Santa Clara

A:

Santa Clara County school districts will have to shed an estimated $305 million when the first dollar goes into Proposition 2's School Account.  A chunk of this will be parcel and property tax collected by its basic aid districts.  These districts will not receive any more property tax until December of the year, presumably forcing them to borrow.

The cap will force the reduction of Santa Clara County school districts' local carryover funds from an average of 20% now, to just 6%.  The two smallest districts (under 1000 students) will be allowed to carry 8-10%.  San Jose Unified will be capped at just 4%.

Compare these allowed carryovers with California Department of Education and Government Finance Officers Association recommendations of 15-17% in reserves -- and the state's late payments to schools in all recent fiscal years.  Santa Clara County schools will be allowed to carry just $123 million forward.  

In the case of the community funded 'basic aid' districts, this means shedding property taxes from April's disbursement that won't be replenished until December.  Palo Alto Unified, for example, carried 24% forward -- about $40 million -- but that $40 million was needed to cover its August, September, October and November bills (Palo Alto expends about $170 million total each year to educate its students).

In the case of the state-funded districts, this will leave them extraordinarily vulnerable to state revenue or property tax swings.  They will be allowed only $86 million of the total, yet were owed $154 million at the end of 2012, $49 million at the end of 2013, and $103 million this June 30th.

Note that Alum Rock Union Elementary, Evergreen Elementary, Franklin-McKinley Elementary, and Gilroy Unified are shown in red because the California Department of Education "qualified" its certification their financial conditions during some or all of the 2012-2014 period.  Despite their challenged financial state, these four school districts would have to pay down $19 million of their total ongoing operating funds were the state 'school saving account' to receive any deposits.

Santa Clara data table

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