Staff Present
Dr. James Alther, Director, Strategic Planning, Implementation, and E-Rate Program
Ms. Maruch Atienza, Director, Business Accounting
Mr. Brian Clelland, Director, Benefits Administration
Mr. Michael Eugene, Business Manager
Ms. Karen Garibaldi, Administrative Manager
Ms. Megan Klee, Chief Information Officer
Mr. Rick Knott, Controller, Accounts Payable and Disbursements
Mr. Don Mullinax, Inspector General
Mr. Ruben Rojas, Revenue Enhancement
Dr. Charles Schepart, Independent Analysis Unit
Ms. Marilynn Wells, Director, Food Services
The minutes for the September 11, 2003 and October 16, 2003, Audit, Business and Technology Committee were approved as submitted.
YEAR 7 E-RATE APPLICATION
Dr. Alther gave an overview of the E-Rate program and presented a Board Report requesting approval of the Year 7 (2004-05) E-Rate application. Under the auspices of the Federal Communications Commission (FCC), the Schools and Libraries Division (SLD) awards E-Rate funding based on a school's level of economic disadvantage. Dr. Alther reviewed the three service categories funded which are telecommunica- tions services, internet provider services, and internal connections. Dr. Alther reviewed some of the major accomplishments using E-Rate dollars in addition to the yearly discounts. There are added costs to the District which are not funded by E-Rate, but must be provided when filing for E-Rate discounts, such as electrical upgrades, air conditioning for equipment rooms, telephone devices, classroom computers, staff and student training, and project management.
Dr. Alther and Ms. Klee responded to comments and questions raised by the Committee Members.
The Board Report was approved for transmittal to the Board of Education on November 25, 2003.
REVENUE MAXIMIZATION PLAN
Mr. Knott gave an overview on the development of a Revenue Enhancement Unit. The Revenue Enhancement Unit was established to identify, evaluate and maximize the District's revenue. The District's current budget, Fiscal Year 2003-04, shows $200 million more in expenses than in revenue, and the District is facing a $500 million deficit for Fiscal Year 2004-05. The District needs to continuously evaluate its revenue generating performance. The recommendation to form a Revenue Enhancement Unit is the result of audits and analysis from independent units over the years. The Office of the Inspector General, in May 2001, focused on the recommendation that there needed to be an enhanced unit whose sole purpose was to increased the revenue stream. In December 2002, KPMG audit firm made a similar recommendation, and the Public Consulting Group, in May 2003, was the third firm that made the recommendation. Several meetings with UTLA resulted in the identification of 21 revenue initiatives. District staff identified 8 of the 21 for implementation of phase one. The following are recommendations from the Revenue Enhancement Unit:
At the request of a Committee Member, Mr. Knott reviewed the following eight revenue initiatives: Impact Aid, Mandated Cost, Free and Reduced Lunch Program, Non-Public Schools, Charter Schools, and Vendor Management. Mr. Rojas reviewed areas of Medical Eligibility and Medical Administrative activity.
Mr. Mullinax suggested another area of revenue‹a centralized Grant Management Office to apply for the many grants that staff does not know about.
FALL 2003 MEAL APPLICATION CAMPAIGN
Ms. Wells gave an overview on the Fall 2003 meal application campaign. She noted that child nutrition programs are acts of congress (National School Lunch Program, National School Breakfast Program, School Feeding Program and After School Snack Program). Authorization is found in the Code of Federal Regulations outlining eligibility requirements for free and reduced price meals. The USDA is the regulatory agency, and the School Food Authority (SFA) must enter into agreements annually with the California Department of Education in order to operate meal programs to comply with USDA regulations. Ms. Wells called attention to the free and reduced price policy statement requiring names of officials to make eligibility determinations. In LAUSD the cafeteria managers are the officials, and they must provide assurance that the SFA will comply with current income eligibility guidelines. A description must be provided on how the SFA will prevent overt identification of children receiving free or reduced price meals. Ms. Wells reviewed the methods and processes of the free and reduced price meal eligibility.
Ms. Wells reported that as of October 31, 2002, LAUSD had an enrollment of approximately 739,000 and of those 553,000 were eligible for free and reduced price meals. Approximately 75,277 (17%) students qualified under the category of Direct Certification, which is a simplified method of determining eligibility for free meals without an application. The Department of Public Social Services (DPSS) provides an electronic file containing the names of LAUSD students receiving CalWORKs or food stamps. If a match is made, the student is identified eligible for free meals, then households receive notice of direct certification. Another method is called Provision 2, where applications are required only in the base year (4 year cycle). All students within the household receive meals at no charge. A problem is that parents are not motivated to submit meal applications. The District receives reimbursement based on participation in each eligibility category. The revenue is not maximized if eligible students do not submit meal applications. There is also the Meal Application, known as the Paper Application method, which must be accompanied by a "letter to households" listing instructions on how to complete the application. There are privacy concerns since a Social Security number is required under provisions of the Richard B. Russell National School Lunch Act.
