charter school capital california budget impact on charter schools
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Copyright © 2012 Charter School Capital
Understanding the CA State Budget Impact on Charter Schools
Copyright © 2012 Charter School Capital
TODAY’S SPEAKERS
1
Chas Cardall Branche Jones CA LEGISLATIVE
CONSULTANT
Miles Denniston CHARTER SCHOOL
MGT CORP ORRICK
John Helgeson Stuart Ellis CHARTER SCHOOL
CAPITAL CHARTER SCHOOL
CAPITAL
Copyright © 2012 Charter School Capital
AGENDA
2
THE SOLUTION
QUESTIONS
THE IMPACT
THE ISSUE
Copyright © 2012 Charter School Capital
THE ISSUE
3
California State Budget
• What is the real issue? - Biggest impact has been glossed over
- Focus has been on tax increase initiatives
- But, immediate impact is from 21.2% reduction in general purpose entitlement funds
Copyright © 2012 Charter School Capital
THE ISSUE
4
California State Budget
• What is the delay in funding? - This is not a cut – it’s a delay in payment
- It’s in addition to existing deferrals already in place
- 21.2% is not taken all at once, but through monthly installments
Copyright © 2012 Charter School Capital
THE ISSUE
5
California State Budget
• Who does this impact? - Impacts all public school – including charter schools
- Most charters don’t have the savings to absorb this state payment delay
Copyright © 2012 Charter School Capital
THE ISSUE
6
California State Budget
• When will this occur? - Already has - began in July
- Schools with deferral waivers may not have noticed this yet
Copyright © 2012 Charter School Capital
THE ISSUE
7
California State Budget
• How does Prop 30 pay a role in this discussion? - Payment delay taking place now regardless of November
results
Copyright © 2012 Charter School Capital
THE IMPACT
8
Deferral Comparison
• How does this compare to others? - Expect monthly deferrals that result in 21.2% of your annual
budget
- Delayed until June
- Each monthly payment will be less than originally projected
Copyright © 2012 Charter School Capital
THE IMPACT
9
An exercise to put this deferral in context…
Copyright © 2012 Charter School Capital
THE IMPACT
10
November Ballot Initiatives
• Background on Prop 30 + Prop 38
Copyright © 2012 Charter School Capital
THE IMPACT
11
November Ballot Initiatives
• Only Prop 30 passes
- Existing 21.2% delay in payment assumes Prop 30 passes
- Should be no additional reductions or deferrals
- New tax revenues go into “Education Protection Account” of the State’s General Fund
- Funds in this account to be paid out next June
Copyright © 2012 Charter School Capital
THE IMPACT
12
November Ballot Initiatives
• Prop 30 + Prop 38 Fail
- Substantial cut in general purpose entitlement funding (trigger cuts)
- More deferrals during the P-1 payment period
- Legislature may enact mid-year budget amendments
Copyright © 2012 Charter School Capital
THE IMPACT
13
November Ballot Initiatives
• Only Prop 38 passes
- Not clear what may happen with funding timing and amounts
- Some implementing legislation seems likely
Copyright © 2012 Charter School Capital
THE IMPACT
14
November Ballot Initiatives
• Both Prop 30 and Prop 38 Pass
- Initiative that receives the most votes will be implemented and the other will not be effective
Copyright © 2012 Charter School Capital
THE IMPACT
15
November Ballot Initiatives
• Scenarios explained
• (BAR CHART GOES HERE)
0%
5%
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15%
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25%
30%
Per
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f A
nn
ual
Rev
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es R
ecei
ved
Eac
h M
on
th
Fiscal Year 2012-2013
Base Line
2011-2012
Pass
Not Pass
Copyright © 2012 Charter School Capital
THE IMPACT
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0%
20%
40%
60%
80%
100%
120%
Cu
mm
ula
tive
Per
cen
t o
f A
nn
ual
Rev
enu
es P
aid
Fiscal Year 2012-2013
Base Line
2011-2012
Pass
Not Pass
Copyright © 2012 Charter School Capital
THE SOLUTION
17
What Should You Do?
• Educate yourself
- Understand the impacts to your school
- Ask questions
- Carefully analyze month-by-month payments to know what your new budget will look like
- Plan, plan, plan
Copyright © 2012 Charter School Capital
THE SOLUTION
18
Help Spread The Word
• Every charter school in CA should know
- This 21.2% deferral will affect every charter school
- If not planned for, it could be significant enough to really hurt some charter school budgets
Copyright © 2012 Charter School Capital
THE SOLUTION
19
We’re Here To Help You
• Just ask
- Charter School Capital and CSMC are both well versed on this subject
- We want you to succeed in bringing high quality education to your students
- Sign up for our blog to follow timely information at http://charterschoolcapital.org/charter-funding-blog/
Copyright © 2012 Charter School Capital
20
QUESTIONS?
Copyright © 2011 Charter School Capital
Stuart Ellis: sellis@charterschoolcapital.org
Contact Information:
Toll Free: 877.272.1001
charterschoolcapital.org
John Helgeson: jhelgeson@charterschoolcapital.org
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