1. Governor’s Proposed Budget 2010-11 Steve Bolman Deputy Supt., Business and Administration Midge Hoffman Director, Budget & Accounting

2. The Economy Signs indicate that most of the nation is recovering…California not so much –California Unemployment at 12.3% compared to 10% for the U.S. –DOF estimates rate to remain above 10% through 2011

3. Government Financial Service Leisure & Hospitality Industrial Sectors (Jobs in Thousands) Manufacturing Construction Employment Trends December 2007 to November 2009

4. Recovery 5-year return to December 2007

5. Governor Vows to Protect Education!!! Education will take less than it’s share of pro-rata cuts in 2010-11

6. Priorities Governor states that prison expenses will no longer be higher than higher education expenses, but speaks nothing about K-12 and the fact that it is next to dead last in funding in the Nation

7. GOOD NEWS!!! No Mid-Year cuts for 2009- 10!!! Decrease in Prop 98 offset by sweep of underutilized K-3 CSR funds

9. GOOD NEWS!!! FUNDED COLA for 2010-11!!!

10. BUT WAIT, THIS GOOD NEWS DIDN’T LAST VERY LONG… If only it were real …the COLA is being ‘funded’ because it’s negative -.38% cut to the Revenue Limit

11. GOOD NEWS THAT DIDN’T LAST The previous 2010-11 COLA reported was.5% positive…a negative swing of.88% –Elementary - $109K –Secondary - $318K –Cherry Valley - $17K – TOTAL - $444K

12. 2011-12 COLA 2011-12 COLA re- benched to 1.8% from 2.4% - decrease –Elementary - $ 66K –Secondary - $182K –Cherry Valley - $ 10K – TOTAL - $258K Cumulative Loss for 2010-11 & 2011-12 = $1.15 Million

13. It feels good to be “Protected”…or does it? “Protected” doesn’t mean no new cuts

14. NO CUTS FOR THE ‘PROTECTED’ EDUCATION BUDGET ??? The one-time revenue limit cut of $252.83 per ADA in 2009-10 is deleted for 2010-11 … BUT This is being replaced by another on-going cut …

15. NO CUTS FOR THE ‘PROTECTED’ EDUCATION BUDGET ??? The $1.5 B cut is to come from “District Administration” –$191 Elementary –$231 Secondary An additional loss of $1.5 M for the District This on-going additional cut won’t increase the revenue limit deficit factor – there’s no payback

16. NO CUTS FOR THE ‘PROTECTED’ EDUCATION BUDGET ??? No basis in reality for this figure Only gives the ‘ appearance ’ that the Governor is keeping cuts from the classroom Would eliminate 3 out of every 4 positions in the District Office

17. NO CUTS FOR THE ‘PROTECTED’ EDUCATION BUDGET ??? For example, The Business Office Staff is comprised of: –2 Payroll –2 Accounts Payable –1 Budget Tech –1 District Accountant –1 Purchasing Coordinator –1 Business Manager NOW, PICK TWO PEOPLE TO PRODUCE PAYROLL,PAY BILLS, MAKE DEPOSITS, BUY BOOKS & SUPPLIES, BALANCE & MANAGE THE BUDGET,MAKE SURE WE HAVE CASH, ENSURE INTERNAL CONTROLS AND SO ON…

18. 2009-102010-112011-12 Elementary $ 506,199 $ 496,647 $ 565,488 Secondary $ 1,294,045 $ 1,197,129 $ 1,301,941 Cherry Valley $ 82,541 $ 85,865 $ 97,431 $ 1,882,785 $ 1,779,641 $ 1,964,860 $253/ADA $245/ADA $278/ADA Revenue Update - Losses Since 1 st Interim

19. Revenue Limit Changes -13.9% from 2007-08

20. Revenue Limit Changes Loss of COLA Loss of baseline dollars $566 $807 $1,373 $1,430 $482

21. District Options/Flexibility Reduce calendar by 5 days through 2012-13 Tier III Categorical funding can continue to be used with flexibility through 2012-13 Eliminate Deferred Maintenance Transfer Reduce Reserve for Economic Uncertainties

22. State Problems & Solutions

23. Problems with Assumptions – Pick your Metaphor… More Gimmicks Funding Shifts may be legally challenged May not see $6.9 B from the Federal Government When will the State figure out they’re out of smoke & mirrors?

24. 2009/2010 2010/2011 2011/2012 TOTAL INCOME $64,391,563 $61,419,468 $61,105,833 LESS TOTAL EXPENSES $67,197,801 $66,133,400 $66,399,713 NET INCREASE (DECREASE) $ (2,806,238) $ (4,713,932) $ (5,293,880) PLUS BEGINNING BALANCE $12,786,321 $ 9,980,083 $ 5,266,151 EQUALS ENDING BALANCE $ 9,980,083 $ 5,266,151 $ (27,729) Less RESERVES (3,062,888) (2,877,089) (2,775,650) UNAPPROPRIATED $ 6,917,194 $ 2,389,062 $ (2,803,380) Trends with Revenue Cuts

25. Average Daily Attendance 2009/2010 2010/2011 2011/2012 COLA4.25%-0.38%1.80% 18.355% Deficit Elementary ADA 2,002 2,027 2,034 Cherry Valley ADA 350 Secondary ADA (funded) 5,058 4,886 4,683 Total ADA 7,410 7,263 7,067 Net Change over Prior Year (32) (147) (196)

26. 2009/2010 2010/2011 2011/2012 TOTAL INCOME $64,391,563 $61,419,468 $61,105,833 LESS TOTAL EXPENSES $67,197,801 $64,914,400 $65,180,713 NET INCREASE (DECREASE) $ (2,806,238) $ (3,494,932) $ (4,074,880) PLUS BEGINNING BALANCE $12,786,321 $ 9,980,083 $ 6,485,151 EQUALS ENDING BALANCE $ 9,980,083 $ 6,485,151 $ 2,410,271 Less RESERVES (3,062,888) (2,840,519) (2,739,080) UNAPPROPRIATED $ 6,917,194 $ 3,644,632 $ (328,810) Trends with 2.75% Salary Cut for All Employees