Benicia Unified School District would need to make $800,000 in ongoing adjustments for its budget to break even, Chief Business Official Tim Rahill reported at Thursday’s school board meeting.

On Jan. 10, Gov. Jerry Brown announced his final January budget proposal. After gathering information from the proposal, Rahill said BUSD would need to make $800,000 in continuing budget adjustments for the budget to become balanced and provide for California’s required minimum 3 percent reserve for economic uncertainties— which is currently $1.4 million— and the board policy reserve— which stands at $2 million.

“Both of those reserves are enacted to help provide financial stability for the district in tough economic times, such as continuing declining student enrollment which our district has experienced for at least two years in a row,” Rahill said.

Reserves can also provide security in times of state or national recessions or economic slowdowns, Rahill said.

The chief business official said BUSD would receive an estimated $1.3 million in one-time funds, which would be spent on items like books, technology, 21st-century classrooms and professional development, including the instructional coaching model. The money would not be spent on items that have a cost to the district over multiple years.

“We’re not proposing to spend these one-time funds on any ongoing items,” Rahill said.

Brown is also proposing to fully fund schools under the Local Control Funding Formula (LCFF), a funding system which establishes grants in place of funding streams. The LCFF funds include a base grant for all students and a supplemental grant for lower socioeconomic, English language learning or foster youth students. Rahill said BUSD must provide a Local Control Accountability Plan and demonstrate how it uses a projected total of $1.6 million in supplemental grant funds for students.

The LCFF is projected to provide an estimated additional $1.5 million to BUSD, Rahill said. From this amount, BUSD would need to pay $1.1 million for increased ongoing salary costs for the salary schedule’s “step and column” system, in which teachers are paid by their number of years working.

“As employees stay in the district and have longevity or if they get education credits, they can move up on the salary schedule,” Rahill said. “We have automatic salary increases on our schedule.”

Also part of this $1.1 million is increased ongoing employee pension costs, Rahill said. The district also needs to pay an additional $100,000 for continuing special education and restricted facility costs, plus an ongoing operating deficit of $1.1 million from the 2017-18 fiscal year, which includes the negotiated salary increases from the 2016-17 school year.

Rahill also said BUSD alters its staff at the beginning of each budget cycle based on student enrollment and contractual staffing ratios. Rahill noted that student enrollment has declined for the last few years, meaning the district will cut four secondary teachers, two and a half special education teachers and three classified special education staff members. Additionally, there is one temporary teacher substituting for another teacher on extended leave, but Rahill said this coverage would not be needed in 2018-19.

“All of those savings amount to about $700,000,” Rahill said.

Rahill said an additional ongoing $100,000 would be achieved through shifting administrative duties from the psychologist and counseling areas to existing site and district administration, saving the equivalent of one psych/counseling position. According to Rahill, many of the position adjustments would be covered through attrition, which would be covered at a March board meeting.

Finally, Rahill said employee negotiations have not been settled for 2017-18 or 2018-19, but costs associated with settled negotiations for these years are not included in the financial projections.

“Negotiations are currently underway with (Benicia Teachers Association), and they are starting soon with our classified union CSEA,” he said.

Board President Diane Ferrucci asked if BUSD would pay a penalty if enrollment numbers continue to dwindle next year. Rahill said it was possible but hopes the numbers can at least remain stable.

“What we’re hopeful (for) is that come August, that the same number of kids show up that first day of school that we had this year and then we can see a new trend starting back to stabilizing,” he said. “Maybe we’ll have more, but we’re just hoping for stable at this moment.”

Ferrucci said it would be good to have a plan in case Brown decides to fund higher education over K-12. She said she would be joining a group on March 13 in which TK-12 districts lobby for funding.

“The push is really to raise the base funding,” she said. “We are one of the lowest funded (districts), and part of the issue is because we don’t have a large population for the supplemental. The idea is just to bring the low districts up to the base average.”

Trustee Celeste Monnette also encouraged the community to remain active in the legislative process.

“Our hands are so tied in so many ways in terms of the finances that we have,” she said. “We’re gonna fight over the scraps, but the reality is there’s money out there that can be coming toward education.”

Rahill will provide updates on the 2017-18 Second Interim Financial Report in March and a 2018-19 draft budget at the final school board meeting in May. The final budget will be presented to the school board in June.

In other matters, the board voted 4-0— Trustee Peter Morgan was absent— to adopt a resolution requesting fair funding for California public schools.

The board will next meet on Thursday, Feb. 15.