Adopted Budget
2011-12
August 22, 2011
1
Overview
Adopted Budget
2011-12
August 22, 2011
State Budget Overview
Board Goals
BAC Planning Assumption Highlights
FTES History and Projection
List of All District Funds – Expenditures
& Other Outgo
Expenditure Reductions
2
Overview (continued)
Unrestricted General Fund Details
Adopted Budget
2011-12
August 22, 2011
Overall Summary
Revenue Summary
Major Revenue Changes in 2011-12
Expenditure Summary
Major Expenditure Changes in 2011-12
Reserves
Breakdown between Fixed and Discretionary
Budgets
8-Year Trends
Future Budget Challenges
3
State Budget Overview
Zero COLA (0%)
Adopted Budget
2011-12
August 22, 2011
No growth funding
Student fees increased $10 to $36 per unit
$290 million net reduction to apportionment
$5.9 million cut to Long Beach City College
No restoration of 2009-10 categorical fund cuts
Increased deferrals $129 million to $961 million - $24.6
million for LBCC
Issued Tax Revenue Anticipation Notes (TRANS)
4
Board Goal
Measure & Improve Fiscal & Infrastructure Stability
Adopted Budget
2011-12
August 22, 2011
Commitment to Reduce Deficit Spending
$8,141,755 deficit spending to maintain service levels to
students
$4,643,566 million surplus for 2010-11
Maintain 5.0% General Fund Reserve
Total reserves equal $10,003,926 (9.1%)
5% reserve $5,491,729
5
Board Goal
Measure & Improve Fiscal & Infrastructure Stability
(continued)
Adopted Budget
2011-12
August 22, 2011
Focus on Advancement of Student Success Plan
$2,134,717 Unrestricted General Fund
$713,177 Restricted General Fund
Reserve to fund campus maintenance & IT functions
$225,213 budgeted reserve in the Unrestricted General
Fund (carried over from prior year) for Technology
Master Plan
6
BAC Planning Assumption
Highlights
Adopted Budget
2011-12
August 22, 2011
There will be budget redirections and potential
reductions in response to both the State’s budget
impact and the priorities as identified by the College
Planning Committee (CPC)
Maintain a 5.0% unrestricted reserve for
contingencies
Deficit spending will be minimized
Carryover will only exist for the Technology Master
Plan and Facilities Improvement Funds.
7
BAC Planning Assumption
Highlights (Continued)
Adopted Budget
2011-12
August 22, 2011
Zero (0%) COLA is budgeted
No Growth is budgeted. Target FTES is 19,618
A 1% deficit factor will be included to offset possible
short fall from apportionment revenues.
Load Banking Reserve
Budgeted the $2.3 million liability
Vacation Liability Reserve
Budgeted $330,125 liability
8
BAC Planning Assumption
Highlights (Continued)
Adopted Budget
2011-12
Benefit costs continue to increase:
Health and welfare costs increased by $1.3 million
Offset by plan changes and increased employee contributions
August 22, 2011
PERS rate increased 0.2%
SUI increased 0.9%
Workers’ Compensation increased 0.06%
Part-time hourly budget will contain sufficient dollars
to meet the FTES target in accordance with class
schedules
9
FTES History and Projection
22,000
30
21,500
105
21,000
21,499
20,500
20,000
20,923
705
19,000
18,500
18,000
Unfunded
FTES
20,457
21,268
19,500
21,499
Funded
FTES
20,931
19,618
18,806
17,500
17,000
04-05 05-06 06-07 07-08 08-09 09-10 10-11 11-12
Total
21,529
Total
21,162
Annual
Total
21,036
Budget
10
List of Funds – Expenditures & Other Outgo (in millions)
Adopted
Budget
2010-11
Unrestricted General Fund
Unaudited
Actual
2010-11
Adopted
Budget
2011-12
$ 109.8
$ 104.5
$ 109.8
Restricted General Fund
18.2
21.5
20.4
Capital Projects Fund
11.2
5.1
7.6
Child & Adult Development Fund
