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Governor’s Proposed Budget 2010-11. Steve Bolman Deputy Supt., Business and Administration Midge Hoffman Director, Budget & Accounting. The Economy. Signs indicate that most of the nation is recovering…California not so much California Unemployment at 12.3% compared to 10% for the U.S.
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Governor’s Proposed Budget 2010-11 Steve Bolman Deputy Supt., Business and Administration Midge Hoffman Director, Budget & Accounting
The Economy • Signs indicate that most of the nation is recovering…California not so much • California Unemployment at 12.3% compared to 10% for the U.S. • DOF estimates rate to remain above 10% through 2011
Employment Trends December 2007 to November 2009 Government Leisure & Hospitality Financial Service Manufacturing Construction Industrial Sectors (Jobs inThousands)
Recovery 5-year return to December 2007
Governor Vows to Protect Education!!! • Education will take less than it’s share of pro-rata cuts in 2010-11
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 2009-10!!! • Decrease in Prop 98 offset by sweep of underutilized K-3 CSR funds
GOOD NEWS!!! • FUNDED COLA for 2010-11!!!
BUT WAIT, THIS GOOD NEWS DIDN’T LAST VERY LONG… • If only it were real • …the COLA is being ‘funded’ because it’s negative • -.38% cut to the Revenue Limit
GOOD NEWS THAT DIDN’T LAST • The previous 2010-11 COLA reported was .5% positive…a negative swing of .88% • Elementary - $109K • Secondary - $318K • Cherry Valley - $17K • TOTAL - $444K
2011-12 COLA • 2011-12 COLA re-benched to 1.8% from 2.4% - <.6%> decrease • Elementary - $ 66K • Secondary - $182K • Cherry Valley - $ 10K • TOTAL - $258K • Cumulative Loss for 2010-11 & 2011-12 = $1.15 Million
It feels good to be “Protected”…or does it? • “Protected” doesn’t mean no new cuts
NO CUTS FOR THE ‘PROTECTED’ EDUCATION BUDGET ??? • The one-time revenue limit cut of $252.83 per ADA in 2009-10 is deleted for 2010-11 … 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 won’t increase the revenue limit deficit factor – there’s 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…
Revenue Update - LossesSince 1st Interim $253/ADA $245/ADA $278/ADA
Revenue Limit Changes -13.9% from 2007-08
Loss of COLA Loss of baseline dollars Revenue Limit Changes $566 $807 $482 $1,373 $1,430
District Options/Flexibility • Reduce calendar by 5 days through 2012-13 • Tier III Categorical funding can continue to be used with flexibility through 2012-13 • Eliminate Deferred Maintenance Transfer • Reduce Reserve for Economic Uncertainties
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 they’re out of smoke & mirrors?
