* This transcript was created by voice-to-text technology. The transcript has not been edited for errors or omissions, it is for reference only and is not the official minutes of the meeting.
          [00:00:01]
          OKAY. 
          HELLO EVERYBODY. 
          THANK YOU. 
          UM, 
          [Roll Call]
THE TIME IS NOW ONE 10. 
          WE'RE GONNA GO AHEAD AND START THIS SPECIAL MEETING OF THE LOS ANGELES UNIFIED SCHOOL DISTRICT BOARD OF EDUCATION. 
          UH, THIS IS A BUDGET WORKSHOP. 
          I'M GOING TO TAKE ROLL MS. NEWBELL PRESENT. 
          DR. RIVAS, I BELIEVE IS ABSENT. 
          UH, MR. MELBOURNE HERE. 
          UH, LET'S SEE, WHO DO WE HAVE? MS. EZ? HERE. 
          MS. GRIEGO. 
          HERE. 
          MS. ORTIZ FRANKLIN IS ABSENT. 
          AND BOARD PRESIDENT SCHUREN PRESENT. 
          OKAY. 
          SO THE ORDER OF OPERATIONS TODAY IS WE'RE GONNA GO DIRECTLY INTO 
          [Public Comment ]
PUBLIC COMMENT, WHICH IS IN PERSON ONLY TODAY, AND WE WILL BE DOING SIMULTANEOUS TRANSLATION AS WE USUALLY DO. 
          FOR THE FOLKS WHO ARE HERE WHO DO NOT SPEAK SPANISH, WHEN THERE IS A SPANISH SPEAKER UP FOR A PUBLIC COMMENT, YOU WOULD PUT ON THE HEADPHONES THAT WE'RE OFFERING TO YOU RIGHT NOW, AND YOU WILL EXPERIENCE SIMULTANEOUS TRANSLATION. 
          OKAY? SO EACH PUBLIC COMMENTER GETS TWO MINUTES EACH. 
          I WILL READ THE NAME OF THE FIRST PUBLIC COMMENTER, AND THEN I WILL RELINQUISH THE MIC. 
          SO, ISABEL GONZALEZ, ARE YOU HERE? ISABEL GONZALEZ. 
          OKAY. 
          MS. GONZALEZ IS GONNA SPEAK IN SPANISH. 
          SO WHILE SHE'S SPEAKING IN SPANISH, PLEASE PUT ON THE HEADSETS IF YOU NEED IT. 
          AND I'LL BE USING THIS TIMER RIGHT HERE. 
          AND ONCE YOU HEAR THE TIMER, YOUR TIME IS UP. 
          EVERYBODY HAVE A HEADSET? OKAY. 
          . 
          OKAY, THE NEXT SPEAKER WILL BE DEANNA GUILLEN. 
          COME ON UP, MS. GUILLEN, YOU'LL HAVE TWO MINUTES TO SPEAK ONCE YOU BEGIN. 
          SORRY ABOUT THAT. 
          YOUR TIME ISN'T UP YET, SO MS. GUILLEN'S GONNA SPEAK IN SPANISH. 
          SO IF YOU'D LIKE TO HEAR WHAT SHE'S SAYING IN ENGLISH, PLEASE PUT YOUR HANDS UP AND WE'LL GET YOU THESE TRANSLATION HEADSETS. 
          OKAY? THE TIME IS YOURS. 
          SO WHEN I 
          [00:06:54]
 THANK YOU FOR YOUR TIME, MARIA LUISA PALMA, ARE YOU HERE? COME ON UP. 
          YOU'LL HAVE TWO MINUTES TO SPEAK. 
          WHEN SHOULD YOU BEGIN TO THE BOARD MEMBERS, WHEN YOU ARE MANAGING YOUR HOUSEHOLDS, DO YOU START LOOKING AT YOUR MONEY? WHEN, UH, DO YOU LOOK AT JUST WHAT'S LEFT OVER IN YOUR CHECKING ACCOUNT EVERY MONTH? THAT'S KNOWN AS LIVING HAND TO MOUTH. 
          AS TRUSTEES OF THIS GIANT PUBLIC INSTITUTION, IS IT PRUDENT TO MANAGE THIS INSTITUTION THAT WAY? I SAY NO. 
          WHEN YOU START YOUR DISCUSSIONS AND YOUR FOCUS, STARTING FROM THE UNRESTRICTED UNASSIGNED UNAPPROPRIATED BALANCE, YOU ARE DOING EXACTLY THE SAME THING, LIVING HAND TO MOUTH. 
          SO LET ME READ TO YOU SOME IMPORTANT INFORMATION FROM THE FINANCIAL STATEMENTS. 
          THE STATEMENT OF NET POSITION, OKAY, REFLECTS YOUR ASSETS, YOUR LIABILITIES, AND THE DIFFERENCE BETWEEN THOSE TWO ELEMENTS ARE THE NET POSITION. 
          THE NEGATIVE NET POSITION POSITION IS WHERE YOU ARE NOW AT AN UNRESTRICTED 11.8 BILLION DEFICIT, OKAY? BECAUSE OF NET PENSION LIABILITIES, UNFUNDED AND OPEP, UNFUNDED LIABILITIES. 
          THEN THE STATEMENT OF ACTIVITIES, ALSO KNOWN AS YOUR INCOME STATEMENT, PRESENTS THE INFORMATION ON HOW THE DISTRICT'S NET POSITION HAS CHANGED DURING THE MOST RECENT FISCAL YEAR. 
          SO THIS INFORMATION WOULD TELL YOU WHERE YOU WERE, WHAT CHANGED WHAT YOU DID IN THAT YEAR. 
          SO THEN YOU'D KNOW WHERE YOU ARE, AND THEN YOU CAN BEGIN TO DISCUSS WHERE DO YOU WANT TO GO? WHAT DO YOU WANT TO DO? THAT'S NOT WHAT YOU DO HERE. 
          YOU START AT THE END. 
          SO THAT IMPLIES TO ME THAT YOU ARE ONLY BEGINNING TO PAY ATTENTION WHEN YOU ARE ALREADY IN TROUBLE. 
          THAT IS NOT PRUDENT. 
          IT IS TOO LATE. 
          I REQUEST ONCE AGAIN THAT YOU CREATE A SUBCOMMITTEE, A BOARD SUBCOMMITTEE TO DISCUSS FINANCE, THE BUDGET, AND THE LCAP IN DEPTH TO DISCUSS YOUR STRUCTURAL PROBLEMS. OTHERWISE, YOU DON'T KNOW WHERE YOU ARE. 
          YOU AS TRUSTEES HAVE TO DRIVE THIS CHANGE. 
          YOU HAVE TO SHOW US IN PUBLIC, DURING PUBLIC MEETINGS, YOUR DISCUSSIONS, YOUR DELIBERATIONS ON WHAT WILL BE INCLUDED IN THE BUDGET, WHICH IS JUST ONE PART, ONE ASPECT OF MANAGING THE ENTIRE FINANCIAL STATEMENTS FOR THIS DISTRICT. 
          THIS IS WHAT IS ABSOLUTELY REQUIRED OF THIS GIANT INSTITUTION. 
          OTHERWISE, L-A-U-S-D IS A SHIP WITHOUT A CAPTAIN. 
          THAT IS WHAT YOU ARE RIGHT NOW OR WHO IS IN CHARGE, IF NOT YOU, BOARD MEMBERS. 
          THANK YOU FOR YOUR TIME. 
          WE HAVE, UH, MARIA DAISY ORTIZ SIGNED UP TO SPEAK, BUT I DO NOT SEE HER HERE. 
          UH, AND THE LAST SPEAKER SIGNED UP TO SPEAK IS LAUREN BROOKE. 
          LAUREN BROOKE, ARE YOU HERE? OH, WE HAVE A LATE, COME ON. 
          IT'S NOT, UH, MS. ORTIZ. 
          SO THAT CONCLUDES PUBLIC COMMENT. 
          AND NOW THE THE 
          [1. Budget Workshop]
TIME IS TO THE BOARD AND THE BUDGET WORKSHOP. 
          THANK YOU, MR. MCLEAN. 
          AND NOW I WOULD LIKE TO WELCOME EVERYONE TO OUR, UH, 26 BUDGET ADOPTION MEETING. 
          AND I WOULD 
          [00:10:01]
LIKE TO TURN THIS OVER TO OUR SUPERINTENDENT, MR. DEL CABO . 
          I DON'T KNOW WHY I SAID THAT. 
          MR. CARVAL . 
          OKAY. 
          THANK YOU VERY MUCH. 
          UH, GOOD AFTERNOON. 
          MY INTRODUCTION WILL BE VERY BRIEF. 
          LEMME BEGIN BY, UH, THANKING THE BOARD FOR AGREEING TO COME TOGETHER TO HAVE AN IMPORTANT CONVERSATION. 
          UH, TODAY, UH, WILL CONSIST OF NOT ONLY A PRESENTATION, ACTUALLY TWO DIFFERENT PRESENTATIONS, AND THEN PLENTY OF, UH, OPPORTUNITY FOR THE BOARD TO CHIME IN, OPINE, ASK QUESTIONS. 
          UH, THE AGENDA WILL BEGIN WITH, UM, A CONVERSATION NEVER FAILS, NO MESSAGE. 
          OKAY, 74, PLEASE STAND FURTHER INSTRUCTIONS. 
          MAY I HAVE YOUR ATTENTION? MAY I HAVE YOUR ATTENTION? WE A MARK 17TH FLOOR. 
          PLEASE STAND BY FOR FURTHER INSTRUCTION. 
          SO THE AGENDA TODAY WILL INCLUDE TWO PRESENTATIONS, AS I SAID, PLENTY OF OPPORTUNITY FOR THE BOARD TO ASK QUESTIONS AND TO ENGAGE IN CONVERSATION WITH OUR FINANCIAL EXPERTS. 
          THE VERY FIRST, UH, PRESENTATION WE'LL BE CONDUCTED BY, UH, SCHOOL SERVICES OF CALIFORNIA, UH, PRESENTED BY, UH, MR. JOHN GRAY, UH, PRESIDENT, CEO, AS WELL AS PATTY HERRERA, EXECUTIVE VICE PRESIDENT, THAT WILL DETAIL, UH, WHATEVER, UH, THE MAY REVISE INFORMATION RECENTLY RELEASED BY THE GOVERNOR, UM, WILL HAVE IN TERMS OF IMPACT TO OUR SCHOOL DISTRICT AND ACROSS THE STATE. 
          IT IS OUR HOPE ALSO THAT THIS GROUP WILL POSITION LOS ANGELES UNIFIED WITHIN THE CONTEXT OF OTHER DISTRICTS OF LIKE SIZE OR SMALLER AND THE ENTIRE STATE OF CALIFORNIA, SPECIFICALLY THE TRENDS THAT WE ARE EXPERIENCING AND OBSERVING. 
          SECONDLY, WE'LL GO INTO INSIGHTS LEADING INTO THE FISCAL YEAR OF 26, UH, BUDGET ADOPTION. 
          OBVIOUSLY, THOSE WILL INCLUDE, UH, A DEEP DIVE, UM, INTO, UM, TRENDS GOING BACK TO FISCAL YEAR 20, ALL THE WAY THROUGH 26. 
          WE'LL LOOK AT COMPENSATION VERSUS REVENUE. 
          TRYING TO UNDERSTAND THE STRUCTURAL DEFICIT TO THE SYSTEM IS, UH, IS EXPERIENCING EXPENSES OVER REVENUES DURING THAT SAME TIME PERIOD. 
          AND ACTUALLY EXTENDING ALL THE WAY TO FISCAL YEAR 28. 
          UM, THE WORK WE'RE DOING, UH, AND THE IMPACT OF SUSTAINING OUR WORKFORCE, UH, STRATEGIES. 
          RECOGNIZING THAT IN THE AFTERMATH OF THE PANDEMIC, UH, WE CONTINUE TO CARRY A LOT OF, UH, FULL-TIME POSITIONS AND PART-TIME POSITIONS, UH, OCCUPIED BY INDIVIDUALS WHOSE SALARIES WERE BEING PAID WITH ESSER FUNDING, WHICH SUNSETTED IN SEPTEMBER OF 2024. 
          UH, WE TOLD THE BOARD THAT THIS PAST YEAR, ACTUALLY CURRENT FISCAL YEAR, WE CONTINUE TO SUPPORT, UH, THOSE INDIVIDUALS. 
          UH, WE HAD, UM, IN EXCESS 2000 SUCH INDIVIDUALS IN OUR SCHOOL DISTRICT CONSUMING AN EXCESS OF $82 MILLION. 
          WE'RE HAPPY TO REPORT, AS YOU'LL SEE IN A BIT, THAT THAT NUMBER HAS GONE DOWN TO ABOUT $60 MILLION. 
          BUT BASED ON THE COMMITMENT WE'VE MADE TO THE WORKFORCE, THERE'LL BE NO RIFTS THIS YEAR, AS WELL AS FISCAL YEAR 26. 
          UH, SO, UH, YOU'LL SEE A REDOUBLING OF THE COMMITMENT OF HOLDING THESE INDIVIDUALS HARMLESS, BUT WITH THE UNDERSTANDING THAT, UH, SOLUTIONS MUST BE FOUND THROUGH EFFICIENCIES, UH, THROUGH THE END OF THIS FISCAL YEAR, AS WELL AS NEXT FISCAL YEAR, UH, TO AVOID ANY POSSIBILITY OF LAYOFFS. 