1.6
1.4
1.6
Contract/Community Education Fund
0.7
0.4
0.7
472.7
56.8
461.3
Retiree Benefits Fund
2.3
2.2
2.4
Self-Insurance Fund
1.0
0.9
1.0
Student Financial Aid
50.9
54.5
56.8
1.0
1.0
1.2
$ 669.4
$ 248.3
$ 662.8
General Obligation Bond Funds
Vet Stadium Operations
Total
11
Expenditure Reductions - $5.5 Million
Adopted Budget
Management Team Furloughs of 3.08% - $339,000
2011-12
Management Team Evening dean duties continue $86,000
August 22, 2011
Health benefit plan changes and employee
contribution increases:
Faculty
$543,000
Classified
$573,000
Management
$210,000
12
Expenditure Reductions - $5.5 Million
(continued)
Adopted Budget
Classified reduction in force and reorganization $1,563,000
2011-12
August 22, 2011
Management reduction in force and reorganization $760,000
Suspending three sports - $74,000
Reduction to part-time faculty - $500,000
Cut discretionary budgets approximately 20% $887,000
13
Unrestricted General Fund
Overall Summary
Unaudited
Actual
2010-11
Adopted
Budget
2011-12
Change
Increase/
(Decrease)
Revenues and Other Financing
Sources
$ 109,145,155
$ 101,692,834
$ (7,452,321)
Expenditures and Other Outgo
104,501,589
109,834,589
5,333,000
4,643,566
(8,141,755)
(12,785,321)
$ 18,145,681
$ 10,003,926
$ (8,141,755)
Surplus/(Deficit)
Fund Balance
14
Unrestricted General Fund
Revenue Summary
Unaudited
Actual
2010-11
Federal
$
Apportionment
$
Change
Increase/
(Decrease)
120,000
$ (349)
101,226,573
94,856,819
(6,369,754)
Other State
3,955,133
3,107,386
(847,747)
Local
2,520,232
2,524,920
4,688
Other Sources
1,322,868
1,083,709
(239,159)
$109,145,155
$101,692,834
$(7,452,321)
Total
120,349
Adopted
Budget
2011-12
15
Major Revenue Changes
in 2011-12
Adopted Budget
2011-12
August 22, 2011
Apportionment - $6.4 million decrease includes a
$5.9 million decrease in current year apportionment
due to reduced FTES targets caused by state funding
reductions and a $0.5 million decrease due to prior
year apportionment revenue in 2010-11.
Other State Revenues - $0.8 million decrease
consists mainly of decreases in mandated cost
reimbursements since future funding is uncertain and
a decrease in lottery revenue due to reduced FTES
targets.
16
Unrestricted General Fund
Expenditure Summary
Unaudited
Actual
2010-11
Adopted
Budget
2011-12
Change
Increase/
(Decrease)
Academic Salaries
$ 43,743,146
$ 44,889,737
$ 1,146,591
Classified Salaries
23,614,430
24,992,138
1,377,708
Benefits
24,940,372
25,680,115
739,743
Supplies
457,915
603,475
145,560
Services
8,783,261
10,625,906
1,842,645
545,242
515,595
(29,647)
2,417,223
2,527,623
110,400
$ 104,501,589
$109,834,589
$ 5,333,000
Capital Outlay
Other Outgo
Total
17
Major Expenditure Changes
in 2011-12
Adopted Budget
2011-12
August 22, 2011
Academic Salaries – overall $1.1 million increase is
due to hiring 15 new faculty, and the expiration of the
2.3075% furlough. Administrator salaries decreased
≈ $300,000.
Classified Salaries - $1.4 million increase is due to
the reduction of management furloughs (3.08%) and
expiration of classified furloughs (5.77%) and step
freeze less the classified and management reduction
in force and reorganization.
Benefits - $0.7 million increase mainly due to salary
and rate increases. Health insurance increases were
offset by plan changes and increased employee
18
contributions.
Major Expenditure Changes
in 2011-12 (continued)
Adopted Budget
2011-12
August 22, 2011
Services – overall $1.8 million increase primarily
due to rollover budgets and cost conscious
measures during 2010-11 by all departments.
