Your Budget Questions Answered

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Recently Asked Questions and Answers - Updated September 2011

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What is the district’s total revenue and expenditures?

Visit www.DistrictDollars.org for full details.

What is the impact on the district of state budget reductions?

State funding has been reduced by over $1,100 per student since 2007. That has been a 15% loss in revenue for DJUSD.

How much do Measures Q, W and A contribute to the district’s revenue and what programs do they fund?

Measure Q contributes $4.1 million to the district annually, Measure W contributes $2.4 million, and Measure A contributes $3.2 million. These dollars can only be spent on programs defined within the ballot measures, though in many cases only a portion of the program is funded. A Citizen’s Oversight Committee reviews all expenditures. Measures Q and W sunset in June 2012. Measure A sunsets in June 2013.

Measure Q provides funds to:

Preserve reading specialists and aides;
Preserve training available to all district teachers and staff;
Preserve school-based technology support, classroom and library materials;
Preserve additional class periods and teachers so that our secondary schools can offer music, art, foreign languages and career/technical courses;
Preserve class size reduction programs;
Preserve school counselors, nurses and others providing direct student support services;
Improve nutrition at schools by providing students with fresh farm produce and;
Implement a math specialist program for classroom support.

Measure W provides funds to:

Preserve elementary science instruction;
Preserve availability of class periods for core science, math, English, and social sciences;
Preserve elementary music;
Preserve librarians at elementary and secondary schools;
Preserve secondary class size reduction for 9th and 10th grade English and math;
Preserve availability of class periods for foreign language, music and physical education and
Preserve athletics and co-curricular programs including drama, debate and journalism programs.

For more information, consult the 2010 report of the Measures Q and W Citizen's Oversight Committee.

Measure A provides funds to preserve and continue to fund the following specific programs and services:

Continued availability of specialized science instruction program;
Continued reduced class size;
Continued availability of sufficient numbers of classes in core subjects;
Continued availability of multiple foreign language programs;
Continued availability of school music programs;
Continued improved school nutrition through Farm-to-School initiatives;
Continued availability of librarian services;
Continued availability of athletics and co-curricular programs;
Continued availability of Reading and Math support programs;
Continued availability of ESL, At-Risk, and Career Technical programs;
Retaining Counseling, Nursing, and Psychologist staffing; and
Continued availability of Site Safety and Support services.

Why were recent budget shortfalls not anticipated and addressed when the parcel tax was structured?

The district currently has two parcel tax measures. Measure Q was approved in November of 2007 and is the continuation of a tax measure that started over 20 years ago. Measure W was approved in November of 2008 to cover the shortfall of funding identified for 2008-09 that was identified in the spring of 2008. In order to get on the ballot in November, a measure must be sent to the county elections office in July.

The amount for Measure W was developed from the projected funding shortfall and polling of the community on the level of tax and possible programs they would be willing to support. The $120/parcel amount that generates the $2.5 million was considered a bit of a stretch at the time.

The current budget shortfall was greatly masked by the state of California’s budgeting process and the magnitude of the shortfall did not come out until later in 2009 after tax receipts and property taxes started to free fall. This was long after the process of developing Measure W. The state budget has continued to erode since then, widening our budget deficit.

Does DJUSD have a structural deficit and if so, how much?

A structural deficit occurs when an organization’s ongoing expenses exceed its ongoing revenue. The District is deficit spending by about $4.5 million a year, and will need to reduce expenditures or increase local revenue by that amount in order to maintain long term fiscal solvency.

Why is it so difficult to reduce a school district’s budget?

Educating students is both labor intensive and highly regulated. Employee compensation accounts for over 85% of the operating budget and the majority of the employees work under collective bargaining agreements that cannot be changed unilaterally.

Is DJUSD required to balance its budget?

The district is required by state law to adopt a three year budget plan and submit it to the Yolo County Office of Education by June 30 each year. This budget will be approved by the county if it shows the district is able to meet its financial obligations and maintain a reserve for economic uncertainty. The district must also file interim reports on December 15 and March 15 showing a continued ability to meet financial obligations and maintain the reserve for the three year period. If so, the county issues a “positive” certification of the budget.

If the budget plan shows the district may not meet its financial obligations, a “qualified” certification is assigned by the county. The district is then required to develop a fiscal recovery plan. Depending upon the size of the problem and the district’s ability to address the issue, the county may require various levels of outside intervention to assist the district in achieving solvency.

If the district’s budget plan shows that it will not meet its financial obligations, a “negative” certification is assigned. The district is required to develop a fiscal recovery to address the problem and the county requires immediate intervention, which could involve setting aside decisions of the local governing board.

