SCHOOL DISTRICT REORGANIZATION Vicki L. Barber, Ed.D., Superintendent Terena Mendonca, Deputy Superintendent El Dorado County Office of Education El Dorado

SCHOOL DISTRICT REORGANIZATION

Vicki L. Barber, Ed.D., SuperintendentTerena Mendonca, Deputy SuperintendentEl Dorado County Office of Education

El Dorado County2011

Purposes of Presentation

• Provide General Information– Process– Implications– Options

• Financial Implications

• Employee Issues

3El Dorado County Office of Education

Background

• The recession has taken its toll on all public programs

– State General Fund revenues are down more than 14% since 2007-08

– K-12 funding for general purpose functions is down more than 10% and most categorical programs have been cut 20%

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Background

• School district consolidations provide an opportunity to increase revenue limit income and reduce local costs

– Current law (Education Code Section [E.C.] 35735, et. seq.) provides for a permanent increase to the base revenue limit

– Consolidations provide opportunities to capture economies of scale and reduce or eliminate duplicative functions

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Why Look at Reorganization?

• Consolidate some services, i.e.: administration, pupil personnel services, library services, etc.

• Improve fiscal status – increase state aid and/or reduce expenditures

• Facilitate economies of scale

• Provide more options for students – improve educational offerings


Reorganization Options• Territory

Transfers/Unionization

• Unifications

• Lapsation of a district

• Transfer Junior High Students


Petitions

• Initiated by the Electorate– 10% registered voters

• Initiated by the County Committee– 25% registered voters

• County Committee Directed

• Local Governmental Agency


New or Consolidated

• Consolidate districts by transfer of territory– eliminate one district and

transfer into existing district. District A becomes bigger, contracts continue in place

– Can have a waiver to require a new governing board election.


New or Consolidated

• Create a new district • Dissolve two or more

elementary districts and create new one

• Initiated by the electorate or by majority of boards

Elements of a Petition• Petition• Boundary Description

and Maps• Rationale for

Reorganization• Analysis and Conclusions

based on State’s 10 criteria

• E.C. Section 35705.5 Provisions

• No Adverse Affect on School District Organization

• Agenda and Minutes Public Hearings


State’s 10 Criteria

• Adequacy of Size

• Substantial Community Identity

• Equitable Division of Property and Facilities

• Not promote Racial/Ethnic Discrimination/Segregation

• No Substantial Increase in State’s Costs


State’s 10 Criteria (Cont.)• No Disruption of Educational

Programs

• No Significant Increase in Housing Cost

• Not Primarily Designed to Result in Significant Increase in Property Values

• Not Cause a Substantial Negative Affect on Fiscal Management/Fiscal Status of Affected Districts

• Any Other SBE Criteria Prescribed


AB 174 Streamline Option

• Streamlines the process for specified school district reorganization– If affected school districts and

county superintendent of schools consent, and

– If an agreement to share CEQA costs exists

• Eliminates approval or disapproval at the state level by the SBE

• Clarifies CEQA responsibilities


AB 174 Concerns & Benefits• Concerns

– Support from the governing boards of affected school districts and county superintendent may not be a guarantee that no local controversy exists

• Benefits– Process for local school

district organization is simplified and streamlined

– Local county committee empowered to make local decisions 15

El Dorado County Office of Education

E.C. Section 35705.5 Provisions• Rights of the Employees• Revenue Limit• Governance by Provisions of

City Charter• Governing Board

Composition (5 or 7) and Trustee Areas or Election at Large

• Election Area


E.C. Section 35705.5 Provisions, (Cont.)

