Governors 2010-11 Budget Announcement January 12, 2010 Richard Nicoll, Ph.D., Superintendent Bryan Richards, Director, Fiscal Services.

Governor’s 2010-11 Budget AnnouncementJanuary 12, 2010

Richard Nicoll, Ph.D., SuperintendentBryan Richards, Director, Fiscal Services

State Fully Funds COLA!

However, the COLA is NEGATIVE. That means a 0.38% DECREASE in funding;

($24) per ADA (which works out to about ($19.59)/ADA when deficited) or ($636,226)

Additionally, we have to subtract the positive COLA previously projected of $848,666

Total effect of negative COLA is $1.5M

“One Time” Deficit to Continue!

This year we have a one-time additional deficit of $252.83 per 2008-09 FUNDED ADA (2007-08 actual P-2 ADA) or about $254.06 per current funded ADA

Starting next year it will become ongoing and be $201 per current year funded ADA This deficit is to be applied to “administrative”

costs. Unclear how districts such as MDUSD that have already cut administration will be affected by this, nor is “administrative” defined in the proposal.

Declining Enrollment Steepens! At adoption we projected a decline of 184.23

ADA At CBEDS we adjusted downward by 471.01

ADA to a decline of 655.24 ADA due to enrollment decline

At P-1 we are actually down 719.95 ADA so we have projected the P-2 ADA downward again by an additional 64.71 ADA

We are now down 2.17% from prior year

Funded Revenue Limit 2009-10 vs. 2010-11Mt. Diablo Unified School District

in dollars per unit of ADA

2009-10 2010-11

$6,370$6,346

$4,947$4,980

Loss due to Deficit Factor and $253-per-

ADA one-time cut

Loss due to Deficit Factor and $201-per-

ADA cut to administration

Funded Revenue Limit Funded Revenue Limit

$1,366$1,423

Graph courtesy of School Services of California, Inc.

2009-10 K-12 Revenue Limit – MDUSD

Mt. Diablo Unified for 2009-10

Base Revenue Limit per ADA

(A)

Proration Factor

(B)

Funded Base Revenue Limit (C) = (A) x (B)

1. 2008-09 Base Revenue Limit $6,109.02 0.92156 $5,629.83

2. 2009-10 COLA per ADA 261.00 – –

3. 2009-10 Base Revenue Limit 6,370.02 0.81645* 5,200.80

4.2009-10 One-Time Reduction (252.83 x 08/09 funded ADA)

– <254.06>

5. Net 2009-10 Funding (C3 minus C4) $4,946.74

6. Dollar Change (Line 5, Column C minus Line 1, Column C) <$683.09>

7.Percentage Change (Line 6, Column C divided by Line 1, Column C)

<12.13%>

*0.81645 = 1 - .18355 (deficit factor) Chart courtesy of School Services of California, Inc.

2010-11 K-12 Revenue Limits – MDUSD

Mt. Diablo Unified for 2010-11

Base Revenue Limit per ADA

(A)

Proration Factor

(B)

Funded Base Revenue Limit (C) = (A) x (B)

1. 2009-10 Base Revenue Limit $6,370.02 0.81645 $5,200.80

2. 2010-11 COLA per ADA <24.00> – –

3. 2010-11 Base Revenue Limit 6,346.02 0.81645* 5,181.21

4.2010-11 Ongoing Administration Cost Reductions

<201.00> – <201.00>

5. Net 2010-11 Funding (C3 minus C4) $4,980.21

6. Net 2009-10 Funded Revenue Limit (Slide TK Line 5, Column C) 4,946.74

7. Dollar Change (Line 5, Column C Minus Line 6, Column C) $33.47

8.Percentage Change (Line 7, Column C Divided by Line 6, Column C)

0.6766%

*0.81645 = 1 - .18355 (deficit factor) Chart courtesy of School Services of California, Inc.

The 10/11 revenue limit cut increases from $1,175 to $1,366/ADA

MDUSD Revenue Limit Funding per ADA

5,079

5,528

5,780

5,079

5,528

5,780

6,803

6,617

6,4616,3466,370

6,109

5,125

5,528

5,7145,541

5,4005,2735,225

5,411

5,079

5,647

5,4825,348

5,227

4,947

5,630

5,3535,201

5,0744,980

4,500

5,000

5,500

6,000

6,500

7,000

7,500

2005/06 2006/07 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14

Year

Do

llar

s $

per

AD

A

Revenue Limit

2nd May Revise

Actual 09-10 Budget

Gov 10-11 budget

Piling it on (what has changed since 1st interim?)

Loss of COLA/funding negative COLA $1.5M Additional student attendance decline $0.3M Additional cut of $201/ADA $6.5M Total decline in revenue limit $8.3M Decline in other State revenues $0.3M Total State revenue decline $8.6M

Note: All of these cuts are ONGOING

Multi Year Projection

Undesignated + Tier 3 @ 6/10 $13,279,341 Operating Deficit 2010/11 (21,821,373) Adjustment in 2% reserve 26,853 Unappropriated Balance 6/11 ( 8,515,179) Operating Deficit 2011/12 (27,059,026) Adjustment in 2% reserve 67,882 Unappropriated Balance 6/12 ($35,506,323)

$35,506,000 across 2 years is only the start to fixing the real

problem Unappropriated Balance 6/12 ($35,506,323) Projected Deficit in 2012/13 ($24,431,947) Unappropriated Balance 6/13 ($59,924,712) Projected Deficit in 2013/14 ($28,170,814) Unappropriated Balance 6/14 ($88,182,084) Projected Deficit in 2014/15 ($27,781,521) Unappropriated Balance 6/15 ($115,933,241)

Average deficit is $25,852,936 per year

How much less must we spend?

Enrollment declines projected to continue through 2014 at rates between 0.71% and 1.26% per year

We must decrease ongoing annual spending by a minimum of $25.85M by 7/1/2010 for the 2010/11 school year OR,

Cut at least $35,506,323 over two years by 2nd interim and plan for even deeper cuts later to solve the rest of the structural deficit. However, the amount of backlog will grow at over $9M per year

As promised, the deficits got bigger when the State cut more

What next?More from

Sacramento

Governor’s Budget came out January 8

School Services updated dartboard based on the new budget January 12

LAO will issue review of budget to legislature State budget talks begin in legislature

Meanwhile back in Concord… We must adopt a balanced budget by June

30th

Budget Calendar will come to board January 26th

We must plan an additional contingency if the State doesn’t fund the COLA when it returns to a positive number in 2011-12 (an additional $3,020,000 ongoing cut)

Thank you and tune in next time for…