Proposed Budget

2010-2011

June 14, 2010

Prepared by the Business Office

National Economy



The U.S. economy is no longer in decline, but is growing slowly

 The recession began in December 2007, 29 months ago  U.S. Gross Domestic Product (GDP) grew 3.2% in the first quarter of 2010  162,000 jobs were added in March (unrevised survey) 

But the unemployment rate has remained high

 The April 2010 rate was 9.9%, up from 8.9% one year ago

U.S. Economic Outlook

1-9 6.0% 4.0% 2.0% 0.0% -2.0% -2.7% -4.0% -6.0% -5.4% -8.0% 3rd Quarter 4th Quarter 2008

U.S. GDP

(Percent Change) -0.7% 2.2% 5.6% 3.2% -6.4% 1st Quarter 2nd Quarter 2009 3rd Quarter 4th Quarter 1st Quarter 2010 Source: U.S. Bureau of Economic Analysis, April 2010

California Economy

1-10

 The state’s economy is recovering along with the nation’s  State personal income grew at 4.1% and taxable sales grew at 1.9% in the 4 th quarter of 2009, according to the University of California Los Angeles (UCLA) Forecast  However, job growth remains a major drag on the economy  California added only 2,800 jobs in February and 4,200 jobs in March  If California had shared in the 162,000 U.S. jobs added in March, our proportionate gain would have been more than 16,000 jobs 

The state’s unemployment rate, at 12.6%, is the third highest in the nation

California Employment

Employment (In thousands) 17,500 17,000 16,500 16,000 15,500 1-14 2008 2009 2010 Sources: Employment Development Department; Historical Civilian Labor Force, May 2010

California’s Unemployment Rate

13% 12% 11% 10% 9% 8% 7% 6% 5% 2008 2009 2010

15%

California’s Unemployment Rate

1-15

vs. Other Hard-hit States

Highest State Unemployment Rate, March 2010 14.1% 14% 13.4% 12.6% 12.6% 13% 12.3% 12% 11% 10% 9% 8% Michigan Nevada Source: U.S. Bureau of Labor Statistics, April 2010 California Rhode Island Florida National Average 9.7%

Overview of the State Budget

1-3

   Education fares better than the rest of the Budget The rest of the Budget is absorbing even heavier cuts in order to protect education from deeper cuts  But there is no “free ride” –

the nearly $2.5 billion taken from education in January remains unrestored

 Child care takes a huge cut  Social and health programs that serve K-12 students and their families are hit even harder  California Work Opportunities and Responsibility to Kids (CalWORKs), which is California’s main avenue to welfare payments, is on the chopping block The Budget reflects two major unresolved problems: 

California’s finance system serves the state poorly in both good and bad times



The current economic woes remain unresolved

May Revision Features

1-5

 For the most part, the May Revision contains no further cuts to K-12 education  Cuts proposed in January remain  Targeted proposed administrative cut is eliminated  Cuts to child care eliminate subsidized slots for 142,000 children  No new federal dollars  No new taxes are proposed  Major additional cuts to the noneducation portions of the Budget are proposed   We expect the Legislature to have great difficulty voting for the choices before them

Despite the Governor’s call for an on-time Budget, chances are slim

Comparing the Forecasts – Income

Personal Income (Annual % Change) 5.0% 4.0% 3.0% 2.0% 1.0% 0.0% -1.0% -2.0% -3.0% -2.8% 2009 3.2% 2.4% January Budget 2010 2010 May Revision 2010 2011 4.5% 3.6% 1-11 Sources: 2010-11 Governor’s Budget, January 2010; 2010-11 May Revision, May 2010

2.0% 1.0% 0.0% -1.0% -2.0% -3.0% -4.0% -5.0% -6.0% -7.0%

Comparing the Forecasts – Jobs

Wage and Salary Employment (Annual % Change) -0.7% 1.7% 1.3% -5.6% -6.0% 2009 January Budget 2010 2010 May Revision 2010 2011 Sources: 2010-11 Governor’s Budget, January 2010; 2010-11 May Revision, May 2010

