More details emerged about the ’s dire financial situation at Tuesday night’s Board of Trustees meeting.
The district has identified about $11 million in cuts it can make fairly easily. But Capo Unified is looking a $33.5 million deficit at a minimum, and that’s . If it fails, the deficit jumps to $51 million, said Robyn Phillips, interim deputy superintendent of business and support services.
The difference will have to be made up in employee concessions from the district’s three unions.
“This is not a case of cutting this or that. This is a case of cutting this and that,” Phillips said.
She outlined how $11 million in savings could be found without reopening negotiations with the three unions:
- $1.5 million from management (mostly at the district headquarters, but also at school sites)
- $3.5 million from classified (non-teaching) employees
- $3.5 million from teachers and other employees with a teaching credential
- $1.1 million in redirecting funding from restricted categories to other areas, now that school districts have greater flexibility to make such moves
- $1.4 million in other savings, including asking student government bodies and booster groups to step up donations
But, Phillips acknowledged, “$11 million is only a small piece of a $33 million reduction and a very small piece of a $51 million reduction.”
Superintendent Joseph Farley said he began the discussion Tuesday with principals about how supporting groups, such as student governments and booster clubs, could step up in the district’s time of need. He’s decided he will have to speak to the students directly about the problem.
One example of where students and parents could help is in transportation to extracurricular activities, Farley said. Currently, the district spends about $650,000 on that item alone.
But to get to the $51 million figure – the number the district must cut because its budget must be approved far ahead of the November election – the trustees will have to .
The trustees unanimously voted to reopen talks with the Capistrano Unified Education Association – the teachers’ union – California School Employees Association and the Teamsters. Specifically, the district is considering furlough days, larger class sizes and lower salaries.
Why is the district in such a bind? Phillips pointed to many causes, including:
- Revenues from the state are coming in less than budgeted, to the tune of $1.8 million
- The $ as a way to solve its own budget problems
- Employee benefits are $2.9 million more than anticipated, $2.1 million of that in medical benefits
- An increase in classified salaries
- Legal expenses
- The consultant who drew up the was more expensive than budgeted
The district will spend $19.6 million more this school year than it will receive in revenues, Phillips said. The reserves will ultimately take care of it, but the district will not be able to go to that well again, she said.
By law, school districts are required to have 2 percent in reserves. After closing out the books on the 2011-12 year, the district will be down to about $9 million, $1.3 million away from the magic 2 percent figure, Phillips said.
“That’s less than one week’s payroll for the district,” she added. “It’s very, very tight.”
Trustees made few comments. The board voted 5-2, with Trustees Ellen Addonizio and Sue Palazzo against, to approve an interim budget report that indicates the district may not be able to meet its fiscal responsiblities in the next two years.