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Budget Update Town Hall Meeting Diana Keelen November 27, 2012 “While the California budget is uncertain, there is one thing that is certain, it will change.”

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Presentation on theme: "Budget Update Town Hall Meeting Diana Keelen November 27, 2012 “While the California budget is uncertain, there is one thing that is certain, it will change.”"— Presentation transcript:

1 Budget Update Town Hall Meeting Diana Keelen November 27, 2012 “While the California budget is uncertain, there is one thing that is certain, it will change.”

2 PROPOSITION 30 PASSED!!! – But we’re not out of the woods, yet…

3 Now What? Not a permanent solution. Only prevents extreme cuts, not a bunch of new revenue. Expires in Not a permanent solution. Only prevents extreme cuts, not a bunch of new revenue. Expires in Prevents $338 million (7.3%) workload reduction Prevents $338 million (7.3%) workload reduction Plan to buy down $159M of $961M deferral. AVC’s deferral goes from $14 mil to $11.7 mil first year Plan to buy down $159M of $961M deferral. AVC’s deferral goes from $14 mil to $11.7 mil first year $50 million in growth or $426K for AVC. $50 million in growth or $426K for AVC. Details of Education Protection Account (EPA) still being worked out. Details of Education Protection Account (EPA) still being worked out. Prop 98 is still subject to manipulation by the legislature Prop 98 is still subject to manipulation by the legislature

4 Education Protection Account Revenues earned for Prop 30 will go into a reserve account that cannot be touched by the legistlature Revenues earned for Prop 30 will go into a reserve account that cannot be touched by the legistlature 11% goes to CCCs and 89% goes to K-12 11% goes to CCCs and 89% goes to K-12 Cannot be used for “administrative salaries” or “audits” Cannot be used for “administrative salaries” or “audits” Definitions being worked out. Restricted or unrestricted??? Definitions being worked out. Restricted or unrestricted??? P1 not yet issued…a lot of unknowns P1 not yet issued…a lot of unknowns

5 Reminder of What Happened in Reductions That Have Been Implemented Fiscal Year Workoad % ApportionmentBaseFTES New Base Head Count Initial Workload Reduction %($3,223,949)11,371(706)10,665(1,484) Additional Deficit due to $23 mil in base funding increase from and with no state funding increase (2 new colleges, several new centers and natural increases to basic allocation) ($129,285) Tier 1 Deficit Co-Efficent ($309,085) Tier 2 Additional Workload Reduction -1.52%($741,526) (162)10,502(341) Student Fee Deficit Co-Efficient/P-Tax Shortfall ($1,389,460) Total Reductions -7.74%($5,793,305) (869) (1,825) AVC Deferrals $2,769, $7,560, $9,856, $11,892, $14,165,447

6 Adopted Budget vs. Prop 30 Passing As of PRELIMINARY-FOR PLANNING PURPOSES ONLY Adopted Budget Prop 30 Passed Prop 30 Passing Difference from Adopted Budget BEGINNING FUND BALANCE 7,502,546 REVENUE Federal21, State43,138,16947,219,8614,081, Local8,763,4838,789,05125,568 Total Revenue51,923,53556,030,7954,107,260 REVENUE PLUS BEGINNING FUND BALANCE 59,426,08163,533,341 EXPENDITURES Academic Salaries24,421,85125,572,8211,150, Classified Salaries10,790,31510,743,736(46,579) Employee Benefits11,101,56311,077,516(24,047) Supplies832,9271,032,927200, Other Operating Costs5,492,3725,612,372120, Capital Expenditures264,593 0 Total Expenditures52,903,62154,303,9651,400, Other Outgo2,117,0581,944,058 Total Expenditures & Other Outgo55,020,67956,248,023 Ending Fund Balance4,405,4027,285,318 Surplus/(Deficit)(3,097,144)(217,228) Reserve % 8.01%12.95% Funded FTES Assumptions ( Includes growth) 9,73210, Targeted FTES Assumptions 1% above funded 9,82910,699870

7 Difference Between Expenditures Adopted Budget and Prop 30 Passage ChangeIncreaseDecreaseTotal Workload Reduction Added Back in of 7.33%-767 FTES $ 1,025, FTES Growth $ 125,658 Reduced Outreach Services $70,627 TRAN Borrowing Increase$120,000 Classroom Materials Increase$100,000 Facilities Materials Increase$100,000 Total Increase (Decrease)$1,470,970$70,627$1,400,343

8 Assumptions to Out-Year Projections Assumptions: Property Tax shortfall in Roughly $780K Flat revenue in through Risk: No increase to benefits in the outyears above what is tied to step & column increases Eliminated outreach program specialist starting in mid Other Post Employment Benefits (OPEB) trust not established until projected deficit mainly due to Election costs that year 20% reduction in Security Contract starting in Increase in interest expense by $120K Reduced interest expense starting in due to deferral buydown $100K increase in instructional supplies starting in $100K increase in facilities supplies starting in

9 Estimates and 3 Year Projection As of PRELIMINARY-FOR PLANNING PURPOSES ONLY Prop 30 Passed Projected Budget Projected Budget Projected Budget BEGINNING FUND BALANCE 7,502,5467,285,3187,304,6387,449,651 REVENUE Federal21,88320, State47,219,86147,987, Local8,789,0518,890,397 8,957,805 Total Revenue56,030,79556,899,080 56,966,488 REVENUE PLUS BEGINNING FUND BALANCE 63,533,34164,184,39864,203,71864,416,139 EXPENDITURES Academic Salaries25,572,82125,731,19825,891,15926,052, Classified Salaries10,743,73610,841,56510,940,37111,040, Employee Benefits11,077,51611,133,64311,190,33111,247, Supplies1,032, Other Operating Costs5,612,3725,784,2645,276,2255,761, Capital Expenditures264,593284,593286,927289,330 Total Expenditures54,303,96554,808,18954,617,94055,423, Other Outgo1,944,0582,071,5712,136,1272,200,802 Total Expenditures & Other Outgo56,248,02356,879,76056,754,06757,624,595 Ending Fund Balance7,285,3187,304,6387,449,6516,791,544 Surplus/(Deficit)(217,228)19,320145,013(658,107) Reserve % 12.95%12.84%13.13%11.79% Funded FTES Assumptions ( Includes growth)10,593 Targeted FTES Assumptions 1% above funded10,699

10 Questions?


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