Budget Workshop
Board Report – December 16, 2009
212/16/2009
Presentations Changes: 12/16/09 Versionfrom 12/11/09 Version
The Presentation distributed on 12/11/09 was changedin this version as follows:1. General Fund Update – Old slide #13 replaced with new slide #132. Services and Other Operating Expenses – Old slide #16 replaced with new slide #163. Hiring/Spending Freeze – Old slide #20 deleted replaced with Projected 2010/11
Deficit new slide #204. Salary Rollback Savings – Old slide #21 replaced with new slide #235. One Day Furlough – Old slide #22 replaced with new slide #226. New slide #25 inserted – Unfilled vs. Vacancy Rates7. Potential Hiring Freeze Savings Old slide #25 replaced with new slide #268. New hires/rehires- old slide # 26 deleted9. Priority Based Budgeting – Old slide #39 replaced with new slides #39 & #4010. Timeline – Old slide # 43 replaced with new slide #44
312/16/2009
Agenda
• Opening Remarks• Legislative/Stakeholder Outreach Update• Financial Update• Human Resources Update• BRACE Update• Priority-Based Budgeting• Next Steps• Closing Remarks• Board Discussion
412/16/2009
Board Budget Workshop Opening Comments
• Continuing the November Budget Workshop Discussion• Legislative and Stakeholder Updates• Financial Update
– $220 Million– Cost Cutting Efforts – Savings Potential– Funding Cliffs – Revenue Challenges
• HR Update Focusing on Vacancies and Hiring Updates• Build a Bridge from Zero-Based Budgeting to Priority-Based
Budgeting Concept – Board Adoption and Approval to Proceed - Tonight
• Additional BRACE Feedback• Next Steps – Moving Toward Decisions
512/16/2009
Legislative/Stakeholder Outreach Update
612/16/2009
State Budget: Outlook Uncertain
• State Deficit = $21 Billion• Education gets cut in bad economic
times• Federal Maintenance of Effort and
Prop 98 can be manipulated, suspended and/or waived
• Prop 98 and Maintenance of Effort protect stable funding
• K-12 education is a top public priority • 2010 is an election year
712/16/2009
Budget Cut Impact Estimates
812/16/2009
Legislative Advocacy For K-12 Funding
912/16/2009
ESEA & Race to the Top (RTTP): Application Process
1012/16/2009
Engagement of Stakeholders
• Town Hall Meetings– 5 Town Halls Completed
• Average attendance of 200 citizens per meeting• Other Community Presentations
– Employee Groups– Board Committees– Cluster Groups – Community Organizations
• Budget Suggestion Cards– Available at all schools and community meetings– More than 100 comments to date
• Website Blog – More than 300 comments
1112/16/2009
Stakeholder Input – What We Heard
• Keep Cuts Away from Students/Classrooms– Preserve Class Size Reduction
• Send a UNITED Message to Sacramento– Lobby for Flexibility and Abolish Archaic Laws & Mandates– Mobilize Parent Involvement and Advocacy
• Right-size Management and Non-School Site Positions• Investigate New Revenue Sources
– Parcel Tax– Corporate Support– Parent Contributions– Advertising
• Reduce/Eliminate/Charge for Bus Transportation• Stop Non-Mandated Testing
Financial Update
1312/16/2009
Previous Budget Reductions Summary
• 2008/09 - $90.0 million – $53.1 million
• Central Office- $35.0 million• School Sites- $18.1 million
– $46.1 million mid-year• Shift custodian cost to Redevelopment Agency Fund• Reduced purchase services• Tier III Categorical Flexibility Revenue Transfer• Expenditure shift General Fund unrestricted to categorical
• 2009/10 - $93.1 million• K-3 class size increase• Cut school supply budgets 25%• SERP
1412/16/2009
General Fund - Remaining Funds Update
Certificated Salaries, $25.36 , 7% Classified Salaries, $22.64 , 6%
