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Wednesday, July 6, 2011

State budget impacts on RUSD

So what does all of this new state budget mean for us in RUSD?  Here is my best guess/information as we go forward:
  1. We stick to our original plan/budget.  Even if it gets better through this effort (which we certainly hope for), we are still largely funded based on one-time money (like your savings account) and employee furloughs.
  2. We continue to do multi-year projections and utilize the original intent of AB1200 as it was good legislation and has shown a 20 year history of actually working pretty well.
  3. Be ready in January to take an additional mid-year reduction.
  4. Be ready in January to NOT take additional reduction of instructional days (remember we have a NO layoffs for 11-12 …which would include more furloughs). 
  5. Smile!!

Tuesday, July 5, 2011

We have a budget...

The Governor has signed the budget and it is historically “early.”  That’s the good news; the more interesting news is what anybody thinks it might be saying to us and how it will play out.  As I understand it from a variety of sources, most, if not all of this legislation was voted on without the Legislative members having copies or certainly having time (should they desire) to read it.  I guess Prop 25 works. 

The vote on the budget was solely Democratic with no Republican members voting in favor, which raises the question – If we are represented by a Republican, do we have any representation in Sacramento, given the majority party scenario?  Not complaining, I just find it to be a very interesting time and set of circumstances.

The earlier budget pieces and parts that we have reported earlier (last week) have changed a bit given the inclusion of special interests in the final negotiations.  So the final budget looks something like this – until January when it changes again (mid-year reductions).
  • K-12 Schools were more or less treated well with no further reductions.  There is a slight problem with an additional $2 billion deferral and the prospect of a mid-year reduction, based on not meeting the projected revenue targets.
    • The budget approval is based on $4 billion in “newly found” money.  The two biggest pots seem to be:  1) redevelopment agency funds and 2) taxes on Internet sales.  The lawsuits on the redevelopment monies have already started and there has been lots of pushback all the way along from large Internet sales folks (e.g., Amazon).
    • If we are more than $2 billion short in the $4 billion projection then there is an automatic reduction in funding AND the potential of local school districts reducing the school year by 7 additional days in the 2nd semester of the school year.
    • Unlike earlier reports, the reduction moved from 10 to 7 days and is negotiable with local employee groups.
    • If there were to be a mid-year reduction, it could be as large as $250 per student (reductions are to be proportional).  Additionally, it seems to be the intent of Sacramento at that point to eliminate all home-to-school transportation funding to districts.
      • While transportation certainly impacts RUSD and our families, it really creates major problems in rural areas which can have substantial distances to cover with no other public transit alternatives.
  • There is also an effort via a November 2012 election to realign funding and sales taxes to the local/county level – and “re-bench” the Prop 98 funding formulas.  We will see what this all looks like, but I am sure that it will promise to be interesting.
  • Probably most interesting of all of this budget adoption are matters related to AB1200 which we have had for 20 years (1991).  The budget essentially says that County offices of education that were tasked under 1200 with fiscal oversight – are to disregard multi-year progressions.  Under AB 1200, county offices were to make sure districts did not go “broke” and that there was an “early warning system” (i.e., interim reports twice per year).  So bottom line, if we put together some “good” estimates of revenue and expenditures for the current 11-12 year, then the county will approve it – and can’t comment about what happens after that.