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Bishop school district makes pre-emptive budget moves |
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Tuesday, 14 July 2009 |
 Bishop Union Elementary School District is sending out preliminary layoff notices to three school bus drivers in anticipation of state funding cuts to transportation. The schools are preparing for the worst because legislators still can’t balance the state budget and it is still uncertain where cuts will be made. Photo by Mike Bodine By Mike Bodine
Register Staff
7-11-2009 The highest ranking elected official in California, GovernorArnold Schwarzenegger, is proposing a 65 percent cut to transportation. This includes funding for school buses and the drivers’ salaries.
In a pre-emptive move by the Bishop Union Elementary School District this week, its Board of Trustees approved issuing preliminary layoff notices to three bus drivers.
“It’s prudent we take action now,” Barry Simpson, superintendent of both the elementary and high school districts said at a special trustee meeting Thursday evening.
Simpson explained to the trustees that the schools should be able to get by with a “skeleton crew.” He said this will mean longer bus runs with more students.
“If we’re overloaded we’ll have to rescind some of the notices,” Simpson said.
He added the school will also be enforcing the district transportation policy that dictates students between fourth and eighth grade who live within one mile of the campus can walk.
The trustees’ discussions of this little piece of the budget led to questions and discussions about the state budget as a whole and its ramifications.
Simpson responded to a worst-case scenario, in which the school year would begin without a balanced state budget, by explaining that state law mandates that schools are first when it comes to funding. He added that teachers would not get IOUs.
The district could probably survive a delay in funding, Simpson said. However, Financial Officer Midge Milici said that there are rumors from Sacramento of “deferring all of 2009-10 payments to 10-11.”
Unfortunately, many of these “proposed cuts” being tossed around Sacramento and smeared across headlines are just that, proposals.
Simpson explained that legislators have drafted a state budget, but one that includes the massive deficit that grows daily. The squabbling in Sacramento now, it seems, is where exactly to make cuts, or increase revenue, to fill in the astronomically giant hole in the budget, now more than $26 billion.
So, in another preemptive move, the district has agreed to accept approximately $675,000 in a one-time loan through a Tax Revenue Anticipation Note, or TRAN.
Milici explained this “loan” is made possible from bonds sold to investors with a 2.5 percent interest rate. The loan will be repaid in increments and within one year.
“It’s a small cost to pay to give us piece of mind,” Simpson said.
He explained that the money would not necessarily go into the General Fund but would be used as “cash flow” to maintain payroll.
The district has “solid reserves,” Simpson explained, but only enough to last a couple months.
Simpson added that the funds will be deposited into the county’s investment account, gaining interest, and can be pulled out as necessary.
Simpson added that schools throughout the state are scrambling to try and find ways to make ends meet.
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Last Updated ( Tuesday, 04 August 2009 )
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