Employee Benefits, $16.27 , 5%
Books and Supplies,
$48.39 , 14%
Services and Other
Operating Expenditures, $80.47 , 23%
Interprogram & Interfund Services/Transfers, $(62.26), -
18%
Capital Outlay, $10.24 , 3%Other Outgo, $(1.63), 0%
Reserves, $82.04 , 24%
Total General Fund Remaining $221.53 Million
1512/16/2009
Books & Supplies
Total Books & Supplies $48.3 Million
1612/16/2009
Materials & Supplies
Total Materials & Supplies $34.1 Million (53% schools)
1712/16/2009
Services and Other Operating Expenditures
Contracted Services >$25K, $32.86 , 41%
Travel and Conferences, $2.88 ,
4%Dues & Memberships,
$0.29 , 0%
Insurance, $0.85 , 1%
Operation & Housekeeping
Services, $15.50 , 19%
Rentals Leases & Repairs, $2.95 , 4%
Other Services & Operating Expenses,
$17.69 , 22%
Communications, $7.44 , 9%
Total Services and Other Operating
Expenditures $80.4 Million
1812/16/2009
Capital Outlay
Total Capital Outlay $10.2 Million
1912/16/2009
ARRA Funding Cliff
$0.1
$42.5
$69.3
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
$80.0
2009/10 2010/11 2011/12
Total ARRA Funding = $111 million
In M
illio
n’s
2012/16/2009
ARRA Funding Detail
Resource Number and Name Total Award Allocated* BalanceBudget FTE
3200X State Fiscal Stabilization Fund (SFSF) $52,080,865 $30,247,208 355.29 $21,833,657
*Certificated Positions
3011X Title I $31,817,241 $16,117,241 117.00 $15,700,000
*K-2 Class-Size Reduction (CSR), School Site Council Training, Grade 9 Student Mentoring/Leadership, Supplemental Education Services (SES)
3313X IDEA Basic Local Assistance $25,627,361 $21,209,043 276.28 $4,418,318
*Prof Dev, Instr. Behavior Interv and Assistive Tech, Expanded Certification Options, Transitional Supt and Parent Ed and Surveys, Research and On-going Consult. and Support
3324X IDEA Preschool LEA $1,395,907 $1,048,615 15.00 $347,292
*Prof Dev, Instructional Behavior Interventions, Parent Education and Surveys
3319X IDEA Part B Preschool $911,563 $647,765 9.03 $263,798
*Prof Dev, Instructional Behavior Interventions, Parent Education and Surreys
Grand Total $111,832,937 $69,269,872 772.60 $42,563,065
2112/16/2009
Projected 2010/11 Unrestricted General Fund Deficit –Incorporating Projected 2009/10 Ending Balance Surplus
2010 Reserve Surplus(from 1st Interim Report)
$11,320,899
Hiring Freeze/Vacancy Savings (70% of unrestricted 7 mo. savings)
$1,657,299
Spending Freeze savings $ 10,000,000
Additional BRACE savings $2,155,544New Projected 10/11 Beginning Balance(Available for deficit reduction)
$25,133,742
Projected 2010/11 Deficit(including $20M 2011/12 reduction)
($84,000,000)
Updated 2010/11 Deficit (With 09/10 savings)
($58,866,258)
Additional Projected State Cuts (mid-range)(TBD in Gov. Budget release 01/10)
($86,500,000)
Total Projected 2010/11 Deficit ($145,366,258)
2212/16/2009
Potential Hiring Freeze Savings
Union Code Vacant FTE 7 Months Vacant $ Vacant FTE 7 Months Vacant $ Vacant FTE 7 Months Vacant $ Vacant FTE 7 Months Vacant $Managers 5.20 327,050 5.05 111,142 11.97 600,800 22.22 1,038,992 Supervisors 3.91 116,023 9.80 429,873 11.29 419,674 25.00 965,570 SDEA * 15.02 577,173 22.64 997,033 22.31 687,957 59.97 2,262,164 OTBS 31.93 816,999 57.43 1,796,148 36.47 1,128,720 125.82 3,741,867 OSS (1.62) (7,804) 54.38 1,256,503 41.91 743,420 94.66 1,992,119 PARA 19.39 246,577 100.50 1,562,725 23.74 398,010 143.63 2,207,312 POA 10.00 291,551 10.00 291,551 Grand Total 83.82 2,367,570$ 249.79 6,153,423$ 147.69 3,978,581$ 481.30 12,499,574$
*SDEA excludes teacher job codes 2000-2299
Unrestricted Restricted Other Funds Total
