Governors Proposed Budget Steve Bolman Deputy Supt., Business and Administration Midge Hoffman Director, Budget & Accounting The Economy Signs indicate that most of the nation is recoveringCalifornia not so much California Unemployment at 12.3% compared to 10% for the U.S. DOF estimates rate to remain above 10% through 2011 Government Financial Service Leisure & Hospitality Industrial Sectors (Jobs in Thousands) Manufacturing Construction Employment Trends December 2007 to November 2009 Recovery 5-year return to December 2007 Governor Vows to Protect Education!!! Education will take less than its share of pro-rata cuts in Priorities Governor states that prison expenses will no longer be higher than higher education expenses, but speaks nothing about K-12 and the fact that it is next to dead last in funding in the Nation GOOD NEWS!!! No Mid-Year cuts for !!! Decrease in Prop 98 offset by sweep of underutilized K-3 CSR funds GOOD NEWS!!! FUNDED COLA for !!! BUT WAIT, THIS GOOD NEWS DIDNT LAST VERY LONG If only it were real the COLA is being funded because its negative -.38% cut to the Revenue Limit GOOD NEWS THAT DIDNT LAST The previous COLA reported was.5% positivea negative swing of.88% Elementary - $109K Secondary - $318K Cherry Valley - $17K TOTAL - $444K COLA COLA re- benched to 1.8% from 2.4% - decrease Elementary - $ 66K Secondary - $182K Cherry Valley - $ 10K TOTAL - $258K Cumulative Loss for & = $1.15 Million It feels good to be Protectedor does it? Protected doesnt mean no new cuts NO CUTS FOR THE PROTECTED EDUCATION BUDGET ??? The one-time revenue limit cut of $ per ADA in is deleted for BUT This is being replaced by another on-going cut NO CUTS FOR THE PROTECTED EDUCATION BUDGET ??? The $1.5 B cut is to come from District Administration $191 Elementary $231 Secondary An additional loss of $1.5 M for the District This on-going additional cut wont increase the revenue limit deficit factor theres no payback NO CUTS FOR THE PROTECTED EDUCATION BUDGET ??? No basis in reality for this figure Only gives the appearance that the Governor is keeping cuts from the classroom Would eliminate 3 out of every 4 positions in the District Office NO CUTS FOR THE PROTECTED EDUCATION BUDGET ??? For example, The Business Office Staff is comprised of: 2 Payroll 2 Accounts Payable 1 Budget Tech 1 District Accountant 1 Purchasing Coordinator 1 Business Manager NOW, PICK TWO PEOPLE TO PRODUCE PAYROLL,PAY BILLS, MAKE DEPOSITS, BUY BOOKS & SUPPLIES, BALANCE & MANAGE THE BUDGET,MAKE SURE WE HAVE CASH, ENSURE INTERNAL CONTROLS AND SO ON Elementary $ 506,199 $ 496,647 $ 565,488 Secondary $ 1,294,045 $ 1,197,129 $ 1,301,941 Cherry Valley $ 82,541 $ 85,865 $ 97,431 $ 1,882,785 $ 1,779,641 $ 1,964,860 $253/ADA $245/ADA $278/ADA Revenue Update - Losses Since 1 st Interim Revenue Limit Changes -13.9% from Revenue Limit Changes Loss of COLA Loss of baseline dollars $566 $807 $1,373 $1,430 $482 District Options/Flexibility Reduce calendar by 5 days through Tier III Categorical funding can continue to be used with flexibility through Eliminate Deferred Maintenance Transfer Reduce Reserve for Economic Uncertainties State Problems & Solutions Problems with Assumptions Pick your Metaphor More Gimmicks Funding Shifts may be legally challenged May not see $6.9 B from the Federal Government When will the State figure out theyre out of smoke & mirrors? 2009/ / /2012 TOTAL INCOME $64,391,563 $61,419,468 $61,105,833 LESS TOTAL EXPENSES $67,197,801 $66,133,400 $66,399,713 NET INCREASE (DECREASE) $ (2,806,238) $ (4,713,932) $ (5,293,880) PLUS BEGINNING BALANCE $12,786,321 $ 9,980,083 $ 5,266,151 EQUALS ENDING BALANCE $ 9,980,083 $ 5,266,151 $ (27,729) Less RESERVES (3,062,888) (2,877,089) (2,775,650) UNAPPROPRIATED $ 6,917,194 $ 2,389,062 $ (2,803,380) Trends with Revenue Cuts Average Daily Attendance 2009/ / /2012 COLA4.25%-0.38%1.80% % Deficit Elementary ADA 2,002 2,027 2,034 Cherry Valley ADA 350 Secondary ADA (funded) 5,058 4,886 4,683 Total ADA 7,410 7,263 7,067 Net Change over Prior Year (32) (147) (196) 2009/ / /2012 TOTAL INCOME $64,391,563 $61,419,468 $61,105,833 LESS TOTAL EXPENSES $67,197,801 $64,914,400 $65,180,713 NET INCREASE (DECREASE) $ (2,806,238) $ (3,494,932) $ (4,074,880) PLUS BEGINNING BALANCE $12,786,321 $ 9,980,083 $ 6,485,151 EQUALS ENDING BALANCE $ 9,980,083 $ 6,485,151 $ 2,410,271 Less RESERVES (3,062,888) (2,840,519) (2,739,080) UNAPPROPRIATED $ 6,917,194 $ 3,644,632 $ (328,810) Trends with 2.75% Salary Cut for All Employees