PFMGC Proposal for the Pennsbury School District RFP #2122-011 Merger Feasibility Study (1)

The Pennsbury School District REQUEST FOR PROPOSAL #2122-011 Merger Feasibility Study Project Completion Date: February 28, 2022 by 12:00 PM Introduction: The Pennsbury School District issues this Request for Proposal from financial/educational consultants to conduct a reorganization feasibility study on the Pennsbury School District merging with the Morrisville School District In addition to a full merger, the study will evaluate a model of Morrisville sending all or some students to Pennsbury School District on a tuition basis The goal in requesting this study is to determine if the merger or tuition relationship is in the best interest of both school districts, including, but not limited to, if instructional opportunities would be enhanced for all students at a similar or reduced cost to taxpayers The completed RFP shall be delivered electronically to the Pennsbury School District, to the attention of Chris Berdnik, Chief Financial Officer, at cberdnik@pennsburysd.org, on or before September 24, 2021, at 12:00 PM The District reserves the right to reject any and all proposals for any reason as it deems fit The District reserves the right to negotiate further with one or more proposers Respondent shall be expected to furnish the District with additional information as may reasonably be required The District will not be liable for any costs incurred in the preparation of proposals or attendance at an on-site visit PFM Group Consulting LLC Name of Agency Submitting this Proposal _ Address 1735 Market Street, 43rd Floor Philadelphia, PA 19103 _ Contact Person Dean Kaplan Telephone Number 267-252-1665 Email kapland@pfm.com Pennsbury School District Request for Proposal #2122-011 Merger Feasibility Study Proposal September 24, 2021 PFM Group Consulting LLC 1735 Market Street 43rd Floor Philadelphia, PA 19103 215.567.6100 www.pfm.com September 24, 2021 Chris Berdnik Chief Financial Officer Pennsbury School District 134 Yardley Avenue PO Box 338 Fallsington, PA 19058 Dear Mr Berdnik, On behalf of PFM Group Consulting LLC (PFM), I am pleased to present this proposal with our proposed scope and f ee f or the merger f easibility study f or the Pennsbury and Morrisville school districts PFM’s Management and Budget Consulting practice is led by f ormer public sector practitioners who are committed to high-quality service delivery f or K-12 school districts Through our work with school district clients and the Pennsylvania Department of Education, we have developed core skills in f inancial, operational, and structural planning f or Pennsylvania schools Through our work with the Department, we have evaluated the impact of boundary changes on school districts, including their academic, operational, and f inancial effects As the leader of PFM’s K-12 schools consulting practice, I will serve as Engagement Manager f or our work The f ormer budget director f or the City/County of Philadelphia, I f ocus on f inance and operational improvement f or school districts around the country I am joined by colleagues on our K-12 schools team who have led projects with a wide variety of Pennsylvania school districts Our proposed staff for Pennsbury also includes support f rom subject matter experts with extensive experience in Pennsylvania: Carol Saylor (a f ormer superintendent), Bob Schoch (a f ormer school business manager with experience in school boundary analyses), and Phil Mowry (a former school district facilities director) PFM is f ully dedicated to providing the resources necessary to complete the study, report, and all necessary follow up communication with representatives from both school boards and administrations, as well as members of the local communities At PFM, serving public sector clients is our first and only priority, and we are dedicated to that work We are enthusiastic about the possibility of collaborating with the Pennsbury and Morrisville school districts and their communities to deliver this important and challenging assignment for you through our independent and impartial analysis If you have any questions or require any further information, please not hesitate to contact me at 215-557-1487 or kapland@pfm.com Sincerely, Dean Kaplan Managing Director Request for Proposal #2122-011 Merger Feasibility Study Table of Contents I Background and Experience II Proposed Scope of Services III Project Timeline IV Project Team 10 V Relevant Experience 14 VI Fee Proposal 19 Request for Proposal #2122-011 Merger Feasibility Study I Background and Experience Public Financial Management, Inc was f ounded in 1975 on the principle of providing sound independent f inancial advice to local and state government agencies Today the firm is the nation’s leading independent municipal advisor to local governments, and our staff work with government leaders every day as partners to help make public sector institutions the best-managed enterprises in America Headquartered in Philadelphia, but with a national practice, PFM’s Management & Budget Consulting (MBC) group works with school districts, cities, counties, and states with a f ocus on long-term f inancial management and operational improvement MBC has a specialty practice in K-12 school finance with a dedicated team that understands the intricacies and complexities of school budgeting and operations Our team f or the feasibility study you have requested consists of professionals who have experience supporting school districts and state education departments nationwide with fiscal planning and budgeting, as well as other services such as organizational efficiency and ef fectiveness reviews, policy and program analysis, and workforce strategy and negotiation support We are proud to help our clients meet financial challenges with a broad array of services, delivered with professionalism and independence While MBC has experience working with some of the largest school districts in the nation, we are particularly f ocused on our home state of Pennsylvania The MBC K-12 practice has worked on multiple engagements with school districts across the Commonwealth, ranging in size f rom the School District of Philadelphia to the Duquesne School District We serve as technical advisors to financially and academically distressed school districts under the Pennsylvania Department of Education’s oversight program, and we have also worked directly with school districts through other engagements While there have been relatively f ew school district mergers in Pennsylvania in the last several decades, there have been proposals to split districts and others to realign school district boundaries to move areas f rom one district to another These situations require analysis very similar to school merger studies, including reviewing similarities and differences in academic programs, analyzing availability of physical space to accommodate students, determining required changes in staffing f or programs, and estimating f ixed costs that may remain for central administration and other services As described later in this proposal, PFM and our business manager subcontractor have worked on a variety of these engagements, including the proposed split of the Blairsville-Saltsburg School District, the proposed transfer of the Highspire section of the Steelton-Highspire School District to the Middletown Area School District, and other engagements Our K-12 team understands the unique needs of contemporary school leaders who must allocate limited resources to meet the increasing needs of students, manage shifts in community demographics, and ensure that all learners are prepared for college or career We pride ourselves in being able to provide independent advice that gets to the core of our clients’ needs, based on their desired scope of work The size and structure of our f irm allow us to provide personal service while drawing on a deep bench of subject matter experts As f ormer public officials, we understand the realities of public sector management in a way that only a f irm focused on government and non-profit clients can As financial and operational specialists, we understand the balance between education, f inancial, and operational demands in a way that many law f irms or other municipal advisors not We believe our strengths match the goals of the Pennsbury and Morrisville