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Frequently
Asked Questions about the
2010 State
Budget Crisis
The state and nation are suffering through a
major budget crisis that impacts the already
inadequate funding for California's public
schools. The current proposals being considered
by the legislature would require the Folsom
Cordova Unified School District to reduce its
expenditures by about __ percent, or $13.9
million. This amount is in addition to nearly $19
million in cuts that have not been restored
since 2000-01.
A reduction of this
magnitude has the potential to affect a wide
variety of services.
The Governing Board and District staff are
working diligently to inform the community about
the budget crisis and the options for addressing
this crisis. Following are some "frequently
asked questions" that have surfaced from a
District survey about the budget crisis or that
have been brought to the District's attention by
other sources.
1. Has the Board of Trustees already made
decisions about cuts to the budget?
No. The Board has not made any decisions about
budget cuts. The Superintendent has already
submitted his
recommendations for reductions. In most
cases, the Board has until the first week in
June to make their decision final.
2. Can the Board use its state mandated
reserves to solve the budget crisis?
Perhaps. The state requires the District to
maintain a reserve equal to three percent of its
General Fund. In order to use this reserve, the
legislature would have to grant a waiver to
allow it to be expended. If a waiver is granted,
we anticipate that the state might allow the
District to use one half of the three percent
reserve. Significant cuts will still be required
even if the District can use these reserves.
It is also important to note that the reserve
would have to be repaid at some future date,
affecting the District's ability to restore
services and programs when the economy does
recover.
3. The District ends each school year with a
significant ending balance. Are these funds
available?
Not generally. The unexpended funds remaining at
the end of the school year have restrictions or
have been designated by the source of the funds
for a specific purpose.
Please see "Understanding
the General Fund Ending Balance" on the
Budget Central section of the District's website
for a detailed explanation.
4. Will the District first look to reduce its
administrative costs?
Yes. The superintendent's recommendations include reductions to administrative services
and positions.
When making cuts to
personnel, the District has historically made
deeper cuts to administrative services than to
any other employee group.
The District has once again looked for ways to
consolidate o eliminate administrative services
and personnel before reducing other services and
employees.
Here is a detailed analysis of
the costs for our
District's Administrative Positions which
account for 2% of the District's General Fund
expenditures.
To learn more about previous budget cuts, see "2009-10
and Prior Years General Fund Budget Reductions,"
posted at this site.
5. Does the superintendent receive special
benefits or compensation such as a housing
allowance?
No. The superintendent receives a salary, the
same health and welfare benefits as other
employees, and a car allowance. The car
allowance replaces any and all mileage
reimbursements paid to other employees who are
required to travel.
The superintendent does not receive a housing
allowance and has declined to be reimbursed for
the cost of a cell phone.
6. The District is planning to build a new
Education Services Center to house the central
administration. Can that money be used to solve
our current budget crisis?
No. Money from a facilities bond may only be
used for the purposes stated in the bond, and
cannot legally be used for any other general
purposes such as paying teacher salaries or
buying books. The Measure M bond, approved by
voters in 2007, included funding for a new
Education Services Center.
For more
information about the District's new Education
Services Center, please review the following
documents and reference articles:
7. Can the District roll back (reduce) and/or
freeze salaries for all employees to save jobs?
Perhaps. Any reduction in compensation for
members of the Folsom Cordova Education
Association (FCEA) or the California School
Employees Association (CSEA) must be bargained
and agreed to by the leadership and members of
the association. Similarly, any plan to shorten
the school year, shorten the school day, or
furlough employees to save money must be
negotiated.
The District and the associations are
considering ways to minimize the number of
employees that might be laid off. However,
changes that impact hours and days of
employment, or affect the compensation and/or
benefits of employees, are subject to the
provisions of the state's collective bargaining
statutes.
Note: In 2003-04, FCEA did voluntarily roll back
salaries to help with a budget crisis.
Additionally, the salary formula used to
determine salaries at that time called for an
additional reduction. The voluntary roll back
was reinstated, but the reduction by formula did
carry forward. For a detailed explanation of the
2003- 04 salary roll back, see "0304
FCEA Voluntary Salary Reduction," posted at
this website.
8. Can the District save money by eliminating
programs such as Adult Education, Student Care,
or Food Services?
No. These types of programs are self-supporting
and are not a part of the General Fund.
Eliminating these services will not generate
more funds for our elementary and high schools.
In fact, eliminating these programs might have
an adverse impact because they help to pay for
some costs of facilities, maintenance, and
energy.
9. The District has postponed its
contribution to retiree medical benefits once
already. If we postpone the contribution again,
will the District be able to continue to fund
the benefits for qualified retirees to age 65?
Yes. The contribution to retiree medical
benefits is designed to protect the District's
long-range financial security, and the District
can delay the contribution for another year.
10. If the state begins issuing IOU’s because
it does not have adequate funds to pay its
bills, will it affect the District and its
employees?
Not immediately. According to state officials,
the state's monthly income will not be enough to
meet its monthly obligations. Consequently, the
state will begin issuing IOU's to some employees
and vendors.
However, according to State Controller John
Chiang, the state's first obligation will be to
pay its debt service (bonds and borrowed money),
and its second obligation is to pay schools.
There will be enough cash to pay schools for
several months. However, if the shortfall
between cash and obligations continues
indefinitely, even schools could be at risk.
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