Capital projects increased due to phase 2 of safety and security improvements and the CHS library renovation (see Capital Projects Section). The decrease in Debt Service fund is due to debt refinancing that lowered future debt payments based on the revised debt payment schedule (see Debt Service section). 30 Explanations of the fluctuations in the various categories are described in more detail on the following pages. 2021-2022 Original Operating Expenses 2022-2023 Proposed Operating Expenses Variance $ Variance % Certified Salaries $27,438,270 $27,887,060 $448,790 1.64% Classified Salaries $8,261,030 $8,232,560 ($28,470) (0.34%) Board Paid Health Benefits $4,798,890 $4,983,040 $184,150 3.84% Employee Benefits $6,627,490 $6,330,890 $63,400 1.01% Purchased Services $5,556,810 $5,702,310 $145,500 2.62% Supplies $3,827,780 $4,105,060 $277,280 7.24% Equipment/Capital $2,410,130 $2,420,460 $10,330 0.43% Total Operating $58,560,400 $59,661,380 $1,100,980 1.88% 31

Explanations of the fluctuations in the various categories are described in more detail on the following pages. 2021-2022 Original Operating Expenses 2022-2023 Proposed Operating Expenses Variance $ Variance % Certified Salaries $27,438,270 $27,887,060 $448,790 1.64% Classified Salaries $8,261,030 $8,232,560 ($28,470) (0.34%) Board Paid Health Benefits $4,798,890 $4,983,040 $184,150 3.84% Employee Benefits $6,627,490 $6,330,890 $63,400 1.01% Purchased Services $5,556,810 $5,702,310 $145,500 2.62% Supplies $3,827,780 $4,105,060 $277,280 7.24% Equipment/Capital $2,410,130 $2,420,460 $10,330 0.43% Total Operating $58,560,400 $59,661,380 $1,100,980 1.88% 31 Staffing The vision for staffing in the School District of Clayton as framed by the District’s mission, vision and core values is to have the best teacher possible in every classroom and the best staff member possible in every non-teaching position. With this purpose in mind, elements critical to staffing recommendations for budget development include: • Enrollment • Class Size Policy • District’s Curricular and Program Expectations • Missouri School Improvement Program Standards • Fund Balance Guidelines Administrators discuss staffing on an ongoing basis and make recommendations that keep the district within fund balance goals. Staffing may be adjusted at any time between the presentation of the budget and the start of the school year based upon a periodic review of the enrollment/registration process or program enrollments at the secondary level. The staffing contingency budget may be used when actual enrollment exceeds projected enrollment. Before a recommendation to replace current staffing or a recommendation for contingency staffing, administrators will make every effort to accommodate any unforeseen need with existing resources. An annual contingency account equivalent to one teacher at the average teacher compensation is maintained to offset fluctuations due to differences between projected enrollment and actual enrollment. Salary and Benefits Certified Staff – The District is very fortunate to have the most experienced and highly educated teaching staff in the area. During 2020-2021, our average teacher had 18.0 years of experience with 97.1% holding a Master’s Degree or higher. The Missouri average for that year was 12.7 years of experience with 59.6% holding Master’s Degrees or higher. 2022-2023 is the second year of a two-year salary agreement. For the 2022-2023 budget, a 1.7% overall budget impact has been included in the current projections as per the salary agreement. This represents an average salary increase of 2.8% for a teacher due to staff turnover. Staffing changes based on enrollment projections and student needs have been budgeted. The staffing changes resulted in a decrease in the salary budget primarily due to the reduction of a full-time teacher at Glenridge as well as Wydown due to shifts in enrollment Non-Certified Staff – Non-certified staff include the following categories of support staff: nurses, office personnel, maintenance personnel, before and after school personnel, personnel at the Family Center, and miscellaneous part-time non-teaching positions. A 2% budgetary increase for non-certified staff has been included in the current budget and projections. Due to inflation and significant increases to minimum starting salaries across St. Louis County, higher increases to some staffing classifications were given to ensure competitive starting salaries. This increase was absorbed by a large turnover in tenured support staff resulting in a decrease to the overall non-certified budget. Employee Benefits – Employee benefits include medical, dental, vision, long-term disability, and life insurance. Also included in this category is the Employee Assistance Program. The employee benefit plans are administered on a calendar year basis. 2017 and 2019 plan years experienced significant medical claims that exceed premiums. 2020 and 2022 saw a reduction in medical claims. Due to the unusual circumstances caused by the COVID-19 pandemic, a 5% increase is reasonable for the 2022-2023 budget projections. 32

