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Dos Palos – Oro Loma Joint USD Fiscal Advisor Report November 18, 2010

Dos Palos – Oro Loma Joint USD Fiscal Advisor Report November 18, 2010. Board’s Fiscal Responsibilities. Avoid deficit spending Prevent a negative fund balance Meet the legally required 3% reserve Maintain adequate cash. What Happened Here?. State budget crisis hit hard

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Dos Palos – Oro Loma Joint USD Fiscal Advisor Report November 18, 2010

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  1. Dos Palos – Oro LomaJoint USDFiscal Advisor ReportNovember 18, 2010

  2. Board’s Fiscal Responsibilities • Avoid deficit spending • Prevent a negative fund balance • Meet the legally required 3% reserve • Maintain adequate cash

  3. What Happened Here? • State budget crisis hit hard • Declining enrollment • District’s choices to: • Maintain small class sizes • Provide expensive programs • Avoid making cuts soon enough

  4. Current District Crisis • There is plenty of blame to go around • Let’s place most of the blame where it belongs -------- on the economy

  5. State Budget Crisis ImpactEvery dollar owed to DPOLis funded at $ .83with payments deferred for several months during the year

  6. Salaries and benefits take up about 90% of the budget

  7. We simply do not get enough cash from the State to meet even our payroll obligations

  8. Let’s Blame California for this not each other!!!

  9. Now What? • Meet monthly payroll obligations • Make difficult decisions quickly • Closely monitor use of cash • Implement significant cuts now

  10. Consequences • Running out of cash • Not meeting payroll • Forced to seek State loan • Loss of local control

  11. What Would Getting a State Loan Mean for DPOL? • Requires legislative approval • Long term expensive obligation to repay the loan – up to 20 years • Added expense = even more cuts • DPOL would be only the 7th District to require a State loan

  12. Loss of Local Control? • Board becomes advisory only • Superintendent is dismissed • State Trustee assigned • Another added expense on top of loan • Here until loan fully repaid (20 years) • Total control over all decisions • Extensive cuts to reduce costs

  13. The District must act now to protect local control All stakeholders need to recognize the risk and participate in the process

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