Long Beach Unified School District Budget Update Including Impact of Adoption of 2010-2011 State Budget Presented at Board of Education Workshop November

Long Beach Unified School District

Budget Update

Including Impact of

Adoption of 2010-2011 State Budget

Presented at

Board of Education WorkshopNovember 9, 2010

Prepared by the Business Office

2

TimelinesFiscal Year Document Date

2010-2011 District Adopted Budget 6-14-2010

2009-2010 Unaudited Actuals 9-7-2010

2010-2011 State Adopted Budget 10-8-2010

2009-2010 Audit Report 12-15-2010

2010-2011 First Interim Report 12-15-2010

2011-2012 Governor’s Proposed Budget January 2011

2010-2011 Second Interim Report 3-15-2011

2011-2012 District Adopted Budget June 2011

2010-2011 Unaudited Actuals 9-15-2011

2010-2011 Audit Report 12-15-2011

Budget revisions are on-going.

3

Initial Thoughts

The State budget is based on political assumptions,

not sound economic assumptions

The intense gridlock led to a gimmick-driven result

by all sides - meaning no real budget at all. The

fight over school funding has simply been delayed,

not resolved.

The overall level of school cuts proposed earlier did

not get worse and in fact provided a slight increase

in dollars for school districts.

4

Economic Outlook

Economists are now referring to the era of the

“Great Recession” to characterize what has been

the longest and deepest recession in the post-

Depression era

Largest job losses ever recorded in CA are highest

in the nation

Impacts every source of revenue for California

government at the state and local levels.

Personal income largest driver

5

The Economy

The economy is the key to financial

recovery for the state as a whole and for

public agencies

Unemployment is key and remains higher

than the rest of the nation

Predictions of an early recovery in the

spring of 2010 proved to be overly

optimistic

6

National Economic Outlook Many economic indicators remain weak

U.S. unemployment is at 9.6%, and it spiked at

10.1%

Gross Domestic Product (GDP) has slipped

Housing remains sluggish

Economists say the recession is over, which doesn’t

translate to meaningful recovery until 2012-13

The keys to recovery

Improvement in the construction industry

Improvement in employment

7

U. S. Economic Outlook

Source: U.S. Bureau of Economic Analysis, August 2010;

Note: Advance estimate for the 3rd quarter 2010 is 2.0%

U.S. GDP (% Change)

5.7%

-2.7%

-5.4%-6.4%

-0.7%

2.2%3.7%

1.6%

-8.0%

-6.0%

-4.0%

-2.0%

0.0%

2.0%

4.0%

6.0%

3rdQuarter

4thQuarter

1stQuarter

2ndQuarter

3rdQuarter

4thQuarter

1stQuarter

2ndQuarter

2008 2009 2010

Gross Domestic Product (GDP)

8

California Economy California’s economy remains weak

The state unemployment rate is 12.4%, among the highest in the country

Home sales slowed in August, down 2.7% from July and down 14.0% from August 2009

Home foreclosures made up more than one-third of the existing homes sold in August

UCLA forecasts some improvement in 2011 Employment will rise 1.90% after three years of decline

Personal income is expected to increase 3.70%

But the unemployment rate will remain high at 11.0% in 2011

9

California’s Spending Lags the NationCalifornia Schools Lag Behind Other States on a Number of

Measures

DescriptionCalifornia Ranking

CaliforniaRest of

U.S.

K-12 Spending Per Student (2009-10)*

44 $8,826 $11,372

K-12 Spending as a Percentage of Personal Income (2008-09)* 46 3.28% 4.25%

Number of K-12 Students Per Teacher (2009-10)*

50 21.3 13.8

Number of K-12 Students Per Administrator (2007-08) 46 358 216

Number of K-12 Students Per Guidance Counselor (2007-08) 49 809 440

Number of K-12 Students Per Librarian (2007-08) 50 5,038 809

*2008-09 and 2009-10 data are estimated.Note: “California Ranking” and “Rest of U.S.” exclude the District of Columbia. Spending per student and number of students per teacher are based on Average Daily Attendance (ADA). Number of students per administrator, guidance counselor, and librarian are based on statewide enrollment.Source: National Education Association, National Center for Education Statistics, and U.S. Bureau of Economic Analysis

