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1st budget trigger Manteca Unified OK; 2nd trigger will pose cash problems
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Manteca Unified won’t be pushed to the brink as California edges closer to the first round of automatic budget cuts.

Revenue for the first three months of the fiscal year that started July 1 is $705 million less than projected, according to State Controller John Chiang. If the shortfall hits $1 billion, the adopted state budget triggers a series of budget cuts statewide to education and other services.

But if a $2 billion gap is reached before the fiscal year ends on June 30, Manteca Unified would be hit with a serious cash flow problem that will prove tricky at best for the district to handle. Superintendent Jason Messer said much of the problem with the second series of cuts - should they materialize - is the fact they run counter to what most districts can do under collective bargaining and state law.

It includes a seven-day reduction in the school year to save $1.54 billion plus an end to $248 million in home-to-school busing subsidies.

“To most people that sounds like no big deal, just end the school year seven days sooner,” Messer said. “But we have binding collective bargaining contracts.”

Also, the school district must comply with state laws requiring teachers to be notified by the previous May if they wil be laid off in an upcoming school year. There is no legislation in place that suspends that requirement.

Manteca is better situated in terms of cash flow than a number of nearby districts including Lodi and Stockton. That has a lot to do with the fact the school board - working with employees and the community - implemented a series of reduction in expenses including whittling staff back four years ago while many districts adopted a wait-and-see attitude hoping revenues from the state would stay the same or rise.

Manteca Unified’s budget was pushing $180 million four years ago. Today it is down around $130 million. Not only has the district lost about 30 percent of its revenue from the state while increasing enrollment, but they also have to deal with rising costs for services such as electricity and supplies just like everyone else.

One area of big savings has been in energy use. The district’s aggressive energy conservation program has reduced costs 30.6 percent to save more than $3.3 million over the past four years.

Messer noted the top two costs for the district are personnel followed by energy.

Also complicating the budget outlook is the fact the state for years has delayed making payments to school districts forcing them to spend money before they have it in hand. Making things dicer this fiscal year is the fact the state is holding back 6 percent a month for “backfill” from redevelopment agency funding that the state has essentially commandeered from local RDAs. That move has been challenged in court by redevelopment agencies with a decision expected by year’s end. If the state loses, it would further cloud the financial outlook for schools.

“We’re not a business but we have to operate in a business world,” Messer said in reference to the need to find ways to be more efficient while basically meeting mandates to educate all children.

Reducing costs as deeply as the district has so far may have some lasting impacts.

First are the emotional “scars” the layoffs have created although Messer noted that most of the employees laid off have been able to get jobs back with the district if they so chose.

The other long-range problem will be deferred maintenance.

Cuts over the past four years have delayed critical needs such as roof replacement that will have to be handled inadequately through patching roofs. That will ultimately mean higher costs when the roof absolutely has to be replaced.

The state’s $86 million spending plan identified three major cuts - $100 million apiece to both the University of California and California State University system as well as increasing community college fees by $10 million - when the revenue shortfall hits $1 billion.