Plumas Lake Elementary School District 2009-10 Governor’s Budget Update January 20, 2009

1. Plumas Lake Elementary School District 2009-10 Governor’s Budget Update January 20, 2009

2. Governor’s Budget 2009-10 1 • Governor’s proposal for mid-year reductions in 2008-09: • The 0.68% COLA included in the Adopted Budget is eliminated • Further revenue limit reductions of 4.5% – total deficit of 9.685% • The overall reduction to Proposition 98 for 2008-09 is $6.3 billion • Elimination of Deferred Maintenance match requirement • Reduction of Routine Restricted Maintenance Account set aside requirement • For 2009-10, the Governor’s proposal included: • COLA of 5.02%, but not funded • Revenue limit cut of $1.6 billion - 6.97% of new base revenue limit • Total deficit is 16.161% • No COLA for categorical programs • Categorical and other flexibility to help school agencies deal with the loss of funding

3. General Fund Revenue Collapse

4. 2008-09 Proposition 98 Guarantee • No COLA • $1.6 billion revenue limit cut Real Cut $56.1 billion • April deferral • Special fund shift • “Settle up” redesignation Minimum Guarantee Actual Spending $51.5 billion $50 $55 $60 Minimum Guarantee

5. 2008-09Proposition 98 Reduction $56.3 billion Special fund shift $55.9 billion Minimum Guarantee Actual Spending Minimum Guarantee $50 $55 $60 2009-10 Proposition 98 Guarantee

6. Governor’s and Legislature’s Major Proposals

7. What Does it Mean for Our District? 6 • Freeze on all non-essential expenses to preserve fund balance • Impact of eliminating deferred maintenance funding by $28,000 • Impact of reducing RRM funding - $165,416 • Ending fund balance – where do we stand relative to requirements? • No COLA - still have the following costs: • Fixed costs – electricity, gas, water, sewer, insurance • Step and column

8. Adopting the Budget 7 • Balanced budget must be adopted by district prior to June 30, 2009 • State Budget will most likely not be in place by then • Developing the budget requires: • Clarifying assumptions • How much revenue? • What flexibility options will be acted upon? • How will expenditures change? • Once the State Budget is adopted, the district makes adjustments to its budget within 45 days

9. Next Steps • Make necessary adjustments at Second Interim: • Eliminate 0.68% COLA • Reduce Revenue Limit additional 4.567% • Eliminate Deferred Maintenance Match • Set aside unallocated State categorical funds • Prepare Multi-Year Projections based on what we know now • Begin building budget for 2009-10 based on what we know now • Review seniority lists for accuracy

10. Questions? Thank you Source: School Services of California (Slide 3, 4, 5, 6)