school districts for the f easibility study, and we look f orward to discussing this project with you f urther to tailor the work product to what you need Request for Proposal #2122-011 Merger Feasibility Study II Proposed Scope of Services Overview PFM understands that the consolidation of academic programs is interrelated with the evaluation of the f inancial stability of any new combined school district Our experience working with school districts in the Commonwealth of Pennsylvania provides us with insight to understand the range of options and issues for the academic and operational configurations under a full merger or a variety of tuition agreements Shared services opportunities and possible operational efficiencies can also heighten the potential for success of a merger or tuition agreement It is essential to prepare an organizational plan that evaluates the likelihood of long-term financial stability and academic success of the consolidated school district in order to support the decision-making for the leaders of the Pennsbury (PSD) and Morrisville (MSD) school districts and the Feasibility Committee that will help guide the evaluation of the consolidation options PFM’s proposed scope and approach is based on our involvement with similar operational and f inancial analyses f or Pennsylvania school districts, including multiple boundary change assignments As highlighted in our proposal below, we would work with the leadership of the Pennsbury and Morrisville school districts to tailor this process to meet the specific goals and areas of emphasis that are relevant for your communities Typically, our engagements f ollow the structure outlined below For each of the components, we have provided additional detail in the rest of this section • Stakeholder Engagement: We will work with the Pennsbury and Morrisville school districts to identify stakeholders to join the Feasibility Committee As a starting point, in the section below we have included a list of potential stakeholders who represent relevant perspectives In addition, we will work with the school district administrations to identify a schedule of meetings for both the Feasibility Committee and the two school boards to keep all parties informed on the progress of the study and its findings • Research: We use your academic, operational, and financial data to develop an understanding of your programs and budget drivers We also incorporate publicly available information in our analysis through sources such as the Pennsylvania Department of Education and the American Community Survey Finally, we understand that local context is vital to understanding trends, so we will conduct interviews with your administrative staff and potentially other stakeholders • Academic and Operational Analysis: In addition to a f inancial analysis, we will review academic and operational inf ormation to evaluate the potential impacts f rom the consolidation scenarios For each section, we will evaluate differences between the school districts in the current state, and also identify potential issues that could arise with consolidation Whenever appropriate, we will highlight places where the issues may be different depending on the full merger or tuition arrangements • Financial Scenario Development: We will use our Excel-based f inancial model to create projections f or the f ull merger and the tuition scenarios Baseline projections f or Pennsylvania school districts often show a deficit after a number of years, and a clear plan of action is required to balance the budget and invest in your priorities (this is particularly true given the impact of onetime ESSER f unds through 2024) We will work with you to identify whether the 10-year projection timeframe should include any initiatives such as tax increases or investments in f acilities, curriculum, or technology Request for Proposal #2122-011 Merger Feasibility Study • Reporting: We can deliver the findings and recommendations of our feasibility study in a format that is most useful to the administrations, the school boards, and the Feasibility Committee; in many cases this takes the form of a narrative written document In order to achieve the goals outlined by PSD, PFM proposes the following work plan We have based this approach on other successful engagements but have tailored it to our current understanding of the unique needs of your feasibility study We expect that portions of this approach will be modified after discussions with PSD and MSD leadership The plan we have developed is intended to be flexible to meet your needs as they emerge, and to create a report that clearly analyzes the full range of options under the merger and tuition scenarios and presents a clear path for decision-making for your communities Analysis Structure In structuring our analysis f or the merger f easibility study, we propose focusing our work on three scenarios: f ull merger of PSD and MSD, tuition of all MSD students to PSD, and tuition of a subset of MSD students to PSD Each scenario will include an analysis of the f inancial, operational, and academic impact, including f indings, issues, and recommendations At the outset of the project, we will work with you to make sure that this approach f its your needs, and we will adjust our project plan as needed to accommodate any changes Throughout all of our analysis of the various options, we will remain committed to presenting an impartial view of each potential option Refine Project Scope and Kickoff Written proposal documents can only convey so much of what school district leaders need and want This scope of work is based on our interpretation of your request for services However, we expect that some scope refinement will be critical to delivering the product you expect We view the finalization of the project plan as a collaborative process that will involve input from the PSD and MSD leadership During our kickoff meeting with the project sponsors, we will review our proposed scope of work with a f ocus on key activities, milestones, and deliverables, as well as set indicators of project success to ensure that the f inal report meets all of your needs Our team would also confirm our project liaison and establish working protocols for communication so that you are properly informed about the progress of the analysis On a parallel track we will develop and share a request for information so that we can begin our analysis of the academics, finances, and operations of the two school districts in advance of our kickoff meeting and subsequent site visits with staff The outcome of our discussion will be a statement of work that reiterates the project goals for the feasibility study and puts in writing all key issue areas that will be identified and addressed in the plan Finally, it will include an achievable timeline that meets your requirements Data Request and Staff Interviews Concurrent with the kickoff meeting, PFM will ask f or detailed academic, operational, and f inancial data f rom the school districts Af ter receiving the data and holding the kickoff meeting, the team will schedule interviews with PSD and MSD staff based on key operational departments, and program managers For example, this may include elementary and secondary education, student equity, curriculum and technology, child accounting, business office, human resources, transportation, and operations and f acilities Our interviews are intended to develop a clear understanding of your current structure with a focus on providing context f or trends in operational and financial data, outlining organizational alignment, as well as relevant work processes, technology, and performance metrics In order to provide the perspective of school board members, we would plan to meet with subset of PSD and MSD board members during this process Request for Proposal #2122-011 Merger Feasibility Study Stakeholder Engagement As set out in the Request f or Proposals, PFM will work with you to identif y members f or the Feasibility Committee, and to coordinate information sessions with the advisory committee and school boards Based on our experience with similar public outreach components of other projects, we believe that PSD and MSD should consider including representatives f rom the f ollowing groups in the Feasibility Committee: a representative f rom the PSD and MSD school