David Hussey led the Board members and guests in the Pledge of Allegiance to the United States of America (USA).

1. Nathan provided the student council treasurer's report.
   
   Robotics Competition Team: Last Friday, the robotics competition team attended an event, possibly a state championship. The student council purchased items for a send-off celebration, costing $50.05.
   Poster Supplies: A recurring purchase for markers, tape, and other materials used for hallway posters was made this month.
   Color Wars: Supplies and prizes for the upcoming class-specific Color Wars event were purchased for a total of $635.34. This included several hundred items prepared as prizes for individual students.
   Mr. ECR Event: For the annual mock beauty pageant event featuring senior boys, happening on December 6, $94.95 was spent on decorations

Mr. Wood, ECRCHS CBO, provided his CBO Report to the Committee

Enrollment and ADA: As of Month 3, enrollment stands at 2,937 students, a decrease of 13 from last month and 222 compared to last year’s Month 3. The average daily attendance (ADA) percentage is 93.3%, slightly down from last year’s 94%. This decline is attributed to fewer incoming ninth graders than graduating twelfth graders.

A recent webinar on declining enrollment in California highlighted strategies such as analyzing trends, multi-year planning, and staffing adjustments. With an annual loss of 222 students, staffing levels may need reevaluation to align with reduced class and support requirements.

 

Cafeteria: Despite the decline in enrollment, meal participation has increased by 2.65% compared to the previous year. Currently, 37% of students qualify for free and reduced meals, the highest percentage recorded.

Through October, total cafeteria revenue was $572,471, with $469,941 in expenses (including food, labor, salary support, repairs, and other costs). The cafeteria is operating with a surplus of $102,530; the cafeteria fund balance has grown. Given this balance, $20,564 has been allocated to capital improvements. Funds in this category must be reinvested into the cafeteria only, but can support student events like picnics, provided meal compliance guidelines are met. 

 

Audits: The Charter School Division will conduct an instructional and operations audit on November 21, with related documents already submitted.
The CPA external audit firm is collecting information for the annual audited financial report due to the state by December 15.
The first interim financial report, capturing actuals through October and projections for the rest of the year, is being prepared for submission.

Mr. Wood, CBO, and Mike Breller (Beacon Pointe) presented the October, 2024, ECRCHS Investment Update.

Investment Review by Mr. Mike Breller 

Economic Overview: The U.S. economy and consumer have demonstrated resilience, maintaining consistent GDP growth over the past two years despite earlier concerns about a recession. While inflation remains a focus, significant progress has been made, with rates approaching the Federal Reserve’s 2% target. Aggressive interest rate hikes in 2022-2023 have not led to major economic disruptions, with unemployment near record lows. Current indicators suggest a "soft landing," achieving inflation control without significant economic fallout-an uncommon outcome.

Potential risks include the possibility of elevated inflation triggering secondary waves, delaying interest rate reductions. Fiscal challenges, such as a 7% GDP deficit amid low unemployment, raise concerns about continued deficit spending and pressure on interest rates. Despite these risks, the overall economic scenario remains positive.

Market Performance: The S&P 500 gained 6% in Q3, with large-cap equities outperforming small caps and U.S. equities outperforming international ones. Fixed income showed double-digit returns over the trailing year, recovering from prior losses in the aggregate bond index. October saw minor declines, but markets responded positively post-election.

Portfolio Allocation and Performance: 
Asset allocation remains well-aligned with policy targets
Equities:

• U.S. equities are slightly overweight and have driven strong returns, outperforming international equities. Passive investments dominate domestic allocations, with two active managers: Fiduciary Management and Virtus (Mid Cap). A recent change replaced the Schwab US Large Cap Growth Index fund with a new active manager.
• International equity are within range, with a 25.6% trailing one-year return which is just ahead of the index. Active managers include Artisan International Value (value-oriented) and American Europacific (growth-oriented), providing balanced exposure. 
• Emerging market manager Lazard closely aligns with the index and has performed well. 

Fixed Income:

• Managers Dodge & Cox and Metropolitan West offer diversification. Dodge & Cox focuses on investment-grade bonds, while MetWest provides a broader mix. While returns have been strong recently, long-term performance is flat due to market timing.