Ms. Wells reviewed the processing of applications, areas of non-compliance, verification efforts and provided the results for fiscal year 2002-2003.
The Committee Members expressed their comments and questions.
REQUEST FOR PROPOSALS (RFP) FOR FINANCIAL ADVISORS
Mr. Knott presented a status report on establishing a financial advisors bench contract to explore avenues on how to raise the District's revenue stream, and how to do things more efficiently to stretch the District's dollars. Mr. Knott reviewed the procedures, which resulted in a proposed bench contract that will be presented to the Board of Education on November 25, 2003.
JOINT POWERS AGREEMENT (JPA) FOR DELINQUENT PROPERTY TAXES
Mr. Knott presented a status report on the Joint Powers Agreement (JPA) for the collection of delinquent property taxes.
PROPOSED FACILITIES BOND AND DEBT TRANSACTIONS
Mr. Knott presented a status report on selected items involving debt transactions as it pertains to
Certificates of Participation (COP's). Mr. Tokofsky requested that this item be brought to the next Audit,
Business and Technology Committee for further discussion.
DEVELOPER FEE POLICY
Mr. Knott advised the Committee that the status report on the developer fee policy was presented this morning to the Special Budget and Finance Committee, and is being shared in this committee. Under Government Code Sections, school districts are required to report the beginning balance, the collections for the year completed, the use of money from developer fees, and the ending balance on an annual basis. State law requires that developer fees which were collected, but not used over a five year period, should be returned to those who paid those fees.
The Board Report that will be presented to the Board is an accounting for last year's transactions. It will
be transmitted to the Board of Education on November 25, 2003.
2004 ANNUAL BENEFITS OPEN ENROLLMENT
Mr. Clelland gave a presentation on the 2004 annual benefits open enrollment period which started on November 3, 2003 and will continue through November 23, 2003. The benefits open enrollment now has a web site and employees are able to access their account on the web. This will eventually reduce the paperwork, and increase efficiency. So far, 2500 individuals have requested hard copy materials, and 90% have gone through the web.
ADJOURNMENT
The meeting adjourned at 3:30 p.m.
ACTION ITEMS Oral reports with written documents that require Committee action
1. Approval of the Minutes for the September 11, 2003 and October 16, 2003 Audit,
Business and Technology (ABT) Committee Meetings
The ABT Committee will take action on approving the draft minutes for the September 11, 2003 and October 16, 2003 ABT Committee meetings.
2. Year 7 E-Rate Application
Dr. Alther (Director of Strategic Plan Information Technology Division) will discuss the E-Rate
program and present a Board Report that seeks approval of the District's Year 7 E-Rate application.
The Committee will be requested to take action on the Board Report.
INFORMATION ITEMS Oral presentations with or without written documents
3. Revenue Maximization Plan
Mr. Buresh, Mr. Knott (Controller) and Mr. Rojas (Acting Director of Revenue Enhancement) will
present a proposed plan for maximizing revenues coming to the District.
4. Fall 2003 Meal Application Campaign
Ms. Wells (Food Services Branch Director) will make a presentation on the Fall 2003 meal
application campaign.
5. Request for Proposals (RFP) for Financial Advisors
Mr. Knott and Ms. Atienza (Director of Business Accounting) will provide a status report on
establishing a financial advisors bench.
6. Joint Powers Agreement (JPA) for Delinquent Property Taxes
Mr. Knott will present a status report on the JPA for the collection of delinquent property taxes.
7. Proposed Facilities Bond and Debt Transactions
Mr. Knott and Ms. Atienza will provide a status report on selected items involving debt transactions.
8. Developer Fee Policy
Mr. Knott and Ms. Garibaldi (Deputy Director, Redevelopment and Developer Fee Office) will
present a status report on a developer fee policy for the District.
9. 2004 Annual Benefits Open Enrollment
Mr. Clelland (Director, Benefits Administration) will discuss the 2004 annual benefits open
enrollment.
10. Committee Organizational Issues
The Committee will discuss various organizational issues such as identifying and prioritizing future
agenda items, calendaring future meetings, and other related Committee business.
OTHER ITEMS
11. Items Referred to the Committee by the Board of Education or Committee of the
Whole
The Committee may consider and act upon motions, Board Reports, or other business referred to it
by the Board of Education or Committee of the Whole, with respect to any properly posted matter
at a meeting immediately preceding this committee meeting,where the time between that meeting
and this committee meeting is less than 72 hours.Members of the public are encouraged to review
the order of business or agenda for the meetings of the Board of Education or Committee of the
Whole.
12. Public Comments
Persons who wish to address the Committee may sign up at the meeting.