• Whether the Proposal Creates 2 or More Districts and Whether the Proposal Will be Voted on as a Single Proposition

• How Property, Obligations, and Any Bonded Indebtedness Will be Divided

• First Governing Board Election and Terms of Office


Other Issues in the Process

• Public Hearings in Each Affected District

• Estimated Timelines: 2 – 3 Years

• Election Needed (Unless territory uninhabited or comprises less than 10% of assessed valuation of district transferring territory and Governing Boards agree or Waived by SBE)


Elections

• When? – Next Regular Election– Special Election – SBE

Waiver

• Area of Election?– Affected Area– Unclear– If opposed – expect Litigation


Revenue Limit Calculations• When districts reorganize – a

new base revenue limit is calculated using 2 step process:

– Step 1 – Blend existing revenue limits using weighted average calculation – No new money

– Step 2 – Calculate add-on for differences in average salary/benefits costs – Only new revenue


Other Issues with Add-On to Revenue Limit

• Not required to adopt higher salary schedules/benefit offerings – Subject to Negotiations

• Add-On Capped at 10% of Blended Base Revenue Limit

• Calculations are Prorated based on ADA for District Partially Included in Reorganization

• District used to Determine Highest Costs per FTE must constitute 25% of total FTE of Reorganized District 21El Dorado County Office of Education

Employee Issues

• Consolidation – All employees become employees of new district

• If not total district affected by reorganization – staff assigned to new district based on whether site is within the area reorganized – district-wide staff may choose, subject to reasonable reassignment


Employee Issues (Cont.)

• Surplus employees – dismissed in reverse order of seniority – with May 15 notification and 39 month reemployment rights

• Power to determine compensation resides with governing board of reorganized district, subject to PERB decisions and negotiations. (Note Unification exception for Classified Staff)


Employee Contracts

• Right to Continued Employment does not exist, except Unification for Classified Staff

• Prior Contracts are not Enforceable in a New District


Employee Contracts (Cont.)• Representation of Employees

• Recruiting for New district – Duty of New Board

• Development of Uniform Salary/Benefit Schedule

• Contracts with Superintendents Probably Nullified


Economies of Scale• Difficult Decisions

• Greater staff specialization

• Analysis of Potential Reductions– Administration– Support Staff– Closing School Sites– Transportation– Other Areas


Potential Positive Outcomes

• More sites – Greater flexibility, more programs and capacity to serve students

• More specialization of programs

• More specialized staff – more opportunities for curriculum and staff development


Potential Added Costs In Reorganizations

• Additional Administrative Staff – larger student population = more staff

• Transportation Issues• Salary Schedules/Benefit

Packages in Excess of Add-On Revenue Limit Funding

• Assumption of Debts• Loss of some income, i.e.:

Direct Service, etc.• Others


Preliminary Revenue Analysis and Findings


• School Services of California, Inc., computed 24 different district combinations– Small district combinations of less than 2,000 ADA– Large district combinations of more than 8,000 ADA– Geographic consolidations arranged by the two major local

highways – Highway 50 (east/west) and Highway 49 (north/south)



• Small district consolidations – six combinations considered– Largest funding increase: Gold Trail + Mother Lode (1,800

ADA; 9.74% increase yielding $1,068,926)– Smallest funding increase: Pollock Pines + Camino (1,083

ADA; 2.59% increase yielding $171,127)

Small District Consolidations



• Large district consolidations – 11 combinations considered

– Largest funding increase: 5.79% yielding almost $4.8 million

– Smallest funding increase: 1.65% yielding almost $850,000

Large District Consolidations



• Geographic consolidations – Seven combinations considered

– Largest funding increase: Mother Lode + Gold Oak + Pioneer (2,218 ADA; 6.4% increase yielding just under $870,000)

– Smallest funding increase: Rescue + Gold Trail (4,500 ADA; no increase)

• This combination produces no additional funding because the district with the higher average salaries – Gold Trail – cannot be the target district due to size

Geographic Consolidations



• Other findings

– 11 district combinations generate at least a 5% increase

– The largest increases are from small size consolidations

– Buckeye influences most of these combinations due to its size and average salaries

Consolidations, Greater than 5% Increase

Community Considerations…• Community Decision Making Points

– Greater Educational Opportunities for Kids?

– Greater Economies of Scale?– Greater Opportunity to Manage

Dwindling Resources?– Opportunity to Capture Additional

Revenue– Greater Opportunity to Focus on Areas

of Expertise?– School vs. District identity

Questions

Complex Issue – No Easy Answers

Thank You!

Documents

SCHOOL DISTRICT REORGANIZATION Vicki L. Barber, Ed.D., Superintendent Terena Mendonca, Deputy Superintendent El Dorado County Office of Education El Dorado