AGENDA ITEM BACKGROUND
TO: GOVERNING BOARD
DATE
FROM: PRESIDENT
February 14, 2011
SUBJECT:
2010-11 and 2011-12 Budget Planning Parameters Update
REASON FOR BOARD CONSIDERATION
INFORMATION
ITEM NUMBER
ENCLOSURE(S)
Page 1 of 3
C.1
BACKGROUND:
The Governing Board reviewed budget planning parameters for 2010-11 and 2011-12 on March 7, 2011.
The Board directed staff to prepare planning assumptions that include the use of 66.67%; $4,026,000 of
operating reserves for 2011-12. The updated planning assumptions are attached.
Administrator Initiating Item:
Victoria Lewis
Academic and Professional Matter
If yes, Faculty Senate Agreement
Senate President Signature
 Yes  No
 Yes  No
Final Disposition
Board Meeting
February 14, 2011
I. 2011 Base Budget Planning Assumptions
2010-11 Final Budget Structural Deficit
Range
Worst
Case
MidRange
Best
Case
(1,886,000)
(1,886,000)
(1,886,000)
1,300,000
1,300,000
1,300,000
216,000
2010-11 Revenue Adjustments- January State Budget
A. Reverse 66.4% of the 2009-10 FTES Reduction (formerly classed
as 2.21%growth)
B. Remove Negative COLA
216,000
216,000
C. Deficit Factor State Property Tax Shortfall@ $15 million
(300,000)
(150,000)
0
D. Adjust General Apportionment Shortfall
465,000
465,000
465,000
0
100,000
100,000
(8,997,000)
(6,184,000)
(3,990,000)
1,097,000
1,097,000
1,097,000
?
?
?
?
?
?
(8,105,000)
(5,042,000)
(2,698,000)
Full-time Faculty Obligation -Fall 2011 (205.6) (6 budgeted/unfilled funded)
0
(270,000)
(360,000)
(Faculty step 5/5, with benefits $90,000)-reduce funded 0, 3, 4
Adjunct Replacement Units- 30 units per FT position @ $1750 per unit
0
0
(3)
157,500
(4)
210,000
Classified positions
0
0
0
0
0
0
66,000
66,000
66,000
E. Part-time Faculty Compensation
2011-12 Revenue Assumptions
A. General Apportionment Red.- $8.99 mil, $6.184 mil, $3.99 mil
B. Increase in Student Fees $110 mil.-to offset apportionment
reduction
C. Deficit Factor Student Fee Revenue Shortfall
Other
TOTAL Revenue Adjustment
2011-12
Management positions
Benefits
Increase in Transfer to Retiree Benefit Fund
Increase in Transfer for future retiree liability (new employees,etc.)
?
?
?
935,000
825,000
715,000
PERS employer rate increase for 2011-12 (rates continue to
increase in subsequent years - 3.24%).
STRS rate increase
Increase in Worker's Comp., Gen. Liability,
17%
400,000
3.24%
0
85,000
15%
400,000
3.24%
0
80,000
13%
400,000
3.24%
0
75,000
Step and Column Increases (includes longevity, shift diff.)
395,000
395,000
395,000
2011-12 Medical benefit increase
Labor Agreements
?
?
?
New Facilities Supplies & Operating Staff
0
0
0
District Contribution- Bus Pass Program
(100,000)
(100,000)
(100,000)
Operating Costs: Supply budget increases for COLA
0
0
0
53 and 54 object classifications
0.00%
0.00%
0.00%
Operating Costs:
Other net operating increases
200,000
150,000
100,000
1,981,000
1,703,500
1,501,000
Total Expense Adjustments
Projected 2011-12 Structural Balance (Deficit)
(10,086,000)
(6,745,500)
(4,199,000)
66.67% of Operating Reserves applied to 2011-12 Defict
4,026,000
4,026,000
4,026,000
Net Reduction Target for 2011-12
(6,060,000)
(2,719,500)
(173,000)
Budget Planning
Board Meeting
February 14, 2011
Difference between ongoing Revenues &
Expenses (Structural Deficit)
Increase in State Revenue Anticipated
Property Tax Shortfall
1/2 of 2.21% Growth in Governor's Budget
Negative .39% COLA Restored
General Apportionment adjustmnet
Part-time faculty compensation
Gen. Apportionment reduction- $8.99 mil, $6.184
mil, 3.99 mil
Increase in Student Fees $110 mil to offset
apportionment reduction
Net change in revenue
2010-11 through 2013-14
Base Budget
Planning Parameters
2010-11
Budget Update
2011-12 Preliminary Budget
Mid-Range Scenario
2012-13
Projected
2013-14
Projected
(1,886,000)
45,000
(6,745,500)
(8,790,500)
0
0
(150,000)
(425,000)
(112,500)
(450,000)
(150,000)
1,300,000
216,000
465,000
100,000
(6,184,000)
1,931,000
Net Increases in Ongoing Expenses
Full-time Faculty Position changes (-3, +4, +3) (net of adjunct backfill)
Step, Column, Longevity Increases, etc.
Classified Positions
Medical Plan Rate Increase--15%
Management Positions
Retiree Benefit Increase
PERS Rate Increase
STRS Rate Increas
Worker's Comp, Unemployment Insurance
New Facilities Supplies & Operating, Staff
Utilities
Net Operating Increases
District Contribution- Bus Pass Program
Retiree Benefits- New Employees
Labor agreements
Total Expenditure Increases
Budget Reductions
Ongoing Shortfall*
45,000
1,097,000
(5,087,000)
112,500
(395,000)
0
(825,000)
0
(66,000)
(400,000)
0
(80,000)
0
0
(150,000)
100,000
?
?
(1,703,500)
(725,000)
?
(50,000)
(395,000)
?
?
?
(100,000)
(200,000)
(750,000)
?
(100,000)
(175,000)
?
?
?
(100,000)
(225,000)
?
?
(2,045,000)
?
?
(1,912,500)
?
?
?
(6,745,500)
(8,790,500)
(10,703,000)
Allocation of 66 2/3% of operating reserves
4,026,000
Deficit net of One-time funds
(2,719,500)
*Estimates will change as more information becomes available