Additional cuts may be on the horizon for the Glendale Unified School District.
Months after district officials agreed to $5 million in reductions for the upcoming school year, staff members suggested more slashes in the 2020-21 budget during a school board meeting Tuesday — cuts that could trigger layoffs.
As board members adopted the district’s budget for next school year with few changes from the financial outlook in March, the district’s chief business and financial officer, Stephen Dickinson, advised the school board to meet soon to strategize finances for the following year and beyond.
“I’m definitely cautioning you about [school year 2020-21] and our need to have a study session in August,” Dickinson said. “To say the 2020-21 budget reductions, if it still needs to be an amount like $5 million, it will be very difficult.”
Glendale Unified’s budget adoption finalized $5 million in cuts previously proposed for the upcoming year this coming fall, which included the elimination of 8½ staff positions, a total of 14 middle- and high-school teachers, 2½ elementary teachers and an elementary assistant principal.
Most of the reductions will come from retirements, where positions will not be filled. No teachers or staff members will be laid off.
However, Dickinson said more options will need to be on the table for 2020-21.
“Lay out the worst-case scenario … ” he said of possible cuts. “Yes, I believe that it could involve a layoff process, which will trigger us to say, ‘or should we do an early retirement incentive?’”
Glendale Unified has been deficit spending for two years, despite cuts of $3.6 million from last school year’s budget and $5 million for next year.
Board members also approved a budget that would again shrink the district’s two reserves.
Glendale’s undesignated reserve and its reserve for economic uncertainty is expected to drop to a combined $13.7 million by the 2021-22 school year, which would be the lowest amount in over a decade.
To say the 2020-21 budget reductions, if it still needs to be an amount like $5 million, it will be very difficult.”
The reserves combined were at $41.55 million a decade ago, when the district was dealing with the aftermath of a recession.
The district overspent by $10 million during the 2017-18 school year and is estimated to be in the red again this just-concluded school year by $2.88 million, according to Dickinson.
Staff members estimate the district’s revenues next year will come in at roughly $294 million, while total expenditures are expected to be $298.3 million, which leaves an operating deficit around $4.2 million. However, that deficit figure is not final.
On the positive side, Dickinson said the district is eligible for a portion of $493 million in special-education funding provided by the state for 3- to 5-year-old preschool students with an individualized education plan.
Dickinson said he thinks 265 district students qualify at a rate of $4,000 per student, which would bring in a little over $1 million for the district next school year, although those funds are not guaranteed to carry over for a second year.
The $4,000-per-student amount could increase to between $9,000 and $10,000 per student, which could bring between $2.4 million and $2.65 million, Dickinson said.
On top of that funding, the district’s health-and-welfare increase estimate was reduced by more than half for the upcoming school year, dropping from $924,771 to $420,000, Dickinson added.
While the special education funds and health savings bring down the district’s deficit, Glendale Unified’s projections also did not include employee raises, including those being bargained with the Glendale Teachers Assn.
Dickinson said he estimates that a 1% salary increase would cost the district at least $2 million annually.
“It would go up $2 million each incremental year,” board member Greg Krikorian said of the deficit. “So, in other words, three years out, that would be a $6-[million]-to-$8 million hit to the budget, approximately.”