          TO THE EXTENT THAT WE ARE NOT DISCIPLINED IN REDUCING LIABILITIES FOR THE REMAINDER OF THIS YEAR, AS WELL AS NEXT FISCAL YEAR, THE POSSIBILITY OF REDUCTIONS IN FORCE ACTUALLY INCREASE. 
          WE'RE NOT ALONE IN THIS IN TERMS OF LOCAL, UH, GOVERNMENTS. 
          WE'RE NOT ALONE IN THIS. 
          IN TERMS OF, UH, SCHOOL DISTRICTS ACROSS THE STATE. 
          UH, WE WILL LOOK ONCE AGAIN AT, UH, END OF YEAR FUND, UH, BALANCES, UM, SPECIFIC TO ALL FUNDS, UH, GOING BACK TO FY 24, STRETCHING ALL THE WAY TO FY 28, AND THEN WE'LL PRESENT. 
          CONSIDERING OUR POSITION, OUR PROJECTED POSITION SPECIFIC TO FISCAL YEAR 28, ALL CLEAR, IT'S SAFE FOR OCCUPANTS TO RETURN TO THEIR WORKPLACE LOCATION. 
          YOU MAY USE THE ELEVATORS TO RETURN TO YOUR FLOOR WITH THE, HAVE YOUR ATTENTION. 
          THEY HAVE YOUR, WE HAVE INVESTIGATED ON THE BOTTOM OF THE 17TH FLOOR. 
          THEY DECLARE AN ALL CLEAR, IT IS SAFE FOR OCCUPANTS TO RETURN TO THEIR WORK LOCATION, LOCATION. 
          YOU MAY USE THE ELEVATORS TO RETURN TO YOUR FLOOR. 
          SO THE, IT IS A REQUIREMENT, AS WE, AS THE BOARD, UH, 
          [00:15:01]
APPROVES THE BUDGET GOING TO JUNE, THAT THE BOARD ALSO APPROVE, UH, A PLAN, A STABILIZATION PLAN, BECAUSE IT IS FORECASTED, IS PROJECTED THAT WE WILL GO INTO DEFICIT A POSITION IN FY 28. 
          SO WE ARE PROVIDING, AT THIS POINT, VERY EARLY ON, UH, THE BASIC ELEMENTS OF WHAT THAT PLAN, UH, WILL INCLUDE WITH THE UNDERSTANDING THAT THINGS MAY CHANGE. 
          AND IN FACT, MANY, UH, MANY OF THOSE THINGS WILL CHANGE GOING TO NEXT YEAR, A PREPARATION YEAR, BUT ALSO A YEAR OF EFFICIENCIES. 
          AND LASTLY, UM, YOU WILL GET, UH, UM, BEFORE YOU, UM, A A NUMBER OF BUDGET ASSUMPTIONS, UH, AS A DISTRICT. 
          AND LAST, BUT NOT LEAST, DESPITE THE FACT THAT WE ARE IN AN ERA OF BUDGET CONSTRAINTS, UH, THERE'S ALWAYS AN OPPORTUNITY TO CONTINUE TO PRIORITIZE, UH, FROM A BUDGET PERSPECTIVE, UM, ELEMENTS WITHIN THIS BUDGET. 
          AND WE DO SO BY REAFFIRMING COMMITMENT IN SOME INSTANCES, ACTUALLY INCREASING FUNDING FOR PROGRAMS BASED ON EQUITY, UH, ELEMENTS OF OUR BUDGET, AS WELL AS CRITICAL NEEDS IN OUR, UH, OF OUR STUDENTS IN OUR SCHOOLS. 
          SO, WITH THAT SAID, LET ME, UH, TURN IT OVER TO, UM, TO OUR NEXT SPEAKERS, UH, MR. JOHN GRAY AND, UH, PATTY HERRERA WITH SCHOOL SERVICES CALIFORNIA. 
          JUST GO GREEN IS QUICKER. 
          UH, OR DO YOU WANNA TELL ME? I'LL, I'LL TELL YOU. 
          WELL, GOOD AFTERNOON, EVERYONE. 
          UH, MY NAME IS JOHN GRAY. 
          I'M WITH SCHOOL SERVICES OF CALIFORNIA. 
          I WAS AT A PREVIOUS BOARD MEETING A FEW MONTHS AGO WHEN WE ONLY HAD THE GOVERNOR'S BUDGET AT THAT TIME. 
          AND SINCE THAT TIME, THE WAY THE BUDGET PROCESS WORKS IN THE STATE OF CALIFORNIA IN JANUARY, THE GOVERNOR PROPOSES HIS BUDGET BASED ON A BUNCH OF NUMBERS THAT ARE A LOT OF ESTIMATES. 
          AND THEN BY MAY, UH, BY LAW, HE'S SUPPOSED TO COME OUT AND REVISE THAT JANUARY BUDGET THAT YOU'VE BEEN, UH, LOOKING AT FOR THE FOLLOWING YEAR. 
          AND HE HAS COME OUT AND DONE THAT. 
          UH, WITH ME TODAY IS PATTY HERRERA. 
          JUST SO YOU KNOW, I SPEND MOST OF MY TIME IN SCHOOL DISTRICTS WORKING WITH FINANCIAL STAFF, PRIMARILY ON THE OPERATIONS OF SCHOOL DISTRICTS. 
          PATTY SPENDS MOST OF HER TIME IN SACRAMENTO. 
          SHE'S A LOBBYIST. 
          SHE WORKS WITH THE DEPARTMENT OF FINANCE, THE LAO. 
          SHE'S OUR PROP 98 EXPERT, UM, AND OUR EXPERT ON, ON ALL THINGS OPERATIONS ON THE STATE. 
          SO, UH, WE'RE GONNA KEEP THIS FAIRLY HIGH LEVEL. 
          WE KNOW YOUR STAFF IS GONNA PROVIDE YOU WITH A LOT OF DETAILS SPECIFICALLY, UH, BUT AS YOUR SUPERINTENDENT SAID AT, AT THE BEGINNING, UM, YOU MAY BE THE LARGEST DISTRICT IN THE STATE, BUT YOU RESIDE IN THE STATE OF CALIFORNIA, AND YOU'RE RELIANT, UH, ON THE STATE FOR, UM, MOST OF YOUR FUNDING. 
          UH, THE VARIOUS FUNDING FORMULAS. 
          SO EVERYTHING WE'RE TALKING ABOUT, UH, THIS, UH, THIS AFTERNOON PRETTY MUCH PERTAINS TO EVERYBODY IN THE STATE. 
          SO THE WHOLE ISSUE OF DECLINING ENROLLMENT, UM, ON WEDNESDAY, IF YOU DON'T GET ENOUGH TODAY, YOU CAN LOG ONTO OUR WORKSHOP. 
          WE HAVE ALL THOUSAND DISTRICTS ARE GONNA COME. 
          UH, AND WE SPEND A LOT MORE TIME AND A LOT MORE DETAIL ON THESE TOPICS. 
          WE HAVE LIKE 200 SLIDES. 
          WE HAVE FOUR THIS, UH, TODAY. 
          AND SO ONE OF THE TOPICS IS THE CONTINUANCE OF DECLINING ENROLLMENT IN THE STATE OF CALIFORNIA. 
          WE'RE LOSING CITIZENS, WE'RE LOSING STUDENTS. 
          UH, THE DEPARTMENT OF FINANCE IS PROJECTING THAT THE DECLINE IS GONNA GO AT LEAST UNTIL 2033. 
          UM, SO WE DON'T SEE, UH, A, A, A BIG CHANGE COMING THERE. 
          UM, SO IN JANUARY WHEN HE, THE GOVERNOR CAME OUT WITH THE BUDGET, THERE WERE A LOT OF UNKNOWNS. 
          ONE WAS THE COST OF LIVING ADJUSTMENT. 
          HE HAD AN ESTIMATE OF 2.43, THAT'S NOW 2.3%. 
          THE OTHER THING WAS HE RECEIVES AN ESTIMATE OF REVENUES FROM HIS DEPARTMENT OF FINANCE. 
          AND AT THAT TIME, WE HAD A, SINCE THAT TIME, UH, OF THE, UH, THE JANUARY BUDGET, UH, WE HAVE A NEW PRESIDENT. 
          UH, WE HAVE, UH, A LOT OF THINGS HAPPENING AT THE FEDERAL LEVEL THAT ARE IMPACTING THE STATE OF CALIFORNIA. 
          AND SO THE DEPARTMENT OF FINANCE HAVE UPDATED THEIR REVENUES FROM JANUARY TO PROVIDE YOU THE MAY REVISION. 
          AND UNFORTUNATELY, UH, A PRETTY SIGNIFICANT DOWNSTROKE IN THE PROJECTION OF REVENUES AT THE STATE. 
          UM, I THINK LAST TIME I WAS HERE, I TALKED ABOUT THE PERSONAL INCOME TAX AND HOW WE'RE HEAVILY RELIANT ON OUR WEALTHIEST CALIFORNIANS. 
          'CAUSE WE HAVE A VERY PROGRESSIVE TAX. 
          AND IF YOU'VE BEEN WATCHING THE STOCK MARKET, UH, THE END OF LAST YEAR, WE WERE RIDING PRETTY HIGH. 
          SINCE THAT TIME. 
          THE ANNOUNCEMENT OF TARIFFS, WE SAW THE S AND P 500, THE DOW PRETTY MUCH TANK. 
          NOW, IT HAS STARTED TO RECOVER. 
          UM, BUT HIS DEPARTMENT FINANCES TAKING THAT INTO ACCOUNT IN THEIR PROJECTIONS. 
          AND SO IF YOU GO INTO THE 
          [00:20:01]
FINANCE PAGES, UH, ON THE GOVERNOR'S, UH, MAY REVISE, YOU'LL GET A LOT OF GORY DETAIL. 
          AND THEY CATEGORIZED IT. 
          WE'RE PROJECTING A GROWTH RECESSION. 
          I HAD NEVER HEARD OF THAT TERM. 
          I THOUGHT THEY MADE IT UP. 
          SO I HAD TO GO LOOK IT UP. 
          IT'S ACTUALLY, UH, AN ECONOMIC TERM. 
          AND I THINK I GOT A QUESTION LAST TIME I WAS HERE ABOUT THE LAST GREAT RECESSION, AND WE TALKED ABOUT THAT A LITTLE BIT. 
          SO, RECESSIONS, IF YOU RECALL, 2008, IT'S 2, 3, 4 QUARTERS, AND THEN THE RECESSION'S DONE. 
          AND THEN YOU GO INTO A RECOVERY, THEY, THEY CATEGORIZE THIS GROWTH RECESSION, SORT OF LIKE THE RECOVERY WE HAD AFTER THE LAST GREAT RECESSION WHERE WE PRETTY MUCH CRAWLED OUT AFTER THAT, SIGNIFICANT DOWN TO. 
          SO ALL OF THOSE FACTORS ARE IMPACTING HIS PROPOSAL. 
          AND SO I'M GONNA LET PATTY TALK A LITTLE BIT WHAT'S HAPPENING ON THE EDUCATION SIDE. 
          UM, IN GENERAL, I WILL SAY THIS, UH, WE FARE PRETTY WELL BASED ON THE CIRCUMSTANCES. 
          THE OTHER SIDE OF THE BUDGET IS TAKING SIGNIFICANT HITS. 
          AND SO THAT DISCUSSION'S GONNA CONTINUE WITH THE LEGISLATURE. 
          AND REMEMBER, THE OTHER SIDE OF THE BUDGET SERVES A LOT OF THE SAME POPULATIONS THAT WE'RE SERVING UNDER PROP 98, UH, K 14 EDUCATION. 
          SO THAT'S SORT OF AN OVERVIEW, BUT I'M GONNA LET PATTY GO INTO A LITTLE MORE DETAIL. 
          THANK YOU, JOHN. 
          HI, EVERYBODY. 
          IT'S GOOD TO BE HERE WITH YOU. 
          IF WE CAN ADVANCE TO THE NEXT SLIDE. 
          THANK YOU. 
          UM, SO BEFORE I EXPLAIN WHAT THIS SLIDE, UH, UM, ILLUSTRATES TO ALL OF YOU, I JUST WANNA SAY THAT AS THE GOVERNOR PROPOSED HIS MAY REVISION FOR EDUCATION, WE SAW A MODEST INCREASE IN ONE-TIME DOLLARS, BUT WE, THE PICTURE CHANGED PRETTY DRAMATICALLY FOR THE WORSE, UM, FROM HIS JANUARY GOVERNOR'S BUDGET. 
          UM, I CAN TELL YOU THAT HE HAS A LOT OF PROPOSALS THAT, UM, CHRIS AND HIS TEAM CAN GO OVER WITH YOU GUYS, UH, OR WE'RE, JOHN AND I ARE HAPPY TO DO THAT AS WELL. 
