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FREMONT UNIFIED S C H O O L D I S T R I C T

Presentation of the Proposed Budget

Balancing Solutions

Presented by

Dr. Kim Wallace, Superintendent

Marcus Battle, Associate Superintendent

February 26, 2020

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Budget Reduction FrameworkThe diagram below provides a graphic representation of the general reduction framework. In general, we will start the reduction process by considering reductions from categories as far away from the center (core classroom instruction) as possible.

Core Classroom Instruction

Programs, Materials, Supplies, and Instructional Supports

District Office Supports, staff, administrators, community resources,

non-core programs

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Recommended Reduction Target- $26.3M

Based on current information, our recommended reduction target has been revised to $26.3M to reflect new financial information and the release of the governor’s budget

Projected Deficits for 2019-20 Adopted Budget

prompted the Board to direct $16M in reductions to ensure solvency & reserves.

Updated financial and enrollment information at First Interim prompts staff

to recommend $20M in ongoing cuts in 2020-21 to

maintain solvency and reserves.

The Governor’s Budget Release and Updated financial assumptions

around COLA, negotiations, and special education prompt staff to recommend $26.3 Million in on going cuts beginning

in FY 2020-21.

March – June 2019 September – December 2019 January 2020 February 12, 2020

The District’s Governing Board Tentatively Recommended an estimated $12 million in on-

going and one-time reductions and/or revenue

enhancements. The remaining budget balancing gap is

estimated at $14.3 Million

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*Our Recommendations

• Increase Revenues (Category 1)

• Decrease Spending (Personnel) (Category 2)

• Decrease Spending (Programs and Services) –

(Category 3)

Note: *All Revenue increases, expenditure reductions, and costs savings are estimates based on our best working assumptions and are subject to adjustment and revision

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Category 1 - Increase Revenue Recommendations

Options FY 2020-21(Year 1)

FY 2021-22(Year 2)

FY 2022-23(Year 3)

Projected 3 Year

Target

BoardApproved

Yes/No

* Estimated 3 Year Cumulative Revenue

1A Facilities Rental – Price Increase (ie. Increase Class II and Class III facility use fees by $10)

$903,300 $ 903,300 $ 903,300 $2,709,900

1B Facilities Rentals – Change Current Site/DistrictContribution from 60/40 to 75/25

$216,637 $216,637 $216,637 $649,911

1C Lease of Marshall Property $894,000 $894,000 $1,788,000

1D Transfer Regional Occupation Program (ROP) Lease Revenue from Fund 40 to General Fund

$344,070 $344,070 $344,070 $1,032,210

1E Increase Child Nutrition Meal Prices by $0.50 $398,070 $398,070 $398,070 $1,194,210

Sub-Total Category 1 (Increased Revenue) $1,862,077 $2,756,077 $2,756,077 $7,374,231

Note: * The detail for all items in this column are highlighted in the attached appendix by the category number

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Category 2 - Decreased Spending Recommendations (Personnel)

* Options FY 2020-21(Yr. 1)

FY 2021-22(Yr. 2)

FY 2021-22(Yr. 3)

Recommended 3 Year Target

Board ApprovedYes/No

2A Reduce Staffing Districtwide by Bargaining Group

Estimated 3 Year Cumulative Savings Total FTEs ReducedFUDTA:SEIU:CSEA:FSMA:

FUDTA (28 FTE’s)

- 5 FTE’s 2020-21 Due to Declining Enrollment

- 23 FTE’s 2019-20 Adjust Teacher Overage

$3,257,828 $3,257,828 $3,257,828 $9,773,484

CSEA (40.5 FTE’s) $2,928,312 $2,928,312 $2,928,312 $8,784,936

SEIU (27.8 FTE’s) $2,010,051 $2,010,051 $2,010,051 $6,030,153

FSMA (9 FTE’s) $1,704,618 $1,704,618 $1,704,618 $5,113,854

Sub-Total Category 2 (Red. in Force) $9,900,809 $9,900,809 $9,900,809 $29,702,427

Note: * The detail for all items in this column are highlighted in the attached appendix by the category number

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Options FY 2020-21Year 1

FY 2021-22Year 2

FY 2022-23Year 3

Projected 3 Year Target

Board Approved

Yes/No

* Estimated 3 Year Cumulative Savings

3A Reduce Ongoing Contracts Districtwide $140,000 $140,000 $140,000 $420,000

3B Eliminate GATE Testing $52,773 $52,773 $52,773 $158,319

3C Leverage Restricted Dollars to Support GF – (Move 5% for Custodians from General Fund to Routine Restricted Maintenance)

$549,609 $549,609 $549,609 $1,648,827

3D Transportation Redesign (Centralized Bus Stops) $460,962 $460,962 $460,962 $1,382,886

3E Reimburse the General Fund from Fund 40 for FY 2016-17 Buses Purchased from the General Fund (One-Time)

$3,500,000 $3,500,000

Sub-Total Category 3 (Decrease – Programs/ Services) $4,703,344 $1,203,344 $1,203,344 $7,110,032

Category 3 - Decreased Spending Recommendations (Programs/Services)

Note: * The detail for all items in this column are highlighted in the attached appendix by the category number

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Options FY 2020-21Year 1

FY 2021-22Year 2

FY 2022-23Year 3

Projected 3 Year Target

Board ApprovedYes/No

* Estimated 3 Year Cumulative Savings

3F Move Kennedy HS Block Schedule Program Funding from General Fund to LCAP Restricted**

