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Budget Fact Sheet (posted on SMUHSD website today)

San Mateo Union High School District
BUDGET FACT SHEET

Background

SMUHSD is a basic aid district. A basic aid district is one whose local property taxes meet or exceed its' per pupil revenue limit. Basic aid school districts are allowed to keep the money it receives from local property taxes including the amount that exceeds the revenue limit apportionment. Budget shortfalls in basic aid districts are not back-filled by state funds. 92% of the SMUHSD's unrestricted general fund revenues are composed of the local property taxes based on property tax projections developed by the County Assessor's office.

Property tax revenue is volatile and subject to dramatic changes. This is due to the cyclical nature of property values. In three (3) of the past four (4) years, property tax projections were reduced substantially after the budgets were adopted by the SMUHSD Board.For the past two (2) years, the District's actual property tax receipts were $4.3M less than the property tax projections received from the San Mateo County Assessor's office. The substantial shortfall was the result of unforeseen rebates and litigation settlements by the county and commercial property owners as a result of the impact of 9/11; e.g. hotels and airlines. As the District reconciled the general fund balance at the end of 2005-2006 fiscal year, it was clear that the unanticipated reduction in actual property tax receipts had eroded its reserves below the state- mandated 3% reserve for economic uncertainty.

District Administration began developing a recovery plan and reduced the 06-07 budget by $1M in non-personnel expenditures. On August 10 a work study session was held for the Board to analyze the budget and embark on a 3-year recovery plan. The District goal was to decrease expenditures by $1M with the least impact on the instructional program. On August 14, the County Superintendent of Schools requested a more prudent time line for a budget that reflected fiscal solvency. The 2006-07 Budget Recovery Plan was to reflect, by September 29, 2006, a $2M ending balance as of June 30, 2007, to receive County Office approval. $3.5M in budget reductions required to achieve $2M ending balance.

Recovery Plan due to County Superintendent on September 29 to receive budget approval. The Administrative Team, CTA, CSEA and the parent community have been notified of current budget challenges.More than 85% of our overall budget is devoted to salaries and benefits. The District presently pays up to $15,000 per employee per year for medical, dental and vision benefits. Employees have received in the last two years, $4,656,235 in salary increases that would not have been negotiated had the property tax shortfalls been known. Employee compensation adjustment for the last two (2) fiscal years by unit:

CTA received $3,144,616
CSEA received $1,069,175
Management and Confidential received $440,444

Compensation is tied to changes in property assessed valuations utilizing a negotiated formula. Compensation increases have been based on the original County Assessor's Assessed Valuation (AV) projections. Historically, the AV projections from the County Assessor's office prior to 9/11 have been accurate. In the past four (4) years, property tax projections were substantially reduced

– Written by Jen

Posted in

30 responses to “Budget Fact Sheet (posted on SMUHSD website today)”

  1. Joanne

    The second page of the document gives a timeline of events since Spring 2006. On September 18, the SMUHSD said that “management indicate support of rollbacks in their salaries in order to save jobs; neither CTA (teachers) or CSEA (classified)poll their memberships regarding rollbacks.” The figure I had previously heard for a rollback was 3%. So if 3% could make up 3.5 million, then the all the SMUHSD employees would still receive more than what their contracts entitled them to (since they were overpaid by 4.65 million). Of course, the new employees did not enjoy that overpayment and the new employees will be the ones whose jobs will be cut when the old employees don’t roll back the salaries. No wonder the unions didn’t poll their membership; I suspect all the new employees would rather have 3% less pay and a job, than no job at all. Maybe there is a public interest law firm out there that is interested in suing to get the overpayment back on behalf of the tax payers.
    The info is posted at http://www.smuhsd.org….go to “Budget Fact Sheet” on the lower right.

  2. Joanne

    PS…Does anyone know what the turnover rate among teachers and classified was last year? That might go a long way in explaining why the CTA or CSEA isn’t putting it to a vote.

  3. Joanne

    PSS…KRN appears to have gone underground, but is there a SMUHSD employee out there (at any level, management, teacher or classified) that can explain why the employees felt justified keeping a raise that their contracts did not entitle them to? If the last hit hadn’t sent the whole budget over the edge, would all the employees have just pocketed that money and kept mum?

  4. steve

    Joanne

    As a teacher in the SMUHSD I am not quite sure what you mean by the contract did not entitle me to the raise. The way the bargaining works, the SMUHSD presents the income statements which determine raises or lack thereof to the teachers union, who can then accept or reject them. Figures are given by the district and not audited by the teachers. If in fact the District OFFERED a raise that was beyond what they should have, WHY DID THEY DO IT TWO YEARS IN A ROW? Shouldn’t the district instead have brought this information to light in the next bargaining session. This is just a plan for the district to blame the district for their own financial bungling.