          BUT IN OUR MINDS, THE ONLY THING THAT IS NEAR CERTAIN, AND I WOULD TELL YOU I'M NOT EVEN CERTAIN THAT IT'S CERTAIN YET, IS THE, THE GOVERNOR'S, UH, PROPOSAL TO FUND THE 2.3% COLA IN 25 26. 
          AND THE REASON WHY I AM HESITANT TO SAY, YEP, WE'RE GONNA SEE THAT IN THE ADOPTED BUDGET, IS BECAUSE IN ORDER TO PAY FOR THAT COLA, THE GOVERNOR IS RELYING ON ONE-TIME RESOURCES BECAUSE THERE'S NO, THE, THE PROPOSITION 98 MINIMUM GUARANTEE IS DROPPING, AS YOU CAN SEE IN THIS CHART BY 3.7% FROM WHERE, WHERE WE ARE, UH, CURRENT YEAR IN 24 25. 
          SO THAT MEANS THAT THE MINIMUM GUARANTEE DOESN'T HAVE THE CAPACITY TO FULLY FUND ALL OF THE BUT, UH, EDUCATION PRIORITIES THAT WERE INCLUDED IN THE JANUARY BUDGET, INCLUDING A 2.3% COST OF LIVING ADJUSTMENT. 
          SO HE IS USING, UH, UH, THE MECHANICS OF, UH, DEFERRALS AS WELL AS DRAINING THE EDUCATION RAINY DAY FUND TO PAY FOR THE 2.3%, UH, COST OF LIVING ADJUSTMENT. 
          BUT I THINK, AS JOHN WAS SAYING, THIS IS, THIS IS JUST A YEAR. 
          THIS IS A, A GRAPH THAT SHOWS YOU YEAR OVER YEAR CHANGE IN WHAT WE CALL THE BIG THREE, UH, TAX REVENUES. 
          IT'S PERSONAL INCOME TAX SALES, AND USE TAX INCORPORATION TAXES, COMBINE THOSE TAXES MAKE UP 97% OF ALL GENERAL FUND REVENUE, WHICH DRIVES PROPOSITION 98. 
          AND, AND EDUCATION, UM, FUND, UH, EDUCATION REVENUES AS WELL. 
          AND THAT'S WHY YOU CAN SEE IN THE DARK BLUE BARS JUST ON A TREND LINE, THE DARK BLUE BARS FOLLOW THE LONG-TERM TRENDS OF THE LIGHT BLUE BARS, RIGHT? WHICH ARE THE, UM, THE, UH, BIG THREE, UM, UH, TAXES FOR CALIFORNIA. 
          I THINK THE THING THAT I WOULD LIKE TO REALLY POINT OUT TO ALL OF YOU IS THAT WE SEE WE'RE SEEING IN THE MAY REVISION THAT 3.7% DROP IN THE MINIMUM GUARANTEE FROM 24 25 TO 25 26. 
          THAT IS NOT OUR ASSUMPTIONS. 
          THAT IS THE GOVERNOR'S ASSUMPTIONS WHEN HE ISSUED HIS MAY REVISION LAST WEDNESDAY. 
          WHAT, WHAT THE GOVERNOR'S MAY REVISION DOESN'T SHOW IS THE SECOND ASSUMPTION IN 26 27. 
          THAT'S NOT ANYWHERE IN HIS PAGES UNLESS YOU DIG DEEP INTO THE BOWELS OF THE REVENUE ESTIMATE SECTION , UH, TO FIND THIS NUMBER. 
          AND WHAT THIS NUMBER SHOWS YOU IS THAT IN 26 27, THE PROPOSITION 98 MINIMUM GUARANTEE IS ONLY ESTIMATED TO INCREASE BY 1.6%. 
          SO THAT YEAR OVER YEAR INCREASE FROM NEXT YEAR THAT YOU GUYS ARE BUILDING YOUR BUDGETS FOR TO THE FOLLOWING YEAR, WILL NOT EVEN LIKELY BE ENOUGH TO BE ABLE TO PAY FOR WHAT WE WOULD ANTICIPATE A COST OF LIVING ADJUSTMENT IN 26 27. 
          IN FACT, THE GOVERNOR'S MAY REVISION, UM, UH, HE DOES INCLUDE AN ESTIMATE FOR THE COST OF LIVING ADJUSTMENT IN, UH, 26 27. 
          AND THIS ESTIMATED GROWTH IS NOT ENOUGH TO PAY FOR THAT COST OF LIVING ADJUSTMENT AT THE END OF THE DAY. 
          WHAT THAT TELLS ME IS THAT WE'RE GONNA HAVE REALLY LEAN BUDGETS, NOT JUST IN 25, 26, BUT ALSO IN 26, 27 
          [00:25:01]
WHEN THE STATE OF CALIFORNIA, WHEN THE GOVERNOR RELEASES HIS JANUARY BUDGET, UH, IN, UH, JANUARY OF 2026. 
          SO WE JUST WANTED TO SHOW, SHOW THAT SLIDE TO YOU, AND HAPPY TO BREAK THIS DOWN, UM, INTO ANY, IF YOU GUYS HAVE ANY QUESTIONS ABOUT THE MECHANICS OF PROPOSITION 98, I'M HAPPY TO ANSWER THOSE QUESTIONS FOR YOU. 
          THE NEXT SLIDE. 
          THANK YOU, CHRIS. 
          UM, THIS IS A SLIDE OF, AGAIN, LOOKING AT THE BIG THREE TAX REVENUES. 
          ONCE AGAIN, THESE CONSTITUTE 97% OF ALL STATE GENERAL FUND REVENUES. 
          THE TOP LIGHT BLUE PARTS OF THE BAR ARE WHAT WE CALL PROPOSITION AND PRO PROPOSITION 30 AND 55 REVENUES. 
          SO YOU GUYS MIGHT REMEMBER IN 2012, AND THEN AGAIN, IN 2016, UM, CALIFORNIA VOTERS, UM, APPROVED TAX INCREASES. 
          FIRST ON SALE, UH, AN INCREASE ON SALES TAX ACROSS THE BOARD. 
          THOSE EXPIRED IN 2016, AND THEN IT, UH, PROPOSITION 55 EXTENDED THE PERSONAL INCOME TAX RATES FOR CALIFORNIA'S WEALTHIEST EARNERS, RIGHT? WE, WE DECIDED WE NEEDED MONEY. 
          THE STATE OF CALIFORNIA NEEDED MONEY . 
          AND THE WAY THAT WE WERE GONNA GET THOSE MONIES IS WE WERE GOING TO TAX THE, THE STATE'S WEALTHIEST EARNERS. 
          AND THAT BLUE BAR REPRESENTS HOW MUCH MONEY PROPOSITION 55 GENERATES FOR THE STATE OF CALIFORNIA. 
          SO YOU CAN SEE HERE IN 24, 25, IT'S ALMOST $15 BILLION. 
          PROPOSITION 55 BRINGS IN, UM, IN 25, 26, IT'S ALMOST $12 BILLION. 
          AND THEN IT'S ESTIMATED IN 26, 27 THAT IT'S GONNA DRAW ANOTHER $11 BILLION. 
          THE LINE ACROSS THE LOWER PARTS OF THAT BAR, THAT'S PROPOSITION 98. 
          THAT'S EDUCATION FUNDING. 
          UM, AS IT RELATES TO THE BIG THREE TAXES, THE REASON WHY WE'RE STARTING TO SHOW THIS SLIDE IS BECAUSE THE BLUE, THE LIGHT BLUE PARTS OF THE BARS ARE GOING TO GO AWAY WITHOUT VOTER ACTION IN THE, IN 2030. 
          AND PEOPLE ARE STARTING TO PAY ATTENTION TO THIS BECAUSE IT CONSTITUTES A PRETTY SIZABLE PERCENTAGE OF THE REVENUES THAT WE ALL RELY ON, NOT JUST FOR THE STATE JOURNAL FUND, BUT ALSO FOR PROPOSITION 98, BECAUSE THAT LIGHT BLUE PART OF THAT BAR GETS DEPOSITED INTO AN ACCOUNT, A RESTRICTED ACCOUNT THAT WE CALL THE EDUCATION PROTECTION ACCOUNT. 
          AND THAT GOES TO ALL OF US, INCLUDING ALL OF YOU, IN, IN THIS ROOM. 
          AND SO VOTERS DON'T, IF THE VOTERS LET PROPOSITION 55 EXPIRE IN 2030, THAT'S GONNA CREATE A BIG HOLE IN THE STATE BUDGET OF, AS YOU CAN SEE, ANYWHERE FROM 10 TO $12 BILLION A YEAR ANNUALLY, IS WHAT THAT IS. 
          SO THE STATE'S LOOKING DOWN AT THIS AT, YOU KNOW, AT THE POTENTIAL OF THIS HAPPENING, THERE'S A LOT OF US IN EDUCATION IN ON, YOU KNOW, THE MANAGEMENT SIDE AS WELL AS ON THE LABOR SIDE, REALLY STARTING TO PAY ATTENTION TO THIS BECAUSE WE KNOW THAT WE RELY SO HEAVILY ON THIS. 
          AND THEN LASTLY, AS, AS JOHN, UM, NOTED IN HIS OPENING SLIDES, WE TALK ABOUT SOME RISKS, UM, THAT WE SEE TO THE STATE BUDGET. 
          IF YOU CAN MOVE TO THE NEXT SLIDE. 
          THANK YOU. 
          SO THE RISKS THAT WE SEE, UM, TO THE MAY RE, YOU KNOW, THE MAY REVISION IS THAT, UM, FOR, PARTICULARLY FOR EDUCATION, THE CONSTITUTION REQUIRES THE STATE OF CALIFORNIA TO FULLY DEPLETE THE EDUCATION RAINY DAY FUND. 
          UM, IT'S A, THE, THE GOVERNOR'S MAY REVISION TAKE, TAKES A WITHDRAWAL OF $540 MILLION, AND HE USES THOSE DOLLARS TO BUOY THE LOCAL CONTROL FUNDING FORMULA TO, SO THAT WE CAN FULLY PAY FOR THE COST OF THE LOCAL CONTROL FUNDING FORMULA IN 25 26, AS WELL AS ON THE CA UH, THE COMMUNITY COLLEGE SIDE, THEIR VERSION OF THE LOCAL CONTROL FUNDING FORMULA. 
          SO, BA BASICALLY WHAT THAT MEANS IS IF, IF THE ECONOMY OR ECONOMIC CONDITIONS OR OUR STATE GENERAL FUND CONDITIONS WORSEN, WE, WE WILL NOT HAVE AN EDUCATION RESERVE ACCOUNT TO DIP INTO. 
          SO THE, IF THE STATE, IF THE CONDITIONS WORSEN, THE STATE IS GOING TO HAVE TO CONSIDER OTHER WAYS TO PLUG A HOLE. 
          WE DON'T, WE WON'T HAVE THAT ANYMORE. 
          THE OTHER THING THAT WE NOTED IN GOVERNOR NEWSOM'S MAY REVISION IS THAT, AS JOHN SAID, WHILE HE DESCRIBES THAT THIS GROWTH RECESSION, HIS MAY REVISION DOES NOT ASSUME AN ECONOMIC DOWNTURN, IT DOES NOT ASSUME AN ECONOMIC, UM, CONTRACTION. 
          AND THEN THE GOVERNOR HIMSELF HIGHLIGHTED THE RISKS THAT ARE INCLUDED IN THE ASSUMPTIONS THAT HE USED TO BUILD HIS MAY REVISION. 
          THOSE RISKS BEING THAT LARGER MACROECONOMIC TRENDS, UM, AND PARTICULARLY THE, UM, UH, ECONOMIC CONDITIONS THAT ARE BEING SPAWNED BY FEDERAL CHANGES IN FEDERAL POLICY, SPECIFICALLY CALIFORNIA, OUR LAWMAKERS ARE REALLY, REALLY WORRIED ABOUT ANY CHANGES THAT OUR FEDERAL GOVERNMENT COULD MAKE TO MEDICARE AND MEDICAID. 
          AND THE REASON WHY THEY'RE WORRIED ABOUT THAT IS BECAUSE CALIFORNIA, THIS YEAR, WE SPENT $178 BILLION ON MEDI-CAL ALONE. 
          LET ME JUST SAY THAT AGAIN. 
          [00:30:01]
$178 BILLION ON MEDI-CAL PROPOSITION 98 FOR COMPARATIVE PURPOSES, WE'RE AT ABOUT $120 BILLION IN EDUCATION FUNDING. 
          SO MEDI-CAL COSTS EXCEED PROPOSITION NINETY EIGHT, A HUNDRED AND SEVENTY $8 BILLION EXPENSE. 
          WE GET OVER A HUNDRED MILLION DOLLARS BILLION DOLLARS, EXCUSE ME, FROM THE FEDERAL GOVERNMENT TO PAY FOR MEDI-CAL. 
          IF THERE ARE ANY CHANGES TO FEDERAL MEDI-CAL MEDICARE AND MEDICAID POLICIES, THAT COULD HAVE A TRICKLE DOWN EFFECT ON OUR STATE GENERAL FUND, IN WHICH CASE, WE ARE NOT IN ANY BUDGET POSITION TO ABSORB THOSE CHANGES, UH, MADE BY THE FEDERAL GOVERNMENT. 
