Second Interim ReportContext Slides

Scott S. Price, Ph.D.

March 13, 2018

1

Budget Calendar

Governor’s January Budget

Second Interim Budget

School Budget

Development

Governor’s May Revise

Final Budget

2

Ending Balance Reserves

3

Second Interim Updates – 2017-18 to 2019-20(including Governor’s January Budget Proposal)

Full Funding ofLocal Control Funding Formula

$137 m

Discretionary Funds($295 per student)

$140 m

Raising Cost of Living (2.15% to 2.51%)

$40 m

Health Care Agreement Savings

~$200 m

Fund Other Post Employment Benefits (OPEB)

$150 m= one-time funds 4

Each New Budget Adds a Subsequent Third Year

2017-18 2018-19 2019-20

2020-212018-19 2019-20

2017-18 Budget

2018-19 Budget

5

2017-18 Budget Required a Fiscal Stabilization Plan

2017-18 2018-19 2019-20

2020-212018-19 2019-20

2017-18 Budget

2018-19 Budget

FiscalStabilization

Plan

6

The 2018-19 Budget Will Require an AdditionalFiscal Stabilization Plan for the Year 2020-21

2017-18 2018-19 2019-20

2020-212018-19 2019-20

2017-18 Budget

2018-19 Budget

FiscalStabilization

Plan

FiscalStabilization

Plan 7

Growth in LCFF Revenues

8

Growth in LCFF Revenues

9

Enrollment Decline

556,115 542,433

528,065

513,875 500,782

484,830

469,467 457,111

350,000

400,000

450,000

500,000

550,000

600,000

2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 2020-21

Enrollment

10

Final Budget Second Interim

Fiscal Stabilization Plan ElementsAdopted 2017-18

Adopted 2018-19

Adopted 2019-20

Revised 2017-18

Revised 2018-19

Revised 2019-20

Central Office Reduction and Efficiencies $ 79.9 $ 79.9 $ 79.9 $ 79.9 $ 79.9 $ 79.9 Implemented in 2017-18 - Ongoing

Central Office Clerical Reduction allocated to school sites

$ (4.1) $ (4.1) $ (4.1) $ (4.1) $ (4.1) $ (4.1) Implemented in 2017-18 - Ongoing

Resolution of Disproportionality Issue $ 20.0 $ 20.0 $ 20.0 $ 20.0 $ 20.0 $ 20.0 Implemented in 2017-18 - Ongoing

Shifting of Telecom Maintenance Funding $ 4.4 $ 4.7 $ 5.0 $ 4.4 $ 4.7 $ 5.0 Implemented in 2017-18 - Ongoing

Change in RRGM Funding $ 5.0 $ 5.0 $ 5.0 $ 5.0 $ 5.0 $ 5.0 Implemented in 2017-18 - Ongoing

Elimination of scheduled Other Post Employment Benefits (OPEB)

$ - $ 150.0 $ 200.0 $ - $ 150.0 $ 200.0 Assign portion of OPEB contribution for

2018-19 and 2019-20

Redirection of School Site Carryover $ - $ - $ 246.0 $ - $ - $ - Postpone until 2020-21

Equivalent to Class Size Increase by 4 (approximately 1,000 FTE)

$ - $ - $ 76.0 $ - $ - $ - Reversed at First Interim

Total Fiscal Stabilization Plan $ 105.2 $ 255.5 $ 627.8 $ 105.2 $ 255.5 $ 305.8

Completed

Reversed

Fiscal Stabilization Plan

11

Other Considerations

• Second Interim “positive” certification is temporary.

• A Fiscal Stabilization Plan will be needed in June 2018.

• Collective Bargaining is ongoing and not reflected in Second Interim.

• Federal funding uncertainties exist.

• May Revision changes are still anticipated.

12

Questions?

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