1. March 1, 2011

2.  Ask voters to extend current temporary taxes which are due to expire at the end of June 2011  Two possible outcomes With passage of ballot to extend temporary taxes, school districts would be funded at slightly lower levels (flat funding) With defeat of ballot to extend temporary taxes, K-12 education could face additional significant cuts to revenues

3.  Based on current Prop. 98 funding, K-12 education would lose $349 per ADA of funding This is K-12 education’s share of the dollars which would be raised by the extension of the temporary taxes Any other dollar amount would require a change in current law  It is also assumed that the shift of dollars from Prop. 63 to pay for county mental health services would not materialize

4.  SDCOE directive to all school districts in the county: Assume that the ballot measure will fail and plan for a minimum $349 per ADA reduction  This scenario would reduce revenues for 2011-2012 by $2.1 million  Assume that the shift of Prop. 63 dollars will not occur

5.  With the current 1 st Interim projection for 2011-2012  Combined with the possibility of higher than projected health insurance rates  RUSD is faced with dealing with the minimum of a $2.1 million cut

6.  To be able to have certificated layoffs for 2011-2012, preliminary notices must be ratified and handed out to employees by March 15 th Before the June election Before any vote by the legislators is taken Before any school districts’ budgets are adopted  Probationary 1 teachers are receiving preliminary notices due to current Education Code allowing laid off tenured teachers the right to substitute teach at their per diem rate of pay

7.  The combination of retirements and reductions to Probationary 1 teachers will yield an anticipated $700,000  Little dollars are left to flex or take  Difficult to get any significant savings from other departments  All one-time Federal dollars will be gone  RUSD’s own reserve is projected to be depleted except for the 3% reserve  Class sizes are high K-3 class size penalties, combined with current law of per diem pay to laid-off tenured teachers, severely limits the financial gain to increase K-3 class size

8.  If this scenario becomes the reality RUSD will need to look at employee concessions for financial relief  Over 85% of expenses are in salaries and benefits  2012-2013 becomes a financial catastrophe

9. 2010-2011 2011-2012 2012-2013 Beginning Balance $ 7,329,658 $ 3,763,486 $ (1,528,751) Revenues $ 49,499,257 $ 43,815,641 $ 44,016,973 Total Revenues $ 56,828,915 $ 47,579,127 $ 42,488,222 Expenditures $ 53,954,429 $ 50,065,847 $ 51,583,104 Transfers In/Out $ 889,000 $ 957,969 $ 89,000 Ending Balance $ 3,763,486 $ (1,528,751) $ (9,005,882)