          WE ALL HAVE SEEN IN THE NEWS, I'M SURE YOU, IT'S UNAVOIDABLE, ESPECIALLY HERE IN LOS ANGELES WITH, YOU KNOW, ONE OF THE NATION'S LARGEST PORT UH, PORTS. 
          UM, THE EFFECT OF, UH, UM, PRESIDENT TRUMP'S, UM, PROPOSED TRADE POLICIES AND TARIFFS WE'RE SEEING THAT HAVE A RIPPLING EFFECT ON THE ECONOMY. 
          WE'RE NOT QUITE SURE HOW THIS IS ALL GONNA SHAKE OUT, AND THE DUST IS GONNA SETTLE AROUND THESE TARIFF POLICIES. 
          BUT BECAUSE CALIFORNIA IS THE FOURTH LARGEST ECONOMY IN THE WORLD, THIS AFFECTS THESE TRADE POLICIES. 
          AND THESE TARIFF POLICIES AFFECT CALIFORNIA DISPROPORTIONATELY RELATIVE TO THE, OUR OTHER 49 FRIENDS, UM, AND STATES, UM, IN, IN THE NATION. 
          AND FINALLY, OF COURSE, UM, UM, FEDERAL CHANGES TO IMMIGRATION POLICY. 
          CALIFORNIA'S LOW-SKILLED, UM, INDUSTRIES AND OUR FARMING INDUSTRIES, WHICH ARE IN MANY WAYS THE BEDROCK OF OUR STATE ECONOMY. 
          WE RELY SO HEAVILY ON OUR IMMIGRANT COMMUNITIES, AND THAT COULD HAVE AN EFFECT ON OUR JOBS MARKET. 
          AS JOHN NOTED EARLIER IN HIS SLIDE, IT COULD CAUSE SOME CONTRACTION IN OUR JOB MARKET, AND IT REALLY COULD LEAD TO A CONTRACTION IN OUR OVERALL ECONOMY, AS WE DON'T, OR AS WE'RE UNABLE, UH, TO CONTINUE TO PRODUCE AT THE LEVELS THAT WE'RE, UM, PRODUCING AT ALL, IN ALL IS THAT WE SEE THESE RISKS ON THE HORIZON, AND NONE OF THESE RISKS ARE INCLUDED IN THE GOVERNOR'S BUDGET. 
          THE GOVERNOR'S MAY REVISION. 
          SO IF ANY OF THESE SHOULD MATERIALIZE, THE QUESTION IS WHAT CONDITION ARE WE IN IN THE, AT THE STATE OF CALIFORNIA TO BE ABLE TO ABSORB ANY ECONOMIC SHOCKS, UM, TO OUR SYSTEM? AND I, I THINK AS NOTED IN THE GOVERNOR'S MAYOR REVISION, THE STATE BUDGET IS NOT IN A CONDITION TO ABSORB SHOCKS. 
          AND SO I DON'T FOR, YOU KNOW, AS IT RELATES TO PUBLIC EDUCATION, UM, WE, YOU KNOW, ONE, WE'RE SEEING THE YEAR OVER YEAR GROWTH PRETTY FLAT, UM, IN PROPOSITION 98 FUNDING. 
          AND OUR, IF THE, IF WE WERE TO EXPERIENCE NEED A NEED, A DEEP NEED IN EDUCATION, THE STATE BUDGET IS NOT IN A CONDITION TO HELP US OUT ON THE EDUCATION SIDE OF THE BUDGET. 
          SO I KNOW, I, I DIDN'T, I DON'T MEAN TO BE GLOOM AND  DOOM, UH, MORE THAN IT IS JUST TO SHARE WITH YOU ALL SOME OF THE, UH, TAKE THE BIG TAKEAWAYS THAT WE SEE FROM THE MAY REVISION. 
          I'LL PASS IT BACK TO JOHN BRADY. 
          ANY CLOSING REMARKS? AND, UH, I WOULD JUST CONCLUDE, WE, WE DO APPLAUD THE GOVERNOR FOR PROPOSING WHAT HE DID. 
          UM, UH, PRETTY MUCH TRYING TO STAY TO HIS JANUARY PROPOSAL, BUT HE HAD TO DO SOME FINANCIAL GYMNASTICS. 
          AND I THINK IF THERE'S ANY RISK, UNFORTUNATELY IT'S PROBABLY DOWNSIDE RISK. 
          UM, AND SO, AS I SAID, I SPEND A LOT OF MY TIME IN DISTRICTS, AND SO THESE MEETINGS LIKE THIS ARE HAPPENING ALL OVER THE STATE OF CALIFORNIA. 
          UM, YOU'RE VERY FORTUNATE TO HAVE, UH, A, A A A SOUND FUND BALANCE. 
          NOT ALL OF YOUR, UH, NOT ALL DISTRICTS ARE IN THE SAME POSITION THAN YOU ARE, AND SO THEY'RE HAVING TO ACT LIKE THIS YEAR ALREADY EXECUTING, UH, JOB REDUCTIONS. 
          UNFORTUNATELY, SOME DISTRICTS ARE HAVING TO CLOSE SCHOOLS. 
          THAT'S ABOUT THE HARDEST THING YOU CAN DO. 
          SO, UM, IF, IF THERE'S ANY POSITIVE MESSAGE, UH, UM, YOUR PAST BEHAVIOR AND HOW YOU'VE MANAGEMENT HAVE PREPARED YOU TO ADDRESS WHAT'S COMING BETTER THAN A LOT OF DISTRICTS THAT WE'RE WORKING WITH. 
          BUT THESE CONVERSATIONS ARE STATEWIDE AND THESE TOUGH DISCUSSIONS, UH, UH, ARE ONGOING. 
          SO WE WANTED TO STAY WITHIN OUR TIME AND WE'RE HAPPY TO TAKE ANY QUESTIONS YOU MAY HAVE. 
          SO THAT WAS VERY UPLIFTING, PATTY. 
          GOOD JOB, . 
          HI. 
          UM, YES, VERY GLOOMY INDEED, ALTHOUGH NOT NECESSARILY UNEXPECTED. 
          UM, I WAS WONDERING IF YOU MIGHT BE ABLE TO SPEAK TO WHAT ARE THE IMPACTS OF THE GOVERNOR UTILIZING, UH, TACTIC LIKE DEFERRALS? DOES THAT HAVE ANY, UM, TANGIBLE IMPACT ON, ON SCHOOL DISTRICTS? IMMEDIATELY FOR THE IMMEDIATE TERM, DEFERRALS ARE HIS WAY OF HELPING TO REALLY KEEP, UH, EDUCATION FUNDING REALLY AT THE LOCAL LEVEL HARMLESS, RIGHT? BECAUSE IF HE WERE NOT TO INSTITUTE THE ONE POINT, IT'S A TOTAL OF 
          [00:35:01]
$1.8 BILLION ON THE K 12 SIDE OF, OF DEFERRALS, UM, HE WOULD HAVE TO MAKE THOSE THROUGH CUTS, YOU KNOW, IN THE, IN THE EDUCATION BUDGET, SO AS TO RECOGNIZE THE DEVASTATING IMPACT THAT ESPECIALLY CUTS AT THIS POINT WOULD HAVE ON LOCAL DISTRICTS. 
          THE GOVERNOR IS USING REALLY AN OLD BUDGET TOOL THAT WE SAW USED QUITE FREQUENTLY DURING THE GREAT RECESSION, UM, OF, OF DEFERRALS. 
          WHAT THAT MEANS IS WE'RE JUST PUSHING THE OBLIGATION IN THE OUT YEARS. 
          THEY USUALLY, THE STATE OF CALIFORNIA HOPES THAT THE PROPOSITION 98 MINIMUM GUARANTEE GROWS ENOUGH TO ACTUALLY RETIRE THE, THAT DEBT. 
          UM, AND, BUT IT COULD VERY WELL BE JUST GIVEN THAT YEAR OVER YEAR GROWTH IN THAT CHART THAT I WAS SHOWING YOU, WE MIGHT BE LIVING WITH DEFERRALS FOR THE NEXT 2, 3, 4 YEARS. 
          AND IF, LET'S JUST SAY IN 26, 27 COLA IS 3%, AND THE MINIMUM GUARANTEE IS NOT ENOUGH TO COVER THE COST OF THAT COLA, UM, THEY MAY ACTUALLY INCREASE THAT DEBT, INCREASE THE AMOUNT OF DEFERRALS. 
          UM, SO AS TO AVOID, BUT, BUT, UM, OUR FRIENDS AT THE LEGISLATIVE ANALYST'S OFFICE, THEY REALLY CAUTION AGAINST RELYING ON THAT BUDGET TOOL BECAUSE YOU'RE JUST PUSH AT, AT SOME, SOME POINT IN THE FUTURE, YOU'RE GONNA HAVE TO PAY OFF THAT DEBT. 
          AND, UM, SO THEY, THEY COULD USE THAT, BUT, BUT IT DOES ABSOLUTELY HAVE, UM, A BUDGET IMPACT, UM, ON PROPOSITION 98, BUT RECOGNIZING IT'S A TOOL THAT THE STATE OF CALIFORNIA USES SO AS TO AVOID LOCAL CUTS, YEAH, YOU WILL HAVE TO DEAL WITH THE CASH FLOW IMPLICATIONS. 
          IT'S NOT FOR A VERY LONG TIME, BUT YOUR BUSINESS STAFF ARE GONNA HAVE TO MONITOR CASH. 
          UM, DURING THE GREAT RECESSION, THE DEFERRALS WERE SO HUGE, IT WOULD WIPE OUT ENTIRE FUND BALANCES AND YOU'D HAVE TO GO OUT IN THE MARKET AND BORROW CASH. 
          BUT THIS IS JUST A ONE MONTH DEFERRAL. 
          SO, BUT IT IS A CASH FLOW ISSUE. 
          THANK YOU. 
          UM, AND THEN I KNOW OVER THE PAST BUDGET CYCLE, THERE HAVE SOMETIMES BEEN, UM, LIKE NOT EQUAL REVENUE ESTIMATES OR DEFICIT ESTIMATES FROM THE GOVERNOR'S OFFICE VERSUS WHAT THE LAO HAS HAS PUT OUT. 
          IS IT POSSIBLE THAT WHAT THE GOVERNOR'S RELYING ON IS, BESIDES THE, IT DOESN'T PLAN FOR A RECESSION, WE DON'T KNOW THE IMPACTS OF FEDERAL, UH, DECISION MAKING. 
          IS IT POSSIBLE THAT THAT IS A, A ROSIER PICTURE THAN, UM, OTHER STATE ENTITIES ARE ESTIMATING IN TERMS OF THE REVENUE, THE GOVERNOR'S, UH, MAY REVISION ESTIMATES? UM, REVENUE ESTIMATES ARE ACTUALLY, UH, BLEECKER THAN THE LEGISLATIVE ANALYST OFFICE. 
          THE LEGISLATIVE ANALYST OFFICE ACTUALLY RELEASED AHEAD OF IN, INTERESTINGLY ENOUGH, I CALLED MY, MY BUDDY AT THE LAO AND I WAS LIKE, YOU GUYS DON'T USUALLY DO THIS , YOU USUALLY WAIT UNTIL THE GOVERNOR ISSUES HIS MAY REVISION. 
          HE'S LIKE, YEAH, BUT WE THOUGHT IT WAS, IT'D BE REALLY IMPORTANT BECAUSE OF THE EFFECT ON PROPOSITION 98 PEOPLE WERE, YOU GUYS HAVE BEEN READING IN THE NEWS THAT RIGHT, STATE REVENUES ARE OUTPERFORMING GOVERNOR'S BUDGET ESTIMATES, BUT IT ACTUALLY HAD A NEGATIVE EFFECT ON PROPOSITION 98. 
          AND IT'S THIS REALLY WEIRD TECHNICAL THING CALLED THE MAINTENANCE FACTOR. 
          BUT HAPPY TO, HAPPY TO DIVE DEEP IN THAT IF YOU WOULD LIKE ME TO. 
          BUT, UM, AND SO THEY FELT THAT IT WAS IMPORTANT, AND WHEN THE LAO CAME OUT WITH THEIR REVENUE ESTIMATES ON MAY 7TH, THEY ACTUALLY CAME IN, UM, MORE OPTIMISTIC THAN WHAT THE GOVERNOR CAME OUT WITH, UM, A WEEK LATER. 
          OKAY. 
          THANK YOU. 
          UM, AND THEN MY LESSON, SORRY, I KNOW OTHERS ARE MAYBE WAITING, UM, WITH REGARD TO THE POTENTIAL EFFECTS OF THE, UH, MEDICARE AND MEDICAID CONVERSATION AT THE FEDERAL LEVEL, WHICH I KNOW IS HAPPENING IN, IN REAL TIME, UH, WHEN THE GOVERNOR RELEASED THE MAY REVISE, DID HE SPEAK AT ALL ABOUT, UM, YOU KNOW, CONTINGENCY PLANNING THAT THE STATE MAY BE DOING IN TERMS OF HOW WE WOULD FILL ANY GAPS SHOULD THOSE CUTS MATERIALIZE? I CAN'T TELL YOU WHAT HE SPOKE TO BECAUSE I WAS REALLY BUSY  WHEN THE GOVERNOR, THE GOVERNOR WENT ON FOR LIKE FOUR HOURS ON IT DURING HIS PRESS CONFERENCE. 
