San Diego Unified will have to cut between $119 million and $175 million from its 2010-2011 budget and shave another $16.6 million from its spending this school year after running up unbudgeted expenses, staff told the school board this morning.
Pinning down the exact amounts of the future cuts still involves some guessing: Depending on the economy and what the legislature decides, the state deficit could force between $3 billion and $6.4 billion in educational cuts statewide. That could translate into as much as $175 million, according to staff estimates.
San Diego Unified had earlier estimated its deficit for 2010-2011 at $64 million. The district was already trying to avoid unpopular cuts it had tentatively planned to reduce that sum, such as ending magnet programs and high school athletics, closing schools and eliminating librarians. It was able to avoid those cuts last year by shooing senior employees out with a golden handshake and using stimulus dollars.
The deeper deficit makes it much harder for the school district to dodge tough cuts that will impact employees, district staffers told the school board. Chief Financial Officer James Masias said the district will have to either reduce staff or cut salaries and benefits. Many of those cuts must be negotiated with employee unions, which could pose a battle.
“The range of possibilities go from bad to catastrophic,” said Monica Henestroza, who handles government relations for San Diego Unified.
Schools have already been cut deeply: San Diego Unified has slashed almost $200 million from its roughly $1.2 billion operating budget since June 2008. But just a few months into the school year, the district has already overrun that budget. Now it must trim back or end up with a diminished credit rating.
“How could that be?” asked school board President Shelia Jackson, adding, “I’ve got problems with that.”
Masias explained that the overspending included nearly $6 million from interest the district earned on developer fees, that outside consultants Fiscal Crisis & Management Assistance Team said it could spend on general fund items. However, the school district’s own legal counsel later advised it couldn’t use those dollars to cover costs in its general fund, forcing it to find the money elsewhere.
It also included $3.4 million that the school district believed it would save by cutting central office staff, but might not have actually saved because of the way in which employees bumped into other jobs, $3.2 million in extra teachers that schools needed to keep bilingual programs intact or avoid massive classes in certain grades, and other costs ranging from a $531,000 legal settlement to $50,000 to support Mandarin classes in Point Loma. (I’m getting a more detailed breakdown and will post it soon.)
Masias said district staffers are still looking for ways to whittle down the $16.6 million, such as checking if any of the costs can be charged to specialized funds that have dollars left over.