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The Centinela Valley Union High School District faces a severe budget shortfall due to the State's deficit factor, rollback of meals for needy money, declining enrollment, and uncertainty of a proposed ballot measure. Swift action is needed to prevent financial uncertainty. The deficit factor alone results in a loss of almost $8.8 million. The passage of California Assembly Bill 851 also impacts the district's finances. Declining enrollment and the uncertain ballot measure further compound the funding crisis.
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California/CVUHSD Education Funding Crisis The Perfect Storm Centinela Valley Union High School District is facing a severe budget shortfall resulting from the State budget crisis and a number of other circumstances. This “perfect storm” of circumstances will require swift and extensive action in order to prevent a return to the financial uncertainty the District faced just a few years ago. TOP FOUR LIST • Continued Increases in State Deficit Factor • Rollback of Meals for Needy Money • Declining Enrollment • Uncertainty of Proposed Ballot Measure
California/CVUHSD Education Funding Crisis The Deficit Factor • Although the Governor’s Office announced that there was no reduction to K12 budgets, in reality, the State’s application of an ever larger deficit factor does result in a decrease in available funding. • In essence, the State acknowledges that they should pay Districts a certain amount per student in attendance (ADA) . . . • but then admits that they have only enough cash on hand to pay a reduced amount. • The difference (in percentage points) is the deficit factor. For the 2011-2012 school year, the State will apply a 19.608% deficit factor . . . • so we get only 80 cents on the dollar . . . $5981 instead of $7440. • CVUHSD will lose almost $1459 per ADA. • Assuming no other issues, such as declining enrollment, the deficit factor alone translates to a loss of almost $8.8 million.
California/CVUHSD Education Funding Crisis The Deficit Factor $8,800,000
California/CVUHSD Education Funding Crisis Meals for Needy Money With the passage of California Assembly Bill 851, CVUHSD took a severe financial hit. This bill established formulas that tie the meals for needy money to the funding and enrollment in the 2007-2008 school year. These formulas essentially erase all financial gains related to increases in meal participation since 2007. $4,864,000
California/CVUHSD Education Funding Crisis Declining Enrollment $1,663,000
California/CVUHSD Education Funding Crisis Ballot Measure • The Governor’s proposed budget, as it looks now, is contingent upon voters approving a ballot measure that would extend temporary tax increases for five more years. • In order to avoid more cuts, the Legislature must place the measure on the ballot with a 2/3 vote, and the voting public must approve the tax increase. • If the measure does not get on the ballot, or if the voters do not approve the measure, there will be an additional cut of $330 per ADA. $1,990,000
California/CVUHSD Education Funding Crisis Total Revenue Reductions2011-2012
California/CVUHSD Education Funding Crisis Total Expenses (in Millions)2011-2012
California/CVUHSD Education Funding Crisis Multi-Year Ending Fund Balance Projection Scenarios