Budgeted Unfilled Positions
70% of unrestricted 7 mo. Savings = $1,657,299
2312/16/2009
One Percent Salary Rollback to General Fund
• Total savings to unrestricted $6.4 million
UNION Unrestricted Restricted Total General FundSDEA 4,217,157$ 1,607,819$ 5,824,976$ POA 45,792 17,459 63,251 Paraeducators 444,977 169,651 614,628 OTBS 568,887 216,892 785,779 OSS 544,309 207,521 751,830 AASD 363,156 138,456 501,611 Non-Represented 168,947 64,412 233,359 TOTALS 6,353,226$ 2,422,209$ 8,775,435$
GENERAL FUND
2412/16/2009
One Day Furlough – Estimated Savings
• $2.6 million unrestricted savings per day
Bargaining Unit Unrestricted Restricted Other Fund TotalSDEA 1,972,569$ 879,445$ 43,898$ 2,895,911$ OSS 108,686 148,010 95,082 351,779 OTBS 199,540 84,329 26,484 310,353 POA 19,311 - - 19,311 Paraeducator 46,877 205,065 35,226 287,167 AASD - Supv 32,963 13,785 14,805 61,553 AASD - CERT 176,545 21,664 3,028 201,238 AASD - CLASS 29,466 6,321 4,284 40,071 Confidential 9,529 - 298 9,827 Total 2,595,486$ 1,358,619$ 223,105$ 4,177,210$
1 DAY REDUCTION
Cabinet level included in AASD - Class
2512/16/2009
School Year Adjustments – Legal Perspective
• Various scenarios – subject to negotiations• work year reduction• school year reduction• combination of both
• Law typically requires 180 day school year to avoid fiscal penalties
• Temporary flexibility to reduce the school year to 175 days without penalty– For the current year and the next three years
• There are no feasible options below a 175 day school year
2612/16/2009
Budget Reduction Alternatives to Conserve Education (BRACE)
2712/16/2009
BRACE - The SDUSD Central OfficeFindings and Definitions
• Central Offices Exists to Support the Schools and Provide District-Wide Oversight and Services
• Central Office Data is Inconsistent– Definitions change yearly
• Certain Atypical Schools are Currently Considered Central Office– They should be considered as schools
• Many District Staff Working Exclusively at Schools are Currently Included in Central Office Cost Centers– School-Based Personnel should not be considered
Central Office
2812/16/2009
BRACE - SDUSD Central Office
SDUSD School Based FTEs Included in Central Office Cost Centers
1,164.53 7.9%
SDUSD Central Office Based FTEs 1,819.30 12.3%
Total FTEs in Central Office Cost Centers 2,983.83 20%
TOTAL District employees (as of 9/09) 14,815
The BRACE Team Recommends that SDUSD Use the Following Data as the Baseline for Identifying Central Office Staff:
2912/16/2009
BRACE – Principal’s CommitteePriorities and Recommendations
• Key Priorities Identified:– Maintenance of Class Size Reduction at 24 to 1 (K-3)– Retention of Vice Principals– Increased School Site Budget Flexibility– Nursing and Counseling Support (Not Health Techs)– Priority for School Security and Safety– Increase K-8 Allocation at the Grade 6-8 Level– Audit Special Education Paraprofessional Services– Review and Training for School Site Clerical Staff– Support for Technology Needs – Consider Closing Under-Enrolled Elementary Schools– Restoration of the Reduced 25% Supply/Materials Allocation
• Additional Input from Other Stakeholder Groups will be Solicited
3012/16/2009
BRACE - Special Education Overview
• SDUSD Special Education Facts:– 16,000 students with IEPs– $265,825,972 of the $1.2 Billion SDUSD Budget (22%
of total)– $85,000,000 Local Contribution in 2009/10 (Inclusive of
ARRA funds, without ARRA $97,000,000)– 387 students (2.4%) Out-of-District Placements– Special Education has Cut Positions and Reorganized
Service Delivery Model
3112/16/2009