General Fund Revenues

1-17

 The state economy drives General Fund revenues through three major taxes:

personal income tax, sales tax, and corporation tax

 The collapse of the state and national economies has driven state tax revenues down, but signs of recovery are emerging  Revenues outperformed admittedly low projections from December 2009 through March 2010  April 2010 collections fell short, but this was based largely on 2009 liabilities; revised revenues for 2009-10 are down $1.2 billion  Sales and corporate earnings are improving, bringing in more tax revenues than expected  The May Revision anticipates continuing improvement in revenues in 2010-11  The forecast adds $2.1 billion for 2010-11 from the January projection

$95.0

$90.0

$85.0

$80.0

$75.0

$70.0

General Fund Revenues

General Fund Revenues (in billions) January Budget May Revision $82.7

$82.7

$88.1

$86.5

2008-09 2009-10 $89.3

$91.5

2010-11 1-18 Source: 2010-11 May Revision, page 56

Risks to the Revised Budget

1-19

Proposal

 In January, we noted several major risks to the Governor’s Budget proposals:  Federal funds – no guarantee that $6.9 billion could be secured  Voter approval – required for fund shifts  Economy and revenues – the economy and revenues could underperform forecasts  Some of these risks have in fact materialized: 

Only $3.4 billion in federal funds are expected to be received

 Fund shifts requiring voter approval will not be placed on the ballot  Current-year revenues have fallen short by $1.6 billion

Risks to the Revised Budget Proposal

 The May Revision, if enacted as proposed, contains other – but equally significant – risks  Court challenges – rebenching Proposition 98, elimination of CalWORKs, state worker pay cuts, health care reductions, and other cuts could face court challenges  Late Budget – a late Budget would delay implementation of program reductions, resulting in the loss of budgeted savings 

Economic and revenue risks – the state and national economies face the possibility of a “double dip” recession, especially in light of the turmoil in overseas economies



These risks in turn could threaten California’s access to the capital markets, pushing borrowing costs even higher

General Fund Budget Summary

Prior-Year Balance Revenues and Transfers Total Resources Total Expenditures Fund Balance Budget Reserve: Reserve for Encumbrance Reserve for Economic Uncertainties Budget Stabilization Account

Total Available Reserve (Dollars in Millions) 2009-10 2010-11

-$5,361 86,521 -$5,305 91,451 81,160 86,465 -$5,305 86,146 83,404 $2,742 1,537 -6,842 0

-$6,842

1,537 1,205 0

$1,205

 One year ago, the proposed reserve for 2009-10 was +$4.5 billion, a swing of more than $11 billion  The reserve equals 1.3% of projected revenues in 2010-11  Revenues increase 5.7% in 2010-11, while expenditures drop 3.5%  The current-year fund balance deteriorated $1.4 billion since January

Source: State Budget 2010-11

California Per-Student Spending Falls Far Below Average

1-26



According to the National Education Association’s (NEA) Rankings of the States 2009, as of 2008-09, California was 44 th per-student spending, falling from 34 th in 2007-08 in California vs. National Average Per-Student Spending $12,000 $10,000 $8,000 $6,000 $4,000 $2,000 $0 $10,615 $9,870 $10,736 $8,605 2007-08 National Average 2008-09 California Source: Rankings of the States 2009 and Estimates of School Statistics 2010, National Education Association

Revenue Limit Deficit Factors

20.000% 18.000% 16.000% 14.000% 12.000% 10.000% 8.000% 6.000% 4.000% 2.000% 0.000% 19 93 -94 19 94 -95 19 95 -96 19 96 -97 19 97 -98 19 98 -99 19 99 -00 20 00 -01 20 01 -02 20 02 -03 20 03 -04 20 04 -05 20 05 -06 20 06 -07 20 07 -08 20 08 -09 20 09 -10 20 10 -11

2010-11 Deficit Applied and Cut

 Apply the 2010-11 deficit of 18.355% to your undeficited revenue limit per ADA  Apply the 3.85% cut to the undeficited revenue limit per ADA

