School board approves balanced budget

Jessica Garrison

NEWPORT-MESA -- Less than 48 hours before classes begin, school board

members Tuesday night unanimously approved a $120-million balanced budget

for the 1999-2000 school year.

Though the district only is expected to bring in $118.6 million next

year while spending $120 million, Mike Fine, assistant superintendent for

business services, assured board members that the budget contains no

deficit.

“You are absolutely in the black,” he said. Last spring, after

revealing that the district faced a $4.8-million deficit for the 1998-99

school year, Supt. Robert Barbot promised that Newport-Mesa would never

again engage in deficit-spending.

Highlights of the budget include $1.2 million in the district’s share

of the statewide class-size reduction program, as well as nearly $1

million to refinance the district’s long-term debt, eventually leading to

savings of up to $200,000 per year.

As part of the class-size reduction program, the district hired 32 new

teachers to make kindergarten classes and ninth-grade English and math

classes smaller.

The apparent deficit next year occurs because of a “timing issue,”

Fine said. The district received money at the very end of the last fiscal

year in June that will be spent this fiscal year, making it appear the

district is in the red.

But though the district is no longer facing a deficit, its general

fund reserve is only 1.36% -- significantly below the state-recommended

3%. Fine was quick to point out, however, that the district also has a

special reserve fund of money from the Irvine Co., which, when added to

the general fund reserve, gives the district about 6.2% for economic

uncertainties.

Board members said they were delighted with the budget but quibbled

about everything from the number of secretaries at Newport Harbor High

School to the way schools apportion money to teachers for classroom

supplies.

“It’s a beautiful document,” said board member Martha Fluor. “But we

need to be very cautious and bring the reserve back up.”

Earlier this summer, the Orange County office of Education also urged

the district to increase its reserve.

Fine also noted the district is on the cusp of two radically different

school-financing methods. As of now, the district relies on the state to

give it money based on the number of students who come to school each

day.

But if local property taxes go up enough, the district could become

one of only about 50 of California’s 1,110 school districts that qualify

as “Basic Aid,” financing itself solely from local property taxes.

Last year, district officials predicted that taxes would not be high

enough to qualify it as Basic Aid for the 1998-99 school year, but in

August they learned the contrary. But the difference was so little --

only $9,000 -- that the district was not able to hire extra teachers, pay

for extra programs or experience any of the other luxuries that educators

usually associate with Basic Aid.

If property taxes climb high enough this year, Fine said, the district

could wind up with a windfall next spring. But he cautioned that,

although the county assessor has predicted an increase in property tax

revenue, there is no telling now if it will happen.

So he assumed in the budget that it wouldn’t.

“We are being conservative,” he told board members.