PLACENTIA YORBA LINDA : District Has Doubts on Financial Stability

The Board of Trustees approved a “qualified” certification of Placentia-Yorba Linda Unified School District’s ability to meet its financial obligations for the next two years, the first time in years the district has granted less than a “positive” rating.

State law requires school districts to submit an interim report by March 15 indicating whether they can meet their financial obligations for the remaining fiscal year and two subsequent years.

Districts have three categories to choose from to describe their financial condition and ability to pay operating expenses and other bills: positive, qualified and negative.

The qualified rating selected by Placentia-Yorba Linda means district officials think the district may not have enough money for all of its expenses, including a $50-million bond payment due this summer.

“Due to the uncertainty resulting from the bankruptcy of the Orange County investment pool, the district cannot state unequivocally that it will meet its financial obligations,” said Kim Stallings, assistant superintendent for administrative services.

Stallings said the county Department of Education has recommended that all local school districts adopt a “qualified” certification for the interim report.

Placentia-Yorba Linda had $84 million invested in the fund when the county declared bankruptcy in December.

The interim report also shows that the district’s actual expenses for the year are expected to drop nearly $2 million from estimated expenditures of $102 million.