Major increase related to Election Costs
estimated at $450,000
19
Unrestricted General Fund
Budgeted Expenditures 2011-12
Capital
Services, Outlay,
9.7% 0.5%
Other
Outgo,
2.3%
Supplies,
0.5%
Academic
Salaries,
40.9%
Benefits,
23.4%
Classified
Salaries,
22.7%
Salaries & Benefits 87.0%
20
Unrestricted General Fund
Reserves
Adopted Budget
Unassigned Reserves
Board Mandated Reserve – 5.0%
Economic Uncertainties
$ 5,491,729
1,692,433
Assigned Reserves
Technology Master Plan
Vacation and Load Banking Reserve
Total
225,213
2,594,551
$ 10,003,926
21
Unrestricted General Fund Breakdown
Between Fixed & Discretionary Budgets
Adopted Budget
2011-12
Adopted Budget
2011-12
August 22, 2011
Fixed Costs:
Academic Salaries
Academic Administrator Salaries
Manager/Supervisor Salaries
Confidential Salaries
Classified Salaries
Benefits
Total Salary & Benefit Costs
Other Fixed Costs:
Professional Services (LBPD)
Material Fees
Software & Online Software Licensing
Contracts for Higher One, Actuarial Study, etc.
AQMD Fees
Utilities
Percentage of
Total Adopted
Budget
$27,622,830
3,603,101
5,232,895
1,135,995
17,897,538
25,680,115
$81,172,474
25.15%
3.28%
4.77%
1.03%
16.30%
23.38%
73.91%
$2,842,845
86,802
832,086
59,550
35,000
2,694,881
2.59%
0.08%
0.76%
0.05%
0.03%
2.45%
22
Unrestricted General Fund Breakdown Between
Fixed & Discretionary Budgets (cont.)
Adopted Budget
2011-12
Adopted Budget
2011-12
August 22, 2011
Percentage of Total
Adopted Budget
Other Fixed Costs:
Copier Maintenance
Building Maintenance
Rental
LACOE Contracts
Environmental Health Fees
Election
Audit, TRANs & Legal Services
Student Services Credit Card Fees
Instructional Services (Police & Fire Science)
Lease/Purchase
Interfund Transfer Out (Required Match)
Total Other Fixed Costs
72,000
387,334
133,331
49,054
930
450,000
666,330
200,000
415,000
256,000
1,562,252
$10,743,395
0.07%
0.35%
0.12%
0.05%
0.00%
0.41%
0.61%
0.18%
0.38%
0.23%
1.42%
9.78%
Total Fixed Costs
$91,915,869
83.69%
23
Unrestricted General Fund Breakdown Between
Fixed & Discretionary Budgets (cont.)
Adopted Budget
2011-12
Adopted Budget
2011-12
August 22, 2011
Percentage of Total
Adopted Budget
Discretionary Costs:
Academic Hourly Salaries
Classified Hourly Salaries
Total Hourly Salaries
$ 13,663,806
725,710
$14,389,516
12.44%
0.66%
13.10%
Other Supplies
Fuel
Professional Services
Travel & Conference
Staff Development
Dues & Memberships
Equipment Repairs
Postage
Other Services & Expenses
Capital Outlay
Other Discretionary Costs
Interfund Transfers Out – Other
Total All Other Discretionary Costs
Total Discretionary Costs
$437,438
59,440
527,550
142,910
20,853
149,243
245,945
151,127
542,937
221,797
64,593
965,371
3,529,204
$17,918,720
0.40%
0.05%
0.48%
0.13%
0.02%
0.14%
0.22%
0.14%
0.49%
0.20%
0.06%
0.88%
3.21%
16.31% 24
Unrestricted General Fund Breakdown Between
Fixed & Discretionary Budgets
(Summary)
Adopted Budget
2011-12
August 22, 2011
Adopted Budget
2011-12
Percentage of Total
Adopted Budget
Fixed Costs:
Academic Salaries
Classified Salaries
Benefits
Other Fixed Costs
Total Fixed Costs
$31,225,931
24,266,428
25,680,115
10,743,395
$91,915,869
28.43%
22.10%
23.38%
9.78%
83.69%
Discretionary Costs:
Discretionary Hourly Salaries
Other Discretionary Costs
Total Discretionary Costs
$14,389,516
3,529,204
$17,918,720
13.10%
3.21%
16.31%
$109,834,589
100.00%
Total Expenditures
25
Unrestricted General Fund Breakdown Between
Fixed & Discretionary Budgets
