Riverbank district OKs final budget that assumes tax hike fails

RIVERBANK -- Trustees have passed a revised $22.3 million budget for the 2012-13 school year that continues the school district's deficit spending and could leave the district without any cash by May.

But Riverbank Unified School District officials say running out of money is a worst-case scenario. They added that they want to reopen negotiations with their labor groups, which could result in concessions that help district finances. Salaries and benefits make up about 85 percent of district spending.

School trustees passed the revised budget Tuesday night on a 3-2 vote with the support of board President Elizabeth Meza and Trustees Ron Peterson and Steve Walker. Trustees John Mitchell and Egidio "Jeep" Oliveira voted "no."

This budget replaces the one trustees passed in late June. That budget was a work in progress and was approved so the district would have the legal authority to continue to operate as of July 1, the start of the 2012-13 school year.

The revised budget is based on the assumption that Gov. Jerry Brown's November ballot initiative — which raises income and sales taxes — fails.

If it does, school districts across California will lose state funding. Riverbank estimates that it will lose $1 million, and the budget passed Tuesday accounts for that loss.

The school district plans to cut $1 million each in the 2013-14 and 2014-15 school years, but still expects to draw down its reserves despite the $2 million in cuts. The district projects its deficits will be:

• $1.36 million in 2012-13

• $1.73 million in 2013-14

• $758,925 million in 2014-15.

The deficits are expected to reduce the school district's unrestricted reserves from $2.27 million to $368,781.

If Brown's initiative passes, the district expects to avoid a cash crisis in May, but deficits would continue at lower amounts.

District officials point to declining enrollment and state cuts to education as among the reasons the kindergarten through 12th grade district is in financial straits. Enrollment has declined by about a third since the 2001-02 school year, from nearly 3,500 students to about 2,300 students today.

But Terri Ryland, the financial consultant provided by the Stanislaus County Office of Education to help Riverbank, said the district waited too long to reduce spending, adding that other local districts made the painful cuts several years ago.

"They are cutting too little, too late," she said. "That's why they are behind the eight ball."

The school district also has had turnover among its top administrators, with Superintendent Ken Geisick, Human Resources Director Norma Gonzales and Director of Business Services Karolyn Crisp leaving or retiring this year.

Interim Superintendent Daryl Camp said the district will work with the community to balance budget cuts against providing children with a quality education. He added that the district will find answers to avoid a cash crisis in May.

"I have confidence that the community will come up with the solutions that are in the best interest of the kids," he said.

Bee staff writer Kevin Valine can be reached at kvaline@modbee.com or (209) 578-2316.