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Recap of Prior Year 2010-11 and Adopted Budget 2011-12 Recap of Prior Year 2010-11 and Adopted Budget 2011-12 Presented by: Ann-Marie Gabel September 29,

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Presentation on theme: "Recap of Prior Year 2010-11 and Adopted Budget 2011-12 Recap of Prior Year 2010-11 and Adopted Budget 2011-12 Presented by: Ann-Marie Gabel September 29,"— Presentation transcript:

1 Recap of Prior Year and Adopted Budget Recap of Prior Year and Adopted Budget Presented by: Ann-Marie Gabel September 29,

2 Overview Recap of Prior Year Adopted Budget Major Assumptions Used Other Assumptions Used from State and/or BAC FTES History and Projection List of All District Funds – Expenditures & Other Outgo Recap of Prior Year and Adopted Budget September 29,

3 Overview (continued) Expenditure Reductions Unrestricted General Fund Details Overall Summary Revenue Summary Major Revenue Changes in Expenditure Summary Major Expenditure Changes in Reserves Breakdown between Fixed and Discretionary Budgets Future Budget Challenges 3 Recap of Prior Year and Adopted Budget September 29, 2011

4 Recap of Prior Year Budget – Key Dates 9/28/10 – LBCC Adopted Budget Approved by Board 10/08/10 – Governor Schwarzenegger signed State budget 01/10/11 – Governor Brown presents January budget for Included no mid-year cuts as originally anticipated Recap of Prior Year and Adopted Budget September 29,

5 Recap of Prior Year Unrestricted General Fund - Overall Summary 5 Adopted Budget Estimated Actual at Tentative Unaudited Actual Change from Adopted Budget to Unaudited Actual Revenues and Other Financing Sources $ 104,137,706$ 108,876,001$ 109,145,155$5,007,449 Expenditures and Other Outgo 109,787,155106,866,779104,501,5895,285,566 Surplus/(Deficit)(5,649,449)2,009,2224,643,56610,293,015 Ending Fund Balance7,852,66615,511,33718,145,68110,293,015

6 Recap of Prior Year What caused the Change? 6 Recap of Prior Year and Adopted Budget September 29, 2011 Revenue Changes Growth Revenue Received2,281,374 0% COLA – Budgeted (0.38%)377,844 1% Deficit Factor – Budgeted 2%990,549 Prior Year Apportionment Adjustment513,868 Mandated Cost Revenue Received893,079 PT Faculty Compensation182,000 Other Revenue Changes(231,265) Total Revenue Changes$5,007,449

7 Recap of Prior Year What caused the Change? Expenditure Changes 5 Mid-Year Faculty Retirements & Reduced Workload Savings$501,038 Part-Time Faculty Budget Savings690,538 Part-Time Non Instructional Savings205,443 Classified Vacancies906,533 Benefit Savings577,446 Utility Savings333,065 TRANs Savings107,778 Legal273,838 Professional Services478,781 Instructional Service Agreement Contracts133,936 Online Licensing133,013 Other944,157 Total Expenditure Changes$5,285,566 7 Recap of Prior Year and Adopted Budget September 29, 2011

8 Recap of Prior Year Cash Balance in Unrestricted General Fund 8 Recap of Prior Year and Adopted Budget September 29, 2011 Cash in the County Treasury June 30, 2011$936,495 Includes Borrowing From Other Funds Capital Projects Fund$5,500,000 Retiree Health Fund2,000,000 Total Borrowed$ 7,500,000

9 Recap of Prior Year Fund Balance - Cash Balance 9 Recap of Prior Year and Adopted Budget September 29, 2011 Reconciliation Between Fund Balance & Cash in the County Treasury Fund Balance, June 30, 2011$18,145,681 Additions: Borrowed from Capital Projects Fund5,500,000 Borrowed from Retiree Health Fund2,000,000 Other Liabilities4,199,389 Deductions: Receivable from Chancellor’s Office - Deferrals(20,539,984) Other Assets(8,368,591) Cash in the County Treasury, June 30, ,495

