Budget Overview

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					        Budget Update
               Welcome Back

               Diana Keelen
              August 17, 2012

“While the California budget is uncertain, there is one
         thing that is certain, it will change.”
        California State Budget
   Deficit is $14.7 billion
   Assumes the passage of Proposition 30:
    Schools and Public Safety Act in November
   Temporary sales tax increase of 0.25%
    and progressive 1-3% income tax increase
    for those making over $250K per year.
   Polling is at 52-56%
   Competing with Molly Munger tax geared
    towards K-12 only
    California Community College Budget
   Tax package would bring 4% additional funding each year or $3
    billion to community colleges over the next 7 years
   It would provide $548.5 million alone in 2012-2013, including $50
    million in growth-Timing may be a challenge
   Includes $28 per FTES in Mandated Cost Reimbursement
   RDA hold harmless agreement
   Deferrals are at $961 million-$159 million would be “bought down”
   If the tax package fails, college enrollment would drop by 85,000
    FTES
   If the tax package fails, CC budgets would be reduced by $338.6
    million
   If it fails, deferrals would be on-going
Antelope Valley College Budget

                       Scenario A: Tax Scenario B: Tax
                       Package Passes Package Fails
   FTES Base               10,499            9,732
                        $400-450K in      $3.4 million
   Revenue              growth funds       reduction

                        $1.9 million of No deferral buy
   Deferral Buy-down   the $14.2 million    down
General Fund Make Up of Revenue

      Local   Federal
      19%       4%




                  State
                  77%
    General Fund Make Up of
         Expenditures

                  Capital
               Expenditures
                   1%
   Other Operating        Other Outgo
         Costs                4%
         11%
Supplies                                Academic
  3%                                     Salaries
                                          42%

Employee
 Benefits
  19%

                        Classified
                         Salaries
                           20%
        Deficit Co-Efficient Trend
Deficit Co-Efficient Percentage   Amount              Source

   2007-2008          0.32%        -$180,331 Recalc dated 2/23/09

   2008-2009          1.19%        -$678,322 Recalc dated 3/18/10

   2009-2010          0.00%                $0 Recalc dated 2/17/11

   2010-2011          0.32%        -$185,559 Exhibit E dated 2/7/12

   2011-2012          2.35%       -$1,255,853 P2 dated 6/20/12

   2012-2013             ?                  ?                    ?

              Total               -$2,300,065
                       Deferrals
    California Community College Deferrals now at $961
     million
    AVC impact: Deferral total of $14,165,447 or roughly
     32% of our apportionment.
    For 2012-2013, we will only receive 40% of what we
     received in the first 5 months of 2011-2012

                  AVC
                Deferrals
2007-2008         $2,769,936
2008-2009         $7,560,021
2009-2010         $9,856,368
2010-2011        $11,892,686
2011-2012        $14,165,447
    What happened in 2011-2012?
                                                                  Fiscal    Workoad                                          New      Head
Reductions That Have Been Implemented                                                     Apportionment Base        FTES
                                                                  Year        %                                              Base     Count
                                                                  2011-
Initial Workload Reduction                                         2012          -6.21%      ($3,223,949) 11,371     (706)   10,665    (1,484)
Additional Deficit due to $23 mil in base funding increase from
2009-2010 and 2010-2011 with no state funding increase (2
                                                                                              ($129,285)
new colleges, several new centers and natural increases to
basic allocation)
Tier 1 Deficit Co-Efficent                                                                    ($309,085)
Tier 2 Additional Workload Reduction                                             -1.55%       ($741,526)             (166)   10,499      (348)
Student Fee & Property Tax Deficit Co-Efficient                                               ($817,483)
                            2011-2012 Total Reductions                           -7.77%    ($5,221,328)             (872)             (1,831)

Reductions That Will Be Implemented if the Tax                    Fiscal    Workoad                                          New      Head
                                                                                          Apportionment Base        FTES
Package Fails                                                     Year        %                                              Base     Count
                                                                  2012-
Scenario B-No Taxes                                                2013          -7.30%      ($3,490,876) 10,499     (766)    9,733    (1,609)

                             2012-2013 Potential Reduction                       -7.30%    ($3,490,876)             (766)             (1,609)

