Special Meeting — October 3, 2024

are displayed on the front and the side monitors please watch for your name to appear and we only have one so you can just go to the mic on the designated um area once the recording secretary announces the first name request to speak will no longer be accepted Mr Cruz can you please explain the the um comment guidelines you have to press the

button so I can let you micers hold on speakers you have three minutes to address the board you cannot donate your time if you read on behalf of an absent person that will be considered your time begin comments when the clock starts thank you Richard Wales if you go on the ACT website do a little searching you'll find a little

pie chart and it says that 62% of teacher dues go to CTA so we know who the real Union is so I have a question and I'm hoping that will be answered this evening my taxes my taxes are supposed to go to teachers and to run this district and I would like to know why Stephen Frasier sitting behind me is paid

primarily out of District funds why is the union paying a very small amount of a salary to a man that is really not doing any official duties as far as instruction in this District when did this happen whose idea was this and is there something that can be done about it I don't support unions in any way shape or form and I don't

understand why my tax dollars are going to pay for most of his salary so if one of you or cou of you could answer that this evening I would be very curious of what's going on with that thank you thank you how is that it okay Dr anfold all right tonight uh Miss chin will be presenting a comprehensive look

at our at our District's uh budget and there will be a lot of information that she will be presenting and so I wanted to uh draw the board's attention to a few areas um regarding Mrs Chin's uh presentation tonight the the first area when she gets to it we'll be covering uh an area on a on the California state

budget which had a $46 billion deficit which resulted in the state reducing the K12 Cola for this school year from 3.49% down to 1.07% with um which also includes our declining enroll so for our district you'll see that it equates to uh about $4.5 million reduction to our general fund budget for the 2024 25 school year uh the second part is um I have Frozen

some positions in the district and uh I want to take a look at that and I I will I will address that when Miss chin starts to cover the CVUSD lcff funding uh and I want to explain my reasoning for that uh for the board and basically for the community I know the board uh has heard that the uh third one uh Miss chin will

be re reviewing a comparison between the funding of the 33 districts in our County and when you look at that comparison you'll see that based on funding we're the 28th lowest funded District in our County and again I want to talk a little bit when she gets to that part of the presentation on the different fundings and how it's really

difficult to compare one District to another when it comes to funding based on the lcff that's the Cal our funding for school district so with that I will now turn it over to miss chin thank you Dr Enfield good afternoon president Shaw members of the board cabinet Dr Enfield is my pleasure to lead our discussion today on the

district's budget study session we have a very ambitious agenda to cover today first uh we start with a quick review of the board's roles and responsibilties in maintaining the district's Financial Health and fiscal solvency then we will take a look at the state's economy and state budget for 2425 and understand its fiscal implications on CVUSD I will walk you through the

enrollment and attendance Trends and patterns for cvd and identify the main drivers of our District's revenues and expenditures and lastly we will identify some next steps for the district the California legislature passed 8 B 1200 in 1991 in response to a large school district going bankrupt and ready for State takeover this law mandates school districts to prepare

multi-year projections to identify funding sources for any substan substantial cost increases such as employee raises and to make those cost implications public prior to the board approving employee contracts it made County offices of Education the first line of defense to protect the state from school district insolvencies and gave them the responsibility to Monitor and enforce fiscal responsibilities of school

districts it also created figat fiscal crisis and management assistant team figat is an independent state agency that was created to assist school districts from getting into financial problems something important to mention here is that the grand jury that was tasked with investigating that large School District's bankruptcy concluded that the local school board has final authority over its budget and

that it failed to control that District's budget fast forward to 2004 faced with the need to make four more Emergency Loans to school districts the legislature passed AB 2756 this assembly Bill further stepped up the level of oversight by our County Superintendent of Schools and figat it also requires certifications from the board president from the superintendent and myself when approving bargaining

settlements the general theory behind both bills is that with proper planning and action School District should be able to anticipate and avoid most negative fiscal situations one of the most important responsibilities of the school board is the adoption of the annual budget by July 1st of each year the NP the multi-year projection is a required element of the budget and it gives the

board an Insight a forecast into the two following school years the county has until August 15th to provide the approval status of our budget oops I'm sorry oops and the adopted budget is either approved conditionally approved or disapproved a budget can be conditionally approved if a district is showing fiscal distress in the third year and if that's the case the school

district the school board will need to adopt a resolution and identify expenditure reductions that must be put in place prior to First interim for as long as I've been working for the school district I do not recall a time when our budget has was not approved or disapproved after the adoption of the annual budget by July 1st school

districts are required to filed two Financial interim reports during the year the first interim financial report reports the actual transactions of revenues and expenditures between July 1st through the end of October 31st which will be the end of this month the second interm financial report covers actual Financial transactions our revenues and our expenditures from July 1st all the way through January

31st both reports must include certifications of whether or not the district is able to to meet its Financial Obligations for the current year plus two subsequent years and in both reports the MP which is the multi-e projection is a required element and again provides the board a projection of the fiscal health of the current year and two subsequent

years unlike the adopted budgets intern reports are certified as either positive which means the district can meet its current year financial obligations and two subsequent years or it can also be certified as qualified which means the district may not meet its future year obligations if the school district certifies a qualified report to the board to the county it would need to be

uh it would be required to file a third interim report which will capture again actual activities from Jan uh from July 1 in this time through the end of April and brought forward to the board for approval subsequently to the county the last time our district filed an interim a qualified interim report were during the initial years that follow the Great