boards, parents, students, professional staff and/or union representatives, building administrators, special education or other service area advocacy groups, and related service providers for mental health or other services received by PSD and MSD students During our initial kickoff meeting with the project sponsors, we would refine this list of stakeholders based on your input and our additional research into the PSD and MSD communities In addition, as set out in the RFP we will respond to requests f rom the PSD and MSD school boards to ensure that their questions are addressed during the study In addition, we plan to meet with school board members during the interview process as described in the section above We are committed to working with your stakeholders and elected officials from the outset to develop and execute a process that meets legal, financial, and practical realities while delivering the high-quality information and outputs needed to make this process effective As technical advisors to the Receivers and Chief Recovery Officers who oversee the implementation of Recovery Plans in several school districts using advisory committees, we have experience coordinating public outreach to communicate complex academic, operational, and financial issues to a broad range of stakeholders including advisory committee members and school boards In working with you to coordinate our outreach to the Feasibility Committee, we will categorize f eedback and direction from the Committee into ideologies as described in the Request for Proposals In this process, we would combine our experience working with other school districts with input f rom PSD and MSD administrators to add your local understanding of the context of the communities and your priorities As a starting point for our proposal, we have included a monthly meeting for the stakeholder group, as this provides sufficient distance between meetings to reach reporting milestones and is logistically feasible We are happy to discuss alternative approaches based on your expectations f or the group If requested by PSD or MSD, we can discuss arranging separate public school board meetings in addition to the Feasibility Committee meetings Academic and Operational Analysis In order to outline our proposed approach for the analysis, we have created the table below to align the study areas described in the Request for Proposals with potential focus areas for our team Based on our review of the study areas in the proposal, we felt that it was appropriate to add Food Service as a potential study area f or the report At the outset of the project, we will work with you to ensure that the focus areas are aligned with your needs f rom the study We will also discuss potential additions to (or subtractions f rom) this list as issues are raised by the administration, the school boards, or the Feasibility Committee Study Area Governance Finance Request for Proposal #2122-011 Merger Feasibility Study • • • • • • • Potential Focus Areas Policies, procedures, and reporting Transition to consolidation and redistricting, including Board transition and leadership succession 10-year f inancial projections for the merger and tuition scenarios Analysis of millage rate impacts and other locally-generated revenues Analysis of state funding impacts Consideration of federal funding opportunities and ESSER planning Analysis of charter school tuition impacts Study Area Funding Sources Personnel Pupil Enrollment Facilities Transportation Instructional Programs Co-Curricular Offerings Technical School Food Service Locally Developed Assurances/Guidelines External Partners • • • • • • • • • • • • • • • • • • • • • • • • • • • Potential Focus Areas Methodologies and alternatives for inter-district tuition Identif y potential sources or strategies to support the transition Staf fing levels and certifications Salary schedules and collective bargaining provisions, including comparison of current collective bargaining agreements Existing District administrative standards for coverage, qualification, and other personnel matters Enrollment trends based on current long-term demographics characteristics Evaluation of student demographic characteristics from PSD and MSD Potential boundary changes for enrollment zones and related impacts Evaluation of potential impact on charter school enrollment Summary of existing capital plans and needs Analysis of facility capacities Potential alignments of school buildings Consideration of potential major capital needs during the plan horizon Review of custodial and maintenance services and non-capital investment Review potential operational impacts from the consolidation Review of subject areas and programs for the separate districts Alignment of curriculum and programs Evaluate staffing needs and assignment options Evaluation of online/hybrid learning options for PSD and MSD Review of offerings for the separate districts Identif y potential issues with alignment of sports and after school programs Analysis of enrollment and cost impacts, if any Review of operations and/or contracts for service, and current eligibility for f ree and reduced lunch Analysis of potential funding or operational impacts under the consolidation Identif y potential assurances or guidelines in tandem with school district administrators, elected officials, and stakeholders Understand existing external partnership agreements for contributions Review support from higher education institutions, arts and cultural organizations, and other partners which may include dual enrollment, internships, co-ops, and access to other programming As a result of this portion of the analysis, we are likely to encounter questions that will benefit f rom further discussion with District leadership and perhaps the Feasibility Committee It will also help us identify and present broader policy issues that the districts will need to consider in ultimately determining what direction to take, as discussed in the Reporting section, below Financial Scenario Development Financial Driver Analysis Based on the information provided in our requests and supplemented by the staff interviews, our team will outline the key revenue and expenditure drivers of the PSD and MSD budgets Typically, this includes an analysis of the factors that impact these major items, as well as the components that could be impacted by policy decisions from the administrations and school boards We will present the findings from this analysis Request for Proposal #2122-011 Merger Feasibility Study to the project sponsors in the context of academic, operational and financial considerations for the potential consolidation, and we will incorporate the findings from this analysis into our report Model Development Using our Excel-based financial model, we will develop a f orecast of revenues and expenditures over a tenyear period f or the merger and tuition arrangement scenarios Through our extensive work in the Commonwealth, we have tailored this model to fit the budget dynamic of Pennsylvania school districts, and we have streamlined our processes to pull information from a variety of sources to inform the projections Typical inputs for the model include the historical financial information from your accounting systems, the adopted budget, enrollment and f inancial data f rom the Pennsylvania Department of Education (for example, average daily membership to support state f unding and charter tuition calculations), and operational data provided by your staff (like charter school enrollment) In our f inancial projections, we spend additional time modeling and developing sensitivity analyses for the largest parts of a school district’s budget In this part of the work, we create detailed tools that allow us to work with you to dynamically update inputs and recalculate the financial impact for the baseline projections or alternative scenarios Given the uncertainties in local and state funding over a ten-year horizon, we expect to have considerable discussion with the project sponsors about assumptions for major revenues and expenditures The timing, ability to collect and policy changes around tax assessment, the Act index, property tax billing, collections, earned income tax remittances and other local sources will be a critical component of our work PFM’s model also includes a detailed state aid projection module that takes into account