Ramona Unified SCHOOL DISTRICT Second Interim Report 2011-2012

1. March13, 2012 Ramona Unified SCHOOL DISTRICTSecond Interim Report 2011-2012

2. Second Interim is the time to update budget assumptions Also time to incorporate the Governor’s January budget proposal During most years changes to the budget have been few and minor However, with the State in fiscal turmoil, this has not been the District’s experience for the past few years, and many major adjustments have had to be made due to changes made by the State Assumptions UPDATE

3. The budget plan presented to the Board over the past several months is now in place and can be seen in this report • The mid-year trigger enacted in December changed in February due to SB 81 • $323,000 loss in revenue limit dollars • Mid-year layoff of classified employees • $207,000 • Mid-year retirements and resignations • $253,000 • 3 furlough days for members of CSEA and ALT • $164,000 BUDGET PLAN INCORPORATED INTO REPORT

4. Revenues $46,190,654 • Expenses $51,124,764 • Difference ($ 4,934,110) • Transfers from Special Reserve $ 986,000 • Beginning Balance $ 8,194,395 June 30, 2011 • Ending Balance $ 4,246,285 Projected for June 30, 2012 2nd Interim final numbers

5. Site and department dollars that were in supply budgets have been swept and have increased the ending balance Salary and benefit budgets are decreased due to mid-year retirements, resignations, and layoffs, as well as 3 furlough days for CSEA and ALT Net result is an increase of over $2 Million to ending balance Why the increase to the Ending balance?

6. These changes have not altered the need for additional ongoing budget reductions; they are merely a part of a $6.5 Million solution Why the increase to the Ending balance?

7. Multi-Year projection

8. What is included: • Board-approved layoffs for teachers and classified employees • Board-approved teacher retirements • Healthcare cost increase of 10% • Step and column increase for employees • CPI 2% increase for supplies and operating expenses Multi-year Assumptions

9. What is not included: • Any new revenues resulting from a November tax initiative • No COLA, transportation funding, the loss of $370 per ADA • No savings from revisions to bus routes, additional layoffs, additional retirements, or employee group concession • No unspent dollars from categorical programs, sites, or departments Multi-year Assumptions

10. June 30, 2012 -- Without borrowing, it is projected that RUSD will be almost $4 Million short of cash necessary to meet operating expenses • The State defers cash for 2011-2012 fiscal year until the 2012-2013 fiscal year • Estimated to be over $6.4 Million that will be deferred • Borrowing from Special Reserve Fund and Developer Fee Fund should be sufficient to meet the needs for the current year • June 30, 2013 --With Developer Fee Fund depleted due to COP payments, meeting the June payroll will be very challenging Cash flow

11. 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 2011-2012 RUSD’s reserve will NOT meet the State’s requirement for 2012-2013 and 2013-2014 under current scenario, unless the State budget and the dollars for K-12 education are increased and additional reductions to ongoing expenses occur Qualified status

12. May Revise will be important to see the status of Governor Brown’s proposal • Class size reduction penalties • Transportation funding • Weighted student formula • Status of deferred cash • Ballot measure • Continue to monitor cash flow and budget projections Next steps