BRACE - Special Education Recommendations
• Complete a Full Review of Special Education Revenues and Expenses to Determine:
– Impacts of reduction in transportation costs resulting from student assignment to General Ed classes
– Determine what revenues are not Included in its income, potentially inflating the local contribution amount
• Assign Fiscal Management Staff to Oversee Both SPED Revenues and Expenditures
• Determine that Special Education Students are being Fully and Accurately Identified for ADA Claims
Priority-Based Budgeting
3312/16/2009
Priority-Based Budgeting
• Priority-Based Budgeting Model – Most Viable Option for an Educational Context
• Unique Factors In Public Education Budgeting– Fixed Costs– Complex Programs– State & Federal Mandates– Minimal Operational Requirements
• Priority-Based Budgeting is Predicated on Establishing Spending Priorities– Not on What Should be Cut
3412/16/2009
Priority-Based Budgeting Components
3512/16/2009
Priority-Based Budgeting Process
• Priority-Based Budgeting Does Not Begin At Zero– Sets Basic Education and Central Office Priorities– Incorporates Mandates and Operational
Requirements• It Creates a Cornerstone/Foundation
– For the Entire Budget• Serves to Unify Rather than Divide the
Organization• Minimizes Conflict
3612/16/2009
Priority-Based Budgeting Process
3712/16/2009
Priority-Based Budgeting -Sample Mandated Functions
• Mandates are Requirements Placed upon the District – Federal, State, Local or Private (Grants) Agencies– Tied to Funding, Programs or Services
• Sample Mandates Include: – Transportation (Special Education, Program Improvement)– Monitoring and Reporting Requirements Related to Categorical
Funding - No Child Left Behind (NCLB), Title I, etc– USDA Reporting Requirements for Free and Reduced Funding– Financial Audit Capacity to Remain Fiscally Independent– California Standardized Testing and Reporting Program– Williams Case Implementation
3812/16/2009
Priority-Based Budgeting –Sample Board Priorities
• A Focus on English Language Learners– English Learner Support Teacher (ELST) at all Schools K-12 – English Language Development (ELD) – Training for Teachers and Principals –QTEL/Systematic ELD– Strengthening and Offering PD for Bi-Literacy Opportunities– New Arrival Centers
• Creating a 21st Century Learning Environment– I-21 Continuation Training for Teachers and Principals– Virtual/Online Learning for High School Students– Positive Behavioral Interventions/Supports– Class Size K-3, 20:1
• Every Child Achieving One Year’s Learning Growth in One Year– Assessments – Data Director and Benchmark Assessments for all Levels– Maintain or reduce class size in K-3
• Reducing the Achievement Gap– Tutoring/Credit Recovery for all Students– Differentiated Instruction PD for Teachers and Principals– Response to Intervention (RTI) Model– Pay Fees for AP Course Exams and PSAT – Summer School– Fund Springboard for all Middle Schools for English Language Arts (ELA)– High School Graduation Coaches
• Valuing Diversity and Integration– Off-Campus Integrated Learning Experiences (OCILE)– Equity Training for all District Employees
3912/16/2009
Priority-Based Budgeting –Sample Board Priorities
• Excellence in Employee Compensation and Benefits– Higher than County-Average Wages– Ensuring a Positive Climate in Which to Work– Equity and Fairness in Hiring and Promotional Opportunities
• Meeting the Learning Needs of Each Individual Student– Learning Contracts for all Students– Web-Based Math and Reading Interventions– Intersession for Far Below Basic and Basic Students– Math Modules for Grades K-5 Teachers – Units of Study for K-8 Teachers– Expand Units of Study for Core High School Courses (ELA and Math)