overall state f unding, your student enrollment (average daily membership) and student demographics, each district’s MV/PI ratio now and in the f uture, and other f actors to allow dynamic modeling of state aid over time In addition, we will work with you to incorporate projected expenditures f or recurring or periodic investments in capital, curriculum, and technology In particular, we expect to see a need to regularly reinvest in technology purchased during the pandemic Detailed Financial Projections As indicated in your request for proposal, the merger feasibility study will require detailed treatment of the f inancial impact of the consolidation scenarios In addition to the items specified in the document, we have included other areas based on our experience working with Pennsylvania school districts For each of the areas below, we develop custom-made modules that are integrated into our f inancial model The outputs f rom these tools and the model will be used in framing our financial analysis for the merger feasibility study Local Revenue Analysis • • Projection tool to model assessed value and collection rate trends for real estate taxes Presentation of millage rate impacts f rom the consolidation scenarios Request for Proposal #2122-011 Merger Feasibility Study State Revenue Analysis Charter School Tuition Modeling • Projection tool incorporating components of Basic Education Funding f ormula (ex average daily membership • Dynamic tuition calculations based and student demographics) on the Commonwealth’s PDE-363 • Ability to show the financial impact of tuition form • Detailed analysis of enrollment alternative f unding amounts from the Commonwealth trends to develop assumptions for • Analysis of impacts to components of model scenarios • Ability to model the impact of return the Basic Education Funding formula under the consolidation scenarios (ex of students to PSD/MSD schools or revenue impact of MSD students and other enrollment alternatives the Market Value / Personal Income ratio) Consolidation Scenarios Under each of the consolidation scenarios, we propose showing a step-by-step comparison of the changes that may occur during the consolidation process For example, our presentation of the expenditures for the f ull merger scenario would likely start with the combination of the PSD and MSD operations with separate adjustments f or additional revenues, additional costs (ex adding transportation service), and potential savings from economies of scale While developing the financial projections for the consolidation scenarios, we will identify potential shared efficiencies as we analyze the academics and operations of the school districts These may include but would not be limited to back-office f unctions, facilities realignment/reuse or consolidation, class and curriculum efficiencies, transportation, and staffing Reporting At the conclusion of our engagement, and af ter discussion with you, we would deliver a report that summarizes our analysis and f indings f or the school district administrations, the school boards, the Feasibility Committee, and other stakeholders As set out in the RFP, we will be able to respond to specific requests from your leadership to advise on media questions and superintendent communications about the study and the process In our report the PFM project team will act in an interdisciplinary manner to ensure that all aspects of the report are integrated across the plans f or educational programs, f acility usage, f inancial projections, and other areas We will evaluate the f easibility of consolidating the academic programs, f inances, and operations of the two school districts under the merger and tuition arrangements Under each study area, we will highlight the pros and cons of establishing a consolidated school district and identify the potential issues associated with the options The report will consider the educational, f inancial, structural, and transitional f actors that will be associated with consolidation options and support a determination by the districts of whether opportunities would be enhanced for all students at a similar or reduced cost Project Management In our experience, regular communication is a key measure of project success We believe that biweekly progress meetings are an important mechanism to guarantee that you will receive a quality report that meets your needs within the timef rame that you have established Depending on the pref erence of the project sponsors, the project team can also provide regular progress reports in the form of short memoranda or descriptive emails written weekly or biweekly summarizing items such as actions under way, issues requiring resolution, and immediate next steps As we have described in our proposal, PFM’s project managers are knowledgeable professionals with broad experience working with school districts and other local governments We understand competing time demands and the need to balance regular communication with the day-to-day obligations of busy school leaders and Board members We will work with the project sponsors and project manager to strike the appropriate balance in project reporting and client communication III Project Timeline The project team will begin work upon notice to proceed and will meet the estimated project completion date of February 28, 2022 Although the final schedule will be subject to discussion with the districts, and we would expect modifications, a preliminary proposal is included below Note that some tasks overlap, and that Feasibility Committee meetings will occur throughout, as will consultations with the project sponsor Request for Proposal #2122-011 Merger Feasibility Study Month 1: Document review, kickoff meetings, and schedule site visits with school districts; school district site visits and enhanced document request Months 2-3: Finish baseline model; document financial condition Months 2-4: Interviews with key district staff, stakeholders and document requests to ref ine overall initiatives for all areas, including shared services and efficiencies Months 5-6: Complete list of initiatives and costing; integration into baseline and projected budget model; detailed consultation with school districts to vet accuracy and relevance of preliminary findings; public meetings as requested/required Month 6: Deliver f inal report, Preparation f or and presentation of reports to the Feasibility Committee, stakeholders; public meetings as requested/required IV Project Team Our team f or the Merger Feasibility Study is composed of individuals committed to supporting improvement in school districts, cities, and counties nationwide, and with specific skills germane to analyzing the potential merger The lead staff and experts proposed f or this project hold advanced degrees in public administration, public policy, education or other fields, and have formed careers around public service and public sector clients including direct service in public schools, and other public agencies The core of PFM’s proposed roster is experienced in analyzing and improving public sector organizations, with a f ocus on school f inance and performance PFM’s in-house experts are complemented by the addition of a f ormer Superintendent, School Business Manager, and School Facilities Manager PFM has worked with each of its subject matter experts on multiple projects in the past, so the District will benefit from a seasoned team that knows each other and can rapidly address its assignment In additional to its broad experience in K-12 school academics and f inances, members of our team have prior experience in assessing the f inancial, operational, and academic impact of boundary changes and district dissolution and we will bring that experience to this project In addition, our proposed staff is accustomed to working with a diverse group of officials – from teachers to superintendents, cabinet officials and department heads to members of school boards, labor and business leaders, line public employees and ordinary citizens – to address complex f inancial and performance issues A brief biography of our team members follows Dean Kaplan, Managing Director Dean Kaplan is a Managing Director and a leader of PFM’s Management & Budget Consulting practice At PFM he has completed multi-year planning, operations improvement, budgeting and budget oversight ef f orts for