By Kathleen Acuff
Local school finance officers and trustees apprehensive of further reductions in state aid for public education cut district budgets still more at the end of the 2004-2005 school year. Their caution paid off in minimal damage from the budget approved by the legislature July 7.
Its basic aid status protects the Mountain View-Los Altos Union High School District from most of the reductions in state aid. Strong local property tax revenue acts as a shock absorber that keeps the district from feeling most of the ups and down that affect revenue limit districts.
Joe White, assistant superintendent for business services, said the main effect on MVLA comes from the elimination of the 2 percent state contribution to the Public School Teacher Retirement System (STRS).
“We put it in the budget as a cost. We will pull it out at first interim forecast in December - that will be a $350,000 reduction. The governor came through on all the categoricals with the COLA (cost-of-living adjustment),” White said earlier this week.
Geoffrey Kiehl, chief business officer for the Fremont Union High School District, is also concerned about the state budget’s effect on STRS.
“Apparently, the compromise proposal has the state covering one-half the cost of this item ($235 million) from the state of California’s General Fund and counting the other half against the funding that school districts would have received under Proposition 98. What this means to our particular district we do not know at this juncture,” he said Monday.
Kiehl said FUHSD officials had hoped the state would “use some of their $2 billion in one-time 2004-2005 revenues to fund old debts owed school districts for unpaid mandated cost reimbursement claims. … Any part of the $1.4 million that is owed to our school district would be nice to recover.”
Spokeswoman Cindy McArthur said, “The Fremont Union High School District has endured a major financial crisis that included the loss of academic courses and staff, plus a salary rollback for all employees.”
FUHSD recently campaigned for and won passage of a $5 million parcel tax. Earlier in the school year, officials cut out-of-district students from the rolls to save $3 million.
Last Friday, the Education Coalition of Santa Clara County released a statement expressing “deep disappointment” in the new state budget, which they said subtract a total of $140 million, or $500 per student, from California public schools.
The group, comprising state and county administrators, teachers and service personnel as well as the county PTA, stated, “The governor’s agreement, state statute and the California Constitution all require an additional $1.8 billion in school funding this past school year and $1.3 billion in the upcoming school year … (but) the new budget underfunds our schools by $3.1 billion.”
In the Los Altos School District, financial officer Randy Kenyon said last week, “The coalition assertions are reasonable and real. … (In) essence, the state is suspending the provisions of Prop 98 in order to solve its budget problems.”
On the somewhat brighter side, however, the district was prepared. Although an additional $2 million from the state would have allowed LASD to give employees a cost-of-living raise and avoid making $1.5 million in further cuts for 2005-2006, the district does not have to scramble to revise its new budget.
“There is nothing in the final state budget that is substantially different from what we were expecting,” Kenyon said. “Because of all our local community support - parcel tax, foundation, PTAs - we are better off than most districts.”
According to the state Web site (http://govbud.dof.ca.gov/BudgetSummary/), the state’s contribution to the STRS Defined Benefit Supplement Program in 2005-06 will be $469 million and “full responsibility for annual payments to (STRS) … will be shifted to school districts and/or covered employees. Initially, school districts will be expected to pay an additional 2 percent of payroll, but they will be provided authority to shift this cost through collective bargaining agreements.”
The 2 percent cut in state contributions to STRS was accompanied by a proposal that teachers be allowed to opt out of the Defined Benefit Supplement Program and see a 2 percent increase in their take-home pay.
The state site states that the new state budget “includes an increase of $2.9 billion to cover increases in growth and cost-of-living adjustments (COLAs) for revenue limits and categorical programs, as well as $328 million to repay almost half of the outstanding deficit factor owed as a result of reductions to school revenue limits (general purpose funding for schools) made by the prior administration.”
