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APPROPRIATION COMMITTEE-ATM 2017 2017 Annual Town Meeting Analysis and Recommendations The warrant for the 2017 Annual Town Meeting contains a full complement of operating budget, enterprise fund and capital appropriations, along with financial adjustments to various programs. The Committee has provided its analysis of these requests below. Article 4: Appropriate FY2018 Operating Budget Funds Requested Funding Source Committee Recommendation See subsections See motion Approve (9-0) The four major components of the operating budget are: Education (Program 1000, broken into line item 1100, Lexington Public Schools, and line item 1200, Regional Schools); Shared Expenses (Program 2000); and Municipal(Programs 3000-8000). Each of these components is discussed separately below. Funds Requested Funding Source Line Item 1100: Lexington Public Schools $101,655,182 See Motion Overview The School Committee has voted to recommend an appropriation of $101,655,182 for the school operating budget for fiscal year 2018. This amount does not include: • The school portion of shared expenses such as health insurance ($13,070,879), dental insurance and workers' compensation. Breakdowns of the latter two items by school and municipal portions are not readily available. • Federal, State, local, and private grants; Revolving and donation fund activity. The request represents an increase of $4,361,883 or 4.48% above the FY2017 appropriation, which was $97,293,299. The primary drivers of the FY2018 increase include contractual requirements such as collective bargaining agreements (2.20%), legal requirements for special education (including transportation services) (1.03%), enrollment increases (1.24%), and programmatic improvements (0.02%). Salaries and Wages Salaries and wages, in the amount of $85,948,669, make up 84.55% of the FY2018 request, an increase of $2,874,323 or 3.46% over FY2017. The budget includes amounts for an additional 12.30 full time equivalent (FTE) positions as well as negotiated salary increases. To cover health insurance, Medicare, and workers' compensation for the employees who will occupy the 12.30 new FTE positions, $195,151 has been included in the Shared Expenses part of the operating budget. The FY2018 budget includes funding for all negotiated bargaining unit increases as well as increases for non- union positions. This covers both step increases and cost of living adjustments (COLA). The current status of collective bargaining agreements and corresponding expiration dates can be found in the Brown Book on page III-4. The additional 12.30 FTE positions address the needs associated with the projected K-12 enrollment increase of 169 students (from 6994 to 7163), which is an increase of 2.42%. During the past five years, K-12 enroll- ment at Lexington Public Schools has increased by 620 students (+9.7%), or an average of 124 students per year (1.9% per year). These past increases have had a direct impact on the School Department operating 8