$1,100,000 $1,100,000 $1,100,000 $3,300,000

3G Reduce Districtwide Overtime by 50% $400,000 $400,000 $400,000 $1,200,000

3H Reduce Outside Conferences by 80% (General Fund Only)

$250,000 $250,000 $250,000$750,000

3I Initiate Districtwide Energy Conservation Program

$50,000 $50,000 $50,000$150,000

3J ***Eliminate Summer School (Except ESY & High School Credit Recovery)

$380,000 $380,000 $380,000$1,140,000

Total Category 3 (Decrease –Programs/Services) $2,180,000 $2,180,000 $2,180,000 $6,540,000

Category 3 - Decreased Spending Options (Programs/Services) Cont.

Note: * The detail for all items in this column are highlighted in the attached appendix by the category number** This item must be approved through LCAAC*** Board Authorized the Reduction for FY 2019-20 but the reduction was not implemented

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Total Reductions (All Categories – W/O Class Size Modifications)

All Options FY 2020-21Year 1

FY 2021-22Year 2

FY 2022-23Year 3

Projected 3 Year Target

All Categories (1 – 3) Totals $18,646,230 $16,040,230 $16,040,230 $50,726,690

The District has identified $18.6 Million in proposed budget balancing recommendations without class size increase to meet the district’s targeted $26.3 Million budget balancing target beginning in FY 2020-21 with an estimated shortfall of $7.7 Mil. remaining

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A. Increase Elementary Class Sizes

B. Add Furlough Days to all Bargaining Groups (i.e. CSEA, SEIU, FSMA, and FUDTA)

C. Reduce and/or Make No Additional Reductions - Plan for a Qualified Certification with the County at Second Interim

Options to Close the Remaining $7.7 Mil. Budget Gap Shortfall

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Elementary Class Size Analysis

TK-K 1 2 3 4 5 6 FTEsRequired2020-21

FTE/$$ Savings 2020-21

Board Approved

Yes/NoCurrent Grade Level Class Size

24 28 28 28 30 30 30 685

Class Size 30:1 TK-6

30 30 30 30 30 30 30 641 (44)

$5.1 Mil.Class Size24:1 TK-K30:1 1-6

24 30 30 30 30 30 30 665 (20)

$2.3 Mil. Class Size 29:1 TK-330:1 4-6

29 29 29 29 30 30 30 654 (31)

$3.6 Mil.Class Size 24:1 TK29:1 1-330:1 4-6

24 29 29 29 30 30 30 675 (10)

$1.1 Mil.

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*Bargaining Units Cost Per Furlough Day

CSEA $199,155

FUDTA $1,162,038

FSMA $114,770

SEIU $126,724

Cost of One Day $1,602,689

Furlough Days Savings by Group

Note: The implementation of Furlough Days would have to be bargained with each unit.

All Bargaining Units Costs Per Furlough Day Board ApprovedYes/No

One Furlough Day $1,600,000

Two Furlough Days $3,200,000

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Other Funding Opportunities

Options FY 2020-21Year 1

FY 2021-22Year 2

FY 2022-23Year 3

Projected 3 Year Target

Estimated 3 Year Cumulative Savings

Potential Parcel Tax $ 18,300,000 $ 18,300,000 $ 18,300,000 $54,900,000

Reduce Board Designated Fund Balance % from 3.5% to 3% $1,957,055 $1,975,000

*New Special Education Funding Formula Up to $5 Million Up to $5 Million Up to $5 Million Up to $15 Million

*New Pre-School (One-time) Grant Up to $2 Million Up to $2 Million

Total - Other Funding Opportunities Up to $25.3 Million Up to $25.3 MillionUp to $23.3

MillionUp to $73.8

Million

Note: The funding opportunities on this page are contingent on other actions not within the district’s control and are currently not being considered as part of recommended reductions*These items are currently under consideration by the California Legislature and a Trailer Bill is currently under review and the details should be known by the Governor’s May Revise. If the funding is secured, the district would be able to reduce the amount the general fund contributes for special education

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What May Happen if our Budget is Certified as Qualified?

• The County Office could assign a fiscal expert to advise the district

• The County can direct the district to submit a fiscal recovery plan

• The County could ask Fiscal Crisis Management Assistance Team (FCMAT) to review teacher hiring practices and require the district to implement FCMAT’s recommendations

• A “Third Interim” report is required to be filed with the County Office of Education (COE) by June 1 for the period ending April 30

• When a district with a qualified or negative certification reaches a tentative agreement with one of its bargaining units, the collective bargaining disclosure must be submitted to the COE at least ten days in advance of ratification by the governing board (Government Code Section 3540.2). The COE is then required to notify the district and certain other parties (including parents) if the COE believes that the agreement would “endanger the fiscal well-being of the school district”

• When a district is qualified, the district cannot sell its bonds except through the county Board of Supervisors (E.C. 15140[b])

• The District’s bond rating may be lowered

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Next Steps

• District continues collaboration with all employee groups

on Recommended Reductions in Force – February – March 2020

• Board Final Actions on Recommended Budget Balancing Solutions –

February 26

• District Provides Budget Balancing Solutions to the ACOE with our First

Interim on March 11

• District Implements Budget Balancing Solutions – March – May 2020