school districts, cities, counties and authorities across the United States He leads the technical support team for the Pennsylvania Department of Education’s program to assist financially-stressed school districts and has worked with numerous other districts around the country, including those in Minneapolis, Broward County, and Philadelphia He has directed PFM’s team work on boundary changes f or school districts in Pennsylvania, work that closely parallels school district mergers Mr Kaplan joined PFM after a year in the United Kingdom with the Atlantic Fellowships in Public Policy Based at the University of Birmingham’s Institute of Local Government Studies, Mr Kaplan was selected by the British government to research local government service ef f orts, including perf ormance measurement and citizen/ stakeholder consultation He also served on a Local Government Improvement & Development peer review team for Lancaster City Council Request for Proposal #2122-011 Merger Feasibility Study 10 Prior to his f ellowship Mr Kaplan was Budget Director f or the City of Philadelphia, leading development and implementation of a $4.5 billion annual all-funds budget for the fifth-largest city in the United States and resulting in record levels of f und balance Before that, Mr Kaplan was Deputy Commissioner f or the Philadelphia Water Department, serving as chief financial officer and head of policy planning for one of the largest publicly-owned water/ wastewater/ storm water utilities in the US Earlier in his career, Mr Kaplan worked f or Philadelphia’s streets and solid waste agency and served as Legislative Director for a U.S Representative Mr Kaplan holds a Master in Public Administration degree from the John F Kennedy School of Government at Harvard University and a Bachelor’s degree from Haverford College Ian Tyson, Senior Managing Consultant Ian Tyson is a member of PFM’s Management and Budget Consulting practice where he f ocuses on f inancial management and operational ef ficiencies f or K-12 school districts Recently, Mr Tyson was appointed to a three-year term as a member of the Government Finance Officers Association’s Committee on Governmental Budgeting and Fiscal Policy to refine best practices and develop recommendations for local governments across the nation He has served as the day-to-day lead on multiple projects where PFM supports the Pennsylvania Department of Education on school district boundary changes, including Blairsville-Saltsburg School District and Steelton-Highspire School District/Middletown Area School District He also supervises f inancial modeling f or MBC’s K-12 school district practice, and he head’s PFM’s implementation ef forts f or the Pennsylvania Department of Education’s financial recovery plans for the Erie and Scranton school districts Mr Tyson has developed tools for projecting state subsidies to evaluate the impact of changes in enrollment and demographics f or school districts As part of his work supporting the f iscal recovery program for Pennsylvania school districts, Mr Tyson created a model to estimate the f inancial impact of changes to school district transportation programs, and the corresponding impact on cost reimbursement through the Commonwealth’s pupil transportation subsidy In his work providing support for the implementation of the Scranton School District’s financial recovery plan, Mr Tyson has led reviews of business office operations, collective bargaining support, and evaluation of long-term maintenance and capital projects as part of a broader strategy to determine needs f or school f acilities Mr Tyson has led cost analyses to support collective bargaining with teachers’ unions, and to evaluate the financial impact of providing services with in-house personnel and contracted vendors Prior to joining PFM, Mr Tyson served as an AmeriCorps VISTA member at a non-profit organization that provided technical assistance and business coaching to low-income entrepreneurs Mr Tyson holds a Master of Public Administration f rom the University of Pennsylvania’s Fels Institute of Government and a Bachelor’s degree from Rowan University Meredith Brett, Senior Managing Consultant Meredith Brett is a Senior Managing Consultant with PFM’s Management and Budget Consulting practice In her role supporting the fiscal recovery program for Pennsylvania school districts, Ms Brett is the day-today lead f or the Harrisburg and Sto-Rox school districts on the development and implementation of their multi-year f inancial plan and recovery strategy to address financial, operational, and academic challenges A native of Bucks County, she is also the lead of PFM’s team assisting the Pennsylvania Department of Education in reviewing the new and renewal licenses of cyber charter schools Ms Brett has also helped Request for Proposal #2122-011 Merger Feasibility Study 11 develop and deliver state-sponsored training f or Pennsylvania school district managers and a training curriculum f or new and returning school board members In addition to her work with school districts, Ms Brett has also supported multi-year planning, operational reviews, and efficiency studies for MBC’s municipal clients Ms Brett has worked on operational reviews of the Finance Departments of the cities of Columbus, Ohio and Wilmington, Delaware and an evaluation of the Health and Human Services Departments f or Beaver County, Pennsylvania Ms Brett also participated in an ef f iciency study f or Pittsfield, Massachusetts as well as the development of a management review and f inancial plan f or Lycoming County, Pennsylvania These reviews have focused on identifying strategic priorities, inefficiencies in processes and resource allocation, and recommendations f or improvement Ms Brett holds a Bachelor’s degree in Government from The College of William and Mary and a Master’s Degree in Public Administration from the University of Pennsylvania’s Fels Institute of Government She is a member of the 2021-22 cohort of Leadership Philadelphia’s core program Clara Lee, Senior Analyst Clara Lee is a Senior Analyst in PFM’s Management and Budget Consulting practice She provides quantitative, analytical, and research support f or governmental performance improvement projects, with a particular focus on K-12 school districts Ms Lee supports PFM’s schools practice through conducting data analysis, providing qualitative support, and developing f inancial projections f or school districts both in and outside of Pennsylvania Recent projects have included the Erie, Harrisburg, Scranton, and Sto-Rox School Districts in Pennsylvania For the Harrisburg School District, she conducted operational analyses to support the development of the District’s amended Recovery Plan, and she also provided financial modeling support for the Plan’s baseline f inancial projections and initiative costing In PFM’s engagements with the Erie School District, Clara is the main f inancial modeler and has recently worked on model scenarios to estimate the f inancial impact of collective bargaining proposals, evaluate the f inancial impact of transportation changes, and to integrate the District’s plans for the use of Elementary and Secondary School Emergency Relief (ESSER) funds with the f inancial projections Ms Lee is currently providing data support and financial analysis for PFM’s efforts in the City of New Haven, which has included f inancial projections and modeling the impact of the use of American Recovery Plan Act f unds for municipalities In addition, Ms Lee has also served on operational reviews of the Department of Technology for the City of Columbus and the Commonwealth of Pennsylvania’s Department of Labor and Industry She has experience conducting subject matter and stakeholder interviews as well as researching and benchmarking various city and state governments to determine national best practices Prior to joining PFM, Ms Lee worked in the Of fice of Diversity and Inclusion f or the City of Philadelphia, and the Of fice of Equity at Boston Public Schools Ms Lee holds a Bachelor of Arts degree in Applied Psychology & Human Development and Sociology from Boston College and a Master’s degree in Education, Culture, and Society f rom the University of Pennsylvania Request for Proposal #2122-011 Merger Feasibility Study 12 Brianna Naman, Analyst Brianna Naman is an Analyst based in PFM’s Management and Budget