10

California’s Spending Lags the Nation

11

U. S. Employment

Forecast

Source: UCLA Anderson Forecast, September 2010

Forecast

___________

12

California Employment

Forecast

____________ Forecast

13

California’s Unemployment Rate vs. Other

Hard-hit StatesHighest State Unemployment Rate, September 2010

Source: U.S. Bureau of Labor Statistics, October 2010

14.4%

8.0%

9.0%

10.0%

11.0%

12.0%

13.0%

14.0%

15.0%

Nevada Michigan California Florida Rhode Island

14.4%

13.0%

12.4%11.9%

11.5%

National Average is 9.6%

14

The State Budget Gap“Closing” the $19.3 Billion Gap - October 2010

$7.8 billion of expenditure–related solutions (including

ongoing and temporary cost or service reductions)

$5.4 billion of new federal funding

$3.3 billion of revenue actions (including $1.4 billion in

higher assumed baseline state revenues consistent with our

May 2010 state revenue forecast)

$2.7 billion of largely one–time loans, transfers, and funding

shifts

Governor vetoes $963 million to boost the Legislature’s

reserve of $375 million to $1.3 billionSource: Department of Finance and LAO

15

Budget Act Expenditure Solutions

Dollars in Billions

$ 3.100 - Reduce Proposition 98 costs

$ .260 - Vetoes to CDE - Stage III Child Care, ASAM

$ 1.600 - Reflect savings in state employee payroll, benefits

$ .800 - Reduce budget for prison medical care

$ .300 - Achieve IHSS savings through various actions

$ .569 - Vetoes to HHS – Including Student Mental Health Services

$ .200 - Defer or suspend local government mandates

$ .200 - Reflect reductions in adult prison population

$ .200 - Offset UC and CSU General Fund costs with federal economic stimulus funding

$ .200 - Require managed care enrollment for certain Medi–Cal recipients

$ .336 - Adjust other spending and Vetoes to Non-Agency Depts. (net reduction)

_______________________________________________________________

$7.765 billion - Total Expenditure Related Solutions

16

Budget Act Revenue Solutions

Dollars in Billions

$ 1.4 - Adopt LAO’s May 2010 revenue forecast

$ 1.2 - Suspend for two years the ability of businesses to deduct net operating losses

$ .9 - Score additional revenues from previously authorized sale leaseback of state office buildings *

$ -.1 - Adopt other compliance actions and reductions in business taxes (net reduction)

________________________________________________ $3.3 billion - Total Revenue Related Solutions

* The State announced sale agreement 2 days after budget was signed for a total of $2.3 billion, with General Fund benefit of $200 million above projection.

17

State General Fund Revenues

Source: 2010-11 May Revision, page 56; Budget Conference Committee Report, October 6, 2010

18

Budget Act Federal Funding Solutions

$ 4.1 billion - Assumes enhanced federal funding

and/or additional cost flexibility

$ 1.3 billion - Score savings from recent

congressional action to extend Federal

Medical Assistance Percentage (FMAP)

support

______________________________________________________$ 5.4 billion -Total Federal Solutions

(Most of this requires an act of Congress)

19

Budget Act Loans, Transfers & ShiftsDollars in Billions

$ 1.3 - Borrow from special funds

$ .5 - Extend repayment due dates of existing loans from the

General Fund to special funds

$ .4 - Fund courts from previously authorized shift from

redevelopment agencies

$ .2 - Use hospital fees to support Medi–Cal children’s coverage

$ .2 - Transfer special fund monies to the General Fund

$ .1 - Use Student Loan Operating Fund monies for Cal Grant

costs

$ .1 - Adopt other funding shifts

_______________________________________________________________

$ 2.7 billion - Total Loans, Transfers & Shifts

20

Risks to the State Budget Higher revenues: Assumes the Legislative Analyst’s Office’s $1.4

