Budget UpdateBoard of Trustees

May 4, 2009

Andy Dunn, Vice Chancellor, Business ServicesBernata Slater, Director, Budget Operations

Strategy to solve Strategy to solve the deficit as the deficit as identified in identified in March….March….

Reduce Operating Expenses by $6.7 million as of July 1, 2009 through

Suspending 10 full time faculty positions (about $300,000)Suspending 16 vacant classified and administrative positions (about $1.5 million)Reducing B budget by about $1.2 millionIdentifying an additional 50 filled classified and administrative positions to be eliminated as of July 2009, BUT, providing one time money to preserve positions to July 2010

Recent changes to Recent changes to the the March forecastMarch forecast

Revenue: $185,049,909A likely deficit factor for property taxes was recommended by the League, resulting in lowered revenue forecasts by about $1.5 million

Expense: $191,731,770Refined expense projections, particularly on filled positions, will increase expense by about $1.0 million

These two factors will cause the operating deficit to increase from $6.7 million to $9.2 million for the 09-10 budget.Proposed solution to this increase is to use $2.5 million in one time funds to balance the 09-10 budget

What don’t we What don’t we know..?know..?

To what degree will the community college system revenue be reduced in 09-10?A recent cautionary forecast from the CCLC warned that the System budget could be reduced by $100-$200 million next yearThis could mean a further reduction in revenue to FHDA of $3 - $6 million.The CCLC has also forecast that failure of key measures at the May 19 Special Election could result in a reduction of $9.3 million for FHDA.

Probable increases in expenses in 2010-

2011

Cumulative totals Cumulative totals for 2 year budgetfor 2 year budget

State Budget cuts may be mitigated by Legislative action

Implementation Implementation ProcessProcessDetailsDetails

Cuts Quantified pos

#De Anza po

s #

Foothill pos

#

Central Services District Wide TotalFaculty 180,000 120,000 - 300,000 Classified/Admin Positions 2,267,489 1,304,998 1,707,513 5,280,000 B Budget 115,150 150,784 354,065 500,000 1,120,000 Other - Total Cost 2,562,639 1,575,782 2,061,579 500,000 6,700,000

Already ImplementedFaculty 5 150,000 5 150,000 300,000 Classified/Admin Positions 4 320,000 5 400,000 7 560,000 1,280,000

470,000 550,000 560,000 - 1,580,000

Need to set aside for 09/ 10 2,092,639 1,025,782 1,501,579 500,000 5,120,000

Estimated Carryover 6/ 30/ 09 5,100,000 2,602,000 2,200,000 1,600,000 11,502,000

Projected Fund Projected Fund Balance 06/30/09-Balance 06/30/09-

RestrictedRestricted

Uncertainties/Risks to Uncertainties/Risks to ProjectionsProjections

State:Continued deterioration in State Budget.Probability of success - May 19 Special Ballot propositions.

District:Challenge to restore1400 FTES from Job Corps and Positive Attendance Courses.

Stability funding would buffer revenue loss for one year.

Maintaining Productivity levelsMedical Benefit Plan Costs

Key dates in planning Key dates in planning for 09/10 Budgetfor 09/10 Budget

Major dates to remember:Board meeting – May 4.Conversations with affected employees (May 11-13)Budget College Council/Roundtable Meetings (May 13-15)State’s Special Election - May 19FHDA Structural Budget Solutions - May 20Budget Town Hall @ Foothill – May 26Governor’s “May/June” Revise (May 26 ~ June 8)Tentative Budget First Reading - June 1Tentative Budget adoption - June 15September 14 - Foothill-De Anza adopts final 2009-10 Budget