Ramona Unified School District

1. Ramona Unified School District First Interim Report December 17, 2009

2. Interim Report • What is an Interim Report? • Report of a district’s financial status, including revised projections and activity through a certain point in the fiscal year • What is the Purpose of the Interim Report? • Review financial condition of district • Revise assumptions in the previous budget • Determine if revisions are needed • Provide status report to interested parties • Determine if district will meet financial obligations

3. First Interim Report • Budget is brought to the Board four times a year • July 1st First Budget of the year • December 15th First Interim Report • March 15th Second Interim Report • September 15th Unaudited Actuals • Keep Board apprised of budget assumptions and new developments • First Interim Report sets the expenditure budgets for the year

4. Budget Budget details a plan for spending Budget constantly changes as new information is received and incorporated into the adopted Budget Most change occurs from the adoption of the Budget (July 1st) until the First Interim Report State of California Budget is not even signed Previous year’s Budget is not finalized Enrollment is not set, so staffing for the enrollment is not finalized

5. Tonight • Major Assumptions • Revenues • Enrollment • Budgets • Staffing • The Numbers of the First Interim Report • Carryover from the Unaudited Actuals • Setting the expenditures for the year • What RUSD and State of California can expect for the next few years

6. Major Assumptions • The estimated actuals and the June adoption of the 2009-2010 Budget were based upon the Governor’s May 14, 2009 proposals • What was signed into law is much different than what was proposed, creating a very different outcome of the 2008-2009 actuals and the 2009-2010 Budget than had been anticipated

7. Revenues • Revenue limit has decreased due to the one-time cut to base revenue limit of $252.83 per Average Daily Attendance (ADA), which equates to a decrease of $1,631,525 • This dollar amount was part of the ending balance for 2008-2009 • Now this reduction is part of the Revenues

8. Enrollment • Until the first day of the new school year, enrollment is just a projection. Yet enrollment has major budgetary impacts for: • Staffing • School Allocation • Transportation

9. The Numbers • Total Revenues $49,315,332 • Total Expenses $55,491,444 • Difference ($ 6,176,112) • Beginning Balance $ 8,552,469 • Ending Balance* $ 2,376,356 • *Projected Ending Balance

10. The Numbers Components of the endingfund balance $2,376,356 2010-2011 Budget $ 1,886,910 Accrued Vacation $ 464,446 Other $ 25,000 Percentage Reserve $1,667,743 to meet required 3% reserve 4.27% general fund projected ending balance

11. The Numbers RUSD is projected to deficit spend by over $6.1 Million Carryover from 2008-2009 must be factored into the current Budget, which inflates expenditures without adding revenues to offset them, thus creating deficit spending Carryover creates a big difference in the expenditure budgets from the July 1st adopted Budget to the First Interim Report The Federal Stimulus Dollars account for a majority of the carryover

12. Carryover Factored Into Budget Carryover in Budget ARRA/ASFSF Funds $2,252,229.00 Site/Dept. Carryover $ 814,944.00 Unrestricted Cat. $ 693,799.82 Restricted Cat. $1,790,348.67 Total $5,551,321.49 Consists of budgeted expenditures, no new revenues Revenues are from previous years The majority of these dollars are expended under the books and supplies object code, which the budget increased by $3,158,000

13. Comparisons - Revenue

14. Comparisons - Salaries

15. Comparisons - Benefits

16. Major Changes • School is back in session, so enrollment numbers are tied in • Retirees, replaced positions, and new hires into salary schedule • Health benefits have been finalized • Dollars in ending balance have been distributed to sites and departments

17. Looking Ahead • Second Interim Report will be presented to the Board in March • Will look at assumptions and make adjustments • Any mid-year reductions from the State • Emeritus program will be implemented and budget changes will be reflected in the budget • State of California Budget for 2009-2010, 2010-2011 • Predicting a $20 Billion deficit • January 13th 2010-2011 Governor’s Budget Workshop, presented by School Services of California, Inc.

18. Multi-Year Projections • State requires each district to project out current year and next two fiscal years to maintain fiscal health and to identify any significant issues • RUSD’s reserve meets State’s requirement for 2009-2010, even with a potential mid-year cut • RUSD’s reserve will meet the State’s requirement for 2010-2011 with assumed early retirement incentive and projected budget savings

19. Multi-Year Projections • RUSD’s reserve will meet the State’s requirement for 2011-2012 if we continue to maintain diligence on expenditure reductions • However, the potential of large reductions to funding from the State, combined with continued decline in enrollment, could create a qualified status for Ramona Unified School District • Qualified Status: A district might not be able to meet its financial obligations for the current and 2 additional years • It is very difficult to forecast that far out

20. Conclusion • Thus far, RUSD has weathered the financial storm, yet the storm is still out there and the next few years will be the toughest ones yet • No relief from the Federal Government in a second wave of dollars • More cuts needed at the state level