          BUT I CAN TELL YOU INCLUDED IN THE MAY REVISION IS DES, SOMEBODY DESCRIBED HIS MEDI-CAL, UH, PROPOSALS AS A SLASH AND BURN. 
          SO ALREADY IN THE MAY REVISION, THE GOVERNOR IS INSTITUTING CHANGES TO THE MEDI-CAL PROGRAM TO REDUCE CALIFORNIA'S RISK EXPOSURE IN THE LONG TERM. 
          UM, PART OF IT IS, UM, CAPPING PARTICIPATION FOR UNDOCUMENTED IMMIGRANTS. 
          THAT'S BEEN A BIG, A BIG ONE. 
          UM, A WORK PROVISION, UH, RELATED TO MEDI-CAL, UM, ELIGIBILITY AS WELL AS OTHER THINGS. 
          BUT THE WAY THAT THIS PERSON HAD DESCRIBED IT TO ME WAS BASICALLY, UM, ALL THE, IN TO THEIR VIEW IMPROVEMENTS IN THE MEDI-CAL PROGRAM THAT HAVE BEEN MADE OVER, YOU KNOW, THE LAST 12 YEARS HAVE BEEN COMPLETELY UNDONE IN THE MAY REVISION. 
          THANK YOU. 
          UM, WHAT, UH, TWO QUESTIONS. 
          ONE, I GUESS WHAT HAPPENED TO THE, UM, I'VE SEEN 1.3 BILLION, 1.7 BILLION, LIKE THE PROP 98 HOLDBACK, UM, AND WHAT'S GOING ON 
          [00:40:01]
THERE, AND IF THERE'S BEEN A CHANGE SINCE JANUARY, AND THEN OUTSIDE OF, UM, PROP 98, 1 OF THE THINGS WE'VE BEEN HEARING ABOUT IS ELLP MONEY THAT'S BEEN SWEPT UP BY DISTRICTS THAT HAVEN'T USED IT AND GIVEN TO DISTRICTS THAT ARE USING IT, AND ALSO THE CHILDREN AND YOUTH BEHAVIORAL HEALTH INITIATIVE AND OTHER LIKE NON-PRO 98 SOURCES OF STATE FUNDING THAT DISTRICTS LIKE OURS CAN TAP INTO. 
          AND I'M JUST CURIOUS IF YOU CAN SHED LIGHT ON ANY OF THOSE KIND OF ADDITIONAL SOURCES. 
          OKAY. 
          SO WITH RESPECT TO THE GOVERNOR'S PROPOSAL TO DELAY, UM, APPROPRIATING, UM, FUNDING PROPOSITION 98 FUNDING FOR SCHOOL DISTRICTS IN THE CURRENT YEAR 24 25, IT'S IMPORTANT TO RECOGNIZE THAT THIS IS A 24, 25 PROPOSITION 98 ISSUE, AND THE GOVERNOR'S JANUARY BUDGET WAS PROPOSING TO WITHHOLD $1.7 BILLION OR $1.6 BILLION, UM, FROM SENDING IT OUT TO ALL OF, ALL OF US, UM, HERE IN, IN THIS ROOM. 
          AND, UH, AND OUR THOU 999 COLLEAGUES ACROSS THE STATE OF CALIFORNIA, WE DID SEE A REDUCTION IN THE MAY REVISION DOWN TO A WITHHOLD OF $1.3 BILLION. 
          BUT IT'S IMPORTANT TO KNOW THAT THAT IS JUST MATH. 
          THAT'S BECAUSE THE GUARANTEE DROPPED BY 0.3 BI $3 MILLION, UH, OR 3.3 BILLION, $300 MILLION. 
          AND BECAUSE THE PROPOSITION 98 ESTIMATE DROPPED BY $300 MILLION, THEN THE DELTA BETWEEN WHAT HE'S WITHHOLDING AND THE MINIMUM GUARANTEE DROPS, BASICALLY, LEMME JUST PUT IT IN LAY TERMS. THE GOVERNOR IS PROPOSING TO APPROPRIATE $117.2 BILLION IN JANUARY. 
          HE THOUGHT THAT THE GUARANTEE WAS GONNA BE 119.8 IN MAY. 
          IT'S ACTUALLY 108, 118 POINT, I DUNNO, $3 BILLION OR $3 BILLION, RIGHT? SO BECAUSE OF THAT REDU, THE, THE AMOUNT THAT HE'S PROPOSING TO APPROPRIATE OUT HASN'T CHANGED SINCE JANUARY. 
          IT'S JUST THE DELTA BETWEEN WHAT IS THE CONSTITUTIONAL MINIMUM AND HOW MUCH I'M GONNA, I'M GONNA, UM, SEND OUT TO SCHOOL DISTRICTS. 
          I WILL TELL YOU, SO WE DID, WE DID A LITTLE BIT OF MATH AS JOHN MENTIONED. 
          WE HAVE A, A LITTLE WORKSHOP TO GIVE ON ON WEDNESDAY WITH OUR 200 SLIDES, AND WE DID A LITTLE BIT OF MATH ON THIS. 
          AND IF THE GOVERNOR WERE TO APPROPRIATE THE 103 BILLION, THE $103 BILLION OUT, UM, TO K 12 SCHOOL DISTRICTS BASED ON THEIR SHARE, IT'S ABOUT $214 PER KID. 
          AND THAT'S JUST ASSUMING THAT IT WOULD GO OUT ON EQUAL ON A PER 80 DA BASIS. 
          UM, SO I MEAN, THAT'S A, IT'S A SIZABLE FROM A LOW, FROM A STATE PERSPECTIVE, WITHHOLDING $1.3 BILLION IS PRETTY SIGNIFICANT. 
          WE'VE NEVER SEEN THIS BEFORE. 
          JOHN GRAY CREATED A TERM FOR IT. 
          HE CALLS IT PSYCHIC SETTLE UP. 
          IT'S A PROP 98 JOKE. 
          I'M SORRY. 
          UM,  ONLY JOHN LAUGHS IT AT, AT IT . 
          UM, UM, WE'VE NEVER SEEN, UH, WE'VE NEVER SEEN ANYTHING LIKE THIS, A PROPOSAL LIKE IT. 
          SO IT IS SIGNIFICANT, BUT EVEN WHEN YOU, WHEN YOU, WHEN YOU TAKE WHAT IT COULD MEAN IN TERMS OF LOCAL RESOURCES, LIKE REALLY LIKE OPERATIONALIZING LOCAL RESOURCES AT $214 MILLION PER A DA OR $214 PER A DA, THAT COULD BE PRETTY SIZABLE. 
          OH, ELOP. 
          SO THE RECAPTURED FUNDS UN OF UNUSED FUNDS, THAT WAS PART OF THE 2024 ENACTED BUDGET AGREEMENT. 
          SO THAT WAS A, THAT WAS AN AGREEMENT THAT WAS LU USED LAST JUNE. 
          AND THAT BASICALLY THE STATE OF CALIFORNIA ENACTED A POLICY THAT SAID, IF YOU DON'T SPEND ALL OF YOUR ELOP FUNDS, THEN YOU, YOU REPORT YOUR UNENDED FUNDS TO THE CALIFORNIA DEPARTMENT OF EDUCATION. 
          UH, TONY THURMAN AND HIS TEAM, UM, GO OUT AND THEY COLLECT ALL THE UNENDED FUNDS, AND THEN THEY REDISTRIBUTE THOSE FUNDS FOR WHAT WE CALL RATE TWO DISTRICTS. 
          SO, SO THEIR DISTRICTS, UNLIKE YOURS, THEIR DISTRICTS WHOSE UNDUPLICATED PUPIL PERCENTAGES ARE BELOW 75% OF, UM, UM, HIGH NEED STUDENTS. 
          AND THEN IT GOES OUT TO THOSE DISTRICTS ON A PER, UH, THROUGHOUT, OUT THROUGH THEIR ALLOCATION FORMULA. 
          AND THAT'S JUST BECAUSE THEY HAVE BEEN HEARING FROM RATE TWO DISTRICTS THAT YEAR OVER YEAR, THEIR PER PUPIL ELOP FUNDING HAS ACTUALLY REDUCED. 
          AND SO THEY'VE DONE NOTHING DIFFERENT. 
          THEY'VE NOT CUT THEIR PROGRAMS, AND IN FACT, MAYBE THEY'VE EVEN EXPANDED OFFERINGS, UM, TO THEIR STUDENTS. 
          AND YET ON YEAR OVER YEAR REVENUE IN ELOP HAS DIMINISHED. 
          BECAUSE, BECAUSE HERE'S THE THING, THE WAY THAT THE ELOP UH, PROGRAM WORKS IS ANY DISTRICT ABOVE 75% UPP, YOU GET A GUARANTEED PER PUPIL AMOUNT. 
          BUT THE STATE OF CALIFORNIA ONLY, THEY, THEY SAID, HERE'S YOUR 10 BUCKS. 
          WE'RE GONNA 10 BUCKS IS GONNA FUND ALL OF CALIFORNIA. 
          HERE'S THE TIER ONE DISTRICTS, YOU KNOW, WHATEVER. 
          THEY DON'T TAKE, WHATEVER THE REST OF THAT PIE IS, THEN WE'LL DISTRIBUTE IT TO RATE TWO. 
          SO THAT'S WHY THE, THAT'S WHY THE AUDIT DOLLAR FOR DOLLAR BASIS ON A PER PUPIL BASIS, THAT POT HAS BEEN DIMINISHING FOR RATE TWO. 
          THEY'VE HEARD THIS LOUD AND CLEAR, THEY'RE WORRIED ABOUT THOSE DISTRICTS BECAUSE THOSE DISTRICTS COULD START CLOSING PROGRAMS. THEY COULD START SAYING, I CAN'T, THIS IS NOT SUSTAINABLE FOR ME. 
          AND SO THEY MADE THAT DECISION LAST YEAR. 
          THE GOVERNOR'S MAY REVISION, AND I KNOW CHRIS AND HIS TEAM, UM, WILL COVER 
          [00:45:01]
THIS FOR YOU AS WELL IN THE JANUARY BUDGET. 
          UM, AND IT, IT'S EXTENDED INTO THE MAY REVISION, BUT AT A HIGHER ESTIMATED COST. 
          'CAUSE I THINK THE, UM, THE DEPARTMENT OF FINANCE UNDERESTIMATED THE COST OF THIS PROPOSAL WAS TO EXPAND WHAT WE CALL UNIVERSAL ELOP. 
          YOU GUYS ARE A DISTRICT THAT HAS TO OFFER UNIVERSAL EXPANDED LEARNING OPPORTUNITY PROGRAMS RIGHT? TO ALL OF YOUR T TK THROUGH SIX GRADE STUDENTS. 
          IT DOESN'T MATTER IF THEY'RE NOT LOW INCOME, IF THEY'RE NOT ENGLISH LEARNER, YOU HAVE TO OFFER IT TO THEM. 
          ANY DISTRICT BELOW 75%, THEY DIDN'T HAVE THE UNIVERSAL REQUIREMENT. 
          THEY ONLY HAD TO OFFER IT TO THEIR HIGH NEEDS STUDENTS. 
          WHAT THE GOVERNOR'S PROPOSAL SAYS IS NOW WHAT WE WANNA DO IS WE WANT TO MOVE, EXPAND UNIVERSAL BY, UM, BY CUTTING, CUTTING OFF THE ELIGIBILITY REQUIREMENT AT 55% IN 70 INSTEAD OF 75% UPP, THAT COMES AT A COST OF $515 MILLION PER THE, PER THE MAY REVISION. 
          UM, AND SO THE ELOP PROGRAM WOULD GO, WOULD GROW FROM A $4 BILLION PROGRAM TO A $4.5 BILLION PROGRAM, BUT IMPORTANTLY, THOSE DOLLARS WILL NOT COME TO AN ALREADY RATE ONE DISTRICT LIKE YOURSELF. 
          RIGHT? UM, THO THOSE DOLLARS ARE NOT DESIGNED TO HELP YOU EXPAND YOUR UNIVERSAL OFFERINGS OR EXPAND THE OFFERINGS TO YOUR STUDENTS. 
          THOSE DOLLARS ARE INTENDED TO MOVE SOME DISTRICTS UP INTO THE UNIVERSAL PROGRAM. 
          DOES THAT MAKE SENSE? UH, IT DOES. 
          AND JUST CAN YOU TOUCH, TOUCH ON THE C-Y-B-H-I AND WHETHER THAT'S AFFECTED AT ALL BY THE PROPOSED TRUMP CUTS TO MEDICAID OR ANY OF THE, LIKE THE, THE, I THINK IT'S 4 BILLION FOR THE CALIFORNIA YOUTH BEHAVIORAL INITIATIVE. 
          UNFORTUNATELY, I'M NOT IN A POSITION TO ANSWER THAT. 
          I DON'T KNOW IF JOHN, YOU ARE, WE'RE HAPPY TO GET BACK TO YOU ON THAT. 
          GREAT. 
          THANK YOU. 
          GREAT. 
          WELL, WE REALLY APPRECIATE YOU COMING, SHARING THE PERSPECTIVE. 
          OKAY. 
