The Ramona Unified School District must borrow money from the county treasury soon to have enough cash to meet its June 30 payroll, the school board has been told.
An assistant schools superintendent is making the request at Thursday night’s board meeting as the district deals with its continuing money crunch. The amount of the loan wasn’t immediately available.
“Although [cost savings] improve the ending balance, the district is still in a fiscal crisis,” says David Ostermann, assistant superintendent for administrative services, in a report to the board. [See attached PDF].
Ostermann said county funds are needed “in case the cash flow projection or the timeline for the cash distribution from the state is not correct.”
He termed the “cross-year transfer” an advance on funds owed by the state of California.
“Had the state not deferred this revenue, a transfer would not have been needed,” he said. “Resolution 2012-13-11 is needed to ensure that enough cash is on hand to meet the cash obligations.”
The school board also will consider a mandated report to the state on the district’s financial status through Jan. 31 of each year. The meeting starts at 7 p.m. Thursday in the Wilson center boardroom at 720 Ninth St.
Even though the Ramona district has saved money by not filling the vacancy of assistant superintendent of education services and from other steps, the district is still in “a fiscal crisis,” he said.
“The multiyear projections include the best estimate of the governor’s new funding formula for Ramona,” he said.
“The Local Control Funding Formula still poses many questions and contains few answers to provide a good basis for projecting next year’s revenue.”
But based on information from School Services of California Inc. and the county Office of Education, Ostermann says “our multiyear projection is based upon a [cost of living allowance] of 1.35 percent, an increase in Mandated Cost Reimbursement, and fully funded ROP dollars.
Further he said in a report to the board:
Also local assumptions include $400,000 in retiree savings in 2013-14 and $540,000 in retiree savings in 2014-15 and an increase in the cost of health benefits by 10 percent in 2013-14 and in 2014-15. Expenses for the payments of the Certificate of Participation are estimated to be $399,683 for 2013-14 and $1,709,632 for 2014-15.
With these assumptions, he said, Ramona Unified will have a “qualified self-certification” for the report.
“This signifies that Ramona Unified is uncertain it will be able to meet the financial responsibilities for the current and next two fiscal years,” he said.
Ostermann said that if the proposed offer to district labor unions is applied to current budget year and to the multiyear projections, the district “would then be able to show a positive certification.”
“Additionally, Ramona Unified would be able to meet its financial obligations for the current and next two years,” he said.