2008/09 22008/09 2ndnd Interim Reporting Interim ReportingProposed Budget AdjustmentsProposed Budget Adjustments

Board MeetingBoard Meeting

January 27, 2009January 27, 2009

Prepared by:Prepared by: Mr. Douglas BargeMr. Douglas Barge & Staff& Staff

Y:\Business Services\Budget\2009-10\Adopted\Meetings\B01-27-09

Executive SummaryExecutive Summary

The 2nd Interim Financial Report will be brought before the Board for approval in March

Our goal is for a positive certification, even in these difficult times

To accomplish that goal a strategy of budget reductions has been developed that reflects: The Governor’s current proposals for reducing income to the

District The Governor’s proposed “opportunities” for reducing

expenditures within the District

These reduction total $6,372,549

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Table of ContentsTable of Contents

DESCRIPTION PAGE #

A. IntroductionB. Balancing the 2nd Interim Financial ReportC. RecommendationsD. Appendix

1. Qualified2. Negative

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IntroductionIntroduction The State requires Districts to report on their interim financial and budgetary

status twice a year, as of October 31 and as of January 31. This report must be certified as Positive, Qualified, or Negative.

Qualified Certification means the District may not meet its financial obligations.

Negative Certification means the District will not be able to meet its financial obligations.

Certifying Qualified will require the County Office of Education to intervene on the district’s financial and educational operations.

Certifying Negative will require the County Office of Education and the State to intervene on District operations. The intervention will include staying and rescinding of district’s board action.

The goal of the District is to continue certifying “Positive”

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Balancing the 2Balancing the 2ndnd Interim Interim

I. The Problem $6,372,549

Description Budget

II. Budget Adjustments

A. Shock Absorbers $1,312,283

B. Phase I Expenditure Reductions 300,000

III. Total Reduction Required $0

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C. Categorical Flexibility/Sweeps

D. R.R.M./Deferred Maint. Program

E. Net Additional Income

F. Development Fee Staffing

G. Contingency Reserve

1,896,979

1,200,000

1,000,000

363,287

300,000

H. Budget Adjustments in 2008/09 6,372,549

RecommendationsRecommendations Approve 2nd Interim Adjustments totaling

$6,372,549

Budget Revisions, reflecting this plan, will be brought to the Board for approval in February

These adjustment will allow for a positive certification at 2nd Interim assuming the County recognizes

• Governor’s proposal for reducing income

• Governor’s proposed flexibility for reducing expenditures

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THE ENDTHE END

AppendixAppendix

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Qualified CertificationQualified Certification COE may assign a fiscal expert to provide assistance to the district in resolving its

budgetary issues

COE may conduct a financial study of the district, including a review of internal controls

COE may require the district to: Submit projections of all fund and cash balances as of June 30 of the current year and subsequent

year as specified Encumber all contracts and other obligations Prepare appropriate cash flow analysis Prepare monthly or quarterly budget revisions Appropriately record all receivables and payables Submit a proposal to address the financial issues causing the problem

COE may withhold compensation of the Board and Superintendent for failure to provide requested financial information

COE may assign the FCMAT to review and make recommendations to improve the teacher hiring process, teacher retention rate, extension of teacher assignment, and provision of highly qualified teachers The District must then follow the recommendations or show good cause for not doing so

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Negative CertificationNegative Certification COE may develop & impose, in consultation with the Superintendent

of Public Instruction (SPI) & the District board, a revised budget to enable financial obligations to be met in the current year

COE may stay or rescind any action of the District’s board that is inconsistent with the ability of the school district to meet its obligation

COE may assist in developing, in consultation with the District’s board, a financial plan that will enable the District to meet its obligations

COE may assist in developing, in consultation with the District’s board, a budget for the subsequent fiscal year

COE may appoint a fiscal advisor to perform any or all of the above duties

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