OCEANSIDE — The Oceanside Unified School District’s revenues are expected to drop following the release of next year’s average daily attendance numbers, according to a budget report.
According to an interim budget report presented to the Oceanside Unified School District board on Dec. 14, both revenues and expenses have increased for the current 2021-2022 fiscal year. The report projects ending the year having made $295.4 million in revenue while having spent $304.5 million, dropping the school’s fund balance from $41.2 million to just below $33 million.
The nearly $33 million fund balance will shrink again by the end of the 2022-2023 school year as revenues are expected to also drop once the average daily attendance, or ADA, numbers switch from using last school year’s (2019-20) attendance to current attendance numbers.
In California, the average daily attendance, not enrollment, of students determines how much funding a school district receives. Because of quarantine requirements due to the COVID-19 pandemic, the district’s average daily attendance currently sits at around 90% rather than its previous 94%. While these numbers are expected to increase by 1% next year, the change will still negatively affect the district’s revenue.
Next year, revenues are projected at only $217 million dollars while expenses will be around $232 million, creating a deficit that will drop the district’s fund balance to just under $18 million.
“That’s quite a drop,” said Andrea Norman, associate superintendent of business services. “That’s because our ADA is going to be changing significantly and we’re anticipating that and we’re ready for that.”
Despite the drop in revenue and increase in expenses, the district doesn’t anticipate making any significant budget cuts either this year or next. By the 2023-2024 school year, however, the district may need to cut $8.2 million from its budget in order to maintain its 5% in emergency reserves.
Starting with a nearly $18 million fund balance, the district anticipates about $224 million in revenues and about $234 million in expenses in the fiscal year 2023-24, dropping the balance to about $7.5 million. To keep the budget balanced and a 5% reserve, the district would likely need to cut an additional $8.2 million that year.
Though OUSD keeps its reserves at 5% as per board policy, the state only requires school districts to keep a 3% minimum reserve balance. Board President Stacy Begin was interested in changing Oceanside’s reserve percentage from 5 to 3%.
Norman said changing the reserves to 3% would reduce the $8.2 million in budget cuts by half.
Begin asked staff to bring back information on how changing the board policy on reserves back to 3% would look like for the budget going forward in January.
“The overall goal is to be positive by our second interim and get out of disqualified status,” Begin said.