ENCINITAS: School district to dip into reserves to cover expenses

No layoffs or class size increases planned.

By BARBARA HENRY - Staff Writer | Tuesday, July 1, 2008 11:44 AM PDT ∞

ENCINITAS ---- Class sizes will stay small in kindergarten through third-grade and teachers won't receive layoff notices, but the Encinitas Union School District will need to dip into its reserves to cover expenses in the coming year, officials said this week.

"We do have a very healthy ending fund balance," said Abby Saadat, the district's assistant superintendent of business services, as he discussed the budget situation Monday.

Monday was the last day of the fiscal year for the school district, and Saadat was forecasting that the district will end the year with $6.2 million in its reserve accounts. That's $63,000 more than the district anticipated having when administrators drew up the budget last year.

But the district will need all that extra cash plus more in the coming year. Under a spending plan that the school board approved last week, Encinitas Union expects to take $281,000 out of its reserves to cover its expenditures in the 2008-09 fiscal year.

The district's unrestricted general fund budget ---- the spending plan that covers most school expenditures ---- is forecast to have $34.26 million in expenses, but only $33.98 million in revenue.

And that's just an estimate. The district is still waiting to see what state budget will be, Saadat said.

The state is forecasting that it will have a massive $15.2 billion shortfall, but lawmakers haven't yet reached a deal on a spending plan for the coming year, though the deadline to do so arrived Tuesday.

Given the situation, the district has simply estimated that it will face a $350,000 cut in state funding, Saadat said.

"As far as the projections for the revenue, I've been very, very conservative," he said.

The district's revenue estimate for the new fiscal year is about $2 million less than the $35.9 million figure for the fiscal year that just ended. Meanwhile, for 2006-07, revenue was $35.5 million.

Encinitas Union has been spared some budgetary pain. It benefits from being in an area with high property values and thus high property tax revenue, which funds local schools. Second, its enrollment is holding fairly steady.

"We're holding our own, but there are other districts that are seeing declining enrollment," Superintendent McLean King said.

The district expects its incoming kindergarten class to be smaller than the previous one ---- about 710 students verses the 749 students last year. But the sixth-grade class is huge ---- 812 students, Saadat said.

The district has 316 certificated teaching staff members, 174 "classified" employees ---- custodians, office staff and other nonteaching jobs ---- and 29 managers.

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