$6,386 Example for Average Unified District Funded revenue limit = $6,386 – ($6,386 x 0.18355 + $6,386 x 0.0385) = $6,386 – ($1,172 + $246) = $6,386 – $1,418 = $4,968 2010-11 Revenue Limit Before Deficit $6,386 Deficit Factor Reduction $1,172 (18.355%) $246 (3.85%) reduction 2010-11 Revenue Limit Funding $4,968 2010-11 Revenue Limit After Deficit and Cut

Special Education Issues

2-17



The mental health budget includes a proposal to suspend AB 3632 (Chapter 1747/1984), which mandates county mental health agencies to provide services to children with disabilities



The concern is that the fiscal burden will shift to school districts since they will continue to provide mental health services required by students’ Individualized Educational Programs

Pension Reform Legislation

2-19

 SB 919 (Hollingsworth) would reform pensions for newly hired employees covered by the Public Employees’ Retirement System (PERS)  School members first employed on or after the date the bill takes effect would be subject to a 2%-at-65 retirement formula, rather than the current 2%-at-55 formula  The bill would also permit districts that contract with PERS for health benefits to collectively bargain a different employer contribution for employee and annuitant health benefits coverage for those hired on or after the effective date of a memorandum of understanding  SB 919 was heard in its first policy committee on May 10, but no vote was taken

STRS Contribution Rates

2-21

 State Teachers’ Retirement System (STRS) had an unfunded actuarial obligation of $22.5 billion as of June 30, 2008   But this does not reflect the 25% investment loss in fiscal year 2008-09 or the partial recovery this year Investment earnings alone, projected at today’s lower rates, cannot close the shortfall  Instead, an approximate 14% increase in contributions will be required to amortize the shortfall over 30 years  The contribution increase could come from employers, employees, and/or the state 

If employers alone were tapped, the employer contribution rate would exceed 22% (additional $47 million in expense)

 Increasing the employer contribution rate would require legislation and none has been introduced

PERS Contribution Rates

2-22

 Employer contribution rates are set by the PERS Board each May  The Board is expected to approve a rate of 10.707% on May 19  Based on PERS’ previously provided multiyear contribution rate estimates and the Board’s subsequent approval of new actuarial assumptions expected to further increase the school employer contribution rate by about 0.5% of payroll, we estimate: Fiscal Year Employer Contribution Rate

2009-10 2012-13 9.709% (actual) 2010-11 10.707% (pending approval) 2011-12 12.107% (estimated) 14.207% (estimated) 2013-14 14.507% (estimated)

Flexibility Opportunities Continue

3-1

 The flexibility options introduced in 2008-09 continue without changes  42 Tier III flexible categorical programs  Including suspension of deferred maintenance match requirements and instructional materials adoption timelines  Relaxation of K-3 Class-Size Reduction (CSR) funding penalties  Lowering of reserve for economic uncertainty requirements  Shorter school year  The May Revision proposes no changes to existing flexibility – nor does it offer answers to questions about the future of flexibility  Tier III flexibility continues through 2012-13  K-3 CSR funding penalties remain relaxed through 2011-12

The Legislative Analyst Office’s Report on Flexibility

3-2

 The Legislative Analyst’s Office (LAO) offers some recommendations to continue and expand flexibility  These proposals are not reflected in the May Revision, but may become part of legislative budget hearings  The LAO conducted a survey of all school districts  231 school districts responded  Based on this survey,

LAO concluded

: 

Flexibility helped districts develop and balance their budgets and focus scarce resources more strategically



Most decisions to shift funds were done to redirect funding from non-instructional to instructional areas



The majority reported that they would like to have additional programs added to the list of flexible programs

The Legislative Analyst Office’s Report on Flexibility

3-3

 LAO’s recommendations: 

Add K-3 CSR, Home-to-School Transportation, and After School Education and Safety to Tier III