    Please also notice that by a percentage basis, the management received larger raises than the teachers.

    As I said in a previous posting on another topic, what has happened isn’t only unforseen property taxes, but a series of mistakes. In the past four years the SMUHSD has cut everything they can to put in the seven period day and still did not have enough money to pay for it, thus our present situation.

  5. Joanne

    Hi Steve,
    I’m not sure I buy the seven period day is the problem of all our woes, given the fact that there are 12 less teachers this year in the district.
    However, I think I hear what you are saying on the contract issue…that your raise is a percentage of what the SMUHSD project the income is going to be — and if it’s off then it’s their tough luck. I guess that might be the “letter” of the contract, but I wonder whether it’s the spirit. I’d like — and I think everyone would like — to see all of you quit the name-calling and come up with a solution. As you know, the parents at BHS are very supportive of the teachers, but this mess is straining everyone’s patience.

  6. steve

    Joanne

    First, a question – just for information – where is the data on the number of teachers from?

    Second a comment. I didn’t say it was their tough luck. Instead I wonder why they did it…. if I make a mistake in the first year, I certainly wouldn’t do it again the next

  7. steve

    Joanne

    First, a question – just for information – where is the data on the number of teachers from?

    Second a comment. I didn’t say it was their tough luck. Instead I wonder why they did it…. if I make a mistake in the first year, I certainly wouldn’t do it again the next.

  8. Joanne

    The 12 teachers less was a quote from Avelar in one of the local papers..Its on a post in this blog…
    With respect to the second issue, of why they kept budgeting for increases if they kept receiving hits, I believe Elizabeth McManus when she said last Thursday that they asked the County Assessor and he said there would be no more. If I were in that position, I would think I could rely on that info…I don’t think it’s fair to expect the SMUHSD to do an independent investigation of the County tax records and litigation.

  9. student X

    i don’t think the seven period day is the problem. its the result. incompetence, mismanagement, inability to learn from mistakes, and only considering one option is what plagues this board.

    and if im at fault and haven’t taken any reponsibility-i am ashamed. my mother taught me to take responsibility for my actions

  10. Kevin

    Several questions were posted that a CTA member like myself might shed some light on.

    First, given retirements and other reasons for leaving the profession or the area, turnover in teaching positions is generally around 10% a year. Thats 40+ positions in SMUHSD.

    Second the concern over the difference between the ~$4.5M reported as overpaid to teachers and the $3.5M budget shortfall confuses money over a two year period (4.5M) with a single year budget defecit.

    With respect to the question about whether our contract “letter” vs “spirit” means we should give back the money we were “overpaid”, I would respectfully ask how many people have enough left after paying daily living expenses in this area to give back money after the fact. We have offered to take no raise (that means no cost of living increase as well since those aren’t in our contract), increase our health benefit contribution through higher copays, increase our duties (with no increase in pay), and ignore any grievances that are already on the books for contractual breaches. We have offered all of this with no reciprocation. We weren’t even allowed to bargain our contract last spring when it should have been bargained because the district was unsure of the finances it would have. I guess the spirit of cooperation that we are looking for is to see that something other than our livelihood (salary or positions) is being considered. I think that if the administration or the board showed that other factors were being considered as well as staffing cuts, there might be more congenial discussions.

  11. Joanne

    Like what, Kevin? What could be cut that would equal 3.5 million? Everyone agrees (I think) that the salary reductions or lay-offs should be the last resort. But what else is available?

  12. ASE

    For those of you who don’t see the numbers adding up, let me take a crack at explaining. Despite the the fact that we have 12 LESS TEACHERS we have MANY MORE CLASS SECTIONS (teachers, can I get help with an actual number?). The 7 period day costs a lot of money (again, numbers anyone?) If executed properly it would cost more. See if anyone can follow my logic. More classes = More teachers. Or at least in theory. So not only has the 7 period day “busted the bank” so to speak, it has decreased the quality of students’ education. (If you check other threads you’ll see I’ve been saying this a lot, but I can’t seem to stress it enough). We have too many classes for teachers to teach to their full potential. They’re only human. After a certain number of hours speaking loudly, standing up in front of hundreds of students throughout the day you can only imagine that they’re ability to teach and explain concepts goes down as the day does on. The more students per class, they’re ability to manage the students who get distracted also goes down. While in theory that nice little equation up there is the way things are supposed to be it seems like we’re dealing with one more like this. More classes = Less teachers –> lessened quality of education and severe budget problems. Something needs to be done about the logic used by the board and the district, because I don’t know about you all, but it’s not working for me.

  13. Kevin

    Joanne asked like what? referring to other cuts.

