1. Adopted Budget 2011-12 Adopted Budget 2011-12 August 22, 2011 1

2. Overview State Budget Overview Board Goals BAC Planning Assumption Highlights FTES History and Projection List of All District Funds – Expenditures & Other Outgo Expenditure Reductions Adopted Budget 2011-12 August 22, 2011 2

3. Overview (continued) Unrestricted General Fund Details Overall Summary Revenue Summary Major Revenue Changes in 2011-12 Expenditure Summary Major Expenditure Changes in 2011-12 Reserves Breakdown between Fixed and Discretionary Budgets 8-Year Trends Future Budget Challenges 3 Adopted Budget 2011-12 August 22, 2011

4. State Budget Overview Zero COLA (0%) No growth funding Student fees increased $10 to $36 per unit $290 million net reduction to apportionment $5.9 million cut to Long Beach City College No restoration of 2009-10 categorical fund cuts Increased deferrals $129 million to $961 million - $24.6 million for LBCC Issued Tax Revenue Anticipation Notes (TRANS) 4 Adopted Budget 2011-12 August 22, 2011

5. Board Goal Board Goal Measure & Improve Fiscal & Infrastructure Stability Commitment to Reduce Deficit Spending $8,141,755 deficit spending to maintain service levels to students $4,643,566 million surplus for 2010-11 Maintain 5.0% General Fund Reserve Total reserves equal $10,003,926 (9.1%) 5% reserve $5,491,729 5 Adopted Budget 2011-12 August 22, 2011

6. Board Goal Board Goal Measure & Improve Fiscal & Infrastructure Stability (continued) Focus on Advancement of Student Success Plan $2,134,717 Unrestricted General Fund $713,177 Restricted General Fund Reserve to fund campus maintenance & IT functions $225,213 budgeted reserve in the Unrestricted General Fund (carried over from prior year) for Technology Master Plan 6 Adopted Budget 2011-12 August 22, 2011

7. BAC Planning Assumption Highlights There will be budget redirections and potential reductions in response to both the State’s budget impact and the priorities as identified by the College Planning Committee (CPC) Maintain a 5.0% unrestricted reserve for contingencies Deficit spending will be minimized Carryover will only exist for the Technology Master Plan and Facilities Improvement Funds. 7 Adopted Budget 2011-12 August 22, 2011

8. BAC Planning Assumption Highlights BAC Planning Assumption Highlights (Continued) Zero (0%) COLA is budgeted No Growth is budgeted. Target FTES is 19,618 A 1% deficit factor will be included to offset possible short fall from apportionment revenues. Load Banking Reserve Budgeted the $2.3 million liability Vacation Liability Reserve Budgeted $330,125 liability 8 Adopted Budget 2011-12 August 22, 2011

9. BAC Planning Assumption Highlights BAC Planning Assumption Highlights (Continued) Benefit costs continue to increase: Health and welfare costs increased by $1.3 million Offset by plan changes and increased employee contributions PERS rate increased 0.2% SUI increased 0.9% Workers’ Compensation increased 0.06% Part-time hourly budget will contain sufficient dollars to meet the FTES target in accordance with class schedules 9 Adopted Budget 2011-12 August 22, 2011

10. 10 FTES History and Projection Total 21,529 Total 21,162 Budget Annual Total 21,036

11. List of Funds – Expenditures & Other Outgo (in millions) 11 Adopted Budget 2010-11 Unaudited Actual 2010-11 Adopted Budget 2011-12 Unrestricted General Fund$ 109.8$ 104.5$ 109.8 Restricted General Fund18.221.520.4 Capital Projects Fund11.25.17.6 Child & Adult Development Fund1.61.41.6 Contract/Community Education Fund0.70.40.7 General Obligation Bond Funds472.756.8461.3 Retiree Benefits Fund2.32.22.4 Self-Insurance Fund1.00.91.0 Student Financial Aid50.954.556.8 Vet Stadium Operations1.0 1.2 Total$ 669.4$ 248.3$ 662.8

12. Expenditure Reductions Expenditure Reductions - $5.5 Million Management Team Furloughs of 3.08% - $339,000 Management Team Evening dean duties continue - $86,000 Health benefit plan changes and employee contribution increases: Faculty$543,000 Classified$573,000 Management$210,000 12 Adopted Budget 2011-12 August 22, 2011

13. Expenditure Reductions Expenditure Reductions - $5.5 Million (continued) Classified reduction in force and reorganization - $1,563,000 Management reduction in force and reorganization - $760,000 Suspending three sports - $74,000 Reduction to part-time faculty - $500,000 Cut discretionary budgets approximately 20% - $887,000 13 Adopted Budget 2011-12 August 22, 2011

14. Unrestricted General Fund Overall Summary 14 Unaudited Actual 2010-11 Adopted Budget 2011-12 Change Increase/ (Decrease) Revenues and Other Financing Sources $ 109,145,155$ 101,692,834$ (7,452,321) Expenditures and Other Outgo104,501,589109,834,5895,333,000 Surplus/(Deficit)4,643,566(8,141,755) (12,785,321) Fund Balance$ 18,145,681$ 10,003,926$ (8,141,755)