Total Reduction + Potential Reduction for 2011-2012
                                                                             -15.07%       ($8,712,204)            (1,638)            (3,440)
and 2012-2013 Only


Assumptions:
Does not include potential property tax or student fees shortfall in 2012-2013
 Does not include a deficit co-efficient in 2012-2013
      2012-2013 Draft Adopted Budget
              Assumptions
   No COLA
   No Growth, although if tax package passes,
    there is about $50 million in growth or ~$400K-
    $450K to AVC
   Scenario B with tax package not passing
   Continued deferrals of over $14 million
   No deficit co-efficient
   Continued deficit spending reserve-Need a plan
   Risk of falling below 8% reserve next year
           Budget Changes from 11-12 to 12-13
                                                         Exhibit A
                            2012-2013 Expenditure Changes and Budget Reductions Adopted Budget
                                 Change                            Increase        Decrease        Total
Social & Behavioral Faculty Retirement                                               ($128,671)
Math, Sci & Eng Faculty Retirement                                                   ($113,033)
Language Arts Faculty Retirement                                                      ($73,174)
Social & Behavioral Faculty Retirement                                               ($125,058)
Learning Specialist Retirement                                                       ($147,392)
Adjunct backfill of Faculty Retirements                               $200,000
Performing Arts Tech to Mgr                                             $7,588
3 Custodians                                                          $167,697
2 Skilled Maintenance Workers                                         $136,168
Electrician                                                            $72,169
Caravan Reduction due to Health Fee Implementation                                     ($57,000)
Workload Reduction-584 FTES                                                           ($822,500)
PERS Rate Increase, 10.92 to 12.12%                                   $120,000
Legal Fees Reserve                                                     $42,000
TRAN Interest Reserve                                                  $80,000
Equipment Reserve                                                     $100,000
Step & Column                                                         $284,456
VP Admin Services Replacement Difference                               $37,174
H&W Reduction Above Cap                                                               ($457,418)
Solar Project Loan Payment Increase                                      $6,800
Energy Loan Commission                                                                 ($65,073)
Increase in Security Contract                                           $45,702
Reduction of Election Costs                                                           ($413,439)
Elimination of Registration Cards                                                      ($33,477)
Reduction of Blackboard                                                               ($164,695)
Reduction of Ebscohost                                                                 ($20,000)
Reserve for Retiree Health Liability                                  $250,000
Increase in CDC Support                                                 $5,028
Redevelopment funds to pick up Central Plant Loan Payment                            ($452,896)
Total Increase (Decrease)                                          $1,554,782     ($3,073,826)      ($1,519,043)
               2012-2013 Draft Adopted Budget & Projections
                   Preliminary Figures/Unaudited Actuals
                                                   As of 8/13/2012
If Tax Package Fails
                                     2011-2012           2012-2013           2013-2014           2015-2016

   Beginning Fund Balance            $8,791,347          $7,502,547          $4,241,914            $43,462

           Revenues                  $55,414,411         $51,923,535         $51,923,535         $51,923,535

           Expenses                  $56,703,211         $55,184,168         $56,121,987         $55,851,020

     Ending Fund Balance             $7,502,547          $4,241,914            $43,462           ($3,884,023)
         Reserve %                    13.23%               7.69%                0.08%               -6.95%

       Surplus/(Deficit)           ($1,288,800)        ($3,260,633)         ($4,198,452)        ($3,927,485)

If Tax Package Passes
                                     2011-2012           2012-2013           2013-2014           2015-2016
                                     $8,791,347          $7,502,547           $7,732,790          $6,661,310
Beginning Fund Balance
                                     $55,414,411         $55,814,411         $55,694,818         $55,694,818
Revenues
                                     $56,703,211         $55,584,168         $56,766,298         $57,068,961
Expenses
                                     $7,502,547          $7,732,790          $6,661,310           $5,287,167
Ending Fund Balance
Reserve %                              13.23%              13.91%              11.73%               9.26%
                                   ($1,288,800)          $230,243           ($1,071,480)        ($1,374,143)
Surplus/(Deficit)

 2013-2014 and beyond assumes 4% increase if tax package passes will most likely go to deferral buy down
Questions?

				
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