          WE APPRECIATE. 
          ALL RIGHT FOLKS, WE'RE JUST GOING TO, UH, TEE UP THE NEXT PRESENTATION AND GET STARTED. 
          UH, THERE ARE PAPER COPIES CIRCULATING. 
          UH, THERE ARE ELECTRONIC AVAILABLE, UH, AFTER THE FACT. 
          UH, THERE WE GO. 
          IT'S ALREADY READY TO GO. 
          UH, SO THE BUDGET WORKSHOP IS GOING TO, WHOOPS, GIVE YOU A MINUTE. 
          OKAY. 
          WE ARE GOING TO FOCUS PRIMARILY TODAY, UH, ON ILLUSTRATING SOME POINTS, UH, THAT OUR INTERIM PRESENTATIONS DON'T NECESSARILY ALWAYS FOCUS ON. 
          UH, THAT IS GOING TO BE, UH, SOME OF THE REASONS FOR OUR DEFICIT, UH, A LITTLE BIT ABOUT THE DIFFERENCE BETWEEN A STRUCTURAL DEFICIT FUND BALANCES OR CARRY FORWARD, UH, AS WELL AS OUR NET POSITION AS YOU SEE IT GO OUT IN THE MULTI-YEAR PROJECTION. 
          AND I THINK WE'RE OKAY TO START. 
          SO, UH, THE AGENDA FOR TODAY, UH, WE'RE GONNA VERY BRIEFLY GO OVER, UH, THE MAY REVISION. 
          THE MAJORITY OF THAT WAS ALREADY DONE. 
          WE DO HAVE THE SUMMARY IN A BULLET POINT FORMAT, UH, THAT THAT'S BEEN SHARED SO THAT FOLKS HAVE AN OPPORTUNITY TO SEE IT IN ONE PLACE. 
          ALTHOUGH IT IS A BUSY SLIDE, WE KNOW THAT, UH, WE'RE GONNA BE LOOKING AT INSIGHTS LEADING INTO OUR BUDGET PRESENTATION FOR BUDGET ADOPTION, OF COURSE, BUDGET ADOPTION, THE HEARING WILL BE ON JUNE 17TH. 
          AND ON THE, UH, 24TH WILL BE THE ACTUAL VOTE. 
          UH, WE WILL BE LOOKING AT THE LATEST MULTI-YEAR PROJECTION. 
          NOW, THIS LATEST MULTI-YEAR PROJECTION EXCLUDES ANY HEALTHCARE VARIANCES, WHICH MEANS INCREASED COST TO, TO PROVIDING HEALTHCARE IN THE FUTURE, AS WELL AS ANY BARGAINING UNIT AGREEMENTS. 
          BECAUSE WE HAVE NOT SETTLED ON ANY, WE CANNOT INCLUDE THE COST OF MULTI-YEAR AGREEMENTS IN THE MULTI-YEAR PROJECTION UNTIL THEY'RE ACTUALLY VOTED ON AND APPROVED. 
          AND THEN THERE'LL BE TIME FOR DISCUSSION AND ASKING QUESTIONS. 
          UH, SOMETHING TO KEEP IN MIND AS, AS YOU'RE LOOKING AT ALL THIS, NOTICE THAT WHAT I'M SAYING IS FOR THE FISCAL YEAR 26 ADOPTION, THIS IS THE FIRST TIME THAT WE'VE DONE THIS IN THIS DISTRICT. 
          BUT TODAY'S NUMBERS ARE DRAFT PREVIEW OF WHAT YOU'LL ACTUALLY BE RECEIVING THE HEARING AND VOTING ON NEXT MONTH. 
          SO THEY WILL CHANGE AS WE CONTINUE TO DEVELOP THE BUDGET, BUT THEY'RE PRETTY SOLID. 
          SO THEY MAY REVISE, UH, WHAT JOHN AND PATTY WERE JUST ILLUSTRATING FOR US. 
          UH, COLE IS NOW DOWN TO 2.3% INSTEAD OF THE 2.43. 
          THAT WAS WHAT WAS UH, ANNOUNCED IN JANUARY. 
          UH, THE PROP 98 GUARANTEE IS $1.3 BILLION LESS IN ORDER TO NOT OVER APPROPRIATE. 
          IT EXHAUSTS THE PROP 98 
          [00:50:01]
RESERVE. 
          THERE'S A $1.8 BILLION DEFERRAL FOR OUR PAYMENTS FROM JUNE TO JULY. 
          THAT WAS MENTIONED BRIEFLY, UH, BY BOTH PATTY AND JOHN. 
          WHAT DOES THAT MEAN? THAT MEANS THE MONEY WE GET TO RUN THE SCHOOL DISTRICT FOR NEXT JUNE, WE WILL NOT RECEIVE IN JUNE. 
          WE WILL NOT RECEIVE THAT MONEY UNTIL JULY. 
          SO IN DELAYING OUR APPORTIONMENT FOR THAT MONTH, THEY SAVED THEMSELVES A LITTLE BIT OF MONEY. 
          THEY DELAY IT, THEY STILL GIVE IT TO US. 
          THAT'S WHEN CASH MANAGEMENT BECOMES REALLY IMPORTANT BECAUSE AS YOU'LL NOTICE FROM TODAY'S PRESENTATION, OUR CASH BALANCES WILL BE FAIRLY LOW AT THAT TIME. 
          SO CASH MANAGEMENT IS GOING TO BE IMPORTANT. 
          UH, IT REDUCES STUDENT SUPPORT AND PROFESSIONAL DIS UH, DEVELOPMENT DISCRETIONARY BLOCK GRANT TO 1.7 BILLION INCREASED ELOP BY 515 MILLION. 
          BUT YOU HEARD WE ARE NOT GETTING ANY OF THAT 200,000,001 TIME FOR PD FOR EVIDENCE-BASED READING FOR ELEMENTARY SCHOOLS AND 100,000,001 TIME FOR STIPENDS FOR STUDENT TEACHERS, 90 MILLION IN ADDITIONAL ONGOING FUNDS FOR UNIVERSAL SCHOOL MEALS AND A REDUCTION OF UNSPENT SCHOOL FACILITIES FUNDS, UH, FROM THE GENERAL FUND. 
          UH, SO LARGELY WHAT YOU'RE HEARING THERE AND WHAT YOU'VE HEARD IN MORE DETAIL, UH, ALREADY, IS THAT WE ARE NOT GOING TO BE GETTING MORE NEXT YEAR. 
          IN FACT, UH, OUR REVENUES ARE GOING TO STABILIZE AND WE'RE GONNA GO BE GOING THROUGH A VERY LOW GROWTH PERIOD. 
          YOU COUPLE THAT WITH OUR DECLINING ENROLLMENT, THAT MEANS LESS REVENUE PER SCHOOL YEAR. 
          THIS IS AN INTERESTING SLIDE. 
          FIRST TIME THAT WE'VE, THAT WE'VE PROVIDED THIS, THIS IS AN INTERESTING LOOK THAT ILLUSTRATES SOMETHING SPECIAL THAT WAS HAPPENING DURING COVID. 
          THIS IS A COMPENSATION VERSUS REVENUE. 
          BY THE WAY, THIS IS ALL OPERATING FUNDS OF THE SCHOOL DISTRICT, NOT CAPITAL FUNDS THAT THE MONEY THAT WE USE TO BUILD BUILDINGS OR MODERNIZE THEM, BUT OPERATING FUNDS. 
          SO THIS INCLUDES THINGS LIKE OUR GENERAL FUND, OUR EARLY CHILDHOOD EDUCATION, OUR NUTRITION SERVICES FUND, AS WELL AS OUR ADULT EDUCATION FUNDS. 
          WHY IS THIS CHART IMPORTANT? WELL, THE ORANGEISH REDDISH LINE UP HERE IS OUR TOTAL COMPENSATION SALARY AND BENEFITS BY YEAR, GOING BACK TO WHEN COVID STARTED IN FISCAL YEAR 20 TO PRESENT DAY. 
          AND THESE ARE ALL ACTUAL NUMBERS. 
          NEXT YEAR IS THE ONLY PROJECTED ONE UP HERE, AND IT'S PROJECTED STRAIGHT LINE BASED ON OUR CURRENT COMPENSATION. 
          NOTICE THAT AS A PORTION OF OUR REVENUES PRIOR TO COVID, 83% OF ALL OF OUR REVENUES WERE USED ON COMPENSATION. 
          WE'RE A PEOPLE BUSINESS. 
          THAT'S NOT UNUSUAL SALARY AND BENEFITS. 
          BUT LOOK WHAT HAPPENED DURING COVID. 
          COMPENSATION GOES UP, BUT WE WERE USING THE ONE TIME MONEY WE RECEIVED TO INCREASE COMPENSATION. 
          SO NOW THIS YEAR WHEN WE NO LONGER HAVE THE ADDITIONAL REVENUES, LOOK AT WHAT THAT PERCENTAGE OF OUR TOTAL REVENUE IS BEING SPENT ON COMPENSATION, WHAT HAPPENED TO IT? IT WENT FROM A PREVIOUS HIGH OF 83% TO THIS YEAR, AND THIS IS ACTUALS 91%. 
          NEXT YEAR WE'RE GOING TO BE AT 93%. 
          IT IS UNUSUAL FOR A SCHOOL DISTRICT IN CALIFORNIA TO EXCEED 85% IS CONSIDERED HIGH BECAUSE WE STILL NEED REVENUES TO PAY THE LIGHTING BILL TO PAY THE SEWER AND WATER BILL TO PAY FOR TRASH PICKUP, TO PAY FOR ALL OF THOSE SUPPLIES AND MATERIALS. 
          THIS IS JUST COMPENSATION. 
          IF A DISTRICT LOOKS AT ITS OTHER EXPENSES, OURS ARE FAR HIGHER. 
          AND THAT'S WHAT WE'RE ALSO DEFICIT SPENDING. 
          THAT IS ANOTHER WAY OF LOOKING AT IT, RIGHT? TO BE SUSTAINABLE, WE PROBABLY NEED TO GET BACK TO AS A PERCENTAGE WHAT WE WERE PRE COVID, MAYBE A PERCENTAGE OR TWO OFF. 
          85% IS STILL CONSIDERED HIGH TO SPEND ON, TOTAL ON COMPENSATION AS A PORTION OF YOUR REVENUES. 
          BUT WE HAVE TO GET BACK IN THAT DIRECTION TO BE SUSTAINABLE. 
          THIS ILLUSTRATES THE DEFICIT. 
          SO REMEMBER I SAID THAT WE WERE GONNA TALK ABOUT THE DIFFERENCE BETWEEN FUND BALANCES AND DEFICITS, AGAIN, USING THE SAME COLORS. 
          THESE ARE NOW ALL EXPENDITURES FOR THE SAME YEARS AS COMPARED TO REVENUES. 
          WHAT YOU'LL NOTICE IS THAT LAST YEAR, AND THAT WAS, REMEMBER THE LAST YEAR THAT WE SPENT OUT FEDERAL ESSER MONEY, CO MONEY. 
          LAST YEAR WAS THE LAST TIME IN THE FORESEEABLE FUTURE THAT OUR REVENUE EXCEEDS EXPENSES. 
          THIS YEAR IS A NORMAL REVENUE PICTURE. 
          FISCAL YEAR 25, THERE IS NO FEDERAL COVID MONEY IN HERE. 
          IT HAD ALL BEEN SPENT OUT. 
          AND THIS YEAR YOU CAN SEE THAT INDEED OUR 
          [00:55:01]
EXPENSES ARE FAR EXCEEDING OUR REVENUES. 
          THIS IS WHAT A DEFICIT IS ABOUT. 
          WHY IS IT STRUCTURAL? BECAUSE IN THE YEARS THAT WE'RE LOOKING FORWARD, NOTICE IT'S NOT CHANGING. 
          SO EVERY YEAR WE ARE GOING TO HAVE TO SPEND MORE THAN WHAT WE'RE TAKING IN. 
          AND JUST LIKE YOUR HOUSEHOLD INCOME, IF YOU ARE SPENDING MORE THAN YOU'RE GETTING IN, AT SOME POINT, YOU'RE GONNA SPEND THROUGH YOUR SAVINGS. 
          AND SO I WANNA ENCOURAGE ALL OF YOU TO THINK OF AS CARRY FORWARD AND FUND BALANCE AS YOUR SAVINGS. 
          THAT IS WHAT WE'RE USING TO MAKE UP THIS DIFFERENCE RIGHT NOW. 
          THE IMPACT OF SUSTAINING OUR WORKFORCE, LIKE WE SAID, WE'RE A HUMAN BUSINESS, RIGHT? EVERY SCHOOL DISTRICT IS, UH, MANY OF US IN HERE ARE TEACHERS, STILL A TEACHER PRINCIPAL. 
          WE OPERATE ON HUMAN RESOURCE. 
          IT'S OUR BIGGEST EXPENSE. 
          THAT'S OKAY, AS LONG AS WE CAN PAY FOR EVERYTHING ELSE. 
          OUR PRIORITY HAS BEEN IN PROVIDING ENRICHING LEARNING ENVIRONMENTS FOR OUR STUDENTS. 
          AND OUR WORKFORCE IS INTEGRAL INTO ACHIEVING THAT GOAL. 