Recession so 1112 was the last time we had to file a qualified inter report so while we have specific deadlines for spec specific reporting this slide illustrates that for a good portion of the year we are working on three fiscal years concurrently we're closing out and auditing prior year 2324 we are monitoring and amending current year 2425 and we are starting to

develop the budget for next year 2526 this is the district's annual budget calendar outlining the important dates that require board action and as mentioned earlier you will see that December 19th is highlighted here because that is when the first interim financial report will be brought forward to you for review and approval before we move on to the the

state economy and budget are there any questions from the board okay let's move on to this to this next point so state budget if California were a country it would be the fifth largest economy in the World Behind United States behind China behind Germany and Japan and then after California will be India this is why when the nation's

economy catches a cold California catches the flu everything is more dramatically better or dramatically worse due to the size of our GDP the cost of living in California housing prices and labor market during the covid-19 pandemic California's economy was hit especially hard the unemployment rate skyrocketed to double digit to 16% and the state's main Revenue sources plummeted post pandemic however it

experienced unpr presidented Revenue growth followed by another sharp reduction the volatility of the state's revenue is largely due to the fact that its biggest source of funding comes from the personal income tax it could represent as much as 70% of all of the state's revenues collected or for this particular year in 2425 it only represents about 56% that's how volatile

is and we will discuss a little bit more about that volatility in the future slide as far as the unemployment goes for California it's lagging compared to the you United States this chart illustrates the historical unemployment rate between California and the rest of the US the United States line is outlined in red whereas the blue bars represent

California in August of this year the the United States unemployment rate actually inched down to 4.2% however California unemployment rate actually ticked up to 5.3% although it is the third highest unemployment rate in the country it still is low compared to the historical data that you see you see here now let me direct your attention to the state's general fund

budget this is a page out of the state's adopted budget if you take a look at the left side of this graph it shows the main sources of the state's general fund Revenue as mentioned earlier the primary source of the stes general fund revenue is the personal income tax personal income tax combined with the sales and use tax and the

corporation tax combined make up 90% of the state's general fund revenues the right side shows that K12 education um community colleges calate and UC expenditures make up about 50% of the state's expenditures so education is one of the most costly category yet funding for them is not always reliable why do I say this the volatility of the

income tax collection system is what makes California's Revenue system so shaky at times here's an example in 2021 when stocks were booming at the top when when the stock market was booming the top 1% earners in California contributed to 50% of all the income taxes collected by the state can I repeat that again the top 1% earners in

California contributed to 50% of all of the income taxes collected by the state who is in that top 1% you might ask in order to qualify as the top 1% in California you would have to make over $1 1,72 th000 so they're probably not the behind the desk kind of people in essence California's economy is carried by millionaires when the stock market

does well the millionaires do well and so does California and vice versa this is a slide that shows the actual state revenue receipts for the past five years with a projection for this year at the state level you can see a drastic Rebound in 2021 and 2122 followed by a sharp decline in 2223 so in 2021 the state collected over $200

billion doll in revenues and in 2122 collected another $231.67 3 it dropped significantly to $1 168.5 billion what further exacerbated the decline in that year 2223 was due to the extension of the tax filings for the 20122 calendar year if you recall for the 2022 calendar year taxes are due when April 2023 the governor postponed the collection of those taxes to October and

then again to November so when it got delayed to November it's no longer the same fiscal year it was meant to be collected to be in 20 uh 20223 fiscal year but because it was I'm sorry it was meant to be collected in 2223 fiscal year but because those tax collection did not come in until November it's now got captured into the

2324 school year fiscal year so if you take a look at 23 24 fiscal year it's no better than the boom years and it was supposed to include two collection years two two calendar years worth of tax collections so a perfect storm was starting to form in 2022 when no real resolutions were put in place until this year's budget

the 2022 bare Market year coupled with the lack of income tax collected for that year until November and combined with the states continued spending as if the revenues were there created a disastrous multi-year deficit spending for the state so remember when the state did not collect the taxes in April the state apportioned the budget for all the

departments in including education as if the money was there and we spent that money as if the money was there and so the problem is exacerbated over the years so how does the governor plan to solve the $ 46.8 billion problem that he identified in his budget report well remember our Cola was decreased sharply from 3.94% to 1.07% for this year that

saved the state quite a bit of money across the the state other Solutions um other broad-based Solutions included ongoing reductions to State operations across the board and vacancy sweeps at the state level totaling $16 billion it included internal borrowing from other funds inside the state it also included withdrawals from the budget stabilization Act of $6 billion this

year and then another $7 billion next year the governor also shifted certain expenditures from the general fund to other funds he also delayed pausing um the funding of certain programs until a later time he also deferred payments for programs to later years so that he could solve this problem I think while the plan may seem like it will work on

paper the major uncertainty that we're dealing with here is again that income collection that that personal income tax collection this is assuming that his Revenue projections will be realized and if those Revenue projections are realized with these Pro with these Solutions put in place then the deficit can be resolved I want to mention here quickly that um a week ago csba California

school boards Association filed a lawsuit against the state of California and the Department of Finance alleging Governor's illegal manipulation of proposition 98 what is Proposition 9 proposition Ida is a constitutional amendment that was passed by the people that guarantees a minimum level of funding for K12 education and community colleges so it's a law that's set in place that that that

tells the state how to calculate that minimum funding for k14 education and and if you take a look at the last bullet here proposition 98 cannot be changed by the legislature or the governor only a vote of the people can change it so when the state adopted its budget back in June for 2425 there was some language included in

the uh in the budget act that stated um something to the effect of if in the future tax uh personal income taxes were delayed again that the governor would be able to direct the Department of Finance to go back to recalculate how much the state actually owes education so instead of using exactly how much we were paid

and then go for and calculate forward from there if the taxes were delayed in collection he would be able to go back and recalculate that formula which is why I I believe csba filed that lawsuit on to the fun stuff this is really what we are why we are here I want to share some of the trends and