billion higher revenue estimate, on top of the 5.7% revenue

increase projected in the May Revision

July and August revenues are tracking the May Revision forecast, not

exceeding it

Federal funds: $5 billion are assumed, which would offset General

Fund expenditures, $1.6 billion more than the May Revision

Expenditure cuts: $7.5 billion are assumed

However, one-third of the fiscal year has already elapsed without

these reductions

The economy: Assumes personal income growth of 3.2% in 2010

and 4.5% in 2011

UCLA forecasts weaker growth: 1.9% in 2010 and 3.7% in 2011

21

Once Again

“The vast majority of the new budget problem we

have identified for 2009-10 can be attributed to

the state’s inability to implement several major

solutions in the July 2009 budget plan…”

- Mac Taylor, Legislative Analyst

November 2009

22

The State Budget For Education What are the provisions of the new State Budget?

Much improved from the May Revision Reverses 3.85% cut and negative cost-of-living adjustment

(COLA) Restores child care cuts No supplanting with Federal Jobs Bill funding

Still, there are concerns: Will there be mid-year cuts? Loss of Tier III and class-size reduction (CSR) flexibility will

cut into the gains

Longer term, we need real Budget reform We need more dollars, and a more stable source of

funding We are still at the bottom of the ranking in education

spending

23

Proposition 98 Proposition 98 was designed to establish a

constitutional minimum funding guarantee for K-14 education

Over the years, Proposition 98 has been subject to manipulation

In 2009-10, the Legislature and the Governor recaptured a $1.6 billion “overappropriation” of the 2008-09 minimum guarantee after the fiscal year had closed

The Governor’s May Revision for 2010-11 had proposed to rebench the guarantee downward by $1.45 billion related to his proposal to eliminate child care

The Legislature rejected the child care cut

24

Proposition 98

For 2010-11, the Legislature suspended Prop

98, establishing the minimum funding level at

$49.7 billion

The minimum funding level without suspension

would have been close to $54 billion, a loss of $4.3

billion

Impact to LBUSD — about $50 million

Outstanding Maintenance Factor at the end of

FY 2010-2011 is estimated to be $9.5 billion

25

Major Changes from May Revision to the Final State Adopted Budget

May Revision(LBUSD Adopted

Budget)

State Adopted Budget

Estimated Impact to

LBUSD

Reduced revenue limit by $1.5 billion

Fully restores revenue limit cut

$246 per ADA or $ 20 million

“Fully funded” negative 0.39% COLA

Eliminates negative COLA

$25 per ADA or $2 million

No funding for mandated costs

$300 million $4 million

Suspended existing AB3632 special

education county mental health

mandate

Not suspended

Services are required without

funding. Lawsuits filed. Unknown at

this time

Note: Mid-Year cut for FY 2010-2011 is uncertain at this time.

26

Revenue Limit

2009-2010 2010-2011 2011-2012 2012-2013

Statutory COLA

4.25% -0.39% 1.7% 1.9%

COLA Adjustment

--- --- -1.7% ---

Revenue Limit

Deficits18.355% 17.963% 17.963% 17.963%

Net Funded COLA

--- No change No change 1.9%

Note 1: Net Funded COLA is the change in the funded revenue limit from the prior yearNote 2: For 2010-2011, the negative COLA was eliminated through a lower deficit factor

27

2010-2011 Revenue Limit Per ADA

LBUSD

May Revision(District Adopted Budget)

State Adopted Budget

Base Revenue Limit (prior year)

$ 6,368.08

$ 6,368.08

Add: COLA -25.00 -25.00

Total Base Revenue Limit Per ADA Prior to Deficit

6,343.08 6,343.08

Deficit Factor (multiply by)

.77795 .82037

Funded Revenue Limit Per ADA

$ 4,934.60

$ 5,203.67

Note: LBUSD is receiving $1,139.41 less per ADA, or $92 million due to state deficits

