budget study session
DESCRIPTION
Budget Study Session. September 7, 2011. Agenda. Recent funding history 11/12 budget Beyond Other issues. Recent Funding History. Last “good” year was 2007/08 COLA funded at 4.53% 2% growth .38% deficit factor State took away $80M of unused restoration - PowerPoint PPT PresentationTRANSCRIPT
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Budget Study SessionSeptember 7, 2011
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AgendaRecent funding history11/12 budgetBeyondOther issues
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Recent Funding HistoryLast “good” year was 2007/08
COLA funded at 4.53%2% growth.38% deficit factorState took away $80M of unused restoration
SMCCCD was below cap and still growing
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Recent Funding History2008/09 statutory COLA was 5.66%
Funded at .68% and that was removed in mid-year cuts along with $26M of mandate reimbursements
Deficit factor was .51% after property tax backfill was provided in 2009/10
SMCCCD was only 116 FTES below funded cap
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Recent Funding History2009/10 saw major cuts from the state
4.25% unfunded COLA3.34% workload and revenue reductionSignificant cuts to categoricals$703M cash deferral to next yearFees raised from $20 to $26/unit
SMCCCD had 1800 unfunded FTES10% cuts ($7.3M) made to site allocations39% cuts ( $4.3M) to categoricals
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Recent Funding History2010/11 continued the slide
0% COLA.54% deficit factor at P-2Additional $200M deferrals to next yearPartial restoration of 2009/10 workload
reduction of 2.2%SMCCCD passes the parcel tax (Measure G)
But doesn’t achieve the full workload restoration
Additional 8.8% cuts ($6.3M) to site allocations
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2011/12 Budget2011/12 gets worse
$400M cuts equaling a 6.2% workload reduction
1.67% unfunded COLAFees increase from $26 to $36/unit generating
$110M$129M in new deferrals (totaling $961M)
SMCCCD cuts $4.9M in enrollment reductionsAssuming a $8M operating deficitBut backfilled with 1X fundsAssuming an overall 2% reduction in FTES
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2011/12 Budget Mid Year CutsMid-year cuts: Tier 1 is below $1B revenue
shortfallNo changes to state budgets
Tier II is between $1B and $2B revenue shortfall$30 M cut to community collegesFees increase from $36 to $46/unit$23M cut to child care$548M cuts to UC, CSU and state agencies
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2011/12 Budget Mid Year cutsTier III is over $2B revenue shortfall
All previous cuts PLUS$72M cuts to community collegesUp to $1.5B cuts to K-12 $248M cut to K-12 transportationAllows reduction of K-12 school year of up to 7
days in addition to the 5 day reduction already authorized
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2011/12 BudgetSMCCCD budget assumptions
7.5% workload reduction (6.2% plus 1.3% for mid year cuts)
1.5% deficit factor (covers $30M mid year cut that isn’t part of workload reduction plus $25M fee shortfall)
Fees remain at $36 until Summer 2012Use of one time funds to hold off cuts for one
more yearMeasure G continues to support classes and
student services and reduces the severity of cuts
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BeyondFurther state revenue cuts in 2012/13District backs into Basic Aid in 2012/13Slight state funded enrollment growth
starting in 2013/14Continued increase in property tax funding
starting in 2013/14Colleges start getting positive enrollment
growth funding in resource allocation model in 2014/15
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Basic AidDetermine Basic
Aid status of SMCCCD.
Total Base Revenue as determined by the state
State Apportionment
Student fees
Regular property taxes
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Basic AidDetermine Basic
Aid status of SMCCCD.
State Apportionment
Student fees
Regular property taxes
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Basic AidDetermine Basic
Aid status of SMCCCD.
State Apportionment
Student fees
Regular property taxes
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Basic AidDetermine Basic
Aid status of SMCCCD.
State Apportionment
Student fees
Regular property taxes
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Basic AidDetermine Basic
Aid status of SMCCCD.
State Apportionment
Student fees
Regular property taxes
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Basic AidDetermine Basic
Aid status of SMCCD.
Student fees
Regular property taxes
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Basic AidBacking into Basic
Aid.
State Apportionment
Student fees
Regular property taxes
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Basic AidBacking into Basic
Aid.
State Apportionment
Student fees
Regular property taxes
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Basic AidBacking into Basic
Aid.
State Apportionment
Student fees
Regular property taxes
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Basic AidBacking into Basic
Aid.
Student fees
Regular property taxes
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BeyondBudget Assumptions
12/13 13/14 14/15
FTES Growth
-2.5% 1% 1%
COLA 0% 0% 1%
Deficit Factor
3% 1% 1%
Other Basic Aid Last year of Measure
G
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BeyondResource Allocation Model smoothes the
funding for the sites
06-07 07-08 08-09 09/10 10/11 11/12 Goal
12/13 Goal
13/14 Goal
14/15 Goal
15,000
16,000
17,000
18,000
19,000
20,000
21,000
22,000
23,000
24,000
25,000
FTES Funding Internally & Externally
State fundedDistrict goalDistrict funded
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ReservesAssumed mid-year cuts in 09/10 and 10/11
that didn’t materializeSavings in utilities and other fixed costsSavings due to no election in 09/10Measure G effect on Fund 1
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ReservesUsing $8M of reserves for 11/12Current projections show cuts in 12/13 of
$5.8MCurrent projections show augmentations in
13/14 and 14/15 of $2.8M and $3M – totaling $5.8M
Recommend assuming that we will use reserves in 12/13 and 13/14 and not make additional cuts or augmentations in the 3 years
Don’t need to decide yet, but will need to know in January after the governor’s budget is released
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RecommendationsSites should prepare cuts for 12/13 totaling
$5.8MThese cuts should be prioritizedDecisions on these cuts won’t be made until
the financial situation is clearer
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Other IssuesCash flowRDAsBondInvestment policyMeasure G
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Questions?