          WE ARE PROACTIVELY EVALUATING AND IMPLEMENTING SUSTAINABLE STRATEGIES TO MINIMIZE THE IMPACT OF SCHOOLS. 
          WHAT DOES THAT MEAN? THAT MEANS THIS YEAR DURING OUR STRATEGIC BUDGETING IN ALL OF THE DEPARTMENTS THAT OPERATE WITHOUT DIRECT PARTICIPATION, A HUNDRED PERCENT OF TIME TO SCHOOLS, IN OTHER WORDS, CENTRAL OFFICES, REGIONAL OFFICES, WE HAVE FROZEN VACANT POSITIONS AFTER THEY'VE BEEN VACANT FOR 180 DAYS, SIX MONTHS, AND WE'VE CLOSED THOSE POSITIONS AND SWEPT THE BALANCES, RIGHT? SO WE HAVE CENTRAL OFFICES HERE. 
          WE HAVE SOME BUILDINGS THAT ARE, THAT ARE EXTENSIONS OF THE CENTRAL OFFICE. 
          AND WE HAVE DONE THAT THROUGHOUT THE DISTRICT THAT HAS HELPED IMPROVE OUR NET POSITION WHILE NOT DOING ANY REDUCTIONS AT SCHOOL SITES. 
          DURING THIS YEAR'S BUDGET DEVELOPMENT, APPROXIMATELY 2,400 EMPLOYEES HAD POSITIONS THAT WERE NOT FUNDED BY A SCHOOL OR OFFICE AS THEY WERE REDOING THEIR BUDGET FOR NEXT YEAR. 
          THAT'S BEEN SOMETHING OF A, OF AN ISSUE IN L-A-U-S-D. 
          WE ALLOW OFFICES AND SCHOOLS TO HIRE A PERSON IN A POSITION ONE YEAR. 
          AND IF THEY DON'T WANT THAT PERSON OR POSITION, OR IF THEY CAN'T AFFORD IT THE NEXT YEAR OR IF THEY WANT SOMETHING DIFFERENT, THEY'RE ALLOWED TO COMPLETELY CHANGE THEIR PATTERN OF EMPLOYMENT. 
          WHICH MEANS THAT WE HAVE PEOPLE WHO HAVE LOST THE FUNDING FOR THEIR POSITION, WHO WE HAVE HIRED ON AS PERMANENT EMPLOYEES, RIGHT? WE HAD 2,400 OF THEM THIS YEAR AT THE CLOSE OF BUDGET DEVELOPMENT, WE HAVE BEEN ABLE TO SUCCESSFULLY MOVE PEOPLE WITH THE ASSISTANCE OF PC AND HR. 
          THIS IS THEIR WORK INTO FUNDED POSITIONS, BUT THERE'S STILL A DELTA OF WHAT WE HAVE NOT BEEN A OF FOLKS THAT WE HAVE NOT BEEN ABLE TO FIND A POSITION FOR. 
          AND AS OF THIS LAST WEEK, THAT POSITION, THAT DELTA, THAT DIFFERENCE, WE STILL HAVE 1100 FOLKS WHO HAVE NOT BEEN FUNDED BY THEIR SCHOOLS OR OFFICES THIS COMING YEAR THAT WE ARE, UH, CARRYING ON THE BOOKS INTO THE YEAR FOR STABILITY. 
          THE MAINTENANCE OF THOSE UNFUNDED POSITIONS IS APPROXIMATELY $60 MILLION RIGHT NOW. 
          SO NOW WE LOOK AT FUND BALANCES. 
          SO THESE ARE FREQUENTLY CONFUSED BY FOLKS. 
          I'VE ALSO, UH, THEY'RE CARRY FORWARD. 
          THEIR FUND BALANCES ESSENTIALLY MONEY WE'VE GOTTEN IN PAST YEARS THAT WE HAVEN'T COMPLETELY EXPENDED. 
          I'VE ALSO HEARD THESE REFERRED TO AS RESERVES. 
          AN ITEM IS NOT A RESERVE UNLESS THE BOARD ACTS ON MAKING AN OFFICIAL RESERVE, RIGHT? WHICH IS A LITTLE BIT DIFFERENT. 
          BUT THESE ARE CARRY FORWARDS OR FUND BALANCES. 
          THIS IS REALLY IMPORTANT TO LOOK AT. 
          WE HAVE BROKEN OUT ALL OF THE DIFFERENT COMPONENTS OF THE FUND BALANCES. 
          AND I'M GONNA START WITH, UH, THE YEAR THAT'S MOST TO YOUR LEFT, RIGHT? SO IN EACH ONE OF THESE, YOU HAVE ALL OF OUR OPERATING FUNDS DENOTED BY COLOR AND BALANCE FROM YEAR TO YEAR. 
          SO THE, THE TOP LITTLE SLICE THERE THAT SAYS 99, THAT'S OUR CHILD DEVELOPMENT FUND. 
          THAT'S FOR EARLY CHILDHOOD DEVELOPMENT. 
          IT OPERATES OUTSIDE OF THE GENERAL FUND. 
          IT IS ITS OWN FUND. 
          SO THAT WAS ITS FUND BALANCE. 
          AGAIN, ENCOURAGE YOU TO THINK OF IT AS THE SAVINGS ACCOUNT FOR THAT PROGRAM. 
          THE YELLOW IS THE CAFETERIA FUND ONLY AVAILABLE FOR THE CAFETERIA AND NUTRITION SERVICES. 
          WHEN PEOPLE SEE A FUND BALANCE, THEY SAY, WAIT A SECOND, WE CAN SPEND THAT. 
          WE DO SPEND IT, BUT IT HAS TO BE SPENT ONLY ON NUTRITION SERVICES. 
          IT'S RESTRICTED. 
          SAME THING FOR EARLY CHILDHOOD DEVELOPMENT. 
          THE 59 ADULT EDUCATION RESTRICTED ONLY TO ADULT EDUCATION. 
          BENEATH THAT, YOU SEE A LITTLE GRAY BAR. 
          IT SAYS 2 45 AND YOU SEE IT GOING DOWN A LITTLE BIT. 
          THAT IS THE STATUTORY 1% RESERVE SCHOOL DISTRICTS ARE REQUIRED TO KEEP A CERTAIN AMOUNT OF RESERVE BY STATE LAW. 
          THAT'S WHAT STATUTORY RESERVE MEANS VERSUS OUR LOCAL BOARD RESERVE. 
          IT'S 1%. 
          WE'RE THE ONLY DISTRICT THAT GETS 1%. 
          I BELIEVE WE'RE STILL THE ONLY DISTRICT. 
          YES, JUST LOOKING 
          [01:00:01]
FOR CONFIRMATION THERE IN CASE SOMETHING CHANGED. 
          WE ARE THE ONLY ONE. 
          MOST DISTRICTS IT'S REQUIRED FOR TWO AND 3%. 
          OKAY? THAT IS NOT SPENDABLE. 
          IF WE SPEND THAT MONEY, WE ARE IN NEGATIVE CERT AT BEST OR POTENTIALLY LACK OF A GOING CONCERN, WHICH IS OUR NICE WAY IN THE STATE OF SAYING BANKRUPT, RIGHT? 'CAUSE YOU NO LONGER HAVE ENOUGH CASH TO BE FUNGIBLE. 
          THE LITTLE PURPLE BAND RIGHT THERE, WHOOP PURPLE MY, THERE WE GO. 
          ASSIGNED, RIGHT? THAT'S GENERAL FUND ASSIGNED. 
          THOSE ARE ASSIGNMENTS MADE EITHER BY RESOLUTION OR POLICY, UH, IN THE BUDGET BY THE BOARD. 
          THE NEXT LITTLE BAND RED, THAT'S THE GENERAL FUND RESTRICTED, THAT'S YOUR TITLE PROGRAMS TITLE ONE, THAT'S ELOP, THAT'S PROP 28. 
          THOSE ARE ALL THE MONIES THAT WE HAVE, BUT THEY CAN ONLY BE SPENT ON EXACTLY WHAT'S DESCRIBED IN THE LANGUAGE THAT THEY'RE PROVIDED FOR. 
          AND THEN WE HAVE THIS BIG GREEN BAND HERE. 
          AND THAT IS GENERAL FUND UNAPPROPRIATED UNASSIGNED. 
          THAT'S OUR FUNGIBLE MONEY. 
          THAT'S THE MONEY THAT WE CAN SPEND AS THE BOARD WANTS US TO. 
          SO YOU CAN SEE THAT IN FISCAL YEAR 24, THAT'S THE YEAR THAT WE'RE COMING TO A CLOSE ON, UM, LAST YEAR, UH, THERE'S ABOUT $7 BILLION IN VARIOUS CARRY FORWARDS, VARIOUS CARRY FORWARDS. 
          THESE ARE AGAIN, THOSE INDIVIDUAL PROGRAMS. SAVINGS ACCOUNTS. 
          YOU GO INTO FUND 20, FISCAL YEAR 25, ALL OF THESE YEARS USES THE SAME COLOR CODING. 
          AND WHAT YOU CAN SEE IS SOME OF THESE PROGRAMS HAVE THEIR AMOUNTS GO UP OR DOWN. 
          BUT THE IMPORTANT ONE TO PAY ATTENTION TO, I ALWAYS TELL THE BOARD THIS RIGHT IN OPEN SESSION WHEN WE'RE GOING THROUGH FISCAL REPORTS IS THIS GREEN ONE, RIGHT? IT'S THE REASON THAT WE USUALLY FOCUS ON THAT SO MUCH. 
          'CAUSE THAT'S THE ONE THAT WE HAVE CONTROL OVER. 
          LOOK AT WHAT'S HAPPENING BETWEEN 24 AND 25. 
          THIS IS WHAT TELLS YOU THAT WE ARE IN A DEFICIT POSITION. 
          OUR FUND BALANCE IS GOING DOWN. 
          AND HOW DO YOU TELL IT'S REAL? YOU TRACK IT WITH CASH. 
          SO WE DO CASH MONITORING AND WE ACTUALLY SEE THE CASH IN OUR ACCOUNTS GOING DOWN AT THIS SAME RATE. 
          SO LAST YEAR, 6.7, ALMOST 6.8 BILLION THIS YEAR IN 25 5, ALMOST 5.2 BILLION. 
          THE ONLY DIFFERENCE BETWEEN THESE TWO YEARS LESS CASH. 
          YES. 
          AND WHEN WE REDUCED THE ASSIGNMENTS AND THE COMMITMENTS TO MAKE THIS GREEN BAR LARGER, ONE OF THE THINGS THAT WAS WAS IN THERE IS THE BOARD'S LOCAL. 
          SO THE ONLY DIFFERENCE DO YOU SEE BETWEEN HERE AND HERE STILL LESS CASH, LESS LESS. 
          UH, FUND BALANCE IS THE 5% LOCAL RESERVE, WHICH WE ARE NOW INCLUDING IN HERE. 
          SO EVERYBODY CAN TRACK THAT AS A PART OF THE CARRY FORWARDS OR THE FUND BALANCES FOR ADOPTED BUDGET. 
          SO REMEMBER, THESE ARE ACTUALS ACTUALIZED AT THIS POINT. 
          WE HAVE A, WE HAVE A COUPLE WEEKS LEFT FOR THIS ONE, BUT IT WON'T CHANGE SIGNIFICANTLY FOR ADOPTED BUDGET. 
          LIKE I SAID, FIRST TIME, WE ARE GIVING YOU A PREVIEW OF THE ADOPTED BUDGET. 
          THIS IS WHAT NEXT YEAR'S FUND BALANCES LOOK LIKE. 
          AS WE ADOPT A BUDGET IN JUNE TO BEGIN JULY ONE. 
          NOTICE WE'VE BEEN TRYING TO PROTECT THIS GENERAL FUND UNRESTRICTED. 
          IT HASN'T GONE DOWN AS MUCH AS THESE OTHERS BECAUSE WE'VE BEEN SPENDING THESE OTHERS DOWN TO PROTECT THE GENERAL FUND UNRESTRICTED. 
          SO THE BOARD HAS FLEXIBILITY, BUT WE ARE CONTINUING TO SPEND THIS GREEN BAND TO FUND OUR DEFICIT. 
          SO AFTER NEXT YEAR, ALL THAT'S LEFT AFTER THE ADOPTED BUDGET IS UNDER $200 MILLION. 
          AND REMEMBER, THERE ARE NO BARGAINING AGREEMENT COSTS AND THERE ARE NO INCREASES IN THAT YEAR OF ANY PROVISION OF HEALTH BENEFITS. 
          NO INCREASES. 
          SO IT'S FLAT. 
          SO THAT TELLS YOU THAT AFTER THE CURRENT YEAR THAT WE'RE GOING TO ADOPT BUDGET ON, WE ARE OUT OF MONEY TO CARRY THE STRUCTURAL DEFICIT THAT WE'VE BEEN CARRYING. 
          WE SAVED A LOT OF OUR MONEY. 
          THERE'S A LOT OF DISTRICTS THAT HAVE HAD TO DO DRAMATIC THINGS BOTH LAST YEAR AND THIS YEAR BECAUSE THEY WEREN'T ABLE TO SAVE AS MUCH MONEY. 