 Consolidate Economic Impact Aid (EIA) with English Language Acquisition Program  Consolidate Career Technical Education programs  Ease or remove state restrictions for: 

Contracting out for noninstructional services



Hiring/pay rate for laid-off teachers serving as substitutes



Quality Education Investment Act (QEIA) requirements The report can be found at www.lao.ca.gov

Other Federal Issues

3-22

 Congress has proposed and the President is now supporting provisions that were in the “Keep Our Educators Working Act”  $23 billion to help states retain and hire teachers and other school staff members 

Economic experts (including Nobel Laureate, Paul Krugman) have called for more investment in education

 The reauthorization of the Elementary and Secondary Education Act (ESEA) continues to be overdue  In spite of expectations that RTTT and other ARRA-related measures signaled the future direction for ESEA, no legislation has been released

State’s Cash Problem Became Our Problem

 On Wednesday, June 2, 2010 State Controller John Chiang sent a letter and chart to the Governor and Legislative leaders, advising them of his latest cash projections based on actual numbers through April and the Governor’s May Revision budget proposal.  “The State’s ability to meet its payment obligations during the next three months is entirely owed to two factors:  Legislation enacted earlier this spring that allowed the

deferral of approximately $4.7 billion of payments to K-12 education

, higher education, and local governments; and  The continued reliance on borrowing as much as $20 billion from special funds.”

Cash Deferrals of 2009-2010 State Apportionment Impact to LBUSD

From To July 2009 August 2009 November 2009 February 2010 * April 2010 * May 2010 * June 2010 * December 2009 October 2009 January 2010 July 2010 to September 2010 August 2010 August 2010 July 2010

Total

Amount Deferred $ 11,540,724 19,518,878 17,566,990 14,124,274 18,514,258 11,074,433 16,319,266 41,418,500

$ 150,077,323

Amount deferred within FY 2009-2010 = $ 48,626,592 * Amount deferred to FY 2010-2011 = $101,450,731

Cash Deferrals of 2010-2011 State Apportionment Impact to LBUSD

From July 2010 October 2010 February 2011 * March 2011 April 2011 * May 2011 * June 2011 * To September 2010 January 2011 July 2011 April 2011 August 2011 August 2011 July 2011

Total

Amount deferred within FY 2010-11 = $ 54,184,566 * Amount deferred to FY 2011-12 = $131,591,086

Amount Deferred $ 19,351,631 34,832,935 32,897,772 34,832,935 11,610,978 17,416,468 34,832,933

$ 185,775,652

Principal Apportionment Deferrals 2009-10 to 2010-11

5-34

District Enrollment (without Charters)

98,000 96,000 94,000 92,000 90,000 88,000 86,000 84,000 82,000 80,000 78,000 76,000 95,584 96,296 96,616 95,362 92,622 89,668 86,947 86,122 84,996 83,855 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11

Revenue Assumptions



Enrollment

- Projections include declining enrollment at

1.4%

for Fiscal Years 2010-11, 2011-12, and 2012-13



Revenue Limit

- Includes: COLA at

-0.39% ,

additional adjustment at

-3.85%

(estimated at

-$250

per ADA), and a deficit of

18.355%



State Categoricals

- COLA at

-0.38%

Lottery — $111 per ADA for unrestricted and $14.50 per ADA for restricted for a total of $125.50 per ADA

Revenue Assumptions (Cont’d)

Programs that will be utilizing carry-over funds and have no new 2010-11 funding include: Description

Reading First Title V (NCLB Transfer)* Connect Ed Safe and Drug Free History Grant PE for Progress TUPE*

Resource No.

Previous Funding

3030 4110 9509 3710 5828 3702 6670 218,508 2,045,296 1,175,000 599,151 986,640 261,201 741,002

Estimated Carryover

139,000 0 900,000 240,000 20,000 40,000 0

* No funding and no carryover in 2010-11

2010-11 Adopted Budget —Revenues

Other State Revenue, $158,450,048 25% Other Local Revenue, $9,334,779 1% Other Financing Sources, $ 0 0% Federal Revenue, $70,911,994 11% Revenue Limit Sources and State Revenues make up 88% of total revenues.

