A Temporary Reprieve?

At last week's board meeting, the Board approved the year-end close financial documents for 2009-2010. Due to good fiscal management and savings in areas such as energy use and supplies, the district's ending balance was higher than originally projected, resulting in a higher beginning balance for the next two years.

In August, the state legislature allocated the federal EdJobs Funding money. It turns out that the Berryessa Union School District will receive over $1.3 million from that allocation.

At the time this year's district budget was adopted in June, it looked like the district's deficit at the end of the 2011-2012 school year would be about $3 million. The higher ending balance and the addition of the EdJobs money (assuming the district doesn't spend any of it) brings down the deficit projection to $400,000.

You can view the presentation on the budget that was presented by Assistant Superintendent Pam Becker to the Board here.

However, there are 4 major considerations that will result in an increase in the deficit.

1. It is September 23 and there is still no state budget for this year. Therefore, we don't really know how much money the district will receive from the state. The conference committee budget provides $3 billion more in education funding than the May revise did. That is the good news. On the other hand, the latest word this week is that legislative leaders are close to a budget, and are about $2 billion short. Rumor is that in order to close that $2 billion, all of it will come through additional cuts to education, which may bring us back to the May level used in our adopted budget.


2. The Federal Ed Jobs bill requires that the money be used to pay for education jobs by June of 2012. One approach could be that the district uses the funds only for existing employee expenses. However, our district would benefit from spending some of that money now to enhance educational opportunities for our students. Therefore, some increase in spending is likely to result.


3. Last week, I posted a discussion of the unrealistic requirements of the Elemenatry and Secondary Education Act (No Child Left Behind) that have resulted in schools in our district (and our district as a whole) being labeled "Program Improvement." Because of this categorization, there are some additional requirements that will cost the district money. The district will hold a special Board Meeting on October 5 to discuss PI and what it means for us.


4. The district continues to operate under deficit spending. Our ending balance is dropping every year because we are using up all of our reserves. The numbers are clear on slide 3 of the budget presentation. The expenses line for 2011-2012 is $4 million larger than the revenues line. This is largely due to the state of California underfunding education, but unless that problem is resolved, the district needs to eventually solve this structural deficit.