Consulting practice in the f irm’s Philadelphia office She provides quantitative, analytical, and research support f or f inancial models and perf ormance improvement projects Ms Naman supports the Scranton School District with f inancial modeling with a f ocus on local revenue needs to support academic and operational plans, integration of ESSER f unds into the f inancial forecast, and workf orce costing f or various collective bargaining proposals In addition, Ms Naman has also provided support f or the ongoing working involving building utilization and reconf iguration, enrollment analysis, and capital planning Previously, Ms Naman supported PFM’s Operational Review, Criminal Justice Review, and Visioning and Recruitment projects for Harris County, Texas She also has been the principal analyst on a multi-year strategic and financial plan for the Public Safety Department of Providence, Rhode Island and an organizational review of Precinct One, an administrative district comprising about onequarter of Harris County Ms Naman holds a Bachelor of Arts degree in both History and Visual Arts f rom Brown University and a Master of Science degree in International Relations from the University of Edinburgh Carol Saylor, Ed D Dr Saylor is an educator with over 40 years of experience as a classroom teacher, principal and Superintendent in Pennsylvania school districts For 13 years Dr Saylor served as the Superintendent of the Manheim Central School District in Lancaster County and prior to that as Superintendent of the Fairfield Area School District in Adams County f or nine years Subsequently, she was appointed by the Pennsylvania Department of Education to serve as the Chief Recovery Officer of the York City School District from 2015 to 2020 During her time at York, Dr Saylor’s accomplishments included stabilizing the District’s f inances, negotiating a new teachers’ contract that revised the salary schedule and provided additional time f or instruction, opening a Science, Technology, Engineering, Arts, and Mathematics academy, and providing a project-based learning program for the City’s students During her tenure as superintendent at Manheim, Dr Saylor received the Superintendent of the Year award f rom the Pennsylvania Association of School Administrators (PASA) In addition, she served as president of PASA’s Women’s Caucus, and she was a member of the Governing Board for the American Association of School Administrators Over the past decade, Dr Saylor has served as a career and leadership coach f or school district administrators, and most recently has begun providing support f or the development of a Recovery Plan for the Sto-Rox School District, again under the auspices of the Pennsylvania Department of Education Dr Saylor received her Doctor of Education f rom Nova University in 1987, and she holds a Master of Science in Public School Administration with a Superintendent’s Letter of Eligibility f rom Bucknell University Robert Schoch Mr Schoch was been a highly-regarded school district business official in the Commonwealth of Pennsylvania for many years He has experience with the Lancaster and Reading urban districts, where he served as Business Administrator and assisted them through severe financial challenges including the development of financial recovery plans He has also worked as a Business Manager for well-regarded districts in Pennsylvania, including Council Rock and North Penn, where he led efforts to achieve further perf ormance improvement and cost savings in operations already presumed to be highly efficient Request for Proposal #2122-011 Merger Feasibility Study 13 In recent years, Mr Schoch has been engaged as a consultant in PFM’s work with districts across Pennsylvania, with a particular focus on school operations, including but not limited to improving district procurement processes, analyzing informational technology capability, reviewing transportation programs, and maximizing federal Medicaid funding He has also supported PFM’s analysis of collective bargaining provisions and business office operations Throughout his career, Mr Schoch has provided his expertise in analyzing the impact of boundary changes for school districts in Pennsylvania and other states Between 2014 and 2021, Mr Schoch provided expert witness testimony for legal proceedings in a case over the transfer of students in central Pennsylvania from Washington Township (Dover Area School District) to the Northern York School District Earlier in his career as a business manager, Mr Schoch provided research and testimony to the Pennsylvania Board of Education over the transfer of commercial property from the Manheim Township School District to the Lancaster School District As a consultant, Mr Schoch has participated in a study f or a proposed consolidation of two school districts in Arkansas, as well as research for the Wyoming Select Committee on Education Funding to determine the feasibility of consolidating school districts in the state Mr Schoch is active in the Pennsylvania Association of School Business Officials, was involved in its “500 Ways to Reduce Costs and Increase Revenue” project, and founded its benchmarking committee His best practices/quality management work is extensive, including a Master’s thesis on the Baldrige Quality Management Program in Public Education and a leading role in helping the first school district in U.S to become registered in the ISO 9000 Quality Management System Mr Schoch completed a Doctoral Program in Educational Leadership from Penn State University, dissertation pending Mr Schoch also holds a Master in Educational Administration degree from Penn State University, a Master of Planning and Public Administration degree from Cornell University and a Bachelor’s degree from Bard College Mr Phillip Mowry, P.E Mr Mowry is a registered professional engineer with facilities management, construction and planning experience, primarily in the educational field He is a graduate of Brown University, with additional studies at Drexel and Temple Universities, and ongoing in-service education with school business and engineering associations (PASBO, ASBO, AIPE, APPA, AEE) He has completed individual building and district-wide school facility studies and energy reviews, as well as maintenance and operations department evaluations for numerous educational/institutional systems He has provided engineering design and project management services on millions in f acility construction projects, as well as planning, direction and support on numerous construction project submissions He has collaborated with PFM on diagnosing and developing response plans for facilities issues for multiple school districts in Pennsylvania Mr Mowry served for 25 years with a large urban educational system as a facilities manager, and also has professional experience with a major commercial/institutional roofing system design/project management firm as well as continuing involvement with Mowry & Schmidt, Inc., a f amily-owned general construction business in north-central Massachusetts V Relevant Experience PFM has worked as management consultant f or school districts throughout the Commonwealth of Pennsylvania In addition, across the state, colleagues in our affiliated municipal advisory business work Request for Proposal #2122-011 Merger Feasibility Study 14 with nearly 200 school districts and technical schools In the section below, we have included case studies of our consulting work with Pennsylvania school districts that are relevant to the Pennsbury School District’s request f or proposal For each of the school district examples below, we have also included the 2019-20 average daily membership (ADM) in order to provide a comparison f or the size of the operations compared to the Pennsbury and Morrisville school districts Project Type Merger Feasibility Study Proposal School District Boundary Change Analysis Tuition Analysis and Financial Modeling Financial Recovery Plan and Operational Support Morrisville Borough SD Pennsbury SD Steelton-Highspire SD Blairsville-Saltsburg SD Middletown Area SD Cornwall-Lebanon SD Lebanon SD Coatesville Area SD Downingtown Area SD 2019-20 ADM 1,010 10,617 1,503 1,511 2,638 5,015 5,407 8,834 13,709 Duquesne City SD 941 Scranton SD 10,199 School District In addition to school-related projects, we have included a description of a recent project