patterns of CVUSD with you this graph right here shows the great progression from kinder through 12th grade uh for the years of 197 9798 through 20045 you may wonder why I started with that year I started working for the Chino valy infi School District in 1998 where we couldn't put down Portables fast enough to welcome the students into our schools our our school

sites were booming with new residents and new students and that's why I wanted to use that year and take you through the Journey that um this district has been on Note here in 1997 98 the number of outgoing seniors was lower than the number of the incoming kindergarteners you see that 2,000 seniors were leaving our system with uh almost 2,300 Kinders coming into

the system this set of data Trend tells us that we have a growth bubble in the elementary years that's soon going to move up in the Years with through the system let's follow the first graders from 1997 98 and each year they're going to progress and by the time they get to 20045 they will be eighth graders in the

district 2004 and five was the year where the district enrollment was at its peak we had 33,785 students at The District in 2005 and six our trend line begins to look a little different and our growth bubble is leaving the district our growth bubble from the seventh grade on onto the 12th grade that high number of enrollment of

students is leaving so if you take a look at here in 2005 and six 200 2,700 seniors were leaving the district while only 2,100 kindergarteners were coming in so the Upper Grade growth bubble will leave our district and the smaller enrollment in the lower grades will now come through and show different Dynamics if I take us through to the

actual numbers of last year you'll see that every single grade level is now lower than before this black line represents the actual enrollment numbers of 2023 24 and it was also the lowest enrollment numbers our district has ever has experienced in my 25 here 25 years here at 25,5 12 students our district landscape definitely changed over time now let me show you that in a

different format so I just took you through that trend line from 98 to 2023 24 here I'm starting with 2004 and five the peak of our enrollment and all the way to the right you'll see the projected enrollment for 2425 which is this year that trend line is going down this orange line right here is our average daily attendance that

corresponds to each f fiscal year so I stated earlier when the district was as it at its peak of enrollment of 33,785 and last year at 2,512 that was a loss of over 8,000 students over time despite the ongoing decline in enrollment our district has always fared well in terms of attendance our students do attend school this is especially important

because many of the state funds and the federal funds are calculated based on attendance and not enrollment so if you take a look at this line right here there is a gap between that green and that orange those are absences the state does not fund us on absences so in 1617 the district's attend rate was at an all-time height of

97.4% so for a unified school district if you think about the seniors that you have that have senioritis and the kindergarteners that may not come to school because it's raining it's usually not as good our district has always fared well at either 96% or 96.5% and that particular year was the highest attendance ever at 97.4% unfortunately when Co hit in 2020

attendance took a deep dive that year and the year that followed and that is the case for all school districts in California the good news is our attendance is trending the right direction right now if you take a look at the Orange Line um in 2122 we were trending at 92% 2223 we were trending at 93% last year our average attendance was

at 94% and we are hopeful that this year we will be able to reach 95% and hopefully normalize in the next couple of years Miss chin can you go back to that slide sure uh so the board I just wanted to draw your attention to a little bit on this uh particular slide if you look at going back to the 0405 school year

you see a a declining enrollment and we've experienced between 300 to 500 student uh decline each school year except in the 1 I think is going into the 171 18 school year and that was when uh I believe Opa was closed yes and so we have a spike that went up that one year but again you see it it progresses

down after that year and continues on a uh a downward pattern but I wanted I want to draw your attention to this school year again we project it um I think it was about around another 500 uh declining enrollment but the good news is if you look at this and and this is just new data that came in off our

P1 um but it looks like we're around 2,577 so it looks like we flattened out but the concern we have we're hoping that it stays there and that is our a pattern moving forward but Davis demographics who's done our our projections over the years and I've used them for 17 years of being in the district when I used to do Staffing

projections when I was uh in HR they are pretty spoton usually and so this is an anomaly um and so they're projecting for the next seven years that we will have a declining enrollment of 300 students again it's a data point for us it's a positive one um again we don't know next year what will happen because

the trend line as you can see is pretty much dropping every year but we we plateaued on this one which is a positive news uh which does impact the the budget positively from what our projections are so you'll see some recalculation in December when we we bring new different numbers to us but again it's just one we're going to

have to watch of is this just an anomaly and then do we drop 300 next year in the following years or are we plateauing off which would be a good sign for our district so just wanted to touch on that thank you thank you for that clarification Dr Enfield and yesterday was cat's day so cat's data was

collected yesterday the um technology uh the info services department will be taking a look at that and we usually certify that in December so hopefully we will have official cowpats data to share with you in December when we certify first intern report next I will review with you the main drivers of our revenues and expenditures okay this pie chart here

shows the total revenues projected for our 2425 fiscal year uh in the amount of 394 approximately $394 million our revenues include lcff funding sources it includes Federal revenues as well other state and other local so as you can see on the chart to the right I have split this entire total uh general fund budget Revenue into restricted and unrestricted as you know

funds come to us one way or the other there are restricted funds that we can only use on certain items and there are unrestricted dollars that we can have we have a little bit more discretion on so for the purpose of today's conversation we will be focusing on the unrestricted portion right here that you see which represents 82% of our total general fund

budget as far as the restricted uh revenues go you'll see on the upper right corner what those entail you have special education funding title uh Title One title two title three title four funding from the federal government Perkins Esser funds learning recovery funds you have after school funding Arts and Music elop etc those are all restricted and can only be used in in a

very narrow way so taking that 82% forward we're going to focus a little bit more on this you can see that on the unrestricted side of the revenues 95% of our Revenue sources come from lcff which is the local control funding formula These funds are calculated using the state formula which provides a specific base Grant amount per pupil by grad span

