Manteca Unified School District45 Day ReviseSept 14, 2004

Golden State Deja Vu

“The new Republican governor is getting credit for compromising with a Democratic legislature. Some conservatives are miffed that he hasn’t cut spending enough, but they like the way he uses his personal charm to get what he wants. His stature is growing as a national figure . . .

• “The actor-turned-politician relies on advice from businesses to close loopholes in a troubled Workers’-Comp system and combat the growth of taxes.”

Source: The Kiplinger California Letter (1967)

That comes from our 1967 Kiplinger California Letter archives, documenting Ronald Reagan’s first year after his election as Governor.

(From the Governor's Budget Summary)

• Budget gap totaled $13.9 billion

• Majority of cuts are in Proposition 98 and local government

• Borrowing and most transfers will require future repayment

Balancing the Budget: Summary of Solutions

Cuts $4.0 billion

Borrowing $2.1 billion

Fund Shifts$1.6 billion

Cost Avoidance$4.4 billion

Transfers/Other$1.8 billion

15.4%

11.2%

31.7%

13.0%

28.7%

The Governor’s Take

Budget Balancing Summary• Borrowing

– Economic Recovery Bond– Pension Obligation Bond– Indian Gaming– Transportation

• Expenditure Reductions– Government Reductions– Prop 98

• New Revenues– Punitive Damages– Higher Fees – Colleges– Indian Gaming– Shifting School District Emergency Loans into Prop 98

The Proposition 98 “Deal”• The Governor and the Education Coalition cut an early deal on

Proposition 98 :

– $2 billion suspension in the guarantee

– Delay in “settle up” of $1.2 billion from prior years

– $150 million in annual payments toward “settle up” commencing in 2006-07

– Full growth and COLA for all programs

– New money 75/25 unrestricted/restricted

– Protection from deeper cuts contemplated by the Legislature

• This deal kept education funding out of the end-game budget battle, which did involve:

– Local government funding

– Pension obligation bonds

– “Sue your boss” amendments

– Repeal of SB 1419 contracting-out restrictions

The Proposition 98 “Deal”• Was this a good deal for education?

– Under our projection, the $2 billion cut will not be restored, and remains through at least 2008-09

– The “settle up” funds will not be fully paid until 2013-14, assuming no additional amounts are owed

– $302 million in the General Fund reserve for Proposition 98 will have to be appropriated; it will not automatically be provided

• On the other hand:

– Proposition 98 was not used as the Budget-balancing tool to close the final negotiations between the Legislature and the Governor

So what does this mean for us?We over estimated Equalization Funds by $.11 per ADA or $2,463 less than we budgeted.

Adjustment to Lottery Projections yields $147,408 more

New Library Materials increased projections by $6,971

Increase in Instructional Materials Realignment increase budget by $554,361

Enrollment

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ENROLLMENT

K 1 2 3 4 5 6 7 8 9 10 11 12 SD

23,627262 students under our projection

Budget Cuts from 03-04

• DO Administrative Support $82,000 $27,033• Charge for Athletic Transportation $150,000 $70,000*• Custodial & Clerical Reductions 03/04 $500,000 $500,000*• Eliminate Study Skills Program $100,000 $110,386• Restructure VP’s $200,000 $105,184• Reduce Ed Services Lottery allotment $300,000 $300,000• Restructure Ed Services/Business $100,000 $126,097• Eliminate Custodial Growth allotment $120,000 $65,000*• Kindergarten Option 2 CSR $800,000 $800,000*• Energy Savings $100,000 $133,934*• Reduce Site Block Allocations 5% $106,000 $103,690• Reduce Time Sheeting 5% $316,000 $316,000*• Postage Reduction $123,170 $6,160*• Cities to Operate Acorn League $250,000 $250,000• Eliminate Buy Back Day Encroachment $130,000 $114,661• Transportation Restructure $350,000 $350,000*

(point to point/staggered starts)• Increase Class Size at the High School $720,000 $720,000*

$4,447,413 $3,997,370* Estimated Savings

Budget Revised

Budget Adds in 04-05 Budget• Growth Staffing

– Teachers 17.9 FTE– Support Staff 17.15625 FTE

• Transition Staffing– Principal Veritas– Custodial Veritas– Clerical Veritas

• Step and Column Increases• Insurance Cost Increases

– Liability– Workers Comp – Unemployment– Alternative Retirement

• Recruiting Budget• Facility Start-up Equipment (lottery)• Reclass for Classified Positions

Unappropriated Ending Balance

• At this time the District has $2,406,235.32 in unappropriated Ending Balance. These funds represent all funds available to the Board for reinstatement of Budget Cuts, addition of new programs, and/or employee raises.

Next Steps

• Adopt Revisions and Direct Staff to Implement Budget As Adopted

• Consider New Budget Adds and Adopt Changes