LAKE COUNTY, Calif. – A state report issued this week shows that more schools than ever are experiencing budgetary difficulties as a result of California’s economic struggles.
This week California Superintendent of Public Instruction Tom Torlakson released the state’s Second Interim Status Report for the 2011-12 fiscal year, which lists school districts considered to be in financial jeopardy.
This latest report lists the highest number of financially troubled educational agencies in state history – 188 – up by 61 from the First Interim Status Report for 2011-12 issued in February, and up 45 from the Second Interim Report for 2010-11 issued a year ago.
Torlakson said the listed districts serve an estimated 2.6 million of California’s 6.2 million school students.
"The deep cuts this budget crisis has forced – and the uncertainties about what lies ahead – are taking an unprecedented and unacceptable toll on our schools,” Torlakson said.
Approximately 1,037 local educational agencies – which include school districts, county offices of education and joint powers agencies – are tracked in the twice a year reports, according to the California Department of Education.
The most recent report covered the financial and budgetary status of the districts for the period ending Jan. 31 and so predate Gov. Jerry Brown’s May Revision, which the state said may mean the agencies’ financial status has changed since the financial certifications were collected in April.
The list of financially struggling districts “is growing tremendously throughout the state and more and more districts are finding themselves in a tough situation,” said Lake County Superintendent of Schools Wally Holbrook.
Local educational agencies receive a positive certification if they meet their financial obligations for the current and two subsequent fiscal years, the California Department of Education explained.
Most Lake County districts appeared to have fallen within the positive certification category in this latest report.
However, Upper Lake Union Elementary, which has a $4.3 million budget, was among 176 districts and local educational agencies statewide given a “qualified” certification, because the state ruled that it may not meet its financial obligations for the current or two subsequent fiscal years.
Kelseyville Unified and Konocti Unified had been given qualified status in the First Interim Status Report in February, but were not listed in this week’s followup report.
No local districts were among the 12 educational agencies given the most serious classification, “negative,” which designates the inability to meet financial obligations for the remainder of the current year or for the subsequent fiscal year. In such cases, the local county office of education can intervene in the district's finances.
Snapshot in time
Tina Jung, a spokesperson for the California Department of Education, told Lake County News that the status report is a snapshot in time that gives both the state superintendent and the educational agencies a sense of their fiscal status. That allows districts the chance to begin making adjustments.
Holbrook said that’s the case with Upper Lake Elementary, which has submitted a third interim report that’s in the process of being reviewed.
Michelle Buell, Lake County Office of Education Fiscal Services director, said of Upper Lake Elementary, “They made reductions that leveled out their shortfall.”
Local school districts are now developing their 2012-13 budgets, which Buell said are due to the Lake County Office of Education by July 1.
Buell and Holbrook also have assisted Kelseyville Unified over the last few years when it appeared on three straight reports under the qualified status.
Holbrook said Kelseyville developed a fiscal stability plan. “We did provide some resources for them to help them do that,” he said. “The result of that has been pretty positive.”
A growing problem
California Department of Education data shows that the number of schools going into qualified or negative status has grown dramatically in recent years.
The state began tracking educational agencies’ financial certificates in the 1991-92 fiscal year.
Jung pointed out that the numbers of districts in financial jeopardy remained small for some time, other than a brief spike to 55 in 1994-95. Then, in 2002-03 – around the time of the dotcom crash – the numbers jumped up to 56.
The number of financially troubled districts then receded. In 2006-07, those districts totaled 19 statewide, but in the following 2007-08 fiscal year – at the same time the recession hit – the number jumped to 109.
Federal stimulus money making its way into the state’s school districts in 2008-09 saw a slight drip to 89 districts, said Jung. The number of districts in financial jeopardy nearly doubled to 160 the following year, the data showed.
“Obviously, it’s tied to the economy,” said Jung.
Holbrook said that even with districts that have been conservative and financially stable, the potential for slipping into qualified or negative status is increasing.
“It’s going to be a serious problem for all of us,” he said.
Jung said Torlakson issued a state of emergency immediately after entering office last year, and is encouraging voters to support the governor’s ballot initiative to raise taxes to help education this November.
Holbrook said the initiative won’t fix the situation, but it may help by allocating resources the way they were originally intended.
As for more dollars for classrooms, “we’re just not going to see them,” he said.
Holbrook said he had a chance to listen to the governor speak about the initiative on Monday. “He’s not totally satisfied with that initiative but he thinks it’s the best thing given the situation that we’re in at this point in time.”
Holbrook said there is the possibility that transportation funding will be restored to schools but that they can actually use the money for other needs.
“In our area it’s really tough for our districts not to provide transportation,” he said.
If that funding flexibility takes place, “that’s going to cause all kinds of debates,” said Holbrook, with some districts possibly having to choose between transportation or keeping an additional teacher in the classroom.
“Those are just really difficult choices,” Holbrook said.
LAKE COUNTY SCHOOL DISTRICTS IN QUALIFIED STATUS, 1998-2012
Second interim status report, 2011-12
Upper Lake Union Elementary; $4.3 million budget
First interim status report, 2011-12
Kelseyville Unified; $14.7 million budget
Konocti Unified; $28.3 million budget
Second interim status report, 2010-11
Kelseyville Unified; $14.5 million
First interim status report, 2010-11
Kelseyville Unified; $14.5 million
Second interim status report, 2009-10
Upper Lake Union Elementary; $3.31 million
First interim status report, 2009-10
Upper Lake Union Elementary; $4.53 million
Second interim status report, 2008-09
Lake County Office of Education; $18.85 million
First interim status report, 2008-09
Konocti Unified; $28.29 million
Lakeport Unified; $14.83 million
Upper Lake Union High; $4.90 million
Upper Lake Union Elementary; $4.98 million
Second interim status report, 2003-04
Upper Lake Union High; $3 million
First interim status report, 2003-04
Upper Lake Union High; $3 million
Second interim status report, 2002-03
Upper Lake Union High; $3 million
Second interim status report, 2001-02
Upper Lake Union High; $3 million
First interim status report, 2001-02
Upper Lake Union High; $3 million
Second interim status report, 2000-01
Upper Lake Union High; $3 million
First interim status report, 2000-01
Upper Lake Union High; $3 million
Second interim status report, 1998-99
Upper Lake Union High; $2 million
First interim status report, 1998-99
Upper Lake Union High; $2 million
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