Community College Board Tentatively OKs Budget : Education: Trustees’ austere plan shifts funds and depletes savings to close $5.3-million gap.

Struggling to stay in the black in the face of declining state funding, the Los Angeles Community College District Board of Trustees closed a $5.3-million hole in its current budget Wednesday and for the coming fiscal year adopted an austere tentative spending package that anticipates further cuts at the district’s nine colleges and in central operations.

To bridge the gap in the district’s current spending plan, caused by lower than anticipated state tax collections, trustees juggled funds, depleting reserves and borrowing from workers’ compensation and other accounts to avoid making further cuts to the colleges this year. If no other ways are found to replenish the accounts, budgets for the individual colleges will be tapped beginning with the 1994-95 fiscal year.

Neil Yoneji, vice chancellor for business services, told trustees that they must find ways in the near future to once again build up reserves so the district has ways of dealing with fiscal crises “that do not have anything to do with the district.”

For the 1993-94 fiscal year, which begins July 1, the board adopted a tentative budget of$333 million. It calls for reductions in college budgets averaging 9.9% and a cut of 10.9% in district administration.

The coming budget is $120 million, or almost 27%, less than the current spending package. But because the final details of the state budget are not yet in place, the college district’s fiscal picture may change between now and Sept. 1, when trustees are scheduled to adopt the year’s final budget.

Over the past three years, as California’s recession-plagued economy led to big cuts in state funding for community colleges and other services, the district has sliced campus budgets and reduced administrative costs but has been unable to build up sufficient reserves.

Warning that “we are running out of financial strategies,” Yoneji said the district needs to “restructure ourselves dramatically.”

Trustees are considering whether to form a districtwide committee to advise them on long-term solutions to a funding crunch that shows no sign of ending soon.

“We are dramatically reducing our expenditures . . . and we are suffering mightily for that,” board President Wallace Knox said. “We are managing ourselves in hard times in the best way that we can.”

In a related matter, trustees were urged by employee representatives to keep costs down in their search for a replacement for Chancellor Donald G. Phelps, who is leaving for a teaching post at the University of Texas.

Some suggestions were to leave the position vacant until the state’s economy and district’s finances improve, to pick a successor from within the state or the district, and to use a districtwide committee to help hire a new chancellor instead of hiring a private executive search firm.