28

2010-2011 Cash Deferral of State Apportionment

Based on State Adopted Budget—LBUSD

Apportionment AmountPercentag

e

Deferred within 2010-11$

149,467,88837%

Deferred to 2011-12118,756,843 30%

Subtotal—Cash Deferrals

268,224,731 67%

Without Deferral133,949,381 33%

Total—State Apportionment

$ 402,174,112

100%

29

Cash Deferrals of 2010-11 State Apportionment Impact to LBUSD

From To Cash Deferral

1 July 2010 September 2010 $ 24,786,540

2 September 2010 December 2010 44,615,772

3 October 2010 November 2010 44,615,772

4 February 2011 * July 2011 33,480,370

5 March 2011 April 2011 35,449,804

6 April 2011 * July & Aug 2011 21,931,900

7 May 2011 * July & Aug 2011 27,894,768

8 June 2011 * July 2011 35,449,805

Total $ 268,224,731

Amount deferred within FY 2010-2011 = $ 149,467,888* Amount deferred to FY 2011-2012 = $ 118,756,843

30

Estimates of New One-Time Funding—LBUSD

Federal Jobs Bill — $14 million

Cash received in Oct. 2010

Use of funds must be related to school sites &

support

Must be spent by Sept. 2012

State Mandated Costs — $4 million

Cash receipt is expected in FY 2010-2011

Use of funds is entirely unrestricted

No deadline for spending

31

3 Different Funding Scenarios

Worst

Assumes State Budget gains are rescinded

Assumes COLA of 0% in 2011-12 and 1.9% in 2012-13

Better

Assumes the reduced deficit factor is one-time for 2010-11


Best

Assumes the reduced deficit factor is on-going for 3 years


32

Worst Case Scenario

General Fund Unrestricted Restricted Combined Unrestricted Restricted Combined Unrestricted Restricted Combined

Revenue Limit Sources 385,489,933 21,234,037 406,723,970 377,286,224 21,451,862 398,738,086 378,148,650 21,968,593 400,117,243 Federal Revenues 2,156,100 82,755,894 84,911,994 2,156,100 70,031,935 72,188,035 2,156,100 71,311,197 73,467,297 Other State Revenues 82,495,319 79,954,729 162,450,048 78,480,800 79,983,475 158,464,275 81,760,770 80,015,630 161,776,400 Other Local Revenues 8,710,470 624,309 9,334,779 8,314,950 638,476 8,953,426 8,318,880 668,249 8,987,129

Total Revenues 478,851,822 184,568,969 663,420,791 466,238,074 172,105,748 638,343,822 470,384,400 173,963,669 644,348,069

Certificated Salaries 240,833,407 87,780,005 328,613,412 266,640,669 89,948,171 356,588,840 272,201,647 91,669,491 363,871,138 Classified Salaries 67,279,480 35,640,823 102,920,303 68,602,275 35,997,231 104,599,506 69,288,297 36,350,203 105,638,500 Employee Benefits 105,797,922 45,280,444 151,078,366 121,821,314 50,148,833 171,970,147 135,279,675 55,608,974 190,888,649 Books and Supplies 8,883,470 6,569,486 15,452,956 7,883,470 6,514,560 14,398,030 16,883,470 6,490,253 23,373,723 Services, Other Operating Expenses 26,271,456 34,239,664 60,511,120 26,835,338 33,513,328 60,348,666 26,199,286 33,393,980 59,593,266 Capital Outlay 1,166,358 188,933 1,355,291 1,166,358 188,933 1,355,291 1,166,358 188,933 1,355,291 Other Outgo - 157,733 157,733 - 157,733 157,733 - 157,733 157,733 Transfers - Indirect and Direct Costs (9,363,283) 7,828,789 (1,534,494) (8,221,283) 8,990,680 769,397 (8,221,283) 9,298,137 1,076,854 Board Approved Reductions 9-7-10 (9,783,000) (725,000) (10,508,000) (2,775,000) (725,000) (3,500,000) (2,775,000) (725,000) (3,500,000) Shift to use jobs bill funds (14,000,000) 14,000,000 - Other Adjustments - - - (27,000,000) - (27,000,000) (109,000,000) - (109,000,000)

