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All Peak to Peak Community: Budget Update

Dear Peak to Peak Community,


As you are well aware, we are living through an unprecedented global pandemic which is causing widespread economic distress. The state of Colorado is no exception. Since over 60% of Peak to Peak’s funding comes from the state in the form of per-pupil revenue (PPR), our school will also be impacted by the reduction in tax revenues that the state is experiencing. The purpose of this letter is to inform our community about the preparedness of the school to address the economic impact.


From our beginning, Peak to Peak has always operated in a fiscally conservative manner. This meant that we didn’t borrow beyond our means, we didn’t take unnecessary financial risks, and we saved money to build our financial reserves. As a charter school, Peak to Peak can be nimble and flexible, and this means that we are able to manage our finances in a way that best suits our community and protects our school. As a result, we are in a good position to weather an economic downturn. At the same time, we have worked hard to compensate our employees competitively. When compared to average teacher salaries across school districts in the state, Peak to Peak would rank fourth.


The Office of State Planning and Budgeting (OSPB) provided its budget outlook for Colorado on May 12th, which will be utilized by the state legislature to determine the level of state funding (PPR) to K-12 public schools for next year. This report revealed that the state budget has a shortfall of over $3 billion, which will require significant cuts in the state budget. This will result in large cuts to PPR. You may have read articles recently discussing the cuts that various districts are considering in anticipation of a reduction in PPR. As a result, community members have raised questions regarding how Peak to Peak is addressing this challenge.


Peak to Peak is in a strong financial position. We have developed several scenarios to study and prioritize the actions we are planning to take to deal with the anticipated revenue shortfall. In each scenario, we preserve our programs and our employees, making expense reductions in other areas. Linkedyou will find a progression of budget scenarios with reductions of 5%, 10%, and 15% in PPR. For context, it may be helpful to understand that for Peak to Peak, a 1% reduction in PPR is equivalent to about $120,000 in lost revenue. This means that a 5% reduction equates to $600,000 in lost revenue. Peak to Peak’s budget is divided into four major funds:

  • General Fund (Fund 11) is by far the largest fund and is where almost all salaries are paid. It is funded by PPR, BVSD mill levy overrides (MLOs), and other state funding.
  • Food Services Fund (Fund 21) only pertains to the food services program.
  • Fundraising Fund (Fund 26) only pertains to fundraised monies and includes no salaries.
  • Operations and Technology Fund (Fund 65) funds all facilities costs and capital projects. It is solely funded by the 2016 BVSD MLO.

In some of the scenarios, shifting expenses between funds is a strategy that helps us accomplish our priorities for preserving programs and retaining employees. By moving some expenses from Fund 11 to Fund 65, monies are freed up to pay salaries, but this also means that capital projects in Fund 65 have been delayed.  Please review the attached information to understand Peak to Peak’s values and priorities with budgeting, and what actions are being planned to manage through deeper cuts in PPR.  

Rest assured that we are doing all we can to ensure that Peak to Peak’s nationally recognized academic program is maintained and that our amazing staff is retained. If you have any questions, please feel free to contact me and I will be happy to answer your questions at sam.todd@bvsd.org.

Thanks,
Sam Todd, Executive Director of Operations