By Greta Nerad
Executive News Editor
The Manhattan Beach Unified School District is facing budget deficits due to a multitude of growing expenses and lack of adequate funding, resulting in a projected $4,117,249 in deficit spending for the 2019-20 school year, according to the Jan. 15 MBUSD Budget Workshop.
District enrollment has decreased by 400 students since 2013-14, causing a decrease in revenue from the Local Control Funding Formula (LCFF), California’s school funding. While it is designed to relieve sharp reductions that result from enrollment decreases by allowing the district to base its revenues on the higher of the current and the prior years’ enrollment, MBUSD’s consecutive years of losses impact revenue.
“Our community has so much pride in and support for our teachers and our schools, and my advice would always be to attend MBUSD schools,” Matthews said.
The LCFF, enacted in the 2013-14 school year, accounts for 66 percent of MBUSD’s revenue through per-pupil base grants, as well as supplemental grants based upon the amount of unduplicated high need students enrolled in the district. With about a five to six percent unduplicated pupil percentage, the seventh-lowest in the state, the district receives limited funding.
Though LCFF funding increased over the past seven years, it has reached full funding, meaning this year its only enhancement will be the statutory Cost of Living Adjustment (COLA). The LCFF will henceforth increase at a COLA-only rate; thus, the gap between state LCFF funding and growing expenditures will continue to expand.
“The way our funding for education works within our state is a structural challenge,” Manhattan Beach Education Foundation Executive Director Hilary Mahan said. “The fact that our programs that we’ve worked so hard to build have the potential of being cut because we consistently receive low state funding is extremely disheartening.”
According to Mahan, private community support that MBEF provides is critical to the district’s efforts to provide for students despite ebbs and flows in state-provided revenue. MBEF has contributed $75 million to the district budget since 1983, helping to provide funding for programs that benefit MBUSD students.
“The district is looking at different ways to increase revenue and decrease expenses so that our MBEF program can remain intact, but there will be some shifts this year,” Mahan said. “It may take us some time to get back to where we would like to be.”
According to Mahan, if every family contributed MBEF’s ask for their student, the foundation would raise over $11 million annually. Typically, the foundation raises about $5 million in its annual appeal.
“We are supportive of the effort to work as a community to help support our students,” Mahan said. “I know we have risen above this before as a community, and I have every belief in my heart that we will do so again.”
Special Education expenditures far exceed funding, as the federal government fails to pay the 40 percent promised in the 1973 Individuals with Disabilities Education Act; MBUSD spends $24 million on Special Education with only $6.4 million in state and federal funding. Special Education costs have grown at an average rate of 7.74 percent over the past five years, and MBUSD projects continued increases.
“We want to have it, we have to have it, and we’re very proud of the fact that we include all students in our schools,” Matthews said. “How we do it as well as possible and as reasonably as possible is not something we are going to solve this year; it’s a long-term solution.”
Pension costs also have a significant impact as employer contribution rates for the California State Teachers’ Retirement System (CalSTRS) and California Public Employees’ Retirement System (CalPERS) continue to increase at unprecedented rates. MBUSD contributions toward employee pension costs have quadrupled over the course of the decade, going from $2.9 million a year for the 2011-12 school year to $12.2 million for the 2019-20 school year.
“The fact that you can have a guaranteed income when you retire makes this job more attractive than many others,” Matthews said. “Pensions are the same for all California teachers; this is not just our issue, it’s the entire state’s.”
Additional increasing expenditures related to personnel occurred between the 2018-19 and 2019-20 school years, including a negotiated salary increase of 2.5 percent and health and welfare benefit cost increases of 5.29 percent, which becomes 7.8 percent in years to come. Also, there was a 1.3 percent increase in salary costs due to “step and column” changes, which occur as employees gain experience and education, according to MBUSD’s 2019-20 annual budget.
“We have to find a way to make a way to make our budget work, and we’re going to find a way to make our budget work,” Matthews said. “The first step in that is to make some painful reductions, but we are going to work tirelessly to find some new revenue that can bring back some of those reductions. We’ll do it.”
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