Total Expenditures 431,085,810 216,960,877 648,046,687 440,953,141 238,734,469 679,687,610 401,022,450 232,432,704 633,455,154

Other Financing Sources/UsesInterfund Transfers 12,360,035 35,849 12,395,884 12,360,035 32,141 12,392,176 12,360,035 32,141 12,392,176 Contributions (47,219,784) 47,219,784 - (51,993,608) 51,993,608 - (56,743,935) 56,743,935 -

Total Other Financing/Uses (59,579,819) 47,183,935 (12,395,884) (64,353,643) 51,961,467 (12,392,176) (69,103,970) 56,711,794 (12,392,176)

Net Inc/(Dec) to Fund Balance (11,813,807) 14,792,027 2,978,220 (39,068,710) (14,667,254) (53,735,964) 257,980 (1,757,241) (1,499,261)

Beginning Fund Balance 65,903,924 34,067,452 99,971,376 54,090,117 48,859,479 102,949,596 15,021,407 34,192,225 49,213,632

Ending Fund Balance 54,090,117 48,859,479 102,949,596 15,021,407 34,192,225 49,213,632 15,279,387 32,434,984 47,714,371

Adopted Budget Projection Projection2010-2011 2011-2012 2012-2013

33

Worst Case Scenario – Includes Non-Rep and CSEA Unit A



Total Revenues 478,851,822 184,568,969 663,420,791 466,238,074 172,105,748 638,343,822 470,384,400 173,963,669 644,348,069

Certificated Salaries 240,833,407 87,780,005 328,613,412 266,640,669 89,948,171 356,588,840 272,201,647 91,669,491 363,871,138 Classified Salaries 67,279,480 35,640,823 102,920,303 68,602,275 35,997,231 104,599,506 69,288,297 36,350,203 105,638,500 Employee Benefits 105,797,922 45,280,444 151,078,366 121,821,314 50,148,833 171,970,147 135,279,675 55,608,974 190,888,649 Books and Supplies 8,883,470 6,569,486 15,452,956 7,883,470 6,514,560 14,398,030 16,883,470 6,490,253 23,373,723 Services, Other Operating Expenses 26,271,456 34,239,664 60,511,120 26,835,338 33,513,328 60,348,666 26,199,286 33,393,980 59,593,266 Capital Outlay 1,166,358 188,933 1,355,291 1,166,358 188,933 1,355,291 1,166,358 188,933 1,355,291 Other Outgo - 157,733 157,733 - 157,733 157,733 - 157,733 157,733 Transfers - Indirect and Direct Costs (9,363,283) 7,828,789 (1,534,494) (8,221,283) 8,990,680 769,397 (8,221,283) 9,298,137 1,076,854 Board Approved Reductions 9-7-10 (9,783,000) (725,000) (10,508,000) (2,775,000) (725,000) (3,500,000) (2,775,000) (725,000) (3,500,000) Shift to use jobs bill funds (14,000,000) 14,000,000 - CSEA A Tentative Agreement (1,304,336) (702,335) (2,006,671) (2,687,237) (1,446,974) (4,134,211) (1,338,166) (720,551) (2,058,717) Non-Rep Similar Concessions (3,585,089) (1,536,467) (5,121,556) (863,393) (370,025) (1,233,418) Other Adjustments - - - (19,000,000) - (19,000,000) (107,000,000) - (107,000,000)


Other Financing Sources/UsesInterfund Transfers 12,360,035 35,849 12,395,884 12,360,035 32,141 12,392,176 12,360,035 32,141 12,392,176 Contributions (47,219,784) 47,219,784 - (51,993,608) 51,993,608 - (56,743,935) 56,743,935 -


Net Inc/(Dec) to Fund Balance (10,509,471) 15,494,362 4,984,891 (40,796,384) (11,683,813) (52,480,197) 459,539 (666,665) (207,126)



Adopted Budget Projection Projection2010-2011 2011-2012 2012-2013

34

Better Case Scenario



Total Revenues 498,699,436 186,028,731 684,728,167 476,986,873 172,105,748 649,092,621 483,789,660 173,963,669 657,753,329