multipli by our District's Ada our average daily attendance by grce span school districts receive additional funding from the state based on the demographic of the students they serve specifically the unduplicated pupil count um of students who are English Learners uh free or reduced meal eligible or Foster youth qualifies for under one of them and so because of that

we get 20% additional funding put into lcff let's dive into lcff a little bit more oh let me right right here uh let me add we also receive other state and other local funds that are unrestricted um which includes mandated costs unrestricted Lottery transportation for uh to help cover cover the cost of our transportation we also have some local funds here through

facilities use uh through sell sale of the bus passes Etc diving into the lcff chart a little bit if you take a closer look at last year 2324 even though the funded Cola was 8.22% for the last fiscal year due to our declining enrollment in the district and our attendance rate still at that 93 94% we actually only received $ 16.6

million new money then prior year so when you calculate that into percentages we actually received 5.65% new money and not 8.22% new money if the district had the exact same enrollment as last year and perfect attendance we would have received the full 8.22% that's how the state's formula works or if the district were growing at a rate faster than last well

at least not declining if we were growing and our attendance rate was pretty good in the 90s we have an opportunity to receive more than 8.22% but that is not this District if you take a look at current year current Year's Cola is 1.0 7% again factoring in our our attendance and our declining enrollment that translates to actually less money that

we will be receiving this year than last year so our lcff total revenues is uh three 306 $37 million compared to last year's 311 so a decrease of $45 million compared to last year so a 1.07 positive Cola actually translates to a negative 1.46 Cola for CVUSD the projected Cola for the two out years are 2.93 and 3.08% respectively

but you will see that again due to the way the calculations are done we do not receive that full Cola unless our trend line starts to improve starting this year and we will start to grow okay one thing to note here that I I included here because of covid-19 many school districts suffered in their revenues because of the atrocious attendance rate

the state came out with um a different way to C to help us calculate it had always been that if you were a declining District you allowed to use last year's attendance because last year would been higher than this year if you were declining or if you were growing District you will use current years because of co9 the state came out

and said you can use the average of three prior years because why the average of the three prior years would have included preco years in there in your calculation so our pre-co year would have been 2021 and that's now falling off of our calculation so that year was a good year and a robust year but now our three

years average includes 2122 22 23 and 23 24 which were all our actuals of the 92% 93% and 94% okay so that's affecting all school districts Miss Jin yes okay I jump in thank you um I want to take a moment and talk about this slide uh to give some information regarding it so when when you when we go

into the 20242 budget and so we're we're going back to last year and actually starting right now this year we're starting to look at the budget for the 2526 school year so behind the scenes districts are always preparing for that and Based on data that comes to us but it starts to True up when we get to April and May is probably when we're

starting to put more numbers into it but as part of that we've looked at projection so we always have to project what is our enrollment and that's a big part of it so going back to last year looking at our trend line we project that we're still declining enrollment our our our uh Davis demographics who we rely on to give us some data we looking

at those those patterns of what we've been declining we put that into that projections and so you're building a budget Based on data that's from the past projecting forward and and putting as much information that you have into a budget the other part of this is when the state was looking at their budget for this scho for this year the

2425 uh budget year in the 2223 budget they overprojected their revenues and it came in lower than what they projected and and they didn't address it the following year for the 2324 budget and they projected a higher revenue and less money came in and then so for this budget the state of California I think they're settl on

about a $46 billion deficit is about what they were saying um the final deficit was a number of us have been in the district and a number it's been in education long enough to know that every decade the state of California has budget issues that impact school districts if you go back and you look and I'll just go back to the 9s I know

Mr Bridge could go back probably further but if you just go back to the 90s you will see there are a couple of inci in yeah back into the 80s but if you go to the 90s you will see there's a couple of incidents where school districts received less funding and they have to look at their budgets and look at at

Cuts if you go to 2000 again we had that same scenario where there was budget budget cuts in in 2000 uh in the 2000s 2010 we had the Great Recession that bled into um well it was at 2009 into 2010 and so we've had a pretty good run uh from the the Great Recession to where we are today

and so when we who were here during the last budget crisis and it was a big budget crisis for this district and for every District in California um we had to well what some of the decisions were they closed schools at that time three schools were closed um I did layoffs for the district three consecutive layoffs the first one

was over 283 teachers uh we laid off classified in management we did Furlow days um there was a lot of things that we did we had to cut $33 million um and it was very difficult time and that budget deficit at the time was 24 billion and so when the state came out and they said 46 billion I mean

you know we're we're going oh that's big that's a big deficit but the state of California was in a better position they had some raing day funds that Miss chin showed earlier that's why we had that slide up there so you can see the state used Ry day funds they froze a number of positions within the state and froze

spending it at the state in many of the the government uh departments uh they've done some deferrals of money into out years and they have some projections and we're hoping those projections are you know come to fruition but when we saw those numbers me as the superintendent having past experience I said hey if this is if we're at the end of it

that's great news but if we're not and I just this is the scenario I just want to show so if you look at the 2425 school year we we were to have a 3.94 cola and so the state didn't cut any they say they didn't cut any money for education but they they brought down the cola that's one of the things they do to

us so they brought the cola down and that I would say was are cut and in a district like us if that declining enrollment stays where it is you see we we potentially go down $4.5 million if I don't do any freezes and say oh we'll just wait we'll roll the dice and see what happens if there's still a deficit and

the and the projections don't come in because California hasn't been collecting as much taxes in in the last couple of years if that persist to the 24 20 uh 25 26 school year if you look at that Cola that's a 2.93 if you did what the state did to the 3.94 that that's almost a zero Cola so in May we're looking at this like