15. Unrestricted General Fund Revenue Summary 15 Unaudited Actual 2010-11 Adopted Budget 2011-12 Change Increase/ (Decrease) Federal$ 120,349$ 120,000$ (349) Apportionment101,226,57394,856,819(6,369,754) Other State3,955,1333,107,386 (847,747) Local2,520,2322,524,9204,688 Other Sources1,322,8681,083,709(239,159) Total$109,145,155$101,692,834$(7,452,321)

16. Major Revenue Changes in 2011-12 Apportionment - $6.4 million decrease includes a $5.9 million decrease in current year apportionment due to reduced FTES targets caused by state funding reductions and a $0.5 million decrease due to prior year apportionment revenue in 2010-11. Other State Revenues - $0.8 million decrease consists mainly of decreases in mandated cost reimbursements since future funding is uncertain and a decrease in lottery revenue due to reduced FTES targets. 16 Adopted Budget 2011-12 August 22, 2011

17. Unrestricted General Fund Expenditure Summary 17 Unaudited Actual 2010-11 Adopted Budget 2011-12 Change Increase/ (Decrease) Academic Salaries$ 43,743,146$ 44,889,737$ 1,146,591 Classified Salaries23,614,43024,992,1381,377,708 Benefits24,940,37225,680,115739,743 Supplies457,915603,475145,560 Services8,783,26110,625,9061,842,645 Capital Outlay545,242515,595(29,647) Other Outgo2,417,2232,527,623110,400 Total$ 104,501,589$109,834,589$ 5,333,000

18. Major Expenditure Changes in 2011-12 Academic Salaries – overall $1.1 million increase is due to hiring 15 new faculty, and the expiration of the 2.3075% furlough. Administrator salaries decreased ≈ $300,000. Classified Salaries - $1.4 million increase is due to the reduction of management furloughs (3.08%) and expiration of classified furloughs (5.77%) and step freeze less the classified and management reduction in force and reorganization. Benefits - $0.7 million increase mainly due to salary and rate increases. Health insurance increases were offset by plan changes and increased employee contributions. 18 Adopted Budget 2011-12 August 22, 2011

19. Major Expenditure Changes in 2011-12 Major Expenditure Changes in 2011-12 (continued) Services – overall $1.8 million increase primarily due to rollover budgets and cost conscious measures during 2010-11 by all departments. Major increase related to Election Costs estimated at $450,000 19 Adopted Budget 2011-12 August 22, 2011

20. 20 Salaries & Benefits 87.0% Unrestricted General Fund Budgeted Expenditures 2011-12

21. Unrestricted General Fund Reserves 21 Adopted Budget Unassigned Reserves Board Mandated Reserve – 5.0%$ 5,491,729 Economic Uncertainties1,692,433 Assigned Reserves Technology Master Plan225,213 Vacation and Load Banking Reserve2,594,551 Total$ 10,003,926

22. Unrestricted General Fund Breakdown Between Fixed & Discretionary Budgets Adopted Budget 2011-12 Percentage of Total Adopted Budget Fixed Costs: Academic Salaries$27,622,83025.15% Academic Administrator Salaries3,603,1013.28% Manager/Supervisor Salaries5,232,8954.77% Confidential Salaries1,135,9951.03% Classified Salaries17,897,53816.30% Benefits25,680,11523.38% Total Salary & Benefit Costs$81,172,47473.91% Other Fixed Costs: Professional Services (LBPD)$2,842,8452.59% Material Fees86,8020.08% Software & Online Software Licensing832,0860.76% Contracts for Higher One, Actuarial Study, etc.59,5500.05% AQMD Fees35,0000.03% Utilities2,694,8812.45% 22 Adopted Budget 2011-12 August 22, 2011

23. Unrestricted General Fund Breakdown Between Fixed & Discretionary Budgets Unrestricted General Fund Breakdown Between Fixed & Discretionary Budgets (cont.) Adopted Budget 2011-12 Percentage of Total Adopted Budget Other Fixed Costs: Copier Maintenance72,0000.07% Building Maintenance387,3340.35% Rental133,3310.12% LACOE Contracts49,0540.05% Environmental Health Fees9300.00% Election450,0000.41% Audit, TRANs & Legal Services666,3300.61% Student Services Credit Card Fees200,0000.18% Instructional Services (Police & Fire Science)415,0000.38% Lease/Purchase256,0000.23% Interfund Transfer Out (Required Match)1,562,2521.42% Total Other Fixed Costs$10,743,3959.78% Total Fixed Costs$91,915,86983.69% 23 Adopted Budget 2011-12 August 22, 2011