Certificated Salaries 240,833,407 87,780,005 328,613,412 266,640,669 89,948,171 356,588,840 272,201,647 91,669,491 363,871,138 Classified Salaries 67,279,480 35,640,823 102,920,303 68,602,275 35,997,231 104,599,506 69,288,297 36,350,203 105,638,500 Employee Benefits 105,797,922 45,280,444 151,078,366 121,821,314 50,148,833 171,970,147 135,279,675 55,608,974 190,888,649 Books and Supplies 8,883,470 6,569,486 15,452,956 7,883,470 6,514,560 14,398,030 16,883,470 6,490,253 23,373,723 Services, Other Operating Expenses 26,271,456 34,239,664 60,511,120 26,835,338 33,513,328 60,348,666 26,199,286 33,393,980 59,593,266 Capital Outlay 1,166,358 188,933 1,355,291 1,166,358 188,933 1,355,291 1,166,358 188,933 1,355,291 Other Outgo - 157,733 157,733 - 157,733 157,733 - 157,733 157,733 Transfers - Indirect and Direct Costs (9,363,283) 7,828,789 (1,534,494) (8,221,283) 8,990,680 769,397 (8,221,283) 9,298,137 1,076,854 Board Approved Reductions 9-7-10 (9,783,000) (725,000) (10,508,000) (2,775,000) (725,000) (3,500,000) (2,775,000) (725,000) (3,500,000) Shift to use jobs bill funds - (14,000,000) 14,000,000 - - Other Adjustments - - - - - - (92,000,000) - (92,000,000)


Interfund Transfers 12,360,035 35,849 12,395,884 12,360,035 32,141 12,392,176 12,360,035 32,141 12,392,176 Contributions (47,219,784) 47,219,784 - (51,993,608) 51,993,608 - (56,743,935) 56,743,935 -


Net Inc/(Dec) to Fund Balance 8,033,807 16,251,789 24,285,596 (55,319,911) (14,667,254) (69,987,165) (3,336,760) (1,757,241) (5,094,001)



Adopted Budget only Projection Projection2010-2011 2011-2012 2012-2013

35

Better Case Scenario – Includes Non-Rep and CSEA Unit A



Total Revenues 498,699,436 186,028,731 684,728,167 476,986,873 172,105,748 649,092,621 483,789,660 173,963,669 657,753,329

Certificated Salaries 240,833,407 87,780,005 328,613,412 266,640,669 89,948,171 356,588,840 272,201,647 91,669,491 363,871,138 Classified Salaries 67,279,480 35,640,823 102,920,303 68,602,275 35,997,231 104,599,506 69,288,297 36,350,203 105,638,500 Employee Benefits 105,797,922 45,280,444 151,078,366 121,821,314 50,148,833 171,970,147 135,279,675 55,608,974 190,888,649 Books and Supplies 8,883,470 6,569,486 15,452,956 7,883,470 6,514,560 14,398,030 16,883,470 6,490,253 23,373,723 Services, Other Operating Expenses 26,271,456 34,239,664 60,511,120 26,835,338 33,513,328 60,348,666 26,199,286 33,393,980 59,593,266 Capital Outlay 1,166,358 188,933 1,355,291 1,166,358 188,933 1,355,291 1,166,358 188,933 1,355,291 Other Outgo - 157,733 157,733 - 157,733 157,733 - 157,733 157,733 Transfers - Indirect and Direct Costs (9,363,283) 7,828,789 (1,534,494) (8,221,283) 8,990,680 769,397 (8,221,283) 9,298,137 1,076,854 Board Approved Reductions 9-7-10 (9,783,000) (725,000) (10,508,000) (2,775,000) (725,000) (3,500,000) (2,775,000) (725,000) (3,500,000) Shift to use jobs bill funds - (14,000,000) 14,000,000 - - CSEA A Tentative Agreement (1,304,336) (702,335) (2,006,671) (2,687,237) (1,446,974) (4,134,211) (1,338,166) (720,551) (2,058,717) Non-Rep Changes (3,585,089) (1,536,467) (5,121,556) (863,393) (370,025) (1,233,418) Other Adjustments - - - - - - (82,000,000) - (82,000,000)




