1. 1 Meeting of the Board of Education February 15, 2011 Budget Reductions and Revisions Phase IV

2. 2 Child Care The Budget includes significant cuts to child care for 2011-12, including: Eliminating services for 11- and 12-year olds Reducing eligibility from 75% of the state median income to 60% A family of four can earn no more than $45,832 per year Lowering subsidies provided for services To soften the impact of cuts, the Governor proposes providing local agencies with greater latitude to manage copayments and other fees

3. 3 Child Care For 2010-11, the Governor proposes reversing the enacted, but legally challenged, cuts to Stage 3 child care by directing $42.6 million in one-time federal funding As of April 1, 2011, the Governor expects lower subsidy and eligibility rules to take effect for programs, such as Stage 3 child care Funding for 2011-12 would continue, but based on lower levels and more restrictive eligibility

4. 4 Child Care Funding Total 2010-2011 $2.3 billion Proposed 2011-2012$1.6 billion LBUSD needs to be prepared for a reduction of approximately 35%

5. 5 Multi-year Projection Assumptions Proposed initiative is not successful ($634/pupil) 1 st Interim assumptions w/reduction ($18.32/ADA) CSR revenue continues at 2010-11 levels (in cuts) Board actions of 2/1/11 are listed as “Ongoing reductions” Categorical programs absorb all costs If Board approved all recommendations tonight; LBUSD will still have to make another $60 million in reductions next year (for 2012-13); and $32 million the following year (for 2013-14)

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7. 7 Legislative Analyst: Unsuccessful Initiative LAO issued recommendations for if the proposed initiative is unsuccessful LAO’s recommendations would result in a reduction in K-12 funding of $760/pupil This identifies downside risk $10 million greater than the risk identified in LBUSD estimate of $634/pupil LAO’s number is not included in LBUSD multi-year scenario

8. 8 Summary of Board-Adopted Budget Reductions PhaseBoard Action DateApproved Amount Estimated Savings Budgeted I12-15-2009$ 17,700,000$ 17,820,087 II1-27-2010 & 2-9-201038,180,63433,891,991 III3-2-20101,922,000 IV6-8-20103,600,0003,700,000 V9-7-201020,244,665 I11-2-20103,403,435 II11-9-20103,586,509 III12-7-2010578,191 IV2-1-201126,853,000 Total$ 116,068,434$ 111,999,878

9. 9 LBUSD Board-Approved Budget Reductions Since FY 2008-09 Date $ in Millions Fiscal YearDate$ in MillionsFiscal Year 2-1-11$ 26.92011-122-9-10$ 5.62010-11 12-7-100.6 2010-11 & 2011-12 1-27-1032.62010-11 11-9-103.6 2010-11 & 2011-12 12-15-0917.7 2009-10 & 2010-11 11-2-103.4 2010-11 & 2011-12 4-7-0924.12009-10 9-7-1020.22010-113-4-0819.82008-09 6-8-103.62010-112-9-0820.82008-09 3-2-101.92010-11 Total$ 180.8

10. 10 Major One-Time Funding & Flexibility for General Fund Description Expenditures in Fiscal Years Funding / Flexibility Ends (Proposed) Total Funding Amount Federal ARRA $ 2009-2010 thru 2010-11 Sept. 2011$90 million *** Federal ARRA Education Jobs Bill 2011-12Sept. 2012$16 million State Class Size Reduction (CSR) Reduced Penalty 2008-09 thru 2013-14 June 2014Varies State Tier 3 Flexibility 2008-09 thru 2014-15 June 2015$67 million ** State Categorical Ending Balance Sweep 2008-09 thru 2009-10 June 2010 *$33 million * Ended ** Projected *** Includes $3.9 million of additional SFSF funds

11. 11 Budget Reductions and Revisions, Phase IV* *Assumes Governor Brown's Proposed Initiative to Extend Taxes is Not Successful

12. 12 Budget Reductions and Revisions, Phase IV*, cont’d

13. 13 THE END