we completed on a potential municipal merger in the western part of Pennsylvania Various School Districts Pennsylvania Department of Education School District Boundary Change Assignments Over the past five years, PFM has worked with the Pennsylvania Department of Education to evaluate the f inancial and operational impact of school district boundary change petitions In these assignments, we have reviewed proposed district boundary changes that range from separating constituent municipalities to separating subdivisions and smaller geographic areas to join adjacent school districts For each assignment, we have provided a brief summary of the engagement, as well as key highlights of the major issues identified in the analyses Blairsville-Saltsburg School District Dissolution In 2016, the Pennsylvania’s General Assembly passed legislation directing the state Department of Education to review the impact of a potential division of the Blairsville-Saltsburg School District into two separate districts The current district has seven constituent jurisdictions with two high schools, two middle schools, and two elementary schools Working with a team from the Department, PFM completed a detailed analysis of the current and projected f inances of the current Blairsville-Saltsburg School District, as well as the projected f inances of the two potential new independent school districts assuming separate academic operations PFM reviewed current and projected revenue sources with additional f ocus on local taxes and state aid formulas; salary and benef its under the two scenarios; potential costs f rom duplicative administrative functions; and the expected Request for Proposal #2122-011 Merger Feasibility Study 15 division of f acilities and debt service PFM’s work was integrated into a report to the state legislature by the Department Steelton-Highspire School District Boundary Change In late 2016, the Pennsylvania Department of Education asked PFM to analyze the financial and academic impact of a transf er of the Highspire portion of the Steelton-Highspire School District to the adjacent Middletown Area School District The work was in response to a petition from parents in Highspire to transf er to the Middletown district The assignment included creating a multi-year f inancial projection for the existing Steelton-Highspire and Middletown districts, and for the possible districts with revised territory Similar to the Blairsville-Saltsburg School District engagement, the work included analysis of major financial and operational components including property taxes and state aid, state aid, salary and benefit growth, and enrollment PFM also collaborated with educators tasked with preparing a comparison of the two districts’ academic and extracurricular offerings A key aspect of PFM’s work included an analysis of the impact on the Middletown Area School District of adding the students f rom Highspire, given current school capacity and capital realities and academic programming assumptions at Middletown The project deliverable was a report for the Department’s Deputy Secretary to be used in his final determination on the petition Coatesville Area School District Boundary Change PFM completed an analysis of a proposed transfer of territory from the Coatesville Area School District to the Downingtown Area School District in 2018 In this engagement, a group of homeowners in a section of Caln Township near the border of Downingtown Borough submitted a petition to join the neighboring school district PFM’s analysis included a review of the major f inancial and operational drivers f or the two school districts and a multi-year f inancial projection of the transfer scenario Although the number of students involved in the transf er was small, PFM reviewed the potential issues raised by the Downingtown Area School District in the petition, which included organic enrollment growth in the Downingtown ASD communities, the potential need for Downingtown to identify additional classroom space, current Coatesville ASD enrollment in charter schools by students residing in the transf erred territory, and the potential f or f uture boundary change petitions if this one was successful Lebanon School District Boundary Change The Department of Education requested PFM to provide support f or an analysis of the f inancial and academic impacts of a transf er of West Lebanon Township f rom the Lebanon School District to the surrounding Cornwall-Lebanon School District in 2019 Similar to the analyses conducted for the other school district boundary changes, PFM’s portion of the work included an analysis of major f inancial and operational drivers with a multi-year f inancial projection of the two school districts under the proposed changes In the Cornwall-Lebanon School District analysis, PFM reviewed estimated staffing changes from the proposed transfer focusing on contractual class size limits, and the potential ability to accommodate the West Lebanon students with existing sections of classes During the analysis of the physical capacity of the Cornwall-Lebanon School District f acilities, PFM also reviewed potential impacts to the intermediate unit and preschool service providers who rented classroom space from the District Request for Proposal #2122-011 Merger Feasibility Study 16 Duquesne School District Pennsylvania Department of Education Tuition Analysis and Financial Modeling PFM has provided f inancial modeling support to the Duquesne School District since the 2012-13 school year when the District entered the Commonwealth’s oversight program for f inancially and academically distressed school districts under Act 141 Since the 2015-16 school year, PFM has been involved in several f inancial analyses related to the District’s secondary-level students who are served by surrounding school districts through a tuition agreement Under the School Code, the West Mifflin Area and the East Allegheny school districts provide education to Duquesne’s students in grades to 12 with a statutorily defined tuition rate f or these districts that is separate from other arrangements in the Commonwealth In 2015-16 and 2016-17, PFM provided technical support to the Commonwealth and the District to resolve litigation surrounding the calculation of the tuition rate and the ability to provide requisite compensation for the educational services In our analysis, PFM reviewed inf ormation to determine which services were provided to Duquesne students and how the costs of these services compared to the tuition received by the West Mifflin Area School District In the 2020-21 school year, PFM provided f inancial modeling support to the Duquesne School District to evaluate a proposal to return of grades and to the District In the analysis, PFM reviewed estimated staf fing and operational costs for the return of the students and created a multi-year f inancial projection to show the impact of the proposed change PFM’s analysis was used by the District in the f ourth amendment to its Recovery Plan and a proposal submitted to the Department for the return of the students Under the structure, the District’s students in grade have returned to the Duquesne Elementary School in the current 2021-22 school year, with grade proposed to return in the following year Wilkinsburg Community Development Corporation Merger Analysis for the Borough of Wilkinsburg and the City of Pittsburgh In 2021, the Wilkinsburg Community Development Corporation engaged PFM to prepare an analysis of the estimated financial and operational impacts of a possible merger between the Borough of Wilkinsburg and the City of Pittsburgh PFM’s analysis f ocused on several different aspects of the potential merger The f irst portion of the work reviewed how the merger would af fect revenues – primarily tax revenues – f or the City, and f or different groups of Wilkinsburg residents and businesses that would f ace a new, different tax mix and adjusted rates Given the uncertain impact of the pandemic on local finances, a range of estimates was prepared to show the variable timing of revenue impacts of a merger The second part of the work focused on what the City would have to spend to provide services to Wilkinsburg, identifying issues by each Wilkinsburg department Finally, PFM prepared a summary overall f iscal impact analysis with several scenarios based on varying types