Net Inc/(Dec) to Fund Balance 9,338,143 16,954,124 26,292,267 (49,047,585) (11,683,813) (60,731,398) (11,135,201) (666,665) (11,801,866)




36

Best Case Scenario



Total Revenues 498,699,436 186,028,731 684,728,167 488,986,873 173,405,748 662,392,621 493,789,660 175,263,669 669,053,329

Certificated Salaries 240,833,407 87,780,005 328,613,412 266,640,669 89,948,171 356,588,840 272,201,647 91,669,491 363,871,138 Classified Salaries 67,279,480 35,640,823 102,920,303 68,602,275 35,997,231 104,599,506 69,288,297 36,350,203 105,638,500 Employee Benefits 105,797,922 45,280,444 151,078,366 121,821,314 50,148,833 171,970,147 135,279,675 55,608,974 190,888,649 Books and Supplies 8,883,470 6,569,486 15,452,956 7,883,470 6,514,560 14,398,030 16,883,470 6,490,253 23,373,723 Services, Other Operating Expenses 26,271,456 34,239,664 60,511,120 26,835,338 33,513,328 60,348,666 26,199,286 33,393,980 59,593,266 Capital Outlay 1,166,358 188,933 1,355,291 1,166,358 188,933 1,355,291 1,166,358 188,933 1,355,291 Other Outgo - 157,733 157,733 - 157,733 157,733 - 157,733 157,733 Transfers - Indirect and Direct Costs (9,363,283) 7,828,789 (1,534,494) (8,221,283) 8,990,680 769,397 (8,221,283) 9,298,137 1,076,854 Board Approved Reductions 9-7-10 (9,783,000) (725,000) (10,508,000) (2,775,000) (725,000) (3,500,000) (2,775,000) (725,000) (3,500,000) Shift to use jobs bill funds (14,000,000) 14,000,000 - Other Adjustments - - - - - - (70,000,000) - (70,000,000)




Net Inc/(Dec) to Fund Balance 8,033,807 16,251,789 24,285,596 (43,319,911) (13,367,254) (56,687,165) (15,336,760) (457,241) (15,794,001)




37

Best Case Scenario – Includes Non-Rep and CSEA Unit A



Total Revenues 498,699,436 186,028,731 684,728,167 488,986,873 173,405,748 662,392,621 493,789,660 175,263,669 669,053,329

Certificated Salaries 240,833,407 87,780,005 328,613,412 266,640,669 89,948,171 356,588,840 272,201,647 91,669,491 363,871,138 Classified Salaries 67,279,480 35,640,823 102,920,303 68,602,275 35,997,231 104,599,506 69,288,297 36,350,203 105,638,500 Employee Benefits 105,797,922 45,280,444 151,078,366 121,821,314 50,148,833 171,970,147 135,279,675 55,608,974 190,888,649 Books and Supplies 8,883,470 6,569,486 15,452,956 7,883,470 6,514,560 14,398,030 16,883,470 6,490,253 23,373,723 Services, Other Operating Expenses 26,271,456 34,239,664 60,511,120 26,835,338 33,513,328 60,348,666 26,199,286 33,393,980 59,593,266 Capital Outlay 1,166,358 188,933 1,355,291 1,166,358 188,933 1,355,291 1,166,358 188,933 1,355,291 Other Outgo - 157,733 157,733 - 157,733 157,733 - 157,733 157,733 Transfers - Indirect and Direct Costs (9,363,283) 7,828,789 (1,534,494) (8,221,283) 8,990,680 769,397 (8,221,283) 9,298,137 1,076,854 Board Approved Reductions 9-7-10 (9,783,000) (725,000) (10,508,000) (2,775,000) (725,000) (3,500,000) (2,775,000) (725,000) (3,500,000) Shift to use jobs bill funds (14,000,000) 14,000,000 - CSEA A Tentative Agreement (1,304,336) (702,335) (2,006,671) (2,687,237) (1,446,974) (4,134,211) (1,338,166) (720,551) (2,058,717) Non-Rep Similar Concessions (3,585,089) (1,536,467) (5,121,556) (863,393) (370,025) (1,233,418) Other Adjustments - - - - - - (60,000,000) - (60,000,000)