What are the key dates in the budget process?

July 1, 2011: Budget submitted to Yolo County Office of Education
December 15, 2011: First Interim Budget Report
January 2012: January State Budget Update
March 6, 2012: Measures Q and W renewal ballots due
March 15, 2012: Second Interim Budget Report, preliminary lay-off notices issued
May 15, 2012: May State Budget Revision, final lay-off notices issued
June 30, 2012: Adopt Final 2010-2011 Budget

Has the district made spending cuts to adjust for lower revenues?

Yes. The district reduced expenses by $3 million in 2009-2010, eliminating 22 certificated and 15 classified full-time equivalent positions. The district reduced expenses by more than $2 million in 2010-11, eliminating 42 full-time equivalent positions.

Does the district have reserve funds to help close the budget gap?

Yes, the district does have carryover funds available. The district keeps a 3% reserve – currently $2 million – for economic uncertainties and to remain fiscally solvent. The district also maintains a 1% contingency, or $650,000, for current year operating emergencies. This year the district also has a multi-year budget balance reserve to maintain fiscal solvency throughout the three year budget cycle.

Given that the state has temporarily reduced to 1% the mandated reserve for economic uncertainty, why is the district still retaining reserves in excess of that amount?

In order to manage its own lack of cash, the state of California deferred payments in apportionments to schools due in 2011-12 to 2012-2013. For this reason, the district is maintaining a higher than normal reserve to guarantee sufficient cash on hand to meet spending obligations, including payroll.

As sound financial management, consistent with the advice of the Yolo County Office of Education and the Fiscal Crisis Management and Assistance Team, the district plans not to let reserve levels dip below 3%.

Are step and column increases still in place for district employees? If so, what is the cost and how is it paid?

Step and column increases remain in place. The annual cost for all employees is $700,000 from the general operating fund. In normal years, 30-50% of this would be defrayed by teacher retirements, that is, the salary difference between a new and a senior teacher. The remainder would have been covered by cost of living adjustment (COLA) to the district’s state funding. The state has not fully funded COLA since 2007.

For the 2010-11 school year, the Davis Teachers Association requested and was given a teacher retirement incentive to accelerate retirement savings to decrease layoffs of less senior teachers. The district offered a cost neutral incentive paid over five years by these savings. During this period, retirement savings are not available to fund step and column increases.

To address future funding shortfalls, the Board of Education acted last spring to negotiate new contracts that eliminate automatic step increases for administrators.

Does the district lose funding whenever a student is on vacation?

Yes. Regardless of whether the absence is excused or not, the district loses about $40 per day when a student is absent. Obviously, when a child is ill they should stay home so they may recover and not infect others, but scheduling family trips during regular school holidays helps avoid lost funding.

If you know your student will be absent for more than five consecutive school days, please consider requesting an independent study contract. This allows them to keep up with school work and the district to receive daily funding on their behalf.

If your child attends elementary school, request a contract in the school office. To obtain an independent study contract for secondary students, contact the School for Independent Study at 757-5333 or lneundorfer@djusd.k12.ca.us.

When a student residing outside of the district attends a DJUSD school, is that a boost in funding for the district or a negative? If it is a benefit to the district, is it possible to increase funding by opening up our schools to families employed in Davis but not living in Davis for school attendance?

A student who resides out of district and attends a DJUSD school brings additional per pupil state funding with them, though their families do not contribute to local parcel taxes. Overall it is a financial benefit to the district. The district encourages and accepts application from any interested student. Requests for specific schools are accommodated as space permits.

Does the district have property that could be sold to help close the budget gap?

The district does own two properties, Grande and Wildhorse/Nugget Field, originally intended as school sites but now declared surplus to educational needs. The Grande site has been entitled by the City for development. That process has not been initiated by the district for Wildhorse/Nugget Field.

Previously, proceeds from the sale of surplus property were restricted by the state for use on facilities. That is, the money could only be spent on maintaining or constructing buildings in the district.

As part of a broader effort to provide districts with more local control over how they use diminished resources, the July 2009 state budget included temporary flexibility for districts to sell surplus properties and use the proceeds for any purpose. Sale of the district’s surplus properties could temporarily avoid some program reductions for a short period of time.

There are, however, several reasons why the district may choose not to use this temporary flexibility:

The district has current facilities needs that would require the use of these funds in the foreseeable future.
In selling property, the district must agree to forego future state emergency facility funding.
The market values of the properties are currently depressed, but expected to recover in the future.
Proceeds from a sale are a one-time source of funds and do not address the district’s ongoing structural deficit.