Revenue Limit Sources, $406,723,970 63%

General Fund Summary

2009-2010 Estimated Actuals Unrestricted Restricted

Revenues Revenue Limit Sources Federal Revenue Other State Revenue Other Local Revenue Total Revenues 392,553,020 1,846,977 85,316,475 11,019,411 490,735,883 21,478,619 106,525,295 88,259,383 3,342,080 219,605,377

Total

414,031,639 108,372,272 173,575,858 14,361,491 710,341,260 Expenditures Certificated Salaries Classified Salaries Employee Benefits Books and Supplies Services, Operating Exp Capital Outlay Other Outgo Tranf-Indirect/Direct Suppt Total Expenditures 255,885,525 68,255,446 106,962,586 6,184,884 32,000,973 1,547,927 6,976 (11,121,693) 459,722,624 117,334,543 39,609,702 53,491,323 11,887,333 38,234,693 192,224 154,944 9,489,275 270,394,037

Unrestricted 2010-2011 Adopted Budget Restricted

385,489,933 2,156,100 78,495,319 8,710,470 474,851,822 21,234,037 68,755,894 79,954,729 624,309 170,568,969 373,220,068 107,865,148 160,453,909 18,072,217 70,235,666 1,740,151 161,920 (1,632,418) 730,116,661 240,833,407 67,279,480 105,797,922 8,883,470 26,271,456 1,166,358 (9,363,283) 440,868,810 87,780,005 35,640,823 45,280,444 6,569,486 34,239,664 188,933 157,733 7,828,789 217,685,877

Total

(1,534,494) Excess (Deficiency) of Revenue over Expenditures 31,013,259 (50,788,660) (19,775,401) 33,983,012 Other Financing Sources/Uses Interfunds Transfers In Inferfunds Transfers Out Other Sources Other Uses Contributions Total Oth Financing/Uses 16,891,176 8,731,269 (33,312,957) (25,153,050) 35,849 42,812,957 42,777,108 Net Increase (Decrease) to Fund Balance Fund Balance Beginning Fund Balance Unaudited Beg FB Audit Adustments Other Restatements Adjusted Beg Balance 5,860,209 55,482,805 (5,175,755) 50,307,050 (8,011,552) 49,128,384 (8,590,326) 40,538,058 16,891,176 8,767,118 9,500,000 17,624,058 (2,151,343) 104,611,189 (13,766,081) 90,845,108 12,360,035 56,167,259 56,167,259 (47,116,908) (13,133,896) 35,849 47,219,784 47,183,935 67,027 32,526,506 32,526,506 (12,395,884) (25,529,780) Ending Balance 56,167,259 32,526,506 88,693,765 30,570,452 32,593,533

Federal Stimulus Summary

2008-09 Actual 2009-10 Projected Revenue 31,731,984 Expenditures Fiscal Year Total 0 31,731,984 28,227,560 41,542,433 - 13,314,873 2010-11 Projected 25,452,875 43,869,986 - 18,417,111 Total 85,412,419 85,412,419

Expenditure Assumptions



Salaries

- No COLA projected. A 5-day furlough in FY 2010-11 projected for TALB and non-representative employees. 

Step and Column Increases

- Certificated @ 2.47% and Classified @ 1% 

Health & Welfare Benefits

- 10% increase for FY 2010-11 and 15% for FY 2011-12 and 2012-13 

Workers Compensation Rate

- reduced from 3% to 2.75% 

Unemployment Insurance Rate

- increased from 0.3% to 0.72%

Expenditure Assumptions, cont’d

 Supply allocations to school sites — remains the same in FY 2010-11 as prior year  Textbooks — Purchase of $10 million of Language Arts textbooks is expected to take place in FY 2012-13 in preparation for FY 2013-14 adoption  Anticipated expenditure reductions include: $57 million for FY 2011-12 and $98 million for FY 2012-13 if reductions were one time. If reductions were made to on-going expenditures, a total reduction of $98 million must be made in the two fiscal years.