Net Inc/(Dec) to Fund Balance 9,338,143 16,954,124 26,292,267 (37,047,585) (10,383,813) (47,431,398) (23,135,201) 633,335 (22,501,866)




38

Summary of Board-Adopted Budget Reductions

Phase Board Action Date Approved AmountEstimated

Savings Budgeted

I 12-15-2009 $ 17,700,000 $ 17,820,087

II1-27-2010 &

2-9-201038,180,634 33,891,991

III 3-2-2010 1,922,000 1,922,000

IV 6-8-2010 3,600,000 3,700,000

V 9-7-2010 20,244,665 20,244,665

I 11-2-2010 3,403,435 3,403,435

Total $ 85,050,734 $ 80,982,178

39

Proposed Staff Recommendation for Reductions—November 9, 2010

DescriptionOn-

GoingOne-Time

Estimates

1

Implement the following for non-represented employees:

(a) Up to 7 furlough days for FY 2011-12 (b) Step and column advancement is

suspended for FY 2011-12 (c) Effective 1-1-2012, non-represented

employees contribute 5% towards their District health and welfare benefit insurance costs *

267,5462,989,24

33,256,78

9

2Central office re-organization with a reduction of 3 FTEs

329,720 329,720

Total 597,2662,989,24

33,586,50

9

* The contribution estimate for FY 2011-12 is $267,546 for a half-year implementation. A full-year estimate is $535,092.

40

Potential Savings Ideas

Close small schools

Freeze certificated and classified hiring

Consider staffing calendar changes, such

as from 12- to 10-month

Evaluate programs and services

Continue to implement procedures related

to efficiencies and effectiveness

41

November 2010 Election Results

Governor — Jerry Brown

Superintendent of Public Instruction — Tom

Torlakson

Proposition 22 — Passed — Prohibits the state from

delaying the distribution of tax revenues for

transportation, redevelopment, or local government

projects and services. It also prohibits redirection of

redevelopment property revenues and temporarily

shifting property taxes from cities, counties, and

special districts to schools

42

November 2010 Election Results Proposition 25 — Passed — Reduces votes needed to

pass the State Budget from two-thirds to simple majority

Proposition 26 — Passed — Reclassifies certain fees

and charges as taxes and therefore, increases the vote

threshold for the Legislature to pass them from simple

majority to two-thirds

Proposition 24 — Failed — Repeals 3 business tax

provisions. This means that the state will not be getting

the estimated $1.3 billion increase from increased

business taxes, about half of which would have gone to

K-14 education

43

The Value of Education —Unemployment Rate by Levels of Highest Education

Source: U.S. Department of Labor, Bureau of Labor Statistics, Current Population Survey – September 2010

No High School Diploma

High School Completed, No College

Some College, No Degree

Bachelor’s or Higher Degree

All Education Levels — 9.6%

44

The Value of Education —Earnings

Education, especially K-12, is critical to the economic success of individuals and our state as a whole

Personal income accounts for more than half of state General Fund revenues

Educational attainment affects earnings

Source: U.S. Census, Education Attainment in the United States, 2009

45

Our Mission

To support the personal and

intellectual success of

every student, every day

46

Thank You School Services of California

School Innovations & Advocacy (SI&A)

Most of all,

Susan Ginder and Fiscal Services team

Chief Business and Financial Officer, Kim Stallings

Superintendent, Christopher Steinhauser

Board of Education

From Betty Ng, Financial

Services Officer

Documents

Long Beach Unified School District Budget Update Including Impact of Adoption of 2010-2011 State Budget Presented at Board of Education Workshop November