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Budget Update Welcome Back. Diana Keelen August 17, 2012. “While the California budget is uncertain, there is one thing that is certain, it will change.”. California State Budget. Deficit is $14.7 billion Assumes the passage of Proposition 30: Schools and Public Safety Act in November

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Budget update welcome back

Budget UpdateWelcome Back

Diana Keelen

August 17, 2012

  • “While the California budget is uncertain, there is one thing that is certain, it will change.”


California state budget
California State Budget

  • Deficit is $14.7 billion

  • Assumes the passage of Proposition 30: Schools and Public Safety Act in November

  • Temporary sales tax increase of 0.25% and progressive 1-3% income tax increase for those making over $250K per year.

  • Polling is at 52-56%

  • Competing with Molly Munger tax geared towards K-12 only


California community college budget
California Community College Budget

  • Tax package would bring 4% additional funding each year or $3 billion to community colleges over the next 7 years

  • It would provide $548.5 million alone in 2012-2013, including $50 million in growth-Timing may be a challenge

  • Includes $28 per FTES in Mandated Cost Reimbursement

  • RDA hold harmless agreement

  • Deferrals are at $961 million-$159 million would be “bought down”

  • If the tax package fails, college enrollment would drop by 85,000 FTES

  • If the tax package fails, CC budgets would be reduced by $338.6 million

  • If it fails, deferrals would be on-going






Deferrals
Deferrals

  • California Community College Deferrals now at $961 million

  • AVC impact: Deferral total of $14,165,447 or roughly 32% of our apportionment.

  • For 2012-2013, we will only receive 40% of what we received in the first 5 months of 2011-2012



2012 2013 draft adopted budget assumptions
2012-2013 Draft Adopted Budget Assumptions

  • No COLA

  • No Growth, although if tax package passes, there is about $50 million in growth or ~$400K-$450K to AVC

  • Scenario B with tax package not passing

  • Continued deferrals of over $14 million

  • No deficit co-efficient

  • Continued deficit spending reserve-Need a plan

  • Risk of falling below 8% reserve next year



2012-2013 Draft Adopted Budget & Projections

Preliminary Figures/Unaudited Actuals

As of 8/13/2012

2013-2014 and beyond assumes 4% increase if tax package passes will most likely go to deferral buy down



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