10 Adopted Budget Major Assumptions Used 10 State Budget Board Goals BAC Assumptions Zero (0%) COLA No Growth Funding $290 million reduction - $5.9 million for LBCC 1% Deficit Factor Commitment to Reduce Deficit Spending Maintain a 5% General Fund Reserve Reserve for campus maintenance and IT functions Focus on Advancement of Student Success Plan 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)

11 Adopted Budget Other Assumptions Used from State and/or BAC State Budget included: Student fee increase of $10 to $36 per unit No restoration of categorical fund cuts Increased deferrals $129 million to $961 million - $24.6 million for LBCC 11 Recap of Prior Year and Adopted Budget September 29, 2011

12 Adopted Budget Other Assumptions Used from State and/or BAC BAC Assumptions included: Part-time hourly budget will contain sufficient dollars to meet the FTES target in accordance with class schedules Class Schedule Target set at 19,907 FTES Revenue Target set at 19,618 FTES 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% 12 Recap of Prior Year and Adopted Budget September 29, 2011

13 13 FTES History and Projection Total 21,529 Total 21,162 Budget Annual Total 21,036

14 List of Funds – Expenditures & Other Outgo (in millions) 14 Adopted Budget Unaudited Actual Adopted Budget Unrestricted General Fund$ 109.8$ 104.5$ Restricted General Fund Capital Projects Fund Child & Adult Development Fund Contract/Community Education Fund General Obligation Bond Funds Retiree Benefits Fund Self-Insurance Fund Student Financial Aid Vet Stadium Operations Total$ 669.4$ 248.3$ 662.8

15 Expenditure Reductions Expenditure Reductions - $5.8 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, Recap of Prior Year and Adopted Budget September 29, 2011

16 Expenditure Reductions Expenditure Reductions - $5.8 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 - $738,000 Cut discretionary budgets approximately 20% - $887, Recap of Prior Year and Adopted Budget September 29, 2011

17 Unrestricted General Fund Overall Summary 17 Unaudited Actual Adopted Budget 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)

18 Unrestricted General Fund Revenue Summary 18 Unaudited Actual Adopted Budget 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)

19 Major Revenue Changes in 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 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. 19 Recap of Prior Year and Adopted Budget September 29, 2011

20 Unrestricted General Fund Expenditure Summary 20 Unaudited Actual Adopted Budget 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

21 Major Expenditure Changes in Academic Salaries – overall $1.1 million increase is due to hiring 15 new faculty, and the expiration of the % 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. 21 Recap of Prior Year and Adopted Budget September 29, 2011

22 Major Expenditure Changes in Major Expenditure Changes in (continued) Services – overall $1.8 million increase primarily due to rollover budgets and cost conscious measures during by all departments. Major increase related to Election Costs estimated at $450, Recap of Prior Year and Adopted Budget September 29, 2011

23 23 Salaries & Benefits 87.0% Unrestricted General Fund Budgeted Expenditures

24 Unrestricted General Fund Reserves 24 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

25 Unrestricted General Fund Breakdown Between Fixed & Discretionary Budgets (Summary Multiyear Comparison – Total Costs) Adopted Budget Adopted Budget Adopted Budget 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, %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, %17.01%16.31% Total Expenditures$113,265,418$109,787,155$109,834, Recap of Prior Year and Adopted Budget September 29, 2011

26 26 Recap of Prior Year and Adopted Budget September 29, 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

27 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 Economic recovery appears slower than projected 27 Recap of Prior Year and Adopted Budget September 29, 2011

28 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) State’s structural budget deficit projected into 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 28 Recap of Prior Year and Adopted Budget September 29, 2011

29 Questions? 29 Recap of Prior Year and Adopted Budget September 29, 2011


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