2010-11 Adopted Budget —Expenditures

Services, Operating Exp, $60,511,120 9% Books and Supplies, $15,452,956 2% Employee Benefits, $151,078,366 23% Capital Outlay, 0% $1,355,291 Classified Salaries, $102,920,303 15% Other Outgo & Transfers, $11,019,123 2% Certificated Salaries, $328,613,412 49%

Salaries and employee benefits make up 87% of total expenditures.

Multi-Year Projections

General Fund Revenue Limit Sources Federal Revenues Other State Revenues Other Local Revenues Total Revenues Unrestricted 2010-2011 Adopted Budget Restricted 385,489,933 2,156,100 78,495,319 8,710,470 474,851,822 Total 406,723,970 70,911,994 158,450,048 9,334,779 645,420,791 Unrestricted 388,035,023 2,156,100 8,314,950 476,986,873 2011-2012 Projection Restricted Total 409,486,885 72,188,035 158,464,275 8,953,426 649,092,621 Unrestricted 391,553,910 2,156,100 81,760,770 8,318,880 483,789,660 2012-2013 Projection Restricted Total 413,522,503 73,467,297 161,776,400 8,987,129 657,753,329 Certificated Salaries Classified Salaries Employee Benefits Books and Supplies Services, Other Operating Expenses Capital Outlay Other Outgo Transfers - Indirect and Direct Costs Other Adjustments Total Expenditures 240,833,407 67,279,480 105,797,922 8,883,470 26,271,456 1,166,358 (9,363,283) 440,868,810 6,569,486 7,828,789 328,613,412 102,920,303 151,078,366 15,452,956 60,511,120 1,355,291 157,733 (1,534,494) 658,554,687 266,640,669 121,821,314 7,883,470 1,166,358 (8,221,283) (57,000,000) 427,728,141 6,514,560 8,990,680 356,588,840 104,599,506 171,970,147 14,398,030 60,348,666 1,355,291 157,733 769,397 (57,000,000) 653,187,610 272,201,647 69,288,297 135,279,675 16,883,470 26,199,286 1,166,358 (8,221,283) (98,000,000) 414,797,450 6,490,253 9,298,137 363,871,138 105,638,500 190,888,649 23,373,723 59,593,266 1,355,291 157,733 1,076,854 (98,000,000) 647,955,154 Excess (Deficiency) of Rev over Exp 33,983,012 (47,116,908) (13,133,896) (53,353,721) (4,094,989) 68,992,210 (59,194,035) 9,798,175 Other Financing Sources/Uses Interfund Transfers In Interfund Transfers Out Other Sources Other Uses Contributions Total Other Financing/Uses Net Increase/(Decrease) to Fund Balance Fund Balance Beginning Fund Balance Unaudited Beginning Balance Audit Adjustments Other Restatements Adjusted Beginning Balance Ending Balance 12,360,035 (47,219,784) (59,579,819) 35,849 12,395,884 (12,395,884) (51,993,608) (64,353,643) 12,392,176 (12,392,176) 12,360,035 (56,743,935) (69,103,970) 12,392,176 (12,392,176) (25,596,807) 67,027 (25,529,780) (15,094,911) (1,392,254) (16,487,165) (111,760) (2,482,241) (2,594,001) 56,167,259 56,167,259 30,570,452 88,693,765 88,693,765 63,163,985 63,163,985 63,163,985 15,475,541 15,475,541 46,676,820 15,363,781 46,676,820 46,676,820 44,082,819

Combined General Fund Projections Without ARRA Revenues

Revenues without ARRA Expenditues and Other Adj Net Increase (Decrease) to Fund Balance Beginning Fund Balance

Ending Fund Balance Without ARRA $ 2008-09 2009-10 2010-11 2011-12 2012-13

744,852,590 692,325,356 645,420,791 649,092,621 657,753,329 751,129,023 743,164,371 714,339,252 665,579,786 660,347,330 (50,839,015) (68,918,461) (16,487,165) (2,594,001) 79,155,639 72,879,206 22,040,191 (46,878,270) (63,365,435)

