Transcript Slide 1
San Jacinto USD Update on State Budget The Governor’s Challenges New Governor, new approach, same difficult economic environment The Governor faces the biggest deficit ever faced by any governor in U.S. history He inherits huge economic problems and a divided Legislature The State budget cannot be balanced without tax extensions, spending cuts, and debt 2 Risks to the Budget Proposal “Flat funding” for K-12 education is dependent upon voters approving the extension of the current temporary taxes and some new taxes. The Legislature must place this tax extension proposal on the ballot, requiring two-thirds vote in each house (March) If Legislature places tax extension measure on the ballot, voters will decide with majority vote (June) 3 State Budget Contingency Plan Current State budget projections include tax extensions. Further reductions will be required should the taxes not be extended. Tax Extensions Pass – “flat funding” – continues the funding level contained in the enacted Budget for 2010-11 into 2011-12 (actually a $19 per ADA cut) or approximately $161K for SJUSD Tax Extensions Fail – a $2 billion reduction in funding (results in a loss of about $349 per ADA or approximately $3 million for SJUSD) Districts will need to plan for both Economic changes between now and the enactment of the 2011-12 Budget could also cause a revision, up or down 4 Proposition 98 Funding Proposition 98 Funding (In Billions) $58.0 $56.0 $54.0 $52.0 $50.0 $49.3 $56.6 $48.0 $46.0 $49.1 $49.5 $49.7 2008-09 Test 2 2009-10 Test 1 2010-11 Test 2 $44.0 $2.0 billion contingent on voter approval of tax extensions $47.3 $42.0 2007-08 Test 3 Source: DOF and LAO © 2011 School Services of California, Inc. 2011-12 Test 1 5 SJUSD Projected vs. Actual Funding Per ADA $6,474 Fully Funded BRL $5,205 Pass $4,875 Fail 6 2011-12 Apportionment Deferrals Feb ’12 to Jul ‘12 $2.6 B* $2.6 B Apr ’12 to Aug ‘12 $0.7 B $0.7 B Insert wimpy Apr ’12 to Jul ‘12 $0.4 B Permanent Deferrals $0.4 B May ’12 to Aug ‘12 $1 B $1 B May ’12 to Jul ‘12 $0.8 B $0.8 B $2 B $2 B Infamous P-2 Deferral New Deferral Jun ’12 to Jul ‘12 Jul 2011 From ? to after Sept or Oct ‘12 $2.1 B $2.1 B Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep 2011 2011 2011 2011 2011 2012 2012 2012 2012 2012 2012 2012 2012 2012 New Fiscal Year *Includes K-12 CSR Deferral Oct 2012 = Timing To Be Determined = Ongoing 7 SJUSD and SJTA MOU 2009-2010 MOU states … “For every $30 incremental increase to the funded BRL per ADA from the projected 2010-2011 BRL of $4,998 without any other negative adjustment to the Revenue Limit, or other State and Federal funds that impact the general fund, the District agrees the Association will determine the restoration of furlough days and/or restoration of step and column using the agreed upon ratio of $30 being equivalent to 1 (one) furlough day.” $5,223 (Adopted budget) - $4,998 (MOU amount) = $225 increase to revenue limit. This increase has not been received by the district and has been deferred indefinitely, but no sooner than September/October 2011 $225 per ADA ÷ $30 (MOU incremental increase) = 7 furlough day restoration or a combination of furlough and step and column restoration 8 SJUSD Budget Scenarios Tax Extensions Pass $19 per 8,500 ADA loss in funding ($161K) Required reductions remain close to budget projections $3.1 million in concessions required by all employee groups over two year period Tax Extensions Fail $349 per 8,500 ADA loss in funding per year ($3 million) Reductions beyond current budget projections would be required $6 million more in concessions required by all employee groups over two year period 1 furlough day for all groups = $182,609* 1% reduction for all groups = $354,045* *Based on unrestricted general fund 9