Sunday, November 25, 2007

Vallejo schools could end year with $7M extra - a major turnaround in finances

Vallejo schools could end year with $7M extra

By TONY BURCHYNS/Times-Herald staff writer

Article Launched: 11/15/2007 08:31:44 AM PST

Since the collapse of its finances three years ago, the Vallejo City Unified School District has undergone a $35 million swing in 36 months. That's about $1 million a month.

The district now has a projected surplus of about $7 million for the 2007-08 fiscal year, according to a quarterly budget update state trustee Richard Damelio delivered Wednesday night to the school board.

That surplus for the unrestricted general fund is expected to climb even higher in December, after the close of escrow on property the district is selling for $3.9 million.

The latest budget snapshot also shows projected revenues rising by $3.6 million. However, expenses are also projected to be $2.6 million higher for the year.

Damelio was upbeat during the presentation. Beforehand, he said the numbers represent a "moment in time," and are always changing as bills for past services come due and new revenues arrive. But he said the district is moving in a positive financial direction.

Board members praised Damelio and other administrators who are part of a state-appointed takeover team working to resolve the district's massive budgetary problems. A newly released state audit shows finances in considerably better shape than three years ago.

The district's total unrestricted general fund sits at around $100 million. About 80 percent is used for employee salaries and benefits. The money also goes for books and supplies and instructional services.

While Damelio painted a fairly positive picture, he also warned that unknown factors, such as the dismal housing market and the state's economy, could affect finances next year. California public school districts get most of their money from the state.

The district's finances fell apart three years ago after an investigation uncovered a $28 million deficit. The district had originally reported a surplus that year. The state issued a $60 million bailout loan and took control of the district.

The school board still lacks power to make financial decisions, but officials hope that will be restored in six to 18 months.

In other news, the board said good-bye to long-time board member Bill Pendergast, who was attending his last meeting after 16 years of service. Pendergast, who did not seek re-election, is known for his work bringing more resources to improve school facilities.

"Your contributions go well beyond my tenure here," Damelio told him. "And your commitment to the students and community are unquestioned. You have done some remarkable things for this school district."

Pendergast, clearly emotional, congratulated the newly elected board members and thanked his friends and past campaign workers. He also praised district administrators and teachers for working "very hard" every day to provide the best possible education under a system that does not provide adequate resources.

"Although all of you work very hard, and care very deeply about getting (the district) where you would want it to be, you know we are not there," Pendergast said.

"We do not provide what we should be providing for our children, and that's a shame," he added.

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