Memo for fiscal year 2020, updated 2019-03-28

[Archived] Question #50: Provide the impact of reducing the ACPS Operating appropriation by $708,570 and increasing funding for the ACPS non-capacity CIP for FY20 by the same amount to fund textbook replacement.


The School Board's approved operating budget includes $708,570 as part of a 7 year plan to replace all textbooks. What would be the fiscal impact of reducing the School Board's Operating appropriation by $708,570 and increasing the cash capital funding for the ACPS non-capacity Capital Improvement Program allocation for FY 2020 by the same amount, reflecting the inclusion of this expenditure in the Capital Improvement Program for this year, and future budget years? (Mayor Wilson)


The Superintendent’s Proposed FY 2020 Combined Funds Presentation to the School Board included a 7-year plan for textbook replacements as seen in the following table. The FY 2020 funding of $708,750 has been included in the School Board Approved FY 2020 Combined Funds budget, which has been fully funded in the City Manager’s Proposed FY 2020 Budget. Moving this funding from the ACPS General Fund operating transfer to the capital fund transfer would not have a fiscal impact in FY 2020, as the reduction on the operating side would directly match the increase on the capital side.

The table below outlines the funding schedule proposed by ACPS in the Superintendent’s Proposed FY 2020 Combined Funds Presentation for textbook replacement. As the table shows, in FY 2021 – FY 2025, investments in textbooks increase above the $708,750 amount budgeted for FY 2020, and for FY 2027 and beyond an investment of $1 million per year is anticipated. As an example, in FY 2021 funding that ACPS estimates that their textbook replacement schedule would require is $381,135 in addition to the $708,750 budgeted in FY 2020. Although City Council can choose to make this transfer, it legally cannot direct how ACPS uses the funds. Ultimately the School Board will adopt the final use of the funds as part of the FY 2020 – FY 2029 Adjusted CIP in June 2019.

BM 50 - Object 1

Moving textbook expenditures to the capital fund is not the only method for creating more stability and certainty in the replacement of the school textbooks. Another option for this issue would be for ACPS to establish an equipment replacement fund for textbook replacements similar to the City’s vehicle and computer replacement funds. The timing of specific textbook replacement schedule recommendations are established by the Commonwealth and could be used as a guideline for establishing annual contributions to the fund for textbook replacement. In both scenarios (creating an equipment replacement fund and capitalization), it is important to note that some level of additional funding support will be necessary to support either the fund and/or the direct purchase of textbooks. If desired by Council, City and ACPS staff can work together to produce a recommendation on how best to fund textbook replacements in the future.

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