Transcript Bridging Rivers of Change” - San Diego Miramar College

San Diego Community College District
Budget Development & Issues
2007-2008 & 2008-2009
CAMPUS FORUMS
Dr. Constance M. Carroll
Terry Davis
Chancellor
Vice Chancellor, Business Services
1
California Community Colleges
Budget Process
State Budget - Proposition 98
Governor - Legislature
State Board of Governors & System
72
Districts
109
Colleges
San Diego Community
College District
Local Boards of Trustees & Districts
Federal &
Special Funds
• Allocations
2
Governor’s Budget
(January 10, 2008)
DEFICIT OF $14.5 BILLION
STRATEGIES:
1. Reduce Expenditures
2. Align Expenditures/Revenue
3. Enhance/Restructure Revenue
COMPONENTS:
• Zero COLA
• 1% Growth
•10% Across-the-Board Cuts
•Categorical Program Cuts
•No Increase in Student Enrollment Fee
•Mid-Year Cuts
($40 Million for CCC)
3
Legislative Analyst’s Office
DEFICIT HAS GROWN TO $16+ BILLION
RECOMMENDATIONS:
• Zero COLA
• 1.5% Growth
•Categorical Block Grants
“Student Success” ($430 Million)
“Faculty Support” ($60 Million)
•No Mid-Year Cuts
•Increase in Student Enrollment Fee
(Back to $26 per unit)
BREAKING NEWS:
Property Tax Shortfall ($76-80 Million)
• In Current Year (2007-2008)
• Projected for Budget Year (2008-2009) 4
San Diego Community College District
PROCESS:
Broad Consultation & Participation
Board of Trustees
Chancellor’s Cabinet
District Governance Council (DGC)
District Budget Committee
Colleges/CE Shared Governance Groups
Campus Forums
VALUES & GOALS:
1. Avoid Negative Impact on Contract Faculty/Staff
2. Maintain Sufficient Classes & Services for Students
3. Increase FTES Revenue
4. Increase Average Class Size
5. Enact Cost-Containment Measures
5
San Diego Community College District
2008-2009
Preliminary Budget
General Fund Unrestricted Only
6
Preliminary Budget 2008-09 is based on the
Governor’s initial budget proposals:





Reductions that range from 3.62 % to 10.90 % in Categorical Programs
(Loss of $266,000 in GFU)
No COLA in 2008-09 (Normal inflationary costs = $3M-$4M)
1 % maximum growth (Restricts our revenue options)
Assumes no Mid-year cuts of $1.4 million
Does not include loss due to Property Tax Shortfall
(Potential loss of $2.8M)
In addition, the Preliminary Budget includes the following:



A roll forward of 2007-08 budgets plus inflationary costs to selected
operating expense accounts such as utilities and maintenance contracts
Employee class and step advance costs
$1.78 million in supplemental funding for additional class sections so
campuses are funded at the same FTEF level in 2008-09 as in 2007-08
(Budget Model FTEF plus Supplemental FTEF)
- Budgeted annual FTEF in 2008-09:
City = 677 FTEF
Mesa = 931 FTEF Miramar = 395 FTEF
7
2008-2009 Budget Model
FTEF Allocations
Total FTEF Used in 2006-2007 (Ex. Academies)
2,160.54
Total FTEF Funded 2007-2008 (Ex. Academies)
1,988.13
FTEF Reduction below 2006-2007
172.41
Pro-rating the 172.41 FTEF reduction to Colleges results in 2007-08
FTEF Allocations as follows :
City
735.21
34.029%
58.67
Mesa
995.74
46.088%
79.46
Miramar
429.59
19.883%
34.28
Total
2,160.54
100.00%
172.41
Total 2007-2008 FTEF to be Funded
2007-2008 Final Budget
(Per Model Formula)
676.54
916.28
395.31
1,988.13
631.42
889.56
370.90
1,891.88
FTEF Increase for Final 2007-2008
Total 2007-2008 FTEF Funded
45.12
676.54
26.72
916.28
24.41
395.31
96.25
1,988.13
Total 2008-2009 FTEF Funded
676.54
916.28
395.31
1,988.13
2006-2007 FTEF Used
% of Total
Share of 172 Reduction
Note: Total reflects minimum FTEF funding levels if no other funds or
budget savings are used to pay for additional class sections.
8
2008-2009 Preliminary Budget
General Fund Unrestricted Only
2007-2008
Adjusted Budget
2008-2009
Preliminary Budget
Changes
Over/Under
190,687,672
190,885,712
198,040
Other State Funds
8,799,266
8,233,027
(566,239)
Other Funds
7,728,935
7,305,737
(423,198)
Incoming Transfers
1,797,900
1,797,900
0
209,013,773
208,222,376
(791,397)
13,686,175
12,518,513
(1,167,662)
Campus Allocations
139,716,344
142,375,876
2,659,532
Districtwide Support
47,924,805
50,091,935
2,167,130
District Offices
17,623,787
18,370,808
747,021
218,951,111
223,357,132
4,406,021
9,937,338
15,134,756
5,197,418
Continuous Revenue
Apportionment Allocation
Total Continuous Revenue
Continuous Expenses
Reserves & Set Asides
Total Continuous Expenses
Continuous Expenses (over) Revenue
(Reliance on one-time funds)
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Reserves and Set Asides
Set Aside to cover remaining 2007-2008 RAF
4,959,894 *
District's 50% share of RAF mandated benefits
434,209 *
Set Aside for 2006-2007 RAF POA
116,055 *
Set Aside for 2007-2008 RAF POA
83,664 *
Classified reclassifications
150,000
Set Aside to fill 31.64 Contract Faculty Positions
987,685
Set Aside from 2006-2007 for Potential Growth Distribution
in 2008-2009 RAF
344,096 *
Set Aside for Equalization Benefit Reserve (Out Years)
3,386,652
Balance of Set Aside for Prop S per Docket #890 8/25/2005
1,399,552
Balance of Set Aside for Prop N per Docket #892 3/22/2007
656,706
Total Reserves and Set Asides
12,518,513
* Budget items that should be fully allocated by June 30, 2008
10
Revenue and Expense Projections
Continuous Revenue vs. Expenses Summary 2008-09 Preliminary:
Total Projected Continuous Allocations:
Campus Allocations
142,375,876
Districtwide Support
Allocations
50,091,935
District Office Allocations
18,370,808
Reserves and Set Asides
12,518,513
Total Continuous Allocations
223,357,132
Total Projected Continuous Revenue:
State
199,118,739
Local
7,305,737
Transfers
1,797,900
Total Continuous Revenue
208,222,376
Projected Continuous Expenses (Over) Under Revenue
(15,134,756)
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Revenue and Expense Projections (cont.)
Projected Continuous Expenses (Over) Under Revenue
(15,134,756)
Use of One-Time Resources:
Projected 2007-2008 Ending Balance
One-Time Allocation
To Balance GFU Continuous Operating Budget
Reserve for Economic Uncertainty
(2008-09 and 2009-10)
14,148,713
15,134,756
2,000,000
Prior Year Encumbrances
950,000
Permanent Records Conversion
128,485
Holding Accounts - AFT (Computer Loan)
Holding Accounts - Risk Management
Campus Carryforward One-Time
Ending Balance Reserves
Advertising - Districtwide
40,000
572,630
1,376,030
325,000
Total Funding Required
20,526,901
Adjustments Required to Balance Budget
(6,378,188)
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Reduce Continuous Costs

