15 Sep 2014
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District’s $1.6M Surplus Won’t Go Far

The net gain of $2.1 million after the 2010-2011 school year is $1.6 million more than projected, but that doesn’t mean the district’s funding worries are over.

Despite $1.6 million more funding than projected, the is still facing an uphill funding battle.

$1.36 million is already earmarked for certain school programs, restoring employees who were laid off, and other costs. The rest will go into the district’s reserves.

“It’s technically a surplus, but it’s not an incredible amount of money,” said Chief Business Official Raul Parungao.

“We will take any money the state or federal government will give us, but they’re earmarked for specific purposes,” he added. “What we need is flexibility.”

And with budgets cuts of $2 million and $3 million coming in 2012-13 and 2013-14, the surplus will be used to keep reserve funds barely above the required 3 percent state minimum.

The $304,000 will reduce the cuts from $2 million in 2012-13 to $1.7 million, which will be used to save jobs, Parungao said.

The $304,000 came from the following savings and expenditures:

Reserve FundsAmountSavings from maintenance and operations budget $249,970 Changes in Special Education Revenue $137,279 Savings from utility costs $115,920 Increase in interest income $85,608 Savings from special ed budget $84,772 Increase in revenue from Medical Administrative Activities (MAA) $27,970 Changes in revenue limit $17,277 Changes in State revenues $12,515 Changes in expenditures -1,366 Changes in local revenue -$26,023 Reduction in special ed revenue from share in high cost pool  (Special Education Local Plan Area- SELPA) -399,882Total Reserve$304,040

The district was able to cut maintenance and operations costs and reduce utilities bills to save a total of $366,000. The operations savings are put aside for facilities in emergency cases like the clean-up after the .

However, the state is threatening more mid-year cuts, which could come as early as January. If the state can raise $4 billion in revenue, school budgets will not be affected. Should the state not hit , further cuts will be made to school districts already operating with limited budgets.

If the state only raises $2 to 3 billion, there will be cuts to childcare programs, community colleges and higher education.

K-12 budgets would be affected if the revenue is less than $2 billion. These budgets would suffer $1.5 billion cuts, or $250 per student in the Redwood City School District. Perhaps most alarmingly, the school year could be cut up by another seven days, in addition to the five days that districts can cut from the typical 180 day school year.

“The money the district generates today may prevent any of these projected budget cuts in the future,” Parungao said.

 

Special Education and Miscellaneous Costs

The $304,000 reserve money is not as high as it could have been because the district received nearly $400,000 less from the county for special education services than anticipated.

However, should it cost a large sum of money to educate an individual special needs student, a local school district can apply for reimbursement from the county, which receives money from the federal government. Parungao said after a certain cost threshold, a school district is eligible for 100 percent reimbursement for a student’s education.

Another blow to the district’s budget was the . The Individuals with Disabilities Act (IDEA) was passed to ensure that students with disabilities would receive fair and equal education, but the federal government does not have the money to give to school districts to ensure that this equality prevails.

The district received only $8.1 million from the federal government of the $15.3 million needed to educate these students. The district had to transfer $7.1 million from its General Fund to this Special Education fund.

“We are truly in need for these students, but the federal government does not provide the entire funding,” Parungao said.

If districts do not comply with these mandates, they could be sued, even though they have not received adequate funding.

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