    Eliminating district paid transportation to athletic events (an extra curricular activity) would eliminate something on the order of 0.5 million dollars district wide.

    Not holding the ribbon-cutting ceremonies would save nearly $150,000 district wide.

    This doesn’t eliminate after-school sports, and a ribbon cutting is nothing more than a political show especially since the buildings have been in use for up to two years prior to the ribbon cutting.

    These two wouldn’t add up to the whole 3.5M but neither these suggestions, nor anything like them is being considered. The district has a list of possible cuts that is over 140 items long. Some are ludicrous admittedly. Some may not be allowed under public policy rules. However, some must be worth examining.

    I firmly believe that my union would be willing to “give” a little more than we’ve already offered if we saw that the district was at least considering other reductions to offset some of the staffing cuts. Since we were notified of the issue in late August, teachers have been sending in ideas. That’s where the list comes from. The greatest consideration we’ve seen of the list is to identify how much they might save if implemented for about half of the items on the list. We don’t even have access to the budget to help “find” places where savings exist. We come up with ideas in a void, send them to the district office and hope something happens.

    I wish I could give a better answer to the question “like what?” Unfortunately, I (and many others at the schools) feel that the cooperative contributions/brainstorming that we are doing is not just born in a void, but sent to a void to die.

  14. KRN

    I love the fact that others have jumped in my absecence!

    The District has been selling the 3% salary cut because it is the Scapegoat. The BIG non-truth. Don’t bother with the little non-turths, people don’t believe those, go for the BIG NON-Truths. As Steve stated above and is verified in labor negotiations, the teachers salary and benefit increases were valid and did not create the budget shortfall. Getting the teachers to take a 3% cut would solve the problem without making other cuts or force the district to accept responsibility for its actions. It would also create cheaper teachers for the future.

    The Sup and his Cabinet made the cut list and have left OFF the list every item that could cause a political fire storm. So they have decided to fire teachers rather than… eliminate sports, cut Middle College, cut some of the $2.7 m in salaries it takes to run the D.O., I could go on but I don’t have my list in front of me. They won’t consider these items.

    Joanne you stated that we should find facts and do research. We should also read “How to Lie with Statistics.” Why have you accepted the District’s numbers as gospel? Lets say that the district is operating with 12 less teachers AND is offering 90 more sections of teaching. WOW! What was the District spending money on for the last few years. If they can get these kinds of results then what have they been doing with the money? Rather than saving the money in the reserve as the were told to (The Sequoia District listend an saved $7m) the SMUHSD spend down their entire reserve and then blamed the teachers. Fiscal Mismanagement!

    The District hired teachers on August 17, knowing that it could not pay their salaries. There is a possibility that these employees may be filing suit against the district as it lured them away from other secure jobs. Lastly, the Board approved every one the of the contracts in question. The teachers are not at fault here and should not be the scapegoat for bad management. How many quality teachers are going to leave district to come to work for the SMUHSD in the future?

  15. Anonymous

    I have a question for either KRN or skeptic:
    What is the ratio of administrative overhead to total budget expenses? When the Burlingame Elementary School District was faced with this identical type of budget crisis and being threatened with County takeover in 1998, the appointed Blue Ribbon task force analyzed the expenses and found the District to be “top heavy” in administration compared to the state totals. This was (and still is) due to having multiple small school site campuses. Has anyone calculated the adminstrative costs (including District administrators, Principals, APs and overhead costs related to running the District Office)? I’d like to know how we compare to high schools in the rest of the state as well as the Sequoia Union High School District.

  16. Anonymous

    Good questions from our Mayor. Hopefully somebody can answer them.

    ASE expressed him/herself very well, with a couple of sentences: “If executed properly it (the 7th period) would cost more. More classes = More teachers. Or at least in theory. So not only has the 7 period day “busted the bank” so to speak, it has decreased the quality of students’ education. We have too many classes for teachers to teach to their full potential.”

    This is, in fact, is also my sentiment as a parent, and why I think this direction was, in the BEST case, a poor decision at the wrong time. In its haste to push this through, this administration, which by March was aware of shortfalls (see minutes) decided to do this “on the cheap.”

    The result for my children has been larger classes, frantic teachers, and more homework, because the material cannot be covered in the allotted time frame. I don’t send my kids to school so that they can bring the rest of their lessons home to learn on their own. They might has well be home schooled, in that case.

    While I applaud the district’s (any district’s) efforts to be all things to all people, they cannot be, particularly in hard times. Money spent to “bring up the bottom” ends up “bringing down the top.” I see it right now. The result will be a mediocre District.

    In addition, there has been so much bad press about the state of this district and its management in the past several weeks, that unless there is a miraculous turn around (doubtful), I suspect there will be far fewer kids attending next year. Whoever can afford to go private, will.