72,879,206 22,040,191 (46,878,270) (63,365,435) (65,959,436)

Major One-Time Funding & Flexibility

Description

Reserves

Amount

16,891,176

Duration Budgeted

1 Year

Fiscal Years

2009-10 Federal ARRA $ 83,718,063 2 Years * 2008-09 thru 2010-11 Class Size Reduction (CSR) Reduced Penalty State Flexibility Varies 4 Years 2008-09 thru 2011-12 Varies 5 Years 2008-09 thru 2012-13 * Revenues are projected for 3 years, and appropriation for 2 years.

Ends

2009-10 Sept. 2011 FY 2011-12 2012-13

Solutions

Sweep of 07-08 State Categorical Balances Use of Reserves Use of Tier 3 Program Flexibility Use of One-Time Federal ARRA Funds Expenditure Reductions Other

Ending Balance

120,000,000 100,000,000 80,000,000 60,000,000 40,000,000 20,000,000 0 (20,000,000) (40,000,000) (60,000,000) 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 The blue bars show the estimated ending balances with expenditure reductions for FY 2011-12 and 2012-13. The purple bars show what the estimated ending balances would have been without expenditure reductions. For Fiscal Years 2006-07 through 2010-11, both bars are the same.

Summary of Recent Budget Reductions

Phase

I

Board Action Date

12-15-2009

Approved Amount

$ 17,700,000

Estimated Savings Budgeted

$ 17,820,087 II III 1-27-2010 & 2-9-2010 3-2-2010 38,180,634 1,922,000 33,891,991 1,922,000 IV 6-8-2010

Total

3,600,000

$ 61,402,634

3,700,000

$ 57,334,078

Status of Budget Reduction Savings

Board Date Description 12-15-09

Grades 4 & 5 staffing ratio Transportation

1-27-10

Grades 6 to 12 staffing ratio Grades K-3 CSR staffing ratio Transportation Aides Evening High School Millikan Pathways

Approved

1,300,000

Estimated Savings Budgeted

1,384,839 1,600,000 1,635,248 2,644,083 2,600,000

Change

84,839 35,248 (44,083) 11,088,560 369,280 670,000 618,360 6,500,000 210,000 685,084 629,306 (4,588,560) (159,280) 15,084 10,946

Status of Budget Reduction Savings (continued)

Board Date 1-27-10 Description

Cal-Safe Funding (Pregnant Minors) Supplemental Services – items 12-24b Central Office

Approved

400,000

Estimated Savings Budgeted

0 6,549,750 10,000,000 7,000,000 10,427,000

6-8-10

Contract with LBPD (100,000) 0

Change

(400,000) 450,250 427,000 100,000

Total $ (4,068,556)

THE END

Thanks to: Erica Cisneros Betty Ng Susan Ginder Tess Mendoza, Renee Arkus, Shawn Bartschi,

Exhibits

The following slides are detail listings of Board-approved budget reductions.

Budget Reductions —Phase I December 5, 2009

c d e f g a b

Description

Utilize authorized flexibility/balance sweep for School and Library Improvement Block Grant (SLIBG) * Utilize authorized flexibility/balance sweep for Deferred Maintenance * Utilize authorized flexibility/balance sweep for IMFRP Instructional Materials * Reduce Summer School offerings * Shift High School Counselors * Increase budget staffing ratio by 2 for Grades 4 & 5 Transportation changes

