Under normal circumstances, the San Marino Unified School District would be fine-tuning its proposed budget for the 2020-21 school year, but as we know, current circumstances are anything but normal. So instead, the board recently pondered further proposed cuts to an already lean budget.
Among the bigger challenges is what is unknown. Typically, Gov. Gavin Newson would have recently released what is known as the May Revise — a reassessment of revenues that allows districts more accurate figures for budget projections — but education officials now believe that data will not not be available until August.
With the COVID-19 pandemic extending the federal and state income tax deadlines to July 15, estimates of declining revenues and a burgeoning unemployment rate, there is little good news from the public education front. The SMUSD was already heading into the 2020-21 school year with a $3 million deficit, but projections based on effects from the pandemic have increased that figure, even if it is not yet tangible.
“The district will continue to face a multi-year challenge,” said Vangie Lingat, the SMUSD’s director of accounting, during a presentation. “There are no predictable pathways to rapid recovery due to the rapid shutdown of economies.” The budget year for public schools typically begins on July 1 and wraps up on July 30 of the following year.
Possible emergency funding could be found in the Budget Stabilization Act, which currently has $16.2 billion on hand. A current estimate has the state using the entire balance over the next three years, including $7.8 billion in 2020-21. The SMUSD has also applied for a Federal Emergency Management Agency grant of up to $100,000 and is documenting COVID-related costs.
Also hitting the district’s $42 million annual budget is a proposed Cost of Living Adjustment, which could amount to a reduction of possibly 10% from the state, when the district had believed a 2.9% increase was in the works. There exists the possibility of as much as a 20% reduction in COLA, though accurate numbers will not be available again until August at the earliest.
Possible good news could be found in the state’s proposal to base funding strictly on enrollment and not on average daily attendance, which would help matters slightly.
Newsom has also proposed using cash deferrals of $1.9 billion from now through July and $5.3 billion from April, May and June of 2021, a tactic that was last used during the Great Recession.
The board also voted unanimously last month to take out a $6.8 million tax and revenue anticipation note, or TRAN loan. The district received a similar loan for the 2019-20 school year and expects to pay it off by July or August of this year. The loan carries a 1.85% interest rate and is used to manage cash flow.
“It would be nice to get some certainty,” said school board member Corey Barberie of the budget discussions. “There is really nothing we can do at this point other than wait and see and see what FEMA will do. There will be more cuts next year, but there are more costs coming as well that are associated with COVID.”
Barberie said that the state has “done such a disservice in public education, most notably in districts like San Marino and La Cañada Flintridge. They think we can run a school district on the money they give us, but this COVID might be the breaking point.”
Barberie said it is up to the board to “educate our population” regarding school funding, “but there is not a lot we can do but wait and hope.”
Additionally, the board honored Grace Davis, a San Marino High School senior, for her year of service as the ASB representative to the board.
“You are intelligent, responsible and a great role model,” said board member Lisa Link of Davis. “You have spoken your mind and your heart, and instead of complaining, you stepped up and helped make a difference.”
“More than any other student board member that I can remember, you were thrown into significant issues and handled them all,” said board member Chris Norgaard. “I hope that after you graduate you would go to Georgetown and the school for foreign service. You really should be a diplomat.”
Four years at Samford University come first.