Alternatives:

• The allocation includes stability-oriented strategies (Swan Hedged Equity and Cliffwater Bank Lending) and growth-focused real estate strategies (PGIM and Apollo). Alternatives have contributed 22% trailing one-year returns, providing diversification and mitigating portfolio volatility.

Summary:
The portfolio has delivered strong absolute and relative returns across asset classes. While macroeconomic uncertainty persists, staying close to policy targets is advised until clearer investment opportunities arise.

Mr. Wood

OPEB: The portfolio experienced a slight decline, ending the month of Oct at $31.7 million, reflecting the flat market performance reported earlier.

Post-election market gains have driven the portfolio value up to $32.2 million, recovering most of October's losses.

Year-to-Date Performance: Through October, the portfolio had achieved a 3.3% return, although recent OPEB payments reduced the total return to 2.8% by the end of October.

The outlook remains positive, with expectations for continued recovery, provided market conditions remain stable.

Ms. Ilyas, Director, Accounting and Finance, reviewed the October 2024, check registers from ECRA's City National Bank Accounts 

ASB Register: Largest expenditure was the Homecoming event at $54,500. Additional transactions included seasonal team purchases. A grand total of $123,044 ASB expenses was incurred in Oct.

ASB Trust Balances: Trust balances are the total balances for sports teams and clubs. There was a Total balance of $567,951 by end of Oct, while ASB income from merchandise and snack sales has so far totaled $158,961, with incurred expenses of $26,957. The Total general Fund balance was $81,957 and the total ASB Balance came to $622,386.

General Account: This covers monthly recurring expenses such as health benefits and retiree payments from investment income. The Grand total for October came to $431,718.

Vendor Payments (YTD): Vendor payments for October totaled $1,569,505, while Year-to-date (July-October) was $7,050,942.

Checking Register: This represents daily operational expenses. The Grand total for October was $1,013,645.

 

Prior to the Vote to recommend Approval, Ms. Ilyas, reviewed the October 2024, credit card charges.

Primary expenses included teacher conferences and miscellaneous items.

• Mr. Hussey’s credit card charges added up to $19,420.
• Mr. Wood’s credit card charges totaled $3,600.
  
   

Mr. Wood and Ms. Ilyas discussed ECRCHS's Fiscal Policies and Procedures

An overview of updates to the fiscal policies and procedures draft, highlighting proposed changes for review was provided:

Travel policy updates: Removed references to specific airlines to prioritise flexibility and cost-efficiency. The revised policy focuses on "economy or promotional discounted airfare."
There is also emphasis securing reasonable fares and prioritising nonstop flights especially when travelling with students for safety and logistical simplicity.
Meal reimbursements: Reimbursement rates should align with GSA-published rates for the destination travelled.
There are plans to collaborate with HR for employee acknowledgment of updated per diem policies.
Credit card policy: Outdated vendor-specific cards addressed and phased out.
Title updates: Updated references to reflect the current title "Director of Human Resources" (formerly "Director of HR and Compliance") on page 23.
Annual bid limit: Revised to reflect the new limit of $114,500 on page 29.
Blank check policy: Adjustments planned on page 33 for clarity and compliance.

Mr. Wood clarified that no vote was required at this stage. The draft, with proposed edits, will be circulated before the next full board meeting for review and recommendation.

Prior to the vote, Jason Camp, Administrative Director, will present the RFP Bid award for the Campus Security Services.

The search for campus security services following the departure of St. Moritz, which exited the school security business 2.5 months into their contract continues. The RFP process sought 10 guards and one manager, and bids were evaluated based on cost, experience & qualifications, and proposal accuracy, weighted at 35%, 35%, and 30%, respectively.

Bidders submitted rates for guards, managers, and special events, with costs calculated using an eight-hour shift for 180 days.

DSPI Inc submitted the lowest bid, but Allied demonstrated the most relevant school security experience, unlike competitors who specialised in less interactive settings like nighttime patrols or university campuses.

Allied was the only bidder to offer the required SB1626 certification, a mandatory certification for school security in California. Others did not addressed this.

Allied is recommended for the contract due to its school security expertise, readiness to begin immediately, and availability of certified guards. This ensures a smooth transition, beginning November 20th, leveraging guards previously employed by St. Moritz.

Mr. Jason concluded by noting that they will be refining the RFP process in future bids to ensure clearer expectations and better alignment.