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2012-13 Budget Update: FTES, Revenues, Expenditures, and Financial Assumptions

The 2012-13 budget update outlines the carryover balances, FTES data, revenue projections, major expenditure changes, and contingency balances. Notable figures include a deficit reserve of $15,600,631, reduced FTES targets by 605, and potential revenue losses of up to $12,433,699 if a tax initiative fails. Other financial uncertainties are highlighted, including cash flow issues and the impact of workload measures. The overall budget strategy focuses on managing expenses without salary increases or new deficits while preparing for potential risks ahead.

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2012-13 Budget Update: FTES, Revenues, Expenditures, and Financial Assumptions

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  1. 2012-13 BUDGET UPDATE • Carryover Balances • FTES • Prior Year actuals • Current Year targets • Revenues • Apportionment • Other • Expenses • Major Assumptions • Changes • Contingency Balances • Uncertainties • Tax Initiative passing • FTES • Cash Flow • Apportionment

  2. CARRYOVER BALANCES 6/30/2012 • Deficit Reserve $15,600,631 • Board Policy Contingency $9,688,301 • Budget Centers • District Services $3,137,869 • Cypress College $6,265,458 • Fullerton College $6,523,479 • School of Continuing Education $795,224 • Designated Fund Balances • Retiree Benefits $2,000,000 • Scheduled Maintenance $1,000,000 • Strategic Plan Fund $500,000 • Staff Development $200,000 • Innovation Fund $100,000 • Election Expense $120,000 • Restricted Fund Balance $3,829,100

  3. FTES • Prior Year Actuals – 2011-12 • 58.11 short of target • 1,188.79 or 3.70% over cap • Current Year Targets • Targets reduced 605 FTES or 1.82% • Target is estimated at 2% or 641.82 FTES over cap if tax initiative passes • Target is estimated to be 10% or 2,976.44 FTES over cap if tax initiative fails • FTES targets are not expected to change during the year

  4. REVENUES • Base apportionment revenue of $145,704,262 • Down $2,479,003 or 1.67% from last year • Since 2007-08, apportionment revenue is down $10,920,149 or 6.97% • Possible that workload measure restoration of $1.2 million would be available • If tax initiative fails, the trigger cut for us is $9,954,696 • Base apportionment would be down $12,433,699 or 8.39% • Since 2007-08 the reduction would be $20,874,845 or 13.33%

  5. REVENUES • Deficit • No deficit budget for 2012-13 • Last year’s deficit is estimated at $3,491,131 • Mandated Cost • New appropriation of $28 per funded FTES = $833,000 • Budgeted in Board Discretionary Contingency • Will evaluate as to being on-going revenue

  6. EXPENDITURES • No salary increases or decreases for 2011-12 or 2012-13 • Net reduction of salary and benefits for permanent positions of $5,312,100 or 4.58% • Extended Day Budgets • FTES reductions $734,864 decrease • Backfill $891,640 increase • Net change is $156,776 increase • Current Vacancies • Faculty – 14 positions, net savings of $918,952 • Other vacancies – 18.47 GF positions $1.7 million

  7. EXPENDITURES • Operating Allocation increase of $2,425,983 • Backfill $266,344 • Personnel changes $2,159,639 • Other • Election Expense down $530K • Areas under-budgeted • Self-insurance contribution • Retiree benefits • Scheduled maintenance

  8. CONTINGENCY BALANCES8/27/2012 • Deficit Reserve $970,714 • Board Policy Contingency $9,688,301 • Board Discretionary Contingency • Mandated Cost Revenues $833,000 • Budget Centers $14,127,240 • Restricted Contingencies $2,429,096 • Facilities Emergency $130,000 • Innovation Fund $100,000 • Strategic Plan Fund $500,000

  9. BUDGET RISK OR UNCERTAINTIES • Tax initiative does not pass in November $9,954,696 • FTES Generation • Impact on fees increasing from $36-$46 per unit • Impact on the 16-week calendar • Cash Flow • Beginning balance down $8 million • $22 million of our apportionment income is tied up in a trailer bill that won’t be resolved until after the November election • Redevelopment funds through taxes not materializing • Apportionment • $855 million in the trailer bill is not guaranteed; only 11% of tax revenue collected – LAO thinks the Department of Finance has overstated revenue • Other deficits

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