The governing board of Plumas Unified School District followed suit with Plumas County and Feather River College in adopting a don’t-call-it-a-done-deal budget last Tuesday, June 21.
With the state budget still up in the air and numerous issues yet to be resolved in Sacramento, board members decided not to decide on a number of points and passed a proposed budget with a projected $4 million in deficit spending.
At one point, trustee Bret Cook asked Business Director Yvonne Bales, “We’re punting with this proposed budget, aren’t we?”
She reiterated many times during the meeting that the budget was a moving target and numbers would be constantly in flux. She promised to update the board regularly as she knew more.
Despite the many unknowns, Bales was very clear with her overall message: “We can’t keep deficit spending at a rate of $4 million a year. We will go through the reserve in no time.”
She repeated herself later: “We have got to get our costs down. We can’t bleed at $4 million a year. It is not sustainable.”
Her budget presentation trod familiar ground as she outlined increasing costs and decreasing revenues. In comparing 2010-11 estimated actual figures to the 2011-12 proposed numbers, Bales anticipated a $500,000 drop in local tax revenues, a $400,000 drop in forest reserve funds, a $90,000 increase in the district’s “fair share” payment and a $99,000 drop from decreased interest and increased worker’s compensation.
She projected an increase in salary, benefits and books and supplies, among other line items.
All told, the ending fund balance for the unrestricted general fund will drop an estimated $3.8 million from this year to next — and will continue dropping over the next two fiscal years.
The accounting left Fund 17, a special reserve the district has set aside to give it a two-year cushion should it have to move from Basic Aid status back to revenue-limit status, at $8.3 million — $3.7 million short of the board’s goal of $12 million.
“You might want to revisit this,” Bales told the board.
Among her assumptions, Bales expects a 10-year slide in attendance to continue, further straining resources. She honed in on facilities expenses during her report, presenting a chart of enrollment, capacity and student/teacher ratios by school. Estimated districtwide enrollment for next year is 1,800 students in 10 facilities.
Bales said she would be passing the information along to the facilities use committee, which is looking at reducing facilities and maintenance costs. Superintendent Glenn Harris said he expects to receive recommendations from the committee sometime in the next year.
He urged the board to think “longitudinally” and said the district had “an obligation to do models.”
The discussion turned to “what-ifs” on the state level. Board chairman Chris Russell asked about possible state plans to defer payments.
Bales called the state situation “just appalling” and went on to describe rolling deferrals — a situation Feather River College is already contending with.
Trustees then asked about cash flow should state payments be deferred.
Bales said because PUSD is a Basic Aid district it is not eligible for TRAN, a kind of line of credit schools can use to help with cash flow. Fund 17 could be used, she said.
In response to more questions, Bales said the state was considering tweaking the Proposition 98 allocation formula. Proposition 98 ostensibly governs how school funds are dispersed from the state and guarantees a minimum percentage of the state budget be spent on K-14 education. Of the state maneuvering, Bales said, “I have yet to see it be to our benefit.”
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