hold it we we have to be very cautious of what we're going to do and so the the the thing for me was going back to 2009 when we had the the Great Recession at that time there was that first year leading into it and it's a lesson that I learned when I looked at it back then we could have

froze positions as a district it would not have stopped the number of cuts we would have had to made by no means it would not have stopped the cuts those were big cuts and I'm not saying that today we're in that position but had we done something back then it would have lessened the the next year out and so I

look at that because if we have a zeroc cola for 25 26 and we do nothing this year and we have declining in if that holds but I don't think it is but at the time in May we're projecting that out then we would have probably about another $4.5 million less money coming in so you would have 311 and now we're

down to probably about $9 million that we have been reduced and so would you rather address that 9 million two years out or would you rather just address it right now with a couple of freezes and so the decision and my recommendation was hey let's freeze positions and look at what's happening because if everything returns back to normal and the estate receives

the funding that they're projecting which we're hoping and our our enrollment is up which is a very positive thing for us then we can adjust going into the 25 26 school year very easily uh but if everything Contin if it drops down and there still is a budget issue of revenues being collected we put oursel in a better position today for

the 25 26 school year and again it would mean we can make fewer adjustments and have to reduce down lower so we're trying to keep things away and that's what I get paid to do is to look at the the trends use my experience of being in this position and other positions and maneuver the district through there so

that we're always in a very positive position and so that why that's why you see there's some position we froze through the district we didn't get rid of anybody we just when people promote up hey we're going to keep this position Frozen and then we've also done some positions where we are slow to fill it meaning if I have a critical position

like a school uh a school custodian is vacant we're flying that position and we're filling it as fast as possible but if I have a if I have a a clerical position at the district office office I may I it may be needed to be filled but I may take a month or two to slow the process down because that creates

savings within the district so we're doing a lot of different things behind the scenes looking at positions and slowing some of our our our positions there to create some cost savings because in a district guard size it does generate a number of savings for us and so that's the reason why you see some of the freezes there I'm just wanted to

ensure that we're in a good position if things go worse if they get better we're in a really we're in a we're in a very positive position moving forward so I just wanted to share with the board so you're clear of why we why I'm doing what we're we're doing with the freezing of some of our positions thank you Dr Enfield that's a

perfect segue into our next slide and now let's shift gears and take a look at where cvu USD spends its funds the total projected expenditure budget for this fiscal year is 453 million this again is the total expenditure um pie chart for the district our main categories of expenditures include salaries for our certificated and classified staff benefits for all groups and some other

expenditures similar to revenues our expenditures are broken up between restricted and unrestricted we will focus on the unrestricted um portion of our expenditures as this is practically the only area that the board has any discretion over remember you don't really have a say over revenues because that is generated by our attendance you don't really have a say over how you

want to spend restricted uh revenues either so this is really the only portion the 74% of our total expenditure share is where you have a say so let's take a look at that particular portion 87% of our unrestricted expenditures pays for the salaries and benefits of our employees this is actually quite consistent across um multiple districts that when you take a look at only your

unrestricted expenditures you're looking at about 85 to 90% dedicated to your people the other 133% is spent on everything else keeping this District running such as books and supplies for our schools our services um operating expenses including our utility costs keeping this just keeping our doors open some capital outlay and other outgo and transfer of indirect costs basically

these are reimbursements from from our restricted programs back into our unrestricted site because we manage those restricted programs but this is not all the expenditures that we have totaling 277.50 the district contributes additionally $150,000 towards its Adult Ed it contributes $38 million towards special education and another $18.5 million towards routine restricted maintenance program and our deferred maintenance

program this then brings the total cost out of our unrestricted side to 3 34.4 million so while restricted revenues cannot be spent on unrestricted expenditures unrestricted revenues can be spent on restricted expenditures what do I mean by that special education is a restricted program but the amount of funding we receive from the federal government from our local Sela is not nearly enough to

operate that program adequately thus the contribution from The District's unrestricted portion the other program routine restricted maintenance and deferred maintenance are also restricted programs but there is no restricted revenues coming from the state for any of that so this the district's unrestricted side of the revenue contributes 100% to fund those programs so that we can keep our

our facilities in in shape this is uh this next slide shows where CVUSD stands in comparison to the other 3 32 districts in san berardino county this first chart here shows um that we are number three in size in the county of San berino just behind San berino City Unified and Fontana Unified at 23552 is our is the projected Ada that

the county has this next slide shows where we stand in terms of the unduplicated pupo percentage remember I shared earlier we're at 52% we are number 30 out of 33 for reference only OMD on ter Monclair is next door to us their percentage is 89.5% this means for every 10 students about nine students are uh qualified for

either as an English learner Foster Youth and or or eligible for free and reduced meals chayi cha joint Union High School District is at 65.5% so when I mentioned about the lcff revenue earlier in order to receive additional funding the funding is calculated based on the demographics of students you serve we are at 52% therefore we receive 20% additional more

in lcff funding districts who have a much higher percentage they get an exponentially amount higher in lcff funding and you will see that in the next chart right here that this is a um an average of lcf funding per Ada so now we're going getting down to the per student basis USD is number 30 when they when they

take a look at all of the lcff money we receive now the L lcff funding we receive is calculated based on uh gr span so each gr span has a different calculation but this is an average so on average there are 12,6 uh excuse me on average 12,637 per Ada is our figure but I'll explain for comparison purposes chaffy

who is 11 uh in rank out of 33 receives about 15,167 per Ada and OMD just next door to us receives about 15,1 163 per Ada now just for the sake of calculation for references only if we were a district that received that type of funding like OMSD or cha it's approximately $2,500 more per Ada take that multiply by our Ada it equates to

almost $60 million more funding on an annual basis but this is not all bad news it simply just shows that we serve different types of demographics our students are such where our percentage is at 52% we don't have as many English Learners we don't have as many students who qualify for free or reduce and we don't have as many Foster youth compared

to the other districts in the county Mr chair yes let me jump in um the reason we wanted to put this slide up here is because a lot of times people want to compare us to other districts and I think you have to always be very careful of comparing one District to another and so that was the

reason to put this slide up here to show the the difference and because I know a lot of times people want to compare us to uh chaffy school district and chaffy school district is an all High School school district and so I'll get a little bit in the weeds but I want to go through some of the funding so every

