The Riverbank Unified School District must make budget cuts, preferably starting in 2012-2013, financial expert Teresa Ryland of the Stanislaus County Office of Education advised the board as it neared the end of an hour's presentation on April 17.
Between a current deficit of $1 to 1.2 million per year, relying on prior one time federal funds, ongoing costs like salary step movement and the need to prepare for mid-year cuts that the state may impose next year, the district has an inbuilt financial problem running into the foreseeable future.
The current imbalance in the budget will grow to $2 million in deficit spending within two years unless there are cuts and will leave the district without a customary 3 percent reserve.
In the best case scenario, Ryland said a projection over the next two to three years indicates the district must reduce its expenditures or increase its revenues by $400,000 for 2012-2013 and by another $400,000 in 2013-14.
In a worst case scenario where the Governor fails to pass his proposed taxes in November and makes further funding cuts for schools, the deficit will grow to $3 million in two years and the district will be $2.5 million short of fund balance.
Even in the best case scenario - with the taxes passing and no mid-year cuts next year - the deficit will grow to $2 million and there will be insufficient cash to cover district obligations. The district will be rated fiscally insolvent and its budget in danger of not being approved by the County Office of Education in June.
Cuts made early will yield savings during this budget year and the next of $1.2 million.
As to possible budget cuts for 2012-2013, it is too late (potential layoff notices were due in March) to make certificated cuts for next year so all staff cuts must involve non-certificated reductions. Other possible cuts would be in reducing transportation services, not filling a vacant teaching position; filling the post of a retiring teacher with a younger, less costly teacher and reducing the stipends and insurance benefits of board members, she suggested.
For 2013-14, trustees should look at reducing teacher positions, negotiating furlough days and reducing counseling services.
The proposed state budget (with the taxes passing) continues to defer paying almost $8 billion statewide in school district apportionments. That brings deferral of state aid, as of June of 2013, to under 30 percent of annual state aid. But by that date the district must pay 100 percent of its bills, including payroll. That can only be handled in a district with enough cash and a balanced budget. For Riverbank, the deferral amounts to about $2 million.
Between a current deficit of $1 to 1.2 million per year, relying on prior one time federal funds, ongoing costs like salary step movement and the need to prepare for mid-year cuts that the state may impose next year, the district has an inbuilt financial problem running into the foreseeable future.
The current imbalance in the budget will grow to $2 million in deficit spending within two years unless there are cuts and will leave the district without a customary 3 percent reserve.
In the best case scenario, Ryland said a projection over the next two to three years indicates the district must reduce its expenditures or increase its revenues by $400,000 for 2012-2013 and by another $400,000 in 2013-14.
In a worst case scenario where the Governor fails to pass his proposed taxes in November and makes further funding cuts for schools, the deficit will grow to $3 million in two years and the district will be $2.5 million short of fund balance.
Even in the best case scenario - with the taxes passing and no mid-year cuts next year - the deficit will grow to $2 million and there will be insufficient cash to cover district obligations. The district will be rated fiscally insolvent and its budget in danger of not being approved by the County Office of Education in June.
Cuts made early will yield savings during this budget year and the next of $1.2 million.
As to possible budget cuts for 2012-2013, it is too late (potential layoff notices were due in March) to make certificated cuts for next year so all staff cuts must involve non-certificated reductions. Other possible cuts would be in reducing transportation services, not filling a vacant teaching position; filling the post of a retiring teacher with a younger, less costly teacher and reducing the stipends and insurance benefits of board members, she suggested.
For 2013-14, trustees should look at reducing teacher positions, negotiating furlough days and reducing counseling services.
The proposed state budget (with the taxes passing) continues to defer paying almost $8 billion statewide in school district apportionments. That brings deferral of state aid, as of June of 2013, to under 30 percent of annual state aid. But by that date the district must pay 100 percent of its bills, including payroll. That can only be handled in a district with enough cash and a balanced budget. For Riverbank, the deferral amounts to about $2 million.
