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Presentation Agenda

Explore the implications of the state budget on the proposed district budget, including planned reductions and cash flow projections. Understand the multi-year assumptions and uncertainties influencing budget decisions. Discover the Superintendent’s recommended budget goals, managing deficits and maintaining reserves. Prepare for budget constraints and necessary reductions in the upcoming years.

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Presentation Agenda

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Presentation Transcript

  1. Presentation Agenda • Opening Remarks • Implications of State Budget • Fiscal Realities • Superintendent’s Recommended Budget • Multi-Year Assumptions & Budget Uncertainties • TRANs Loan Implications • Closing Remarks/Next Steps

  2. Implications of State Budget • The Proposed District Budget is Based on the Governor’s May Revised Budget • Reduction of $441 Per ADA in State Funding Must Be Planned for 2012/13 Assuming the Governor’s Tax Initiative Fails • SDCOE Strongly Recommends No COLA for 2012/13 or 2013/14 years or District to Set Aside a Contingency Reserve

  3. Serious Fiscal Realities • First Reading : • Update Budget Assumptions/ Fiscal Realities • Highlight Multi-year Risks • One-Time Solutions Create Multi-Year Problems • Significant Deficits Projected for 2013/14 • Limited Options to Solve the Budget Gap • More Reductions will be Necessary in 2013/14 • Budget Must be Submitted to the SDCOE byJuly 10, 2012 2012/13 - 5th Straight Year of Funding Reductions

  4. General Fund Deficit 2009/10 to 2014/15 Total Budget Reductions Over 5Years Is $555.5 Million -If 2013/14 Solutions are all on-going then the District would need to reduce only $27.5 Mil in 2014/15

  5. Superintendent’s Recommended Budget • The Superintendent’s Recommended Budget Accomplishes the Following Important Goals • Supports Successful TRANs Issuance in Early July • Manages Multi-Year Deficits • Maintains State Required 2% Minimum Reserve Level

  6. Total All Funds 2012/13 Compared To 2011/12 -Current Proposed Budget Reflects 9% Reduction Across All Funds -General Fund Unrestricted Budget Includes One-time Transfers From Other Funds of $41Mil

  7. Total General Fund 2012/13 Compared To 2011/12 -2012/13 Proposed Total General Fund Budget is $1,077.57 Mil -2011/12 Adopted Total General Fund Budget is $1,165.07 Mil

  8. Total General Fund Unrestricted 2012/13 Compared To 2011/12 -2012/13 Proposed Total General Fund Unrestricted Budget is $624.15 Mil -2011/12 Adopted Total General Fund Unrestricted Budget is $729.00 Mil

  9. Total General Fund Restricted 2012/13 Compared To 2011/12 -2012/13 Proposed Total General Fund Restricted Budget is $453.42 Mil -2011/12 Adopted Total General Fund Restricted Budget is $436.07 Mil

  10. Other Restricted Funds - 2012/13 Budget

  11. County Office of Education: Budget Development Requirements • SDCOE Recommendations: • Assume the Trigger Reduction of $441 Per ADA • Unfunded COLA in 2012/13 and 2013/14 or Set Up a Contingency Plan/Reserve

  12. Multi-Year Assumptions – Revenues

  13. Multi-Year Assumptions – Expenditures

  14. Multi-Year Assumptions – Expenditures (cont’d.) ** Assuming 2013/14 Reductions Are All Ongoing

  15. Multi-Year Assumptions & Reserves Requirements

  16. Multi-Year Assumptions - Uncertainties • Governor’s Budget Veto – Uncertainty on Timing and Direction of State Budget • November Tax Initiative Election Result • Enrollment Decline • Pre- Kindergarten Implementation of Legal Requirements and State Funding

  17. 2012/13 Budget – Superintendent’s RecommendationMulti-Year Projections- General Fund Unrestricted 2013/14 Shortfall $98.3Mil 2014/15 Shortfall $27.5Mil

  18. 2012/13 Budget Solutions List

  19. Potential Budget Solutions for FY 2013/14$98 Mil Projected Balanced Budget Shortfall Far Fewer Realistic Options Available to Cover Deficits * Further Actions Are Needed To Identify Additional $18.4 Mil

  20. 2012/13 General Fund Projected Cash FlowsWith TRANs Borrowing TRANs Borrowing $227 Mil

  21. Closing Remarks • Superintendent’s Recommended Budget is the BEST Course for the District • Addresses Long-Term Fiscal Solvency • Enables Successful TRANs to Meet Payroll • Manages Multi-Year Deficits • Balances Uncertainty of the Moment

  22. Next Steps • June 22 First Reading of 2012/13 Budget • June 29 Board Budget Adoption • June 30 Submission of Budget to SDCOE • July 1 Implementation of 2012/13 Budget

  23. Questions?

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