  17. Test

    Is this post blocked?

  18. SARC Report

    Why is Mr. Johnson using the district’s phone calling system to call each student’s home requesting that the family go to the District’s website to read the budget facts?

    Why does this innocent man need to defend himself so vigorously?

    “The lady doth protest too much, methinks.”

    The School Accountability Report (p. 17) for the SMUHSD states the following:
    % of Budget on Teachers 38.6 % avg. for state 38.1%
    % of Budget on Adm 6.1 % avg for state 5.2%

  19. Meeting Minutes

    Facts not included in the FACT SHEET

    They knew about the problem in June and did NOTHING ABOUT IT!

    SMUHSD Meeting Minutes, June 22 2006

    “Superintendent Johnson presented an overview of budget development issues and the components of the 2006-2007 budget, noting an unrestricted Ending Balance for 2006-2007 of $215,015.38 which needs to be increased.”

    “Trustee Hanley stated that he is opposed to round-table discussions, that there should be an immediate cap on health care costs; that programs be evaluated from a historical value and reduced as a result of that review, and that, among other things,
    the reserve should be increased by $1.4 million.”

    “President Cohn-Lyle noted that three of the sitting trustees have been through rough budget times before and she believes that, if addressed immediately, the district can address these budget issues.
    Trustees agreed to hold a Budget Study Session prior to the opening of school.”

    “Joan Klink, Director of Budget, stated that the District must provide the CountyOffice of Education with a recovery plan within 45 days of the County’s approving the District’s budget.”

  20. Outsider

    My comment would be

    SSF High School teacher $40,000 – 72,000
    Jefferson High teacher $40,000 – 69,000
    San Mateo High teacher $47,000 – 87,500

    San Mateo High teacher minus 3%
    $45,600 – 84,875 and still teaching more motivated students in better facilities with more support staff

    Your drama is heartwarming for the revenue limit districts

  21. Ed Larios

    You left off the Seqouia Union HS which is $48,000 – 87,000 with better retirement benefits and also lower API Ranking and a Basic Aid District as is the SMUHSD, the others you listed are not. Check out their API scores as well. You get what you pay for!!!!

  22. Rich Grogan

    Outsider, very valuable information. I wonder why this information was not brought forward sooner, by one of the SMHSUD teachers or district staff?

  23. KRN

    Rich,

    Why is it that home prices are falling other cities and not in Burlingame? One of the BIG factors is the schools. Burlingame Elementary, the support of BCE, and then… BHS are the reasons why people are willing to pay big bucks to live here. You will find the same in Palo Alto and Marin. A solid school system pays off in home equity. When you lose strong schools, you lose housiing demand. Right now, we need to keep housing demand STRONG. Look at the districts listed above and reflect on how their home prices relate to Burlingame.

  24. Rich Grogan

    KRN, you have me mixed up with someone else. I haven’t said anything about housing prices, but now that you have mentioned it, prices are falling in Burlingame, just not like a rock. Currently it is more of a buyer’s market than a seller’s market.

    Seeing you mentioned the School District as a contributing factor as to housing prices, where did Burlingame rank in the State and in the Nation rankings? If my memory serves me correctly, Burlingame is one of the top housing areas in the Nation, so would it be reasonable to draw from your statement the School District is amoung the TOP School Districts within the Nation; unfortunately it ISN’T!

  25. Anonymous

    Having looked at the “final” budget sheet, which is pretty confusing, particularly in the staffing area, a couple of other things sticks out for me:

    Why was there ever a 40K mileage for management allowance? And what about 30K for cell phones? Where are these people going, and whom are they calling? This seems on the high side, or?

    At the very least, it has been very interesting to see just how much is spent on what.

  26. Anonymous

    Pardon me, that’s “stick.” ( I wouldn’t want Ann to jump on me for typos.)

  27. KRN

    Rich,

    I refernced housing prices from your comment on teaching salaries posted above. Burlingame is one of the top school districts in the area and that is why people flock here (along with Palo Alto, Marin, Los Altos, etc) Check out the teaching salaries in those districts and you will find that they are superior to lower priced home areas.
    As far as falling prices… check out the market conditions report below. Burlingame is holding its value, if not growing.

    http://www.realtor.com/RealtyTimes/marketconditions.asp?open?open&link=http://mktc.realtytimes.com/mktc/loclookupjs/California~Burlingame?open&pID=r.com2&poe=realtor?open

  28. Margie

    According to the May 2006 issue of Newsweek Magazine, BHS is ranked in the top 5% of public schools in the country. Its rank is 282 out of the top 1200 schools!

  29. Joanne

    I had a question about the $225,000 in overtime. Who does that go to?

  30. Joanne

    I had a question about the $225,000 in overtime. Who was that going to and for what?

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