After years of budget cuts throughout California’s public education system, an improving economy and increased tax revenues have resulted in a state budget surplus.
This upturn is expected to benefit Citrus College as the college’s budget allocation for the 2014-15 school year has increased.
With improving economic outlooks, the college is continuing to restore classes and grow programs.
Claudette Dain, vice president of finance and administrative services, hosted the annual all-campus Budget Forum on Sept. 2.
As she began her presentation, Dain pointed out that the college is entering its centennial celebration year.
In 1915, the college’s first year of operation, its initial budget was a mere $31,000. One hundred years later, Citrus College’s operating budget exceeds $60 million.
Dain first presented the Unaudited Actuals of the 2013-14 closed book finances. Dain summarized, explaining that with 11,314 full-time equivalent students and a beginning budget of $7.13 million on July 1, 2013, the year ended June 30 with $8.8 million in reserve.
Dain continued, displaying the 2013-14 ending balance, minus automatic commitments that would affect the 2014-15 school year budget. Setting aside projected expenditures at the beginning of each fiscal year ensures that the college does not spend money it will likely need later.
Dain then presented highlights of the state budget for 2014-15.
With no threat of trigger cuts, which are automatic financial cuts to categorical programs at the beginning of an economic dip, Dain summarized Gov. Jerry Brown’s cautious approach. His conservative budget is designed to protect against boom-and-bust cycles; to reduce the state’s “wall of debt”; and to focus funding for education, Dain said.
Dain followed with an explanation of Prop 2, the “Rainy Day Budget Stabilization Act”, on the ballot for the Nov. 2014 elections. If passed by the voters, it would require 1.5 percent of the state’s General Fund be put aside to create a “Prop 98 Reserve” that could be used to smooth out the economic highs and lows and meet California’s funding obligation to community colleges.
She also mentioned the college’s mandated increase in contributions to the California State Teachers Retirement Fund.
Dain explained that CalSTRS has been “significantly underfunded for years” and that the state has continually avoided attempts at fixing the long-term issues.
The presentation then focused on Citrus College’s budget priorities for 2014-2015: honoring institutional planning priorities; maintaining commitment to regular and permanent employees; supporting critical new hires; filling vacant positions; and completing construction projects.
Dain emphasized the importance of full-time equivalent students, as she continued her explanation of the 2014-2015 Budget. FTES are calculated, not by headcount of students enrolled, but by calculating the total number of units all Citrus students are attempting each semester.
The record high for Citrus was set in 2008-2009 with 11,900 FTES. In 2011-2012, dropped to 10,600 FTES. Dain predicted that the 2014-2015 FTES will be approximately 11,300.
Ongoing revenue for the proposed budget included $56.6 million from apportionment revenue assumptions, $2.8 million from non-resident tuition, and $1.45 million from unrestricted lottery funds.
With the addition of mandated cost block grant and other sources, the Citrus College budget is approximately $62.2 million.
Expenditures are estimated at $42 million in salaries for staff and faculty, $8.2 million in adjunct/overload budgets, $1 million in retiree medical costs, $7 million in cost center allocations, and $1.6 million for utilities.
Dain reminded her listeners that the tax benefits of Proposition 30 are temporary, as a portion will end in 2016, followed by the complete end in 2018.
Prop 30 is a personal and sales tax designed to produce additional revenue during an economic low. Voters approved Prop 30 in November 2012. The proposition “turned the situation of education around,” Dain said.
The cost of ending Prop 30 revenues will range from $247,000 the first year to $2.9 million after four years, Dain predicted.
Nevertheless, Dain mentioned that possible economy rises have the potential to offset Citrus’ losses and continue budget restoration effects.