the start of the school year as possible. This was the reason for the delay in November SEG allotments. However, the PED had (and still has) concerns regarding statewide finances and availability of data. These include an August 2017 consensus revenue forecast projection that statewide FY18 expenditures are projected to exceed revenues by $122 million and the possibility that potential solvency measures, combined with an interim unit value increase, could negatively impact the final unit value.

Additionally, there is always a need to be conservative when setting any unit value. Concerns about any declines in federal Impact Aid awards and the uncertainty of first reporting period adjustments contributed to taking a more cautious stance regarding setting an interim unit value in this particular year. The decision to wait to increase the unit value until January provides more confidence in a potential unit value increase or, if solvency measures are taken, to lessen the impact to state education finances. It does not make any sense, and would be detrimental to school finances, to raise the unit value in the interim only to turn around and lower it in January. The PED received concerns from some school districts regarding not setting an interim unit value. To clarify, the PED did not receive an additional appropriation to set an interim unit value; there was simply the ability to request additional funds from the state Board of Finance if projections fell short.

David Craig