BHUSD To Become Basic Aid By 2011
School Board President Myra Demeter sat in front of hundreds of parents and teachers at the high school’s Salter Family Theater last spring, listening to students attack her for defending the board’s catering finances in light of the budgets cut they were about to make.
How and why, when teachers faced potential layoffs was Demeter defending the budget line that paid for her turkey sandwiches, student Helen Grossman asked?
The board was forced to make tough decisions—potentially cutting teachers or programs because of the governor’s plans to reduce the state’s education budget by $4.8 billion.
Soon BHUSD will not have to make these types of decisions, consultants are predicting.
That’s because the five schools in the BHUSD will soon be funded by property taxes collected from the community.
For this to happen, Beverly Hills needs to increase its property tax revenue—it will come by September 2011, according to BHUSD’s consultant Mike Winters. The district will be one of 87 in the state known as a “basic aid district.”
Districts become basic aid, automatically, under a formula based on the community’s revenue. Districts that receive state aid, instead of local property taxes, are known as “revenue limit” school districts.
A basic-aid district like Laguna Beach—Unified has $13, 367 per pupil.
Becoming basic aid is a complicated.
This school year, BHUSD is funded through a variety of local, state and federal sources that are ear-marked for specifics like special education or class-size reduction.
Other monies go into the general fund for spending. These monies are provided through average daily attendance (ADA). This means a school district receives the same amount of money per pupil from the state. BHUSD receives a little more than $6,000 OF ADA for each student. When the state cuts its education budget, this number goes down.
For the current year, the school board has a general fund of $33,171, 251 from ADA monies.
If at any point in time, the City’s property tax revenues (that are designated to go to the state for education) exceed the $33 million, BHUSD keeps the rest.
Winters was hired by BHUSD last summer to predict when it would hit that point.
Based on looking at the City’s current assessment, with a conservative projected increase over five years of assessed valuation, he believes BHUSD will become basic aid in the 2011-2012 school year.
Winters based his study on prior patterns and worked closely with the City’s staff.
Beverly Hills property tax revenue has increased more than 50 percent over the past five years, according to the County assessor’s office. Last year, it increased 12 percent, the highest of any city in L.A. County. It is ranked eighth in the highest valued City. The county said the value will continue to rise.
Although it appears once BHUSD becomes basic aid, it will stay that way because trends indicate a continued increase, Winters warned there is a danger with falling in and out of being basic aid. He recommends maintaining a high reserve of 20 to 25 percent.
“Given the fact we are becoming a basic aid district it is now more impotent than ever to look to zero based budgeting and developing a detailed line item budget,” said school board member Brian Goldberg.
Goldberg said the district has an opportunity to rethink and reprioritize its budget, something most districts will never have.
“I look forward to working with the community as we remake and reshape our district and our budget to meet our priorities.”
• How will Basic Aid Affect Students On Permit?
Unlike now the community does not pay for permit students. Their attendance brings ADA funds from the state. But when BHUSD is required to go basic aid, the community will have to start paying for permits, because the district will no longer rely on state funds.
“I think it is clear that BHUSD is close to becoming a basic aid district sooner rather than later,” said Goldberg. “It is also clear to me that we need to look at dramatically reducing the number of opportunity permits in the district in order to fully take advantage of becoming and maintaining our status as a Basic Aid district.”
Goldberg said he recommends the board not issue new opportunity permits (a lottery for anyone to apply) going forward and letting current opportunity permit families know that the board will “be looking at natural breaking points in their child’s education for not renewing their permits.”
Goldberg explained himself by stating: “For example, any child entering fifth grade next year should be made aware that they will not have a spot for the following year for middle school and any student entering eighth grade next year should be made aware that they will not have a spot for the following year in the high school.
Current K-5 graders would be able to complete their elementary education, any current middle- school students would be able to complete their middle school and any current high-school student should be able to complete their high-school education.”
The school board will begin next year in compliance with the current practice for LAUSD on revoking permits, provide parents with at least a year to either move into BHUSD, return to their home district or apply for private school,
“To continue our current practice of keeping opportunity permits kindergarten through 12th, puts our resident students at a disadvantage and will negate most if not all the benefits of becoming a basic aid district,” he said.