Reduce or eliminate programs or services, maintenance
agreements or contracts, professional service agreements, etc.

Eliminate vacant positions (86 % of Districtwide expenses in
2006-07 in General Fund Unrestricted was for salaries and
benefits).

Implement hiring delays and cost containment procedures.
But there is an easier and more permanent way to balance
continuous costs and continuous revenue …
13
Impact of Average Class Size
on Funding Requirements
2003-2004
Campus Ending
Balances
2006-2007
Campus Ending
Balances
2,558,495
(6,370,378)
Funding for Supplemental
Class Sections
0
5,520,138
Transfers to Basic Skills
0
644,146
Transfers to Prop 20 Lottery
0
206,094
2,558,495
0
34
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Based on Budget Model
Funding Only
Adjusted Ending Balance
Average Class Size
14
Result of Lower Class Size
Revenue Change Due to Class Size
($28,120,000)
5.6 students per class x 1100 FTES per 1.0 student increase above
28.4 per class x $4,565 per credit FTES = $28,120,000
Note: 1.0 student increase above an average of 28.4 students in
every class will generate 1100 FTES, or $5 million in credit
apportionment revenue.
Solution:
Reduce number of class sections to stay within funding
provided through the Budget Model formulas, while increasing
average class size to maintain FTES base or to grow in FTES.
15
Distribute New Revenue to Cover
all Current and Future Increasing Costs
As new continuous revenue is received, it needs to be allocated to
address several issues such as …

Economic improvements for employees

Eliminate structural budget problem and reduce reliance on
one-time funds

Provide funds to cover $13.1 million (today’s dollars) in
Proposition S & N continuous costs

Improve both academic and non-academic permanent
staffing levels
Any issues not addressed at least in part from new revenue
sources will become more difficult to solve in the future.
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Summary

Based on the Governor’s initial budget proposal, a roll forward of the 200708 budget to 2008-09, and a potential “deficit factor”, requires $10.1 million
in budget “adjustments” that need to be made between the 2008-2009
Preliminary Budget (February) and the 2008-2009 Tentative Budget (June).

Adjustments need to be made in both continuous costs and one-time costs
to balance the 2008-09 budget and address the structural budget problem
and reduce reliance on one-time funds.

How the 2008-09 budget issues are resolved will impact the magnitude of
the budget challenges in 2009-10.

Class schedules need to continue to be adjusted to bring costs in line with
Budget Model funding formulas, and increase average class size back to
2003-04 levels.

Future revenue needs to be allocated in such a way that all budget
requirements are addressed.
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Proposed Budget Adjustment Plan
1.
Adjustments to Preliminary to Balance Budget
6,378,188
2.
Additional Adjustments to Reduce Structural Budget
Problem
1,000,000
Increase to Cover Potential 1.33% Deficit Factor in
2007-08 due to Property Tax Shortfall
2,800,000
3.
4.
Total Adjustment Goal
10,178,188
5.
Summer 08 Roll to Grow 254 Credit and 300 Non-Credit
FTES for 1.34%
Total Growth 07-08 (2-Year Total Revenue).
(4,258,220)
Growth of 1.0% in 08-09 (210 Credit and 210 CDCP
Non-Credit)
(1,637,370)
6.
7.
Savings from Delay in Hiring Vacant Academic Positions
(28.04 positions)
(867,937)
Savings from Delay in Hiring Vacant District Classified
Positions (Non-campus staff)
(519,057)
GFU Offset from Basic Skills
(719,310)
10.
Eliminate Scheduled Maintenance Matching Funds
(451,247)
11.
Remaining Budget Adjustment Required
1,725,047
8.
9.
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