(Summary Multiyear Comparison – Total Costs)
Adopted Budget
2011-12
August 22, 2011
Adopted Budget
2009-10
Fixed Costs:
Academic Salaries
Classified Salaries
Benefits
Total Other Fixed Costs
Total Fixed Costs
Discretionary Costs:
Discretionary Hourly Salaries
Other Discretionary Costs
Total Discretionary Costs
Total Expenditures
Adopted Budget
2010-11
Adopted Budget
2011-12
$32,702,246
24,959,575
24,055,863
11,615,744
$93,333,428
82.40%
$30,805,108
23,623,469
25,517,818
11,170,226
$91,116,621
82.99%
$31,225,931
24,266,428
25,680,115
10,743,395
$91,915,869
83.69%
$15,253,912
4,678,078
$19,931,990
17.60%
$113,265,418
$15,095,267
3,575,267
$18,670,534
17.01%
$109,787,155
$14,389,516
3,529,204
$17,918,720
16.31%
$109,834,589
26
Unrestricted General Fund
8-Year Trend Summary
04-05 05-06
Actual Actual
Salaries &
Benefits as a % of
Total Expenses & 83.8%
Other Outgo
06-07
Actual
07-08
Actual
08-09
Actual
10-11
11-12
09-10
Unaudited Adopted
Actual
Actual
Budget
84.7%
85.5%
85.2%
86.7%
87.7%
88.3%
87.0%
Surplus / (Deficit)
$3.3
$1.2
$7.5
$1.3
($0.1)
($1.2)
$4.6
($8.1)
Ending Balance
Ending Balance as
a % of Total
Expenses & Other
Outgo
$4.9
$6.1
$13.6
$14.9
$14.7
$13.5
$18.1
$10.0
5.5%
6.4%
12.9%
13.3%
13.1%
12.4%
17.4%
9.1%
27
Unrestricted General Fund 8-Year Trend
Salaries & Benefits as a % of
Total Expenditures & Other Outgo
89.0%
88.0%
87.0%
86.0%
85.0%
84.0%
83.0%
82.0%
81.0%
86.7%
85.5%
85.2%
2006-07
2007-08
84.7%
Unaudited Actual
88.3%
Budget
87.7%
87.0%
83.8%
2004-05
2005-06
2008-09
2009-10
2010-11
2011-12
28
Unrestricted General Fund
8-Year Trend Ending Fund Balance and Surplus/(Deficit)
20
$18.1
$13.6
15
$14.7
$13.5
$10.0
10
5
$14.9
$4.9
$3.3
$6.1 $7.5
$1.3
$1.2
0
04-05
05-06
$4.6
06-07
($0.1) ($1.2)
07-08 08-09 09-10
10-11
-5
11-12
Budget
($8.1)
-10
Surplus/(Deficit)
Ending Fund Balance
29
Future Budget Challenges
Adopted Budget
2011-12
August 22, 2011
Mid-Year cuts appear likely based on current economic
forecasts – as of July State revenues down $540 million
State Revenue Shortfall
Mid-Year Spending Reductions
Less than $1 billion below forecast
No changes
$1 - $2 billion below forecast
$23 million cut to child care
$30 million cut to apportionment $566,180 LBCC share
$10 additional enrollment fee increase
to $46/unit
Greater than $2 billion below
forecast
$ 72 million additional cut to
apportionment - $1,358,831 LBCC share
30
Future Budget Challenges (cont.)
Adopted Budget
2011-12
August 22, 2011
Cash flow concerns – State continues to increase
apportionment deferrals
At June 30, 2011 our cash balance in the Unrestricted General
Fund was $936,495 after borrowing $7.5 million from ourselves
Fee Shortage – increased BOGG waivers are reducing
collections state-wide
Chancellor’s Office already estimating a $25 million (~ 0.4%)
shortfall - $432,000 LBCC share
Recovery appears slower than projected
31
Future Budget Challenges (cont.)
Adopted Budget
2011-12
August 22, 2011
State Litigation
Redevelopment Agencies – contesting $1.7 billion payments to
state with the Supreme Court
Medi-Cal Providers – going to court to contest proposed
changes ($1.3 billion)
Amazon Tax - going to court to try to stop ($0.2 billion)
State’s structural budget deficit projected into 2015-16
Full-time faculty obligation (FON) – once the Board of
Governors lifts the obligation suspension, LBCC will
need to hire a significant number of full-time faculty
32
Adopted Budget
2011-12
Questions?
August 22, 2011
33