Livermore schools are preparing for significant budget cuts for the coming school year, mainly because the state will reduce funding as the economic toll of the pandemic and shelter-in-place orders hit its own budget.

Expense reductions may include layoffs and some categorical program funding may fall as much as 50%, said Susan Kinder, Livermore Valley Joint Unified School District (LVJUSD) assistant superintendent of business services.

“A lot of things are going to be different, and that’s going to cost money,” Kinder told the board of education at last week’s meeting.

For the current fiscal year, the district ended April with a positive balance, Kinder said. The district spent about $1 million less than expected because schools were closed for the last few months. Utility bills dropped and schools didn’t need bussing or substitute teachers.

At the same time, revenue declined about $426,000 because of the local control funding formula, which determine state revenue per pupil.

In addition, the district must account for additional needs if students return to the schools in the fall, potentially including extensive campus cleaning, smaller class sizes to maintain social-distancing needs and health screenings for everyone coming on campus.

The board will vote on the budget after a public hearing on June 23.

Education is unlikely to get any revenue from the state’s rainy-day fund, added Kinder, who attended a workshop with the state following Gov. Gavin Newsom’s May budget revision. The school’s cost of living adjustment formula is reducing state funding by almost $10 million, and the district may have to consider layoffs in August.

“Of course, we never want to use that option,” LVJUSD Superintendent Kelly Bowers said. “We will do lots of other things first and have plans in place to avoid some cuts.”

Still, categorical programs that will get cut more than 50% by the state include the career technical education (CTE) incentive grant, agricultural CTE grant, some after-school programs and adult education grants, Kinder said.

The CTE programs have several other funding sources, so they will not disappear, Bowers said. While there may be some reductions to the after-school programs, the district will try to find funding elsewhere to keep those available. To minimize the impact, the district prioritizes adult education classes.

The district will maintain funding to equalize special education — part of a five-year state initiative — but special education preschool funding has been cut, Kinder said.

The school board must approve the budget with lots of broader unknowns, including whether the federal government will pass another stimulus package and how quickly the economy rebounds.

The district expects California to adopt its budget in June, though the state may revise it in August after tax receipts come in, since tax payments aren’t due until July this year. The district has 45 days to update its budget if the state revises its own.

Board clerk Chuck Rogge asked if any federal grant programs are available to sustain programs currently slated for big cuts. Bowers said the district is pursuing some federal grants. She also noted any labor negotiations involving salary concessions or reduction in the workforce would need to have contingencies related to what happens with state or federal funding.

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