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December 15, 2010. Financial Overview of General Fund October State Adopted Budget Cash Flow Issues Multi-Year Projections Based on States October Budget.

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Presentation on theme: "December 15, 2010. Financial Overview of General Fund October State Adopted Budget Cash Flow Issues Multi-Year Projections Based on States October Budget."— Presentation transcript:

1 December 15, 2010

2 Financial Overview of General Fund October State Adopted Budget Cash Flow Issues Multi-Year Projections Based on States October Budget Based on most likely scenario in January 2011 Districts Plan Federal Jobs Funds Class-Size Reduction K Fiscal Year 12/7/ First Interim

3 12/7/ First Interim 3 Combined General Fund (in millions) Actuals Adopted Budget First Interim Change a. Beginning Balance $ 28.9$ 23.1$ 26.2$ 3.1 b. Revenues $ 177.3$ 164.7$ 174.9$ 10.2 c. Expenses $ 180.0$ 168.5$ 177.4$ 8.9 d. Surplus/(Deficit) ($ 2.70)($ 3.8)($ 2.5)$ 1.3 e. Ending Balance $ 26.2$ 19.3$ 23.7$ 4.4 f. Economic Uncertainty $ 5.4$ 6.5$ 5.3($ 1.2) g. Restricted Balances $ 10.5$ 2.3$ 2.2($ 0.1) h. Other Reserves * $ 10.4$ 10.5$ 16.2$ 5.7

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5 12/7/ First Interim 5

6 12/7/ First Interim

7 Shortfall anticipated in June Mid-month cash balances in December through June will be significantly lower than month-end cash balances shown on cash flow analysis $15 million TRAN issued on July 1, 2010 to be re- paid by March 2011 $15 million mid-year TRAN available in March 2011 to be repaid by September 2011 Federal Jobs money help to mitigate cash flow problems in current year 12/7/ First Interim

8 Assumptions a. Beginning Balance$ 26.2$ 23.7$ 18.1 b. Revenues/Contributions$ 174.9$ 173.3$ Revenue Limit increased $270/ADA c. Expenses/Transfers Out$ 177.4$ 178.9$ 183.3CSR Restored in d. Surplus/(Deficit)($ 2.5)($ 5.6)($ 12.30) $4.2M Federal Jobs funds cover salaries in e. Ending Balance (a + d)$ 23.7$ 18.1$ 5.8 Budget Reductions/Added Revenue Needed to maintain 3% Reserve $ 0 f. Required Ending Balance $ 5.3$ 5.4$ /7/ First Interim Multi-Year Projection (in millions)

9 (Scenario if Budget is Reduced in January) projection Mid-year reduction to Revenue Limit of at least $270/ADA (If Prop 98 is reduced there could be an additional $330/ADA reduction) Reduced Revenue limit at level Federal Jobs funds used to backfill expired ARRA funds Revenue limit at level Ending balance projected at ($9.2) million Federal Jobs money depleted Reinstate K-3 CSR to 20:1 staffing ratio (Flexibility Expires) Bargaining unit agreements continue reduced salaries/work year All other flexibility options expire June 2013, including: 175 day school year Categorical flexibility Required contributions to routine/deferred maintenance 12/7/ First Interim 9

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11 12/7/ First Interim Assumptions a. Beginning Balance$ 26.2$ 18.7$ 8.1 b. Revenues/Contributions$ 169.9$ 168.3$ Revenue Limit Reduced by $270/ADA c. Expenses/Transfers Out$ 177.4$ 178.9$ 183.3CSR reinstated to 20:1 d. Surplus/(Deficit)($ 7.5)($ 10.6)($ 17.30) $4.2M Federal Jobs funds cover salaries in e. Ending Balance (a + d)$ 18.7$ 8.1($ -9.2) Budget Reductions/Added Revenue Needed to maintain 3% Reserve $ 15.7 f. Required Ending Balance$ 5.3$ 5.4$ 5.5 Multi-Year Projection (in millions) Assumes $5 million reduction to revenue limit funding in all years

12 Up to $15 million in solutions may be necessary by Potential budget balancing solutions could include: Increase revenue through grants and/or other funding sources Reduce/eliminate extra-curricular activities Reduce/eliminate K-3 CSR Reduce/eliminate school security Staffing reductions in all areas Salary/benefit concessions 12/7/ First Interim 12


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