District receives base Grant it's a same amount of money for for all the students but it's in groups of students and so we receive x amount of dollars per student for K through third grade and and that's the same amount for for everybody and then for students who are in fourth to sixth grade we receive a little bit more

money because it's a little bit more expensive as kids get older for the education and then students who are in seventh to e8th grade we get more money for for students in sth to e8th grade and then 9th through 12th is where you get the most money for your students and so if you look at our school district

which is a unified school district we have students from K to 12 so we're getting four different types of funding for those students when you compare us to chaffy Unified School District which is an all High School school district and I think they're around 20 some thousand um 21 somewhere around there um they're getting all the students in that

District are being funded at the 9th through 12th grade which is the highest rate so it's not a fair comparison because they're not a unified school district the other part if you look at chaffy there's there's and now there's two other parts of funding that school districts receive and Miss chin touched on that if you have any Foster students

English Learners or stud students who meet income requirement to receive free or reduced meals you receive what we call supplement grant money for those students that fall into that category and if you have 1% to 55% then the district receives 20% on top of the base Grant so students in K3 that are identified there they will get 20% on

top of that base Grant if you're at a higher base Grant like 9 through 12 you're going to get 20% on that that part of the base Grant all right so that's up to 55% and as Miss Chen shared we have 53% in our district we're around there 52 53 right around there um the N once you get

over 55% then you receive 65 it's called concentration Grant you receive 65% additional monies based on that base Grant so if you have students in K3 you get 65 for that for every student over 55% so again if you look at chaffy they're at 65% so about 10% of their students they get that concentration Grant and so it's a

difficult one to compare districts to districts because that's Cha's reality our reality is 53 about 52 52% of our students fall in that category and we get 25% of the money they're a high school district we're a unified school district but a lot of times people want to compare us to them the other one Ontario Monclair School District they

are a K through 8 they don't receive base grant for kids in 9th through 12th grade because they only go up to 8th grade but if you look at their district there about almost 90% of their students fall into the Foster English language Learners are students who meet income requirements for free or reduced meal so they get 20% all the way up to

55 and then the next 35% they're getting 65 on top of that and so when you look at the average of their students their Ada they receive around $155,000 compared to around 122,500 for us but people want to compare us from this District to that district and I always say it's not fair to compare districts to districts every district

has their own student population whatever that population is and based on that based on the state funding is what a district will receive and it's based on that money that you build your budget not on another District it's this is what Chino is this is our reality and so this is our students that we serve we receive our money and then we educate

them based on that not based on what another district is it's based on what we here in Chino have and that just becomes what are our priorities as a district and how do we want to allocate our money so I asked Miss Chen to put that slide in there because I know this comes up quite a bit now that you fully understand where

our revenues come from and where they're spent what they're spent on this is a chart that marries the two together so this green line right here represents the actual revenues we received um starting in 2008 20 9 through last year's actuals with projections for this year and the two following years um you'll see the big trough in the beginning of the this

chart 20089 through 2012 13 that was the impact of the Great Recession the revenues were significantly reduced and um we had to work with what the state gave us there were constant threats of meteor Cuts as Dr enil mentioned during those years we had to have plans ready uh a reduction plan ready every single month simly when we discuss

budget this next line right here is the actual expenditures going back to 20089 same thing with projections through for this year and next two years so where I want to point your attention to is really this year and the next two years this green this red band right here ideally we like our green line to be above our red line that will show that

we are spending within our means so for the coming up three years because of the reduction of the cola to 1.07 and because our district also um settled on two years of unprecedented salary increases that will have an impact going forward uh into the future it shows that we have deficit spending and the benefit of this myp um

as required by ab200 is that I show you this way ahead of time and it gives us plenty of time like Dr enil mentioned earlier to make adjustments where we can early so that we're not leading into reduction in Workforce in summary there are still risks contained in the governor's 2425 budget we really don't know if the

govern's projected revenues will be realized as we discussed earlier how volatile the personal income taxes can be so when the governor unveils his budget proposal in January for the 2025 26 school year he will at that time have six months of actual collections of revenues uh data worth that he can refer back to and see if we're on

track other concerns are listed on this sheet in no particular order um or the ones that I feel may also have an impact on our budget as you know our one-time federal funds um that came on the heels of uh covid-19 are sunsetting many of those funds conclude this year our declining Trend uh is still an issue but we are happy to see that this

year may be a tapering off year and hopefully it goes the other direction despite what our demographer has shown us for the next seven years our attendance rate is still lower than preco but we are hopeful that we could get back on track with that so where do we go from here I am certain that the board's interest is to

continue the good effort that is already in place to build a sustainable budget year after year for our students rest assured that staff will continue to monitor the state's economy and budget and we will also closely monitor our budget as well I understand this is a lot of information and um I here to answer questions if you have

any board do you have any questions I see Mr Cruz's light already on if anybody else has any questions you can use the light system I'll go ahead and put Mr Cruz in thank you m CH know under your leadership you know you have done you have Financial audits 23 positive Financial audits since 2013 so thank you

