State Still Faces $1.8 Billion Deficit
By Jerry Bernstein
There is much relief at the ABCUSD offices after the passage of Proposition 30, but it is tempered by what’s to come in the future. “The passage of Proposition 30 means there will no additional District budget cuts this year,” said ABC Assistant Superintendent of Business Services Toan Nguyan in the First Interim Report to the School Board for the 2012-13 school year.
He said the Board made a required $6.4 million budget cut earlier this year and will not have to make any further cuts this school year. It will also not get additional funding this year from the state,” he stated.
On Jan. 10 the Governor will present his proposed budget to the state legislature for the fiscal year 2013-14. He said projections predict there will be no further cuts and the budget deficit days are behind us.” Toan said during the past five years the District has suffered massive budget cuts. “This year we have a flat budget [no additional budget cuts].
He said ABC’s revenue limit has increased by $257,563 due to an increase in ADA [average daily attendance of students last year], He said going into the new fiscal year the state still has a deficit of approximately $1.8 billion that is due from Proposition 98.
Board Member Olympia Chen commented she thought Toan was more optimistic than she concerning Proposition 98.
Proposition 98 was approved on Nov. 8, 1988 and requires a minimum percentage of the state budget be spent on K-14 education guaranteeing an annual increase in the state budget of 40 percent. However, it can be suspended by a two-third vote of the legislature.
Board Member James Kang asked how much funding the district would receive from Redevelopment money. Toan explained the tax increment of the Redevelopment Agency goes to the county and state. Whatever increment we get the state will offset that amount. Kang also inquired about the three year unrestricted general fund projections. He said for 2012-13 ABC revenue was projected at $114,404,161, 2013-14 the projection is $116,399,749 and for 2014-15 it’s projected at $119,375,292. Kang asked what the cause of the increases each year.
Toan explained this was the projected annual cost of living built into the budget. He said in a normal year, when the state has the money, the District always get COLA money. However, because of passage of Proposition 30, the County has assumed the COLA will be funded for the next two years. He said with the state slowly coming out of the recession it should be funded. In addition the state is paying back the education money it owes. They have been paying 78 cents on the dollar.” Hopefully they will be able to pay back the money they owe us,” he said. “We’ll have a clearer picture after the Governor’s presents his budget proposal.”
Toan described the budget as being fluid. This is why the Board receives a quarterly report. “Once we receive the Governor’s budget proposal in March, the Board will see different figures in the budget.”
