Review Agenda Item
Meeting Date: 12/1/2016 - 6:00 PM
Category: Old Business and Action Items
Type: Action
Subject: Resolution to Designate Fund Balance for the New Elementary School
ACPS 2025 Strategic Plan Goal:
Objective 4.1 Optimal Learning Environments and Infrastructure
In collaboration with City partners, ACPS will move aggressively to modernize all learning environments, expand or otherwise adapt facilities to meet projected changes in school enrollment, and ensure equitable application of capital improvements throughout the school division.
Policy: DAB - Operating Fund Balance
Funding Source or Fiscal Impact (where applicable)
File Attachment:
161201_Memo_Fund_Balance_Resolution.pdf
Agenda Item Summary:
Background: The School Board and staff have been actively performing the necessary due diligence with regards to the prospective purchase of a new elementary school at 1701 and 1705 North Beauregard Street. Staff has reviewed the building condition, academic programming feasibility, covenant modifications, and land use requirements to inform the School Board’s decision to proceed with this purchase. This building and adjacent garage became the most optimal solution for addressing elementary capacity given its square footage, location on the West End, and good building condition. At a sales price of $15.0 million and preliminary retrofit estimates of $23.2 million, the total cost of this project is approximately $38.2 million. Additionally, the total cost to establish a separate Pre-K Center at John Adams Elementary School is approximately $1.0 million.

With available Capital Improvement Program (CIP) funding of $24.3 million, an additional $14.9 million is required and anticipated to be covered through a reprioritization of capital improvement program projects, the use of school board reserves/ operating fund balance, and a transfer of operating funds to the ACPS Capital Improvement Program.

Use of Fund Balance

On May 19, 2016, the School Board adopted a new fund balance policy (Policy DAB) that outlines the acceptable levels and uses of unrestricted operating fund balance. The policy was established in collaboration with the City, giving the School Board the authority to establish a reserve to address any unanticipated funding needs or revenue shortfalls. Based on the available, unassigned fund balance as of June 30, 2015, the School Board designated $1,934,459 as School Board Reserves on May 26, 2016.

Pursuant to School Board Policy DAB, the Superintendent is recommending that the School Board adopt a new fund balance resolution to use $1,934,459 from School Board Reserves to partially fund the New Elementary School CIP Project.

To do this, the School Board will need to adopt a new Fund Balance Resolution that specifies the use of $1,934,459 from School Board Reserves/ Operating Fund Balance for the new elementary school CIP project (see Attachment 1). This resolution authorizes the following: 1) an increase in the use of Spendable Fund Balance in FY 2017 for the ACPS Operating Fund by $1,934,459 to a total of $6,996,799, and 2) an increase in the operating expenditure budget from $253,400,479 to $255,334,938 in support of the new elementary scho
Recommendation: The Superintendent recommends that the School Board adopt the attached resolution to designate and appropriate $1,934,459 from available operating fund balance in support of the new elementary school and pre-k center projects. Adoption of both this resolution and the concurrent “Resolution to Transfer FY 2017 Operating Budget Funding to the ACPS Capital Improvement Program Budget for the New Elementary School” will result in a total of $4,475,434 additional CIP funding for the new elementary school and pre-k center.
Approvals:
Recommended By:
Signed By:
Final-Clerk of the Board - Proxy
Vote Results:

Original Motion
Member Christopher J. Lewis Moved, Member Ramee A. Gentry seconded to approve the Original motion 'The Superintendent recommends that the School Board adopt the attached resolution to designate and appropriate $1,934,459 from available operating fund balance in support of the new elementary school and pre-k center projects. Adoption of both this resolution and the concurrent “Resolution to Transfer FY 2017 Operating Budget Funding to the ACPS Capital Improvement Program Budget for the New Elementary School” will result in a total of $4,475,434 additional CIP funding for the new elementary school and pre-k center.'. Upon a Roll-Call Vote being taken, the vote was: Aye: 8 Nay: 1.
The motion Carried 8 - 1
   
Ronnie Campbell     Yes
William E. Campbell     Yes
Karen Graf     Yes
Christopher J. Lewis     Yes
Ramee A. Gentry     Yes
Henry E. Cardwell     Yes
Margaret Lorber     Yes
Cindy Anderson     No
Veronica R. Nolan     Yes

Amended Motion
Member Christopher J. Lewis Moved, Member Ramee A. Gentry seconded to approve the Amended motion 'FURTHER, BE IT RESOLVED that the foregoing fund transfers by the School Board will be effective fourteen days prior to the scheduled closing date of the purchase contract for the property at 1701 and 1705 North Beauregard Street, as that date may be amended.
'. Upon a Roll-Call Vote being taken, the vote was: Aye: 9 Nay: 0.
The motion Carried 9 - 0
   
Ramee A. Gentry     Yes
Margaret Lorber     Yes
Veronica R. Nolan     Yes
Karen Graf     Yes
Ronnie Campbell     Yes
William E. Campbell     Yes
Henry E. Cardwell     Yes
Christopher J. Lewis     Yes
Cindy Anderson     Yes