also also the also the onetime covid money are we using that to pay employees funding employees so covid dollars are restricted in nature so they have been used on all of the allowable expenditures provided by each fund I'm sorry I didn't hear it covid dollars are restricted Revenue sources from the federal government each fund comes with a set of restrictions the

district has expended those dollars in accordance with the allowable expenditures are we using them right now for employees uh are for the ones yes yes it has paid for salaries on on many categories and that's ending that's ending and then you stated 1% of the California population pays 50% of the taxes the top 1% yeah and then

you know we've been hearing Chevron they've been around for 145 years they they have moved SpaceX has moved Oracle and 660 companies and then you stated 42.8% budget shortfall that's the largest Dr Enfield what what you stated huh was it 27 or 22% in 2009 2010 the the percentage of the budget shortfall 28% because it was 42% right 23 24 you

were referring to the budget deficit at the state level during stener's um time as a governor the the uh I believe the peak of that budget deficit was 26 billion it's the largest we are at yes currently at 46.8 and then you know governor governor Nome you know looking at his page 15 and and just looking at his

budget it's when when you see the outlines what's going on with this budget it's actually kind of funky looking and you know the only word I I could think of is there's a lot of deception a lot of gimmicks occurring within this thing not being truthful at all what's actually occurring and um there's some there's some things going on on

here and then you mentioned freezing positions the importance of freezing positions I think you're doing I think that's excellent Dr infield because when it comes to families when it comes to people working for employees with their children that that is our priority is to keep them safe for these downturns so I'm I'm really I'm really proud for this District to look after

our employees because um there there could be yeah you also stated 70% that 70% tax base dropped down to 50% in 2023 2024 for this year yes for um the um that was in reference to the total income personal income tax representing as high as 70% of of all of the state's revenues it's only 56% this year yeah we

definitely have to have cautious when it comes to the next budget of the 2024 2025 school year thank you thank you Mr Cruz Mr n your mic's on it's on okay yeah um our data shows we have lower number of Kinder students entering our school district and we have uh higher number of high school students exiting our school district and I think

that is a major concern um for my sake uh I'd like to see uh Dr anfield if there's a um program that we could study or or offer where more parents would be willing to uh bring their Kinder or primary grade students even from outside of our district to um enroll in our schools I think if we could maybe uh

have that study done with our parents themselves and and come with the right solution uh we could capture more Kinder students in our district and also there's a still ongoing uh a talk about uh neighboring schools have offering more AP courses in their high schools so we need to uh also pay close attention and see if we could offer as

many U Val good AP courses to keep all of our high school students in our school district and also attract other high school students to our district to to accomplish their uh educational goal to going to college I think um we could do that because we have an awesome staffs and awesome um principles that who are willing to do everything for our

kids Dr Enfield yeah I can look into the uh kindergarten programs um but regarding our AP courses we've increased those we have quite a a number of APS and every year we have increased those and we continue uh we're continuing to work on our dual credits um and and which I think is extremely important the Dual credits um um so again we continue to

look at those things and continue to add as much as we can yeah great thank you okay M CH excuse me thank you for the presentation and as because of the biotech Academy at at Chino high I'll go ahead and jump in on that one I I think there's a lot of programs that we've added here if you look at the

uh at Hidden trails and look at borba we have the Dual language programs that we've added so we're seeing increase in our our kindergarten uh classrooms when you look at the best program that's been added over at Chino high that program continues to be growing and recruiting people from outside of the the district um so there there's a lot of positive

things I believe that that's going on that that's helping that uh again we'll continue to monitor that and and hopefully we're plateauing uh ideally increasing um I in that Legacy area I don't necessarily know if it was the opening of the school we split it but enrollment is up above a little bit of projections of what we had for both

schools so we're seeing some of that so I think some of that's uh attributing to that um but we're we've seen a little bit rise in our kindergarten programs uh as a district so which is good news yeah that's that's good to hear I and I hope we continue to promote promote those programs uh both inside and and outside

the district I know uh the biotech Academy I think has some uh open houses coming up uh shortly and I hope we can get the word out about that because it it is a tremendous program and I know we can draw students from outside the district to it so thank you thanks Mr Bridge um I also like to just mention

about our AP courses I was at aella high school Yer yesterday with Mr bridge and Dr Enfield and it was great because um you know Y booy and the staff were they were honoring all the AP uh teachers and all the success that they've had and she was showing us their goals for the next year um with that said I I know on the

campus that my daughter attends including Ayala the counselors are really focusing on um making sure our students know about the dual enrollment I wish that was there when you know my kids started High School um because it's such an amazing program I know my kids started to take advantage of it but I have a senior too so that's kind of a

little too late for her um but that program is super awesome and I know that there's a great push to get our students into there and also the great things that are happening at Bal view too are very attractive to our district um which I'm very proud of because I sit on the commission and seeing you know the

direction of that commission to make sure our students are aware of that because we have a lot of kids going into a field that may not require college and they can come straight out of that program and be ready to work which I think is a tremendous thing it's just a message of getting it out to our

students which I've seen our staff do a great job alongside baly view so I'm excited for all those things because um even talking to a developer this morning um in a area that is still developing in our community which is The Preserve area it I think they did a um survey and only 48% have kids so I know the declining

enrollment is just a reality that a lot of people are facing with the new generations not having children as younger and and the um you know they're waiting later on in life so there isn't that influx of kids coming in as well so glad that you guys are doing creative things to make sure that we still have

our district attractive um for others to make sure that you know they they have the trust in there so I do thank you guys for that I thank you for all your hard work I know as a mother four years ago when I would look at some of these things I'd be like why are we doing that