The employee benefit plans are administered on a calendar year basis. 2017 and 2019 plan years experienced significant medical claims that exceed premiums. 2020 and 2022 saw a reduction in medical claims. Due to the unusual circumstances caused by the COVID-19 pandemic, a 5% increase is reasonable for the 2022-2023 budget projections. 32 Administration will continue to work with a representative group of staff to identify ways to adjust the plan design, negotiate discounts, and incorporate wellness activities such as free membership and low-cost fitness classes for staff through the Center of Clayton that will maintain a competitive benefits package. Retirement Contributions - Retirement contributions for PSRS members and employer matching have been approved by the retirement system at the same percentage as 2021-2022 which is 14.50 percent of retirement compensation. Retirement contributions for PEERS members and employer matching have also been approved by the retirement system at the same percentage as 2021-2022 which is 6.86 percent of retirement compensation. Retirement compensation includes salary, extra pay, and medical, dental, and vision insurance contributions. PSRS participants are not eligible for social security benefits and neither the District nor the participants contribute to social security on their behalf. PEERS participants and the District both contribute to social security and participants are eligible for full benefits. School Building and Department Budgets For 2022-2023, school building and department budgets will be established through the ZBB approach as previously described. This represents approximately $5.0 million of the overall operating budget. All members of the District Leadership Council will share in the experience of analyzing budget trade-offs and making tough decisions between building and department requested wants and enhancements. This overall budget area is budgeted with a 2 percent increase. However, through the ZBB approach, District leaders will ensure the District’s resources are allocated to programs that support its mission, vision and core values as well as to secure the District’s ability to continue to provide our students with a rich and rigorous educational experience. Capital Expenditures The District defines capital expenditures and projects as follows: • Capital Expenditures – Any purchase of furniture, equipment, vehicles, or permanent improvement having per unit cost of $1,000 or more and useful life of more than one year is classified as a capital asset. Purchases of $3,500 or more will be competitively bid, and sealed bids will be required for purchases that may exceed $50,000 as stated in District Policy DJF -2 – Purchasing. • Capital Project – An activity that does not occur routinely or annually, has a scheduled and definitive beginning and ending, and results in a capital improvement or acquisition. Funding for this activity is from local revenue sources. • Capital Projects Bond Program – Major technology infrastructure and facility needs such as new construction, or upgrading existing facilities are funded through the sale of bonds. As part of a bond elections process, the District develops a framework of the projects to be addressed. These projects are determined through internal staff analysis and input from the community. Once the projects are identified, specific project budgets are established on a project basis. Facility Services – The Director of Facility Services and key stakeholders work to develop a five-year capital projects budget each January and February. General building maintenance needs are considered as well as educational needs. The needs throughout the District are analyzed and prioritized. This list is continuously updated as the needs of the District and its students change. Each spring the District asks the Board to approve the top priority projects that fit within budget parameters that need to be completed at that time. As a result, many projects get deferred over a period of years. Some of these projects include: 33

As a result, many projects get deferred over a period of years. Some of these projects include: 33  Infrastructure improvements that were identified in the District’s Facilities Master Plan but were not pressing enough to be included as part of the 2009 bond issue.  Updates to learning spaces/libraries to meet the evolving needs of today’s learners.  Improvements to athletic facilities including a press box and restroom for Adzick Field and a renovated press box, new scoreboard and improved fencing for Gay Field. Total proposed maintenance Capital Improvement Plan (CIP) expenditures will increase 2%. $35,000 will be included for classroom furniture purchases for a total budget of $958,360. A contingency fund of $35,000 has historically been maintained to handle unanticipated maintenance needs and emergency repairs. Water main breaks, unanticipated roof leaks, funding insurance damage claims, and dealing with environmental health issues are examples of potential uses of contingency funds. Many of Maintenance’s projects are completed during the summer months and therefore projects that are not completed prior to the end of the fiscal year will continue to be carried over into the following year’s budget. Technology – Technology serves as a powerful learning tool in a dynamic community where all children and adults work and learn together. It enables learners to build and share understandings and facilitates the mastery of specific content learning outcomes. It supports generalized learning outcomes by promoting an increase in interest and motivation, by strengthening process and thinking skills, by providing a format for helping students make connections and apply knowledge, by providing opportunities to solve problems and engage in simulations, by strengthening the development of the inquiry process and skills, and by allowing students to communicate, synthesize, and create. It empowers learners by expanding resources, improving communication, and providing greater versatility in the curriculum. Technology connects home, school, and the world and supports learning as a continuous, lifelong process. The budget supports District-level Technology Improvement Plan (TIP) funds are utilized to provide for a replacement cycle of technology capital items including staff and student devices, and beginning in Fiscal Year 2017, larger-scale technology infrastructure improvements such as the District’s wireless network, phone system, and more. The shift to an infrastructure-inclusive TIP funding model has allowed the District to systematically move forward with planned replacements and enhancements without adjusting the budget each time a new