Manteca Unified is not among the San Joaquin school districts that may have to tap into an emergency county loan program to get through the upcoming school year due to the state deferring payments.
But a year from now Manteca Unified may be in a different position. The district already expects to be forced to eliminate 65 certificated positions — primarily teachers — due to the state plan to defer payments over multiple years. If that happens, district officials believe the 65 positions can be eliminated through attrition.
The state is only providing K-12 schools and community colleges $70.5 billion of the $81.5 billion they received for the school year that ended June 30 to pay for the school year starting Aug. 6. Rather than cut school spending 13 percent, the state simply deferred payments allowing schools to continue with spending at the 2019-2020 level.
If districts lack the funds in reserve to sustain spending the deferred payments— based on what happened during the Great Recession — could be delayed for more than a year if state revenue doesn’t bounce back.
Districts that are forced to borrow through the county must pay the funds back within a year with interest. The state, however, doesn’t add interest to the deferred payments.
While District Superintendent Clark Burke has stressed Manteca Unified is situated to weather the current school year that starts Aug. 6, the prospects for 2021-2022 are more than dicey as deferrals to schools could approach 41 percent of what the states would owe local schools under Proposition 98 mandates.
This year Manteca is experiencing a $28.1 million loss of a 7.92 percent decrease in state funding via deferrals to the $54 billion multi-year state budget deficit expected to be created by measures taken to flatten the spread of COVID-19.
The $256.4 million spending plan for the current school year is doable with 11 percent of the district’s overall funding not being paid by the state until at least the next fiscal year that starts July 1, 2021 due to several steps Manteca Unified has taken.
By adhering to the state mandated principle of a three-year budget that a large number of districts haven’t mastered when it comes to aligning future revenues with future expenses, Manteca has adequate reserves to cover the shortfall created by the deferral for the current year. It also helped that the district after the pandemic hit in March opted not to fill 100 vacant teaching and support staff positions that were vacant.
That included 55 full-time equivalent (FTE) certificated positions (teachers and administrators) as well as 45.88 FTE classified positions that run the gamut from bus drivers to clerical staff. All of those positions were vacant so no one lost their jobs.
The staffing reductions will save $1.9 million in benefits in addition to $7.1 million in salaries.
The three-phased learning model the district is deploying this year that starts with distance learning and then transitions into a hybrid model and then possibly into every child on campus with COVID-19 safety protocols in place will reduce substitute teacher and extra pay costs by $1.5 million.
Those measures will cover $10.5 billion of the $28.1 billion in deferred revenue that Manteca Unified will be shorted in the next 12 months.
Given the deferral of state funding for the fiscal year starting July 1, 2021 is expected to be even larger than this year’s the need to eliminate positions and other costs will have to be addressed for the 2021-2022 school year.
Underscoring the severity of the funding shortfall down the road, Democrats in the California Legislature are toying with a $100 billion economic stimulus plan that would issue “future tax vouchers” to allow the prepaying of state taxes at a discount to generate more money for the state to spend today.
That, however, would create funding shortfalls in future fiscal years that would have to be covered by higher taxes, spending cuts, or a combination of both.
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