why don't we have this why don't we have that and having a better understanding as a board member is a lot of the reason why um you know I really asked for something like this to happen in the public so there's a lot of transparency there's a lot of explanations because a lot of things that you look at on the

surface aren't always what they seem to be and knowing how you guys are working as a team and we're be able we're able to support you and with Dr enfield's recommendations to make sure we don't get into something sticky I I truly um do appreciate that direction I I think a lot of people call you the goat I do

agree uh Sandra you are the goat of making sure our district that's a good thing by the way it means like you're a top M MVP um alongside the team but it just means that you're really really doing an amazing job I I know that people all over California would love to have you working for them to make sure

that they're secure too so thank you for all your hard work thank you for the staff's all hard work and recommendations to keep our district um healthy even in situations where has Mr Cruz pointed out are some really funky things happening with the state and I I feel bad that you guys have to deal and pivot with that but I feel very

comfortable as a district that we're in a position that most districts are not in the same position we've seen people lay off tons the people already and that is heartbreaking and we all are facing the same uh challenges but you guys are doing tremendous things to make sure that our families are not affected the same way as other ones so thank you I

know that we still have more of a presentation um that that we're going to give um so I'll stop it at there but thank you again for everything you guys do uh Mr no go ahead yes um yeah I'd like to thank Dr Enfield uh the direction we're taking yes I do remember 2009 and 2010 where Sacramento uh made us

to not only our school district throughout California lay off many teachers and our school staff members and that was the worst experience that I have had to face uh many of our teachers were crying the parents were here here and their friends were here their childrens were here and it was very tough and seeing that our family members

losing their job losing potential of losing their home was really really an awful night so we're doing the right thing not trusting sacramental BR brats to to make mistakes in their projections and and um and harming our teachers and our staffs we have to come together so that we never have to go through that pain again whatsoever never

do that again so yes I do agree that we must prepare now to make sure that we protect every single teachers and every single staff members CSA members and our champ members everyone in our district as we said we're a family member and and we're all related we're all un United together so we have to make sure

that it's not different body but one mind and one body working together for our children in our school district thank you thank you Mr Dr anfield all right thank you Michelle um again I I want to kind of go back a little bit on on that budget development so again we're in a process of starting to look at 25

26 um last year in May when we were looking at uh bringing the the final budget to the board in June the the data points again we we're always having to deal with what is the data saying today and trying to make decisions at that time and I can tell you in May I was very concerned but I'm less concerned today which is

good news one of the positive news again I'm going to reiterate this is we had a projection of I think correct me if I'm wrong Miss Jen around 500 declining enrollment yes it some somewhere around there um but our if you look at our enrollment now it's actually flat a little bit up if those numbers hold which is extremely positive like if if I

knew that in May it would been a different like like probably maybe recommendation because we're counting on losing that number of students and so that's a that's a tremendous amount of money that we lose every year because of declining enrollment so that's a really positive one um the state of California economy I always looking at that one um

that's one of the things I I I I I enjoy looking at those things and reading on on on the national economy California's economy um and and looking at information and and M chin was on the phone with the Department of Finance trying to because we were seeing some data that was you know from one office is a little bit different from another

office and we got clarification on that and so when we look at at California the were they only have data I believe up until August but the projections you know the last two years what they have projected hasn't come to fruition but for July and August it's it's only two months but their projections are coming in which is a positive thing that's what

we want to see we don't want to see go down so I'm little I'm looking at things and I feel much more comfortable today than I did in May regarding where we can possibly end up but come January um the governor will come out with his proposal and we'll have six months of data collection so they'll know what taxes they've collected up to

that point um and we'll have a really good picture of where we're at and if things continue things look could be very positive because once California gets back on a roll uh the economy it does very well as we all know that it's a big big economy so we're hoping for the best and I think we put ourselves in

in that position um which is positive news so I wanted to share that with you because I don't want people to walk out of here thinking that we're like the uh the Great Recession um it's just when those things happen and you see a large deficit like that you you have to respond on the data that you have at

that point so things are looking much better today uh for me but one of the things I do also want to bring forward to the board um one of the things that you've made to me have shared with me as a priority has that you want us to be competitive in salary and wages and again again that's why I brought out

that slide tonight just to show you that one would consider us a a low wealth District that used to be a term they used under the UN the old uh funding formula but I would call it we're like a low wealth District we don't receive as much money as other districts per student so we we don't have those

luxuries if that's a priority as a board you're going to have to make decisions uh of of what you're going to do in the future and I share that as Miss chin has always shared with me you can afford anything it's just what are you willing to give up and so if that's a a priority of the board into the

future you're going to have to to make some decisions uh regarding where we're going to move as a district if if that's going to become a if that's the priority I mean we've always got raises and and we tried to be very competitive with that but if you're looking at maintaining like what we've done the last couple of years we've

given those have been large raises the largest in this District so if you're looking at competing with those districts that receive more money there there there has to be some some give and take and and the board has to be aware of that so I just wanted to share that with the board tonight it thank you Miss jaw I know that

keeping the district solvent is definitely not a one-man job and it's a collective effort across the district um I do want to take a second to recognize my staff here uh Miss pens is our director of fiscal Services who um really um is my right-and person thank [Applause] you absolutely no thank you very much and I'm glad that the board has um made

priorities but also listening to your guys' expertise and our superintendent's recommendations with the transparency to the community that's the biggest thing when I came in here is just the transparency and allow the community the opportunity to know what we're doing and why we're doing and how we're doing it um so thank you for your time for doing

this I know that you're very busy so I appreciate that I appreciate the staff and everything that they're do doing to ensure that our district um does what's best for kids continuously so thank you again and with that said I will adjourn the special meeting of board of education at 5:53 p.m.