Business Services » Superintendent's Budget Message

Superintendent's Budget Message

When the Governor signed the state budget agreement in February 2009 for both the 2008-2009 and 2009-2010 budgets, he proclaimed that it was the earliest on record budget in the history in California.  While the statement was true, the budget was almost immediately out of balance with the deficit growing each day until the deficit reached $24.1 billion.  This immediate deficit wreaked havoc on school districts’ budgets across California.  Despite excellent fiscal management by the Board and administration, Castro Valley Unified School District could not escape budget cuts for the 2009-2010 school year, which eventually totaled $4.1 million in the District’s adopted budget.


Besides the direct cuts to the education budget, education funding in California continued to decline due to the Proposition 98 funding formula.  K-14 education is guaranteed 40% of the state budget under Proposition 98, but state revenue has fallen from $103 billion to $89 billion thereby reducing education’s share of the budget.  Sacramento will claim that it is fully funding education, but 40% of $89 billion is a great deal less than $103 billion.  Besides reducing the funding, the state is deferring payments and adding a deficit factor.  The bottom line is that the District will have $1,174 less per student than it is legally entitled to.  To avoid further cuts, the District has spent down its legally required reserve (3% of the budget) plus the District cannot use the accounting techniques that Sacramento does.  In fact, Sacramento’s deferral of school district revenue will likely cause the District to borrow money to maintain adequate cash balances.


Throughout May, June, and July, the Legislature and Governor debated ways to balance the state budget and stop issuing IOUs.  The budget agreement reached in July, after the close of the fiscal year, included additional cuts to the 2008-2009 education budget  as well as actions that will further reduce funding in both 2009-2010 and 2010-2011.  There is no guarantee that the budget assumptions used to balance the state budget will hold throughout the year.  If the assumptions do not hold, the District could face mid-year cuts.  Based on the current projections, which seem to change weekly, the District will face another $2.5 million in budget reductions for 2010-2011.  Due to the influx of one time federal stimulus funding, it appears at the present time that the District will be able to make it through this year.  The federal stimulus dollars present an interesting challenge for the District.  Since the stimulus funding must be spent on specific categories, the District could be faced with new spending while cutting existing programs.


While I am concerned about this year, I am very concerned about 2010-2011 when the stimulus funding disappears.  In an effort to get a handle on the situation as soon as possible and keep our stakeholder groups informed, the District will begin discussions in September and October.  On September 9, staff will present a budget development timeline to the Board of Education, which will be posted on the web site.  Shortly thereafter, I will begin scheduling meetings with our staff and parents.

I encourage you to become informed about the state budget crisis and the impact on the District budget and our students and staff.  We can no longer count on Sacramento to provide what our students need and deserve.  We are fortunate to have community organizations to assist our efforts.  Please support our partners:

  • Castro Valley Arts Foundation
  • Castro Valley Educational Foundation
  • Castro Valley Sports Foundation
  • Music Parents Society
  • Save Our Schools Castro Valley!
  • School PTAs/Parent Clubs/Boosters.

I am committed to providing everyone with timely and accurate budget information in a changing economic environment and am interested in hearing your questions and concerns. Please feel free to contact me at jnegri@cv.k12.ca.us.

 

Sincerely,

Jim Negri, Superintendent