24. Adopted Budget 2011-12 Percentage of Total Adopted Budget Discretionary Costs: Academic Hourly Salaries$ 13,663,80612.44% Classified Hourly Salaries725,7100.66% Total Hourly Salaries$14,389,51613.10% Other Supplies$437,4380.40% Fuel59,4400.05% Professional Services527,5500.48% Travel & Conference142,9100.13% Staff Development20,8530.02% Dues & Memberships149,2430.14% Equipment Repairs245,9450.22% Postage151,1270.14% Other Services & Expenses542,9370.49% Capital Outlay221,7970.20% Other Discretionary Costs64,5930.06% Interfund Transfers Out – Other965,3710.88% Total All Other Discretionary Costs3,529,2043.21% Total Discretionary Costs$17,918,72016.31% 24 Unrestricted General Fund Breakdown Between Fixed & Discretionary Budgets Unrestricted General Fund Breakdown Between Fixed & Discretionary Budgets (cont.) Adopted Budget 2011-12 August 22, 2011

25. Unrestricted General Fund Breakdown Between Fixed & Discretionary Budgets (Summary) Adopted Budget 2011-12 Percentage of Total Adopted Budget Fixed Costs: Academic Salaries$31,225,93128.43% Classified Salaries24,266,42822.10% Benefits25,680,11523.38% Other Fixed Costs10,743,3959.78% Total Fixed Costs$91,915,86983.69% Discretionary Costs: Discretionary Hourly Salaries$14,389,51613.10% Other Discretionary Costs3,529,2043.21% Total Discretionary Costs$17,918,72016.31% Total Expenditures$109,834,589100.00% 25 Adopted Budget 2011-12 August 22, 2011

26. Unrestricted General Fund Breakdown Between Fixed & Discretionary Budgets (Summary Multiyear Comparison – Total Costs) Adopted Budget 2009-10 Adopted Budget 2010-11 Adopted Budget 2011-12 Fixed Costs: Academic Salaries$32,702,246$30,805,108$31,225,931 Classified Salaries24,959,57523,623,46924,266,428 Benefits24,055,86325,517,81825,680,115 Total Other Fixed Costs11,615,74411,170,22610,743,395 Total Fixed Costs$93,333,428$91,116,621$91,915,869 82.40%82.99%83.69% Discretionary Costs: Discretionary Hourly Salaries$15,253,912$15,095,267$14,389,516 Other Discretionary Costs4,678,0783,575,2673,529,204 Total Discretionary Costs$19,931,990$18,670,534$17,918,720 17.60%17.01%16.31% Total Expenditures$113,265,418$109,787,155$109,834,589 26 Adopted Budget 2011-12 August 22, 2011

27. 27 04-05 Actual 05-06 Actual 06-07 Actual 07-08 Actual 08-09 Actual 09-10 Actual 10-11 Unaudited Actual 11-12 Adopted Budget Salaries & Benefits as a % of Total Expenses & Other Outgo 83.8%84.7%85.5%85.2%86.7%87.7%88.3%87.0% Surplus / (Deficit)$3.3$1.2$7.5$1.3($0.1)($1.2)$4.6($8.1) Ending Balance$4.9$6.1$13.6$14.9$14.7$13.5$18.1$10.0 Ending Balance as a % of Total Expenses & Other Outgo 5.5%6.4%12.9%13.3%13.1%12.4%17.4%9.1%

28. Unrestricted General Fund 8-Year Trend Salaries & Benefits as a % of Total Expenditures & Other Outgo 28

29. Unrestricted General Fund 8-Year Trend Ending Fund Balance and Surplus/(Deficit) 29

30. 30 Adopted Budget 2011-12 August 22, 2011 State Revenue ShortfallMid-Year Spending Reductions Less than $1 billion below forecastNo changes $1 - $2 billion below forecast$23 million cut to child care $30 million cut to apportionment - $566,180 LBCC share $10 additional enrollment fee increase to $46/unit Greater than $2 billion below forecast $ 72 million additional cut to apportionment - $1,358,831 LBCC share Future Budget Challenges Mid-Year cuts appear likely based on current economic forecasts – as of July State revenues down $540 million

31. Future Budget Challenges (cont.) Cash flow concerns – State continues to increase apportionment deferrals At June 30, 2011 our cash balance in the Unrestricted General Fund was $936,495 after borrowing $7.5 million from ourselves Fee Shortage – increased BOGG waivers are reducing collections state-wide Chancellor’s Office already estimating a $25 million (~ 0.4%) shortfall - $432,000 LBCC share Recovery appears slower than projected 31 Adopted Budget 2011-12 August 22, 2011

32. Future Budget Challenges (cont.) State Litigation Redevelopment Agencies – contesting $1.7 billion payments to state with the Supreme Court Medi-Cal Providers – going to court to contest proposed changes ($1.3 billion) Amazon Tax - going to court to try to stop ($0.2 billion) State’s structural budget deficit projected into 2015-16 Full-time faculty obligation (FON) – once the Board of Governors lifts the obligation suspension, LBCC will need to hire a significant number of full-time faculty 32 Adopted Budget 2011-12 August 22, 2011

33. Questions? 33 Adopted Budget 2011-12 August 22, 2011