Is the district considering closure of a school to address the budget deficit?

Several years of declining enrollment resulted in the closure of Valley Oak Elementary School in 2008. Since then, the district’s student population size has stabilized and is projected to grow slowly over the next ten years. The most recent demographic project is available here.

There are no school sites significantly under-enrolled at this time. Increasing class size (affecting grades K-3 most notably) to close the budget gap calls into question whether all elementary campuses are needed, but the flexibility granted by the state to increase class size is temporary in nature. To keep the option of returning to lower class sizes available, the district must maintain all its present school sites.

The estimated savings of closing an elementary school site is $350,000, and $450,000 for a junior high. This amount would not close the budget gap and the discussion over which school to close would be deeply divisive for the community. For this reason, Superintendent James Hammond is not recommending school closure at this time.

What impact does categorical "flexibility" have on the budget?

A large portion of state education funding, known as categorical, is allocated to districts for specific programs. Categorical flexibility, granted in the state budget, means that some of that money need no longer be restricted to those programs and can be used for General Fund purposes, with the consequence that the program is reduced or no longer offered. This allows districts to make local decisions on how to respond to budget reductions.

Categorical flexibility has allowed the district to temporarily reduce support programs in order to retain core programming.

Has the district received new federal funds to restore jobs and programs?

DJUSD received $1.4 million in federal education jobs funding in fall 2010.

During the layoff process, why does the district send notices to more employees than it intends to let go?

By law, an employee who will be laid-off must receive first notice of possible action by March 15. The district requires flexibility to respond to unknowns such as changing student enrollment or complications in the seniority process that dictates lay-offs. For that reason, more employees are typically noticed than will actually be laid-off. The additional notices also allow the district to respond should the state impose greater than expected reduction in revenue.

Do special programs like GATE, Spanish Immersion and Montessori cost more per pupil than the general education program?

There is a basic cost for educating students in each classroom, whether the classroom is general education, GATE, Spanish Immersion, or another program. In some cases, categorical funds specific to the program were available to fund district coordinators. Where that categorical funding is now flexible, coordinator positions have been identified for reduction.

Are there courses with low enrollment, e.g. foreign language or music, being offered at the high school?

Parcel tax revenues permit some programs to be offered despite fluctuation in enrollment. In addition, the Board of Education has authorized use of some one time monies to retain programs that would otherwise be lost to budget cuts.

The district does not “fully load” at-risk classes such as ACES, reading interventions, and/or Algebra One and remains committed to smaller class sizes for all at-risk/intervention courses to give those students the most positive learning environment needed to close their achievement gap.

Does the district have unfunded liability in connection with its post-employment retirement benefits program? If so, how much?

Yes. As reported most recently in the DJUSD 2010-11 Adoption Budget Report, the district pays retiree health benefits (other post employment benefits or OPEB) to 81 retirees. Based on 2007 actuarial valuations for current and future retirees, the unfunded actuarial accrued liability is $12,482,499 over a 27 year period.

Retiree health benefits are unique to each school district. DJUSD has a relatively low benefit capped at $1,500 annually for employees who continue on the district’s health plan. The annual cost is $26/Average Daily Attendance which is 20% of the state average for unified districts. This amounts to $220,000 annually, paid from the General Fund. This accounts for 0.3% of the total General Fund Budget.

The budget pie chart in District Dollars does not reveal how much the schools pays to keep the lights on, the heat on, and the air conditioning on when needed. What is the actual cost of energy to the district? How might this expenditure be reduced?

The district spends around $1 million on energy. Usage has been reduced over 20% annually as part of an energy reduction program that is administered by a dedicated energy manager. Other reductions are planned from facilities upgrades to mitigate usage and generate alternative energy (solar).

Woodland buses currently transport special education students in Davis. Is it cheaper to contract them rather than provide one van for the district?

Special education transportation is a specialized service that can not be provided with passenger vans. We are required to provide these services to over 70 students. It is cost beneficial to contract to another school district that provides bus transportation rather than owning and operating DJUSD buses to provide the service.

How do I stay I informed about future decisions?

The Board of Education meets the first and third Thursday of each month. Agendas and back-up documentation are available online. Meetings are broadcast live and in replay on cable channel 17 and videostreamed at www.djusd.tv.

Current and historical documents are posted on the district’s website.

Where do I direct my budget related questions?

Email your question to budgetinput@djusd.k12.ca.us.

May I make a donation to support the students of the school district?

We appreciate your support of our students. You may donate directly to the district (526 B St., Davis, California 95616) or through one of our supporting foundations:

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