1. Governor’s 2009- 2010 Budget Ramona Unified School District January 22, 2008

2. Where to Begin…

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4. To Start … California’s budget deficit has grown to over $40 Billion Both the Governor and the Legislature have advanced proposals Neither proposal has been acceptable to the other side

5. California in Fiscal Crisis Financing structure which is dependent on increasing revenues of sales and personal income taxes Creates up and down budget years 1% of the top California earners contribute 50% to the State revenues through personal income, of which capital gains tax is a large portion The failure of prior budgets to come to terms with the structural budget gap Always hoping for a good year to grow out of the problem Hope is not a strategy

6. Consequence The arrival of this recession has hit California extremely hard Weakened by past budget debt loads Most of the tools and gimmicks are gone California has the worst credit rating of the 50 States

7. Governor’s Proposal: 2008-2009 Reduction of.68% funded COLA Additional reduction of 4.5% to the revenue limit No categorical program reductions Prior-year categorical ending balances transfers Current-year categorical flexibility Reductions in deferred maintenance Reduce mandatory State reserve requirements by half Deferral of April revenue limit and CSR payments until July 2009

8. Governor’s Proposal: 2008-2009 Governor’s budget is based upon: Securitization of the California Lottery Temporary increase in sales tax of 1.5% Revenue Anticipation Warrant (RAW) Borrow funds in July 2009 and pay them back in June 2011 If these do not happen or the dollars are not realized, the shortfall will need to be made up

9. Legislature’s Proposal: 2008-2009 Reduction of.68% funded COLA Categorical program elimination Instructional materials, professional development Categorical program reductions SLIP Prior-year categorical ending balances transfers Reductions in deferred maintenance

10. Reductions to RUSD: 2008-2009 Reduction in Revenue Limit funding for 2008-2009 $1,942,000

11. Governor’s Proposal: 2009-2010 Continues the theme of the proposed 2008- 2009 mid-year reductions No COLA increase of 5.02% Additional reduction to revenue limit of 2.52% Ability to transfer State categorical dollars to the unrestricted fund to offset reductions Lifting of statutory requirements for most categorical programs

12. Governor’s Proposal: 2009-2010 Elimination of deferred maintenance match Reduce mandatory State reserve requirements by half Proposes providing permanent categorical flexibility

13. Reductions to RUSD 2009-2010 Revenue Limit for 2009-2010 Takes into account declining enrollment Reductions to 2008-2009 must be taken into account ($1,941,000) So figure is larger than a 2.52% reduction

14. 2008-09 and 2009-10 K-12 Revenue Limits C-14

15. Reductions to RUSD: 2009-2010 Reduction in Revenue Limit funding for 2009-2010 $3,814,000

16. Continue Increasing Operating Costs 2009-2010 Step and column advancement 2% increase $750,000 Health and Welfare Increases 14% increase $650,000

17. Summarizing the Numbers 2008-2009 mid-year reductions $1,942,000 2009-2010 budget reductions $3,814,000 2009-2010 Increased costs $1,400,000 Total 7,156,000

18. Cash The State continues to be in a cash flow crisis The State runs low on cash in February and March (before the April taxes) and then during the summer months Governor’s proposal is to defer payments to school districts to later months Continues to pass on the State’s cash shortages to school districts

19. RUSD response to Legislators Support proposals which generate increased revenue for K-12 public education Support the Governor’s proposals centered on flexibility in categorical programs Make every effort to approve mid-year cuts and a 2009-2010 budget quickly

20. RUSD Response Withhold an additional 25% of site and department budgets Slowed process for filling open positions -- some have been left unfilled Offered an early retirement incentive to teachers Issued a freeze on spending from several categorical budgets

21. RUSD Response Identifying other reductions, savings programs, based upon the recommendations from School Services of California and San Diego County Office of Education Board will be kept apprised of the progress of the inclusive budget reduction process District Administration RTA, CSEA Board Ongoing information will be distributed to the Board Tentative list of reductions to the Board at the February Board meeting

22. RUSD Response Priority of Reductions Support all children in their quest to excel everyday in every classroom Maintain as much of our existing educational programs and support services as possible Protect the employment of as many school employees as possible Preserve the rich fabric of our local community schools and parental support

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24. In Conclusion The end is not here for Ramona Unified School District

25. Acknowledgments Governor’s Proposal for the 09-10 State Budget School Services of California, Inc.