In June, the Berryessa Union School District passed a budget that is balanced for 2010-2011, but the district is still deficit spending, meaning that any remaining reserves will be gone in the 2011-2012 school year if further cuts are not made. State law usually mandates a 3% reserve, which will also be gone unless action is taken.
By the time the district submits its first interim budget at the end of this calendar year, we must demonstrate that we are able to reduce spending or increase revenues by enough to maintain that reserve. Otherwise, the district runs the risk of being classified with a "qualified" financial rating. That means that the district is at risk of falling short of adequate funding going forward, although not in danger of immediate bankruptcy. The consequence of this filing will be additional oversight and control by the Santa Clara County Office of Education.
The number of at risk school districts across the state has increased by 38% since the beginning of 2010, according to a story in the Los Angeles Times.
The Mercury News ran a similar story that listed districts that are facing financial risk. In Santa Clara County, Frankiln-McKinley and Orchard are at risk in 2010-11, while East Side Union HS District and Milpitas Unified face risk for 2011-12. The Board's goal is to keep the budget balanced so that we stay off the at-risk list. (UPDATE: Franklin-McKinley was originally listed as "qualified" before they implemented huge cuts in the spring that brought their finances back in line.)
John Festerwald of the Silicon Valley Education Foundation discussed in his blog the danger already facing 16% of districts across the state. Districts that fall into negative certification are at risk of being taken over the by the state. Fourteen districts fell into that category this year, most of which are in the Bay Area.
State Superintendent of Public Instruction Jack O'Connell said that "the contributing factor is lack of adequate funding from the state for several years in a row. These are cuts upon cuts upon cuts. It's totally exhausted whatever revenue they might have in terms of their surplus, in terms of money set aside." In Berryessa, those cuts total 18% of our revenues.
The deficit Berryessa is facing looks like it will approach $3 million by the end of the coming school year. We just struggled to reduce the budget by $8 million, but the work is not done. Stay tuned for further discussion of how the district will approach the budget process for next year.
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2 comments:
How much does the district save by restricting teacher budgets that prevent students and teachers from receiving basic supplies and basic technology like transparencies necessary for learning?
Joe, I don't know that the district is preventing anybody from receiving basic supplies, but the district has tried to make sure that sites are frugal with their discretionary money in order to preserve resources for all of our needs. In the budget report the board received last night, the closing numbers showed a savings of $200,000 in the supplies budget categories based on good management of funds.
I would like to provide a budget for each classroom teacher so that they can buy what they need. However, at $100 per classroom, that would be $40,000, money that would not be available to pay for hours for clerks, media techs and other necessary positions. So every spending decision results in a trade-off of something else that can't be provided.
The good news is that since this post was written in August, there has been a bit of relief, as we received $1.3 million from the Federal Jobs Bill. Taking that and the ending balances into account, our deficit is now significantly less, although we are still deficit spending as a district by nearly $4 million.
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