Total Estimated Savings On-Going **

$ 2,100,000 1,000,000 1,500,000 1,300,000 1,600,000

$ 7,500,000 One-Time

$ 6,500,000 3,700,000

$ 10,200,000 Estimates

$ 2,100,000 6,500,000 3,700,000 1,000,000 1,500,000 1,300,000 1,600,000

$ 17,700,000

Budget Reductions —Phase II January 27 and February 9, 2010

1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12 24b

Description

For grades 6 – 12, increase staffing ratio by 1 from 31 to 32 For grades K – 3, increase staffing ratio from 20:1 to 30:1 Science Itinerant Program, K-5 Displaced Physical Education teachers Transportation Aides Reduce Regional Occupational Program budget Reduce School for Adults budget Reduce late bus for sports — K-8, Middle and High Schools High School sports Terminate contracts with City of LB Police Dept and replace with LBUSD Safety Resource Officers who will be at the schools Monday through Friday Eliminate Evening High School Reduce services —itinerant music teachers, librarians, library media assistants, nurses, counselors, recreation aides and leaders, assistant principals, social workers, psychologists, AVID program, and teachers on special assignment

Estimates

$ 2,644,083 11,088,560 405,135 750,866 369,280 700,000 700,000 180,000 1,200,000 150,000 670,000 6,549,750

Budget Reductions —Phase II January 27 and February 9, 2010 (Continued)

25a 25b. 25c. 26. 27. 28. 29. 30. 31. 32.

Description

Additional Quota staffing at Millikan Pathways Additional Quota staffing at Wilson Classical High School Additional Quota staffing for Lakewood Merit Scholars Close Two Harbors classroom Reduce the number of school calendars. Waivers will not be approved. Identify positions for possible calendar reductions Review all contracts funded by unrestricted and restricted resources Reevaluate funding for Cal-Safe (Pregnant Minors) Program Central Office / Central Services, including Special Education Continue classified hiring freeze. Classified positions vacated by retirements or resignations will not be replaced.

Total Estimated Savings Estimates

618,360 539,600 95,000 120,000 TBD TBD TBD 400,000 10,000,000 1,000,000

38,180,634

Budget Reductions —Phase II January 27 and February 9, 2010 (Continued)

Item no. 31 Details for Central Office Reductions to Elementary/Recreation Office Reductions to Middle School/K-8 Office Reductions to High School Office Reductions to Office of Research, Testing and Evaluation Reductions to Curriculum Services and Deputy Superintendent Reductions to Office of the Superintendent Reductions to Special Education Reductions to Business Services Reductions to Financial Services Other Reductions: Implement Worker's Compensation rate reduction from 3% to 2.75%

Total Savings from Central Office and Special Education Resources Amount Certificated FTE Classified FTE

71,000 - 1.0 96,463 - - 1,184,969 12.0 - 67,000 - - 476,425 1.0 2.0 987,481 - 8.4 2,239,516 1.5 5.0 2,370,760 - 31.0 1,844,668 - 6.0 1,200,000

10,538,282 14.5 53.4 Deferred Maintenance - one year savings only 3,000,000

Budget Reductions —Phase III March 2, 2010

1. 2. 3. 4.

Description

Closure of DeMille Middle School High School Sports: a. Keep high school sports within the regular school day. Modifications will be made at Millikan and Wilson High Schools. b. Eliminate high school summer sports clinics Three furlough days for non-representative employees Two-Harbors Classroom

Total Estimated Savings * On-Going

$1,500,000 $470,000 $72,000

$722,000 One-Time

$1,200,000

$1,200,000

* Total estimated savings include the original board actions and March 2 changes.

Estimates

$1,500,000 $470,000 $1,200,000 $72,000

$1,922,000

Budget Reductions —Phase IV June 8, 2010

No .

Description Previously Approved Change or New Savings for the Budget Revised Estimated Savings for Fiscal Year 2010-2011

$ (100,000) $ 50,000 1 Contract with the City of Long Beach Police Department. This item was previously approved on January 27, 2010, item no. 10.

$ 150,000 2 Deferred Maintenance -- additional sweep of ending balance 3 All Non-Representative employees take five furlough days in Fiscal Year 2010-2011. The Board previously approved a three-day furlough on March 2, 2010.

$ 1,200,000

Total $ 1,350,000

$ 3,000,000 $ 3,000,000 $ 700,000 $ 1,900,000

$ 3,600,000 $ 4,950,000