• Providing a Well-Rounded Educational Experience for Every Student– A Safe and Secure Environment– Arts and Athletics– College, Career and Technical Education
• Supportive Central Office Support for Curriculum and Instruction– A-G Default Curriculum – Gifted and Talented Education (GATE) Certification for all Teachers– Trainer of Trainers to Build In-House Expertise and Increase Capacity of all District Resource Teachers (100
Total)– School Improvement Officers– Strengthen Instructional Leadership Capacity of Instructional Leadership Teams
• Efficient and Effective Business Operations– Accurate and Timely Financial Results– Integrated Systems Providing Consistent Data– Increased Managerial Accountability at all Levels
4012/16/2009
Priority-Based Budgeting –Sample Minimum Central Office Functions
• Governance– Board of Education– Superintendent– Legal Services – Audit Services– Stakeholder Communications
• Business Operations– Finance, Budgeting & Procurement– Human Resources– Information Technology & Demographics
• District /Charter Schools Oversight– School Site Supervision– Special Education – Mandated Programs– Assessment/Research and Reporting– Instructional Materials Management
4112/16/2009
Priority-Based Budgeting –Sample Minimum Operational Requirements
• Physical Plant Operations – Custodial, Landscaping and Maintenance
• Food Services
• Facilities Planning and Construction
• Utilities Management
• Technology Management
• School Allocations – Staff, Materials and Supplies
Next Steps
4312/16/2009
Budget Actions Timeline
Month/Date Decision /Action
December - Board Approves Priority Based Budgeting Methodology
January - Weekly Board Workshops – Priorities Approved- Governor’s Budget Release- Staff Calculates Costs and Operational Requirements- Board sets Title I and other program allocations
February 9 - Board Completes Decisions on Funding Priorities and Staffing- Budget Allocations Distributed to Schools
March 15 - Deadline - Precautionary Lay-Off Notices to Certificated Staff- Second Financial Interim Report
April 13 - Board Decision on Classified Staff Lay-Offs- 45 Day Notice Required
May 14 - Notices to Certificated Staff- Governor’s May Revised Budget
June - Final Budget Adoption
4412/16/2009
Closing Comments
• Board Approves Priority Based Budgeting as Method – Tonight
• Board Adoption of Core Priorities - Mid-January
• Continued Financial/ Budget Updates– Fund Core Priorities, Mandates and Minimal Operational
Requirements– Continuing to Calculate Impact of Hiring and Spending Freezes
on Ending Balance– Governor’s Budget - January 8-10
• Stakeholder Outreach Will Continue
• Continue Advocacy Efforts in Sacramento
• Board Direction and Decisions– Late January - February
4512/16/2009
Projected 2010/11 Unrestricted General Fund Deficit –Incorporating Projected 2009/10 Ending Balance Surplus
2010 Reserve Surplus(from 1st Interim Report)
$11,320,899
Hiring Freeze/Vacancy Savings (70% of unrestricted 7 mo. savings)
$1,657,299
Spending Freeze savings $ 10,000,000
Additional BRACE savings $2,155,544New Projected 10/11 Beginning Balance(Available for deficit reduction)
$25,133,742
Projected 2010/11 Deficit(including $20M 2011/12 reduction)
($84,000,000)
Updated 2010/11 Deficit (With 09/10 savings)
($58,866,258)
Additional Projected State Cuts (mid-range)(TBD in Gov. Budget release 01/10)
($86,500,000)
Total Projected 2010/11 Deficit ($145,366,258)
4612/16/2009
San Diego Unified Students