step of the plan is implemented. The District has taken great care to make responsible decisions, react to unexpected needs, and support progressive thinking, all while staying in budget. To date, approximately 60 percent of TIP funds have been directly used to provide students with access to technology with the remaining 40 percent used for infrastructure, general operations, and staff access. The District has also implemented a number of cost-savings measures including a reduction in physical datacenter hardware, a data-based device life cycle analysis, and the deliberate pursuit of alternative funding sources such as E-Rate. Based upon the TIP cost projection model over the next six years, the current level of capital funding is not sufficient to accomplish the goals outlined in the self-study presented to the Board of Education on April 13, 2022. Specifically, the objectives for Goal 3 related to cybersecurity, data privacy, and risk 8 management will require additional funds. A one-time increase of $200,000 in the TIP budget is requested to continue the infrastructure-inclusive funding model and in support of the Goal areas presented to the Board. It is expected that the requested TIP budget will return to the previous funding level with an annual 2% increase thereafter to help offset inflation and to provide flexibility and responsiveness to changes in District needs. As a result, the 2022-2023 TIP budget will be increased 2% to $649,460 with a one-time increase of $200,000 for a total funding of $849,460. A contingency fund of $10,000 is maintained to handle unanticipated needs. Because many of Technology’s projects are completed during the summer months, projects that are not completed prior to the end of the fiscal year will continue to be carried into the next fiscal year. 34

A contingency fund of $10,000 is maintained to handle unanticipated needs. Because many of Technology’s projects are completed during the summer months, projects that are not completed prior to the end of the fiscal year will continue to be carried into the next fiscal year. 34 Clayton Recreation Sports and Wellness Commission The Clayton Recreation, Sports and Wellness Commission, Inc. (CRSWC) is a not-for-profit organization, which provides a shared use facility called the Center of Clayton (Center) to address the athletic and educational needs of the District and the community. The goal of the Center is to cover operating costs; however, feasibility studies conducted prior to the opening of the Center recommended establishing a funding mechanism for capital and equipment replacement costs. These expenditures had not been factored into the original projections and unexpected capital costs would be difficult if not impossible for the Center’s budget to fund. Historically, expenditures in the capital and equipment replacement fund have been provided through a total annual capital contribution of $100,000 to $200,000 by each parent organization (the City of Clayton and the District). Due to the significant loss of memberships from the COVID-19 pandemic, the Center of Clayton operations are projecting a loss of approximately $400,000 for the fiscal year 2023 that the District is responsible for 50 percent and the City of Clayton for the other 50 percent. In addition, annual contributions from the parent organizations to the Center of Clayton have been budgeted at $300,000 each with $150,000 each budgeted for the Operating Fund, $50,000 each for the replacement of fitness equipment and $100,000 each for building maintenance and improvements. The Center of Clayton administration will continue to review staffing and revenue projections to minimize operational losses. Decreasing operating losses have been included in the projections over the next five years. Adjustments to projections will be made when more information becomes available. It is recommended that the Board continue to commit to placing in reserve $100,000 a year to cover the costs of potential major capital repairs to the building and grounds. This reserve would accumulate up to, and be maintained at, a $500,000 fund balance. The CRSWC recently approved $220,000 in repairs to the roof over the competition pool that will be completed during the summer of 2022. The District’s portion of $110,000 will be charged against these reserves. After this expense, the reserve balance is projected at $410,000 as of June 30, 2023 and will be replenished at an amount up to $100,000 annually until accumulated up to $500,000. The funds are recorded as committed on the balance sheet for the governmental fund financial statements as well as not included in fund balance projections. Family Center The Family Center budget has historically been developed through a ZBB approach. Funding is allocated based on operational needs. District administration will continue to review the Family Center’s fee structure to ensure tuition maintains competitiveness with market programs and covers the historical percentage of operating costs. Historic funding levels and District support are provided in the following chart and gap analysis: 2016- 2017 2017- 2018 2018- 2019 2019- 2020 2020- 2021^ 2021- 2022*^ 2022- 2023* Program Revenues $743,045 $813,688 $785,931 $538,904 $433,000 $703,000 $785,000 Operational Costs~ $406,795 $441,623 $548,526 $478,712 $753,312 $529,720 $690,570 Program Costs $762,832 $799,383 $813,014 $825,314 $824,405 $981,270 $1,017,770 Total Expenses $1,169,627 $1,241,006 $1,361,540 $1,304,026 $1,577,717 $1,510,990 $1,708,340 District Support $ $426,582 $427,318 $575,609 $765,122 $1,136,380 $807,990 $923,340 District Support % 36.47% 34.43% 42.28% 58.67% 72.06% 53.47% 54.05% Program Generated 63.53% 65.57% 57.72% 41.33% 27.97% 46.53% 45.95% *Budgeted ^Loss of revenue due to COVID-19 ~Operational costs include building and grounds capital improvements (i.e. HVAC, roof replacement, parking lot repairs, etc.) 35