Board approves budget

Andrew Edwards

The Laguna Beach Unified School District’s board gave unanimous

approval to its 2005-06 budget Tuesday. Outside of the general

budget, the district’s funds include a reserve designed to preserve

increased revenues derived from the recent housing boom.

In general, school board president Jan Vickers is satisfied with

the district’s financial health.

“We’re pretty solid right now,” she said.

The budget calls for the district to spend $28.5 million over the

next fiscal year. Norma Shelton, the district’s assistant

superintendent of business services, expects Laguna schools will

enjoy an $812,000 surplus. Combined with money held in reserve, the

budget projects a $4.3-million balance for the coming fiscal year.

Shelton held out the possibility for the district to end up with a

better balance. The district’s budget assumes two proposals from Gov.

Arnold Schwarzenegger that could increase the district’s costs will

be passed. The governor has proposed school district’s shoulder

teachers’ retirement costs and shifting the burden of special

education students’ mental health services from county agencies to

schools.

If those proposals are not carried out in the state’s final

budget, Shelton suggested the district could end up with more funds

than presently anticipated.

In the 2004-05 fiscal year, the district established a new fund

outside of its operating budget to hold on to property tax revenues

associated with real estate appreciation. Most of the district’s

expected revenue for 2005-06, about 83%, is slated to come from

property taxes.

During the last fiscal year, almost $3 million was placed into the

new reserve. The district plans to add about $300,000 more to that

fund this fiscal year.

In May, the median price for a Laguna Beach home or condo was $1.3

million, a 12.8% percent gain over May 2004 prices, according to La

Jolla-based DataQuick Information Services.

Varying forecasts on whether real estate appreciation gains can be

sustained abound. Some analysts see a bubble where others view a

thriving market. Shelton believes the district is being prudent by

planning for a possible market correction.

“Because this is a boom, we have to prepare for the non-boom

years,” Shelter said.