of recovery from the pandemic Scranton School District Pennsylvania Department of Education School District Financial Recovery Plan and Operational Support Since 2017 PFM has provided technical assistance to the Scranton School District as part of the Commonwealth of Pennsylvania’s oversight programs f or academically and f inancially distressed school districts In August 2019, Scranton’s Board of School Directors adopted the f inancial recovery plan developed by the state-appointed Chief Recovery Officer (CRO) with support from PFM In this long-term plan, PFM included a variety of analysis including reviews of key operational departments, f inancial Request for Proposal #2122-011 Merger Feasibility Study 17 projections, development of academic and organizational priorities, and input from a wide variety of internal and external stakeholders PFM has continued to support the CRO in her work to improve f inances and academics in Scranton Key sections of the plan and subsequent work that are relevant to the services requested by the Commonwealth of Massachusetts are highlighted below Financial Projections Baseline budget projections were developed assuming a status quo scenario with the District’s current operations An additional scenario was developed showing the financial impact of the f undamental Recovery Plan initiatives to bring the District’s budget into balance over five years The District continues to receive ongoing support f or long-term f inancial planning with updates to the f inancial projections and additional scenario planning, such as the incorporation of collective bargaining proposals In 2019, ongoing support from PFM in conjunction with internal improvements allowed the District to achieve its f irst positive f inancial result since the mid-2000’s, which allowed the District to restore a modest fund balance Continued successful f inancial management in 2020 has allowed the District to continue contributing to its long-term reserves based on current estimates for the current calendar year Building Utilization As identified in the District’s Recovery Plan, the Scranton School District had many older school buildings, significant needs for capital investments, and excess capacity for enrollment in the District’s buildings In conjunction with the CRO’s direction and strategy, PFM provided analytical and technical support f or the development of building reconfiguration options As part of this analysis, PFM reviewed current and f uture enrollment levels by school and grade, building floor plans and use of space f or programs, and classroom sections by school building Business Office Staffing levels, procurement and operational processes, and inf ormation systems were evaluated, and recommendations were developed to modernize antiquated practices and revamp the organizational chart In addition, a subject matter expert provided coaching f or the newly-promoted business manager to take over leadership of the office Central Office Organization Reporting structures and staff roles were reviewed to streamline the number of direct reports to the superintendent Data systems and reports provided to administrators and school board members were evaluated, and recommendations were developed to provide accurate, timely, and inf ormative data to key decision-makers The District has made several personnel changes and reassignment of responsibilities to align with our recommendations Capital planning In the body of work used to develop the multi-year plan recommendations, PFM organized a team of experts to complete a high-level update of a six-year-old f acilities plan and review current custodial and maintenance staffing This study identified understaffing for custodial and maintenance staff and the need f or targeting scarce capital resources to the most urgent construction and rehabilitation projects PFM is currently leading a comprehensive ef fort to modernize the District’s capital planning program In December 2020, the District adopted its f irst multi-year capital improvement plan with the technical assistance of PFM In addition, our team worked with the District to competitively hire qualified engineers, architects, and an owner’s representative, and borrow new money for the first time in years Elementary and Secondary School Emergency Relief Fund (ESSER) Planning Since March 2021, PFM has worked with the CRO and the District’s administration to work through operational and f inancial planning for the use of federal relief funds for the coronavirus pandemic Our work started with a strategic planning process to identify the District’s current goals, and to identify larger categories of spending for the f unds Following this process, we worked with the District to determine potential uses for the ESSER funds, developing costing tools f or budget submissions and f inancial planning f or f uture school years, and integrating ESSER planning with capital budgeting Request for Proposal #2122-011 Merger Feasibility Study 18 Pre-Kindergarten PFM worked to implement the long-term plan recommendation to reprogram the Scranton School District’s Title I funds from pre-kindergarten to reading and math intervention programs for elementary students The District is now in a two-year process of moving over 400 pre-kindergarten students f rom District-funded to state- and federally-funded pre-K programs, while shifting Title I f unds to academic enrichment for its K-5 students Special Education PFM worked closely with the Chief Recovery Officer to identify challenges in Scranton’s special education program that were leading to rapidly growing compensatory education costs After scoping and commissioning an expert study, PFM and the CRO collaborated closely with District administrators to devise and implement a strategy to control cost growth and improve services to students needing special education services Transportation Working with Bob Schoch (proposed subcontractor for the merger feasibility study), PFM has worked with the District’s administration team to develop and implement a multi-year transportation improvement program This work has included support for the implementation of the Transfinder software, review of bus stops and routes for potential consolidation into multiple tiers of service to reduce operating costs, a review of walking zones for alignment with local and state policies, and analyses of transportation subsidy impacts of service changes VI Fee Proposal PFM proposes to complete the projected scope for fixed f ee of $195,200 This amount will cover the cost of all professional services and expenses related to completion of all components of the feasibility study as described in the RFP, including the drafting and presentation of the two requested reports, assuming a sixmonth project timeline from notice to proceed We recognize that after reviewing our proposal you may wish to modify our suggested scope, adding new items or subtracting or modifying ones we have suggested As noted, we can provide examples of our budget forecast model, which may affect your thoughts about deliverables or the structure of the analysis We are committed to working with you to develop the scope and deliverables that best meet your needs and executing that scope to provide you with a strong result Finally, PFM is accustomed to working with clients under a broad range of contract structures, and we are f lexible on the subject of f air compensation f or our services We want to work f or the Pennsbury and Morrisville school districts on this important project, and will be glad to discuss fee arrangements that are workable and are commensurate with the level of ef fort and expertise needed to complete the scope of work requested Request for Proposal #2122-011 Merger Feasibility Study 19 ... split of the Blairsville-Saltsburg School District, the proposed transfer of the Highspire section of the Steelton-Highspire School District to the Middletown Area School District, and other engagements... academic success of the consolidated school district in order to support the decision-making for the leaders of the Pennsbury (PSD) and Morrisville (MSD) school districts and the Feasibility Committee... with the school district administrations to identify a schedule of meetings for both the Feasibility Committee and the two school boards to keep all parties informed on the progress of the study