Filling the Ongoing Revenue Hole
Most school boards are struggling mightily to approve a balanced budget of 2009/10. However, many of them are ignoring the out years because the cuts are too painful. What is the primary reason why school boards are confronted with these heart wrenching decisions? The ongoing monies to pay for salary increases approved in 2006 and 2007 are no longer there.
Below is a chart of the projected base limit revenue for Alameda Unified School. If you roll the clock back to June, 2007 you can see the trend line showing a declining trend of 1% less funding each year. Staff using the latest information from the State projected an even quicker decline of state funding increases. Staff recommended salary increases of 2% for 2007/08 and 4% for 2008/09 believing the projected funding increases would produce enough ongoing revenue to pay for the increased expenses.
Move the clock forward to June, 2009 and you can see the huge problem. Ongoing revenues for 2008/09 drops below 2007/08 levels and gets worse from 2009/10 through 2011/12. By 2011/12 there is $7 million hole between the 2007/08 projections and 2009/10 projections.
Many school districts are using categorical flexibility and Federal Stimulus monies to fill the hole for 2009/10. Unfortunately, when 2011/12 rolls around there will not be anymore one time monies available to fill the hole.
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