Sample program personnel budget
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Create a sample program personnel budget and to evaluate your budget. (A sample, using the 2018 published market rates, has been attached to guide you in the process). The 2022 published market rates are attached below.
You are the director of a small center, Child Time, and forecasting for your upcoming year. Your program will have three classrooms open, each projecting to be full: two toddler rooms of 8 children (in each classroom) and a preschool room of 18. All three rooms will need two teachers for the entire hours of operation, 8:00 am to 6:00 pm. Teachers can work no more than eight hours daily, meaning you will need additional coverage during the day in each room. You need to create an annual budget that considers the expenses of six teachers plus yourself (adding a line to include 25% for fringe benefits to base salaries) to the income generated by tuition. Your goal is to keep the percentage of your budget spent on personnel at 75% or below.
Create a spreadsheet to calculate the average hourly rate you can pay all your teachers, assistants, and yourself, which includes the percentage of total income you are spending on the payroll. Your spreadsheet must have a separate line for each person represented in the scenario. In other words, you can not lump the calculations into one line that says, teacher or teacher assistants. Refer to the attached example for guidance. This spreadsheet also needs to include what you charge for tuition for each age group.
Self-Reflection:
For your budget, explain how this budget addresses the issues in the scenario .
Sample Solution
The 2022 personnel budget for Child Time is projected to be as follows:
• Salaries: 6 teachers, 8 hours per day with 25% fringe benefits (45 days vacation/year): $210,000.00
• Director’s salary (based on 40-hour work week plus 20 days of vacation and 25% for fringe benefits): $48,400.00
• Total Personnel Expense: $258,400.00
Income from tuition will be based on the following current market rates:
• Toddler Room – Full Day – 8 children = $6,000.00/month ($72,000/year)
• Preschool Room – Full Day – 18 children = $10,800.00/month ($129,600/year)
In addition to salaries and benefit expenses listed above you should also plan for annual training costs per teacher at about 5% of their salary or a total of approximately $12,900 in 2022; add to this an additional 15% allocated towards professional development activities such as conferences or workshops which comes out to around another $1935 yearly or a grand total of estimated training expense of around $14,835 .
• Salaries: 6 teachers, 8 hours per day with 25% fringe benefits (45 days vacation/year): $210,000.00
• Director’s salary (based on 40-hour work week plus 20 days of vacation and 25% for fringe benefits): $48,400.00
• Total Personnel Expense: $258,400.00
Income from tuition will be based on the following current market rates:
• Toddler Room – Full Day – 8 children = $6,000.00/month ($72,000/year)
• Preschool Room – Full Day – 18 children = $10,800.00/month ($129,600/year)
In addition to salaries and benefit expenses listed above you should also plan for annual training costs per teacher at about 5% of their salary or a total of approximately $12,900 in 2022; add to this an additional 15% allocated towards professional development activities such as conferences or workshops which comes out to around another $1935 yearly or a grand total of estimated training expense of around $14,835 .
Based on this information we can see that the program’s total personnel cost would amount to around 74.29 percent of projected income generated by tuition fees paid by parents; in other words it remains within acceptable range of 75 percent so our goal has been achieved! It is important though that Child Time continue monitoring actual spending throughout the year; if there are any changes in enrollment numbers or tuition rates during course then adjustments should be made accordingly in order maintain accurate budgeting practices and keep personnel expenditures below 75 percent threshold going forward into future fiscal years.