Wednesday, March 29, 2017

Fewer districts than expected say they’re facing financial distress | EdSource

Fewer districts than expected say they’re facing financial distress | EdSource:

Fewer districts than expected say they're facing financial distress


Only 39 school districts have indicated they will have a hard time balancing their books within the next two years, according to the latest reports filed with their county offices of education.
That low number may mask the difficulties many districts will face amid flattening revenues, rising pension costs and, for many, declining enrollments. And some districts may be too optimistic about the extent to which Gov. Jerry Brown’s budget revision in May will solve their problems, said the head of the state agency in charge of keeping districts fiscally solvent.
“When given the choice, districts will generally choose the ‘rosy glow’ position regarding the state’s economy. Right now, there is a ton of mixed messaging out there about how revenues will look at the May Revision,” Joel Montero, CEO of the Fiscal Crisis and Management Assistance Team, wrote in an email.
Twice each year, following the passage of their budgets on July 1, the state’s 1,094 districts file updates, the first one in the fall and the second in March. The updates state whether they are on track to balance their budgets for the current year and the following two years. County offices of education must review and verify they are accurate.
Last Friday, the Fiscal Crisis and Management Assistance Team posted a graph showing that 38 districts had self-certified as “qualified,” meaning they foresee difficulty paying their bills in 2018-19. One, San Miguel Joint Union in San Luis Obispo County, self-certified as “negative,” meaning it is struggling to remain solvent this year or the upcoming year, and the rest signed off as “positive,” signifying they foresee no problem ending the third year with a required 3 percent budget reserve. The number of qualified reports may creep upward to around 45 districts after county offices have reviewed them, Montero said. They have until Fewer districts than expected say they’re facing financial distress | EdSource:

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