          WE ARE RAPIDLY DEPLETING THOSE FUND BALANCES. 
          SO AGAIN, THINK OF IT AS A SAVINGS ACCOUNT. 
          THE SAVINGS ACCOUNT IS GOING AWAY. 
          NOT FOR A BAD REASON, NOT BECAUSE THERE'S ANYTHING NEFARIOUS GOING ON, BUT WE HAVE CHOSEN TO SPEND IT TO MAINTAIN AND STABILIZE OUR WORKFORCE FOR NOW, KNOWING THAT UNLESS WE ARE BUDGET HAWKS AND SOMEHOW GET COSTS DOWN, WE HAVE FEWER AND FEWER OPTIONS GOING INTO THAT YEAR IN 28 CURRENTLY, UNTIL WE FIX IT HERE CURRENTLY, YOU CAN SEE THAT THAT GREEN SORT OF SHADED SPOT THAT SHOWS YOU THE SIZE, IT'S, THIS IS NOT THE SIZE OF THE DEFICIT. 
          [01:05:01]
IT'S, IT'S FAIRLY CLOSE, BUT IT'S NOT THE SIZE. 
          THIS IS HOW FAR WE GO INTO THE HOLE IN FISCAL YEAR 28. 
          WE ARE LEGALLY NOT PERMITTED TO DO THAT, RIGHT? THAT'S LACK OF A GOING CONCERN, BUT WE ARE ADOPTING A BUDGET. 
          SO HERE'S OUR NEW BUDGET ADOPTION FROM FY 26 FORWARD. 
          WE ARE ADOPTING A BUDGET CURRENT YEAR PLUS TWO, THAT FOR ONE OF THOSE YEARS OR MORE, WE CANNOT AFFORD ALL OF OUR EXPENSES. 
          SO WE WILL BE ADOPTING A BUDGET THAT IS QUALIFIED. 
          SOME PEOPLE CALL IT CONDITIONAL BECAUSE WE ARE NOT GOING TO BE ABLE TO MEET HAVING ENOUGH MONEY TO PAY ALL OF OUR EXPENSES. 
          THAT IS WHAT RESULTS IN A FISCAL STABILIZATION PLAN. 
          SO WHEN WE GET TO THAT POINT, A BOARD OF EDUCATION GOES INTO OVERSIGHT WITH THE COUNTY OFFICE OF EDUCATION ON BEHALF OF THE STATE TO MAKE SURE THAT THEY ARE HAVING A PLAN THAT THEY'RE IMPLEMENTING TO GET BACK TO A, AN EVEN BALANCED BUDGET, AND THAT THAT IS MONITORED AT EVERY INTERIM REPORT TO MAKE SURE THEY'RE MAKING THE PROGRESS THAT THEY HAVE COMMITTED TO, TO BALANCE THE BUDGET WITHIN THAT THREE YEAR PERIOD OF TIME. 
          SO WHAT WILL FISCAL SUSTAINABILITY LOOK LIKE IN LOS ANGELES UNIFIED? THE STRUCTURAL DEFICIT, NOT THE AMOUNT THE FUND BALANCES GO DOWN, THAT'S INCLUDED IN THERE. 
          THE, THE, THE STRUCTURAL DEFICIT IS ABOUT $1.4 BILLION. 
          AGAIN, THAT'S BETTER THAN WHERE WE WERE AT THE BEGINNING OF THE YEAR. 
          WE'VE IMPROVED THAT BY CUTTING AROUND THE EDGES. 
          THERE'S NOT A LOT MORE THAT WE CAN CUT AROUND THE EDGES, BUT WE CAN BE STRATEGIC AND TRY TO CUT MORE. 
          THIS DOES NOT INCLUDE, I KEEP SAYING THIS SO THAT EVERYBODY REMEMBERS IT. 
          IT DOES NOT INCLUDE ANY FUTURE LABOR AGREEMENTS OR NEGOTIATED SALARY OR BENEFIT CHANGES, OR THE INCREASE IN COSTS THAT WE DON'T KNOW ABOUT YET. 
          NEXT YEAR IN THE FCI FISCAL SUSTAINABILITY PROGRAM, YOU'LL NOTICE THAT WE ARE LEVERAGING NEXT YEAR, WE ARE SPENDING DOWN THE REST OF THE DISTRICT'S GENERAL FUND UNCOMMITTED BALANCE TO PROVIDE US FOR A PLANNING YEAR WHILE THE FISCAL SUSTAINABILITY PLAN IS IN PLACE, WHILE WE ARE BEING MONITORED TO MAKE PROGRESS ON BALANCING THE BUDGET. 
          SO THAT'S WHAT WE'RE LEVERAGING NEXT YEAR TO DO. 
          SO IN JUNE ON THE 17TH, YOU WILL HAVE A BUDGET HEARING AND YOU'LL HAVE A FISCAL STABILIZATION PLAN TO APPROVE. 
          AND THEN ON THE 24TH, WE'LL COME BACK AND WE'LL ADOPT A QUALIFIED BUDGET, AND ALL OF IT WILL BE SUBMITTED TO THE COUNTY FOR OVERSIGHT. 
          THE BOARD CAN REVISE THE FISCAL STABILIZATION PLAN AT THE FIRST OR SECOND INTERIM REPORTS BY PROVIDING INPUT TO MYSELF AND THE TEAM, AND WE MAKE THE CHANGES. 
          AND THEN YOU REAPPROVE, LIKE YOU DO THE BUDGET AT THE FIRST AND SECOND INTERIM. 
          SO FOR FISCAL YEAR 25, WE'LL BE IMPLEMENTING STRATEGIC BUDGET FOR CENTRAL OFFICES. 
          WE'VE DONE THAT ALREADY. 
          WE'VE SW SWEPT UNSPENT DOLLARS AND USED A HIRING FREEZE AND SAVED OVER A HUNDRED MILLION DOLLARS TO IMPROVE OUR NET POSITION. 
          WE MAXIMIZED RESTRICTED FUNDS FOR ANOTHER A HUNDRED MILLION DOLLARS OF GENERAL FUND RELIEF, AND WE ELIMINATED CARRY FORWARD FOR ALL CENTRAL OFFICE PROGRAMS. HOWEVER, WE WILL BE ADOPTING A QUALIFIED BUDGET FOR 26. 
          SO IN 26, WE WILL IMPLEMENT THE FISCAL STABILIZATION PLAN. 
          WE WILL CONTINUE MAXIMIZATION OF RESTRICTED FUNDS, AND WE WILL IDENTIFY REDUCTION OPPORTUNITIES, INCLUDING CLO CLOSING VACANCIES, SWEEPING UNSPENT DOLLARS, AND IMPLEMENTING TIERED EQUITABLE STRATEGIES TO OPTIMIZE THE WORKFORCE FOR FISCAL YEAR 27. 
          IN 27, WE WILL CONTINUE IMPLEMENTATION AND WE WILL CONTINUE COUNTY OVERSIGHT TO MAKE SURE THAT THE STABILIZATION PLAN, UH, IS IN PLACE AND HAVING THE IMPACT THAT IT'S ANTICIPATED. 
          WE'LL ASSESS ADDITIONAL VACANCY CLOSURES, MAINTAIN THE HIRING, FREEZE AND ENACT STAFF REASSIGNMENTS AND REDUCTIONS IN FORCE. 
          WE'LL IDENTIFY AND REVISE COST SAVINGS STRATEGIES FOR FISCAL YEAR 28, AND THEN AT THAT POINT IT BECOMES WASH, RINSE, REPEAT. 
          IT MEANS THAT WE STAY UNDER THE AUSPICES OF OVERSIGHT WITH THE COUNTY, UH, ACTING ON BEHALF OF THE STATE UNTIL WE REACH BALANCED BUDGET, UH, AND CAN SHOW THAT WE ARE MANAGING OUR FINANCES WITHOUT THE OVERSIGHT. 
          THIS JUST TELLS YOU THAT THE FI, UH, STABILIZATION PLAN, AS I ALREADY EXPLAINED, IS REQUIRED. 
          UH, WE HAVE TO PUT IT IN PLACE BECAUSE OF OUR FINANCIAL OBLIGATIONS NOT BEING MET FOR THE NEXT TWO YEARS. 
          UH, BUT WE DO HAVE A PLANNING YEAR BUILT IN THERE, AND WE ARE UNDER THE OVERSIGHT OF THE LOS ANGELES COUNTY OF EDUCATION. 
          SO THIS IS, AND 
          [01:10:01]
WE HAVE TO SHOW FOR ALL THREE YEARS TO MAINTAIN A BALANCED BUDGET. 
          SO THIS IS THE PROPOSED FISCAL STABILIZATION PLAN TO ADDRESS THE $1.4 BILLION DEFICIT. 
          SO PLEASE NOTE A COUPLE OF THINGS AT THE BOTTOM. 
          CURRENTLY, CURRENTLY, FUND 17 HAS 5% RESERVE. 
          IT'S A BOARD RESERVE. 
          IT'S CALCULATED EVERY YEAR. 
          YOU'LL NOTICE THAT THE RESERVE AMOUNT SLOWLY GOES DOWN BECAUSE 5% IS DIFFERENT EVERY YEAR. 
          AND AS OUR EXPENSES GO DOWN A LITTLE BIT, THE RESERVE IS A LITTLE BIT LESS, BUT CURRENTLY IT HAS A BALANCE OF 532 MILLION OR 5% IN FISCAL YEAR 27. 
          THE STABILIZATION PLAN DOES NOT INCLUDE THE USE OF THE BOARD'S RESERVE. 
          IF THE BOARD WANTS TO CHANGE ITS RESERVE POLICY, THEY CAN BY SIMPLY HAVING A MAJORITY OF THE BOARD DIRECT ME TO CHANGE IT AND, AND WHAT TO DO WITH IT. 
          BUT AT THIS POINT, THE 5% STATUTORY, OR I'M SORRY, THE BOARD RESERVE STAYS IN PLACE, THERE IS NO WAY TO CHANGE THE STATUTORY RESERVE OF 1%. 
          ALL OF THE ASSIGNMENTS AND COMMITMENTS ARE ASSUMED TO HAVE DROPPED IN FISCAL YEAR 27 TO MAINTAIN WORKFORCE AND NOT SPECIAL INITIATIVES OR RESOLUTIONS. 
          SO THESE LINES IN THE FISCAL STABILIZATION PLAN, THE FIRST LINE AND BOARD MEMBERS HAVE SEEN THESE IN, IN ITERATIVE DISCUSSIONS BEFORE, BUT THE COMMUNITY HAS NOT AS MUCH. 
          SO I JUST WANNA WALK THROUGH THEM ALL CAREFULLY. 
          THE FIRST ONE, REASSESS SCHOOL CARRY FORWARD POLICIES OR CARRYOVER POLICIES BY NEED FOR FISCAL YEAR 27. 
          SO LOS ANGELES HAS A LONGSTANDING PRACTICE OF LEAVING ALLOCATIONS AT SCHOOL SITES AND LETTING SCHOOL SITES, MEANING ELEMENTARY, MIDDLE, AND HIGH SCHOOL, BUILD UP THEIR OWN RESERVES INSTEAD OF SPENDING THE MONEY THEY'RE GETTING THAT YEAR ON THE STUDENTS THAT THEY HAVE. 
          THEY ALSO HAVE DISCRETION OVER THAT MONEY. 
          IT'S OUT OF LINE WITH STATE PRACTICE OR GUIDELINES. 
          WE'VE KNOWN THAT, BUT WE'VE BEEN ABLE TO AFFORD IT AND ALLOW FOLKS TO HAVE FAR MORE, UH, AUTHORITY ON AUTONOMY AT THEIR SCHOOL SITES. 
          TO BALANCE FOR THE FISCAL STABILIZATION PLAN. 
          IT CALLS FOR DISCONTINUING THAT PRACTICE IN FISCAL YEAR 27 TO MITIGATE THE NUMBER OF LAYOFFS THAT WE WOULD HAVE TO DO OR REDUCTIONS WE WOULD HAVE TO DO BY FISCAL YEAR 27. 
          THE ESTIMATE IS 380 MILLION OF CARRY FORWARD THAT WOULD COME BACK TO THE CENTER TO HELP PAY FOR THE EXPENSES THAT EXIST ANNUALLY. 
          WE ANTICIPATE THIS. 
          THESE ARE ESTIMATES. 
          REMEMBER THAT $65 MILLION WOULD BE SWEPT. 
          WHAT DOES THAT MEAN? THAT MEANS AT THE END OF THE SCHOOL YEAR, ANYTHING THAT WASN'T SPENT OF GENERAL FUND, WHICH INCLUDES C, WE WOULD TAKE BACK TO THE CENTER AND WE WOULD REALLOCATE IT ANEW OUT TO SCHOOL SITES THE NEXT YEAR FOR THE NEXT YEAR AND THE NEXT YEAR'S STUDENTS. 
          THIS IS THE WAY THAT MOST SCHOOLS IN THE STATE OF CALIFORNIA OPERATE. 
          IT'S CONSIDERED BEST PRACTICE. 
          AND SO THAT'S THE PROPOSAL, AND IT DIRECTLY IMPACTS THE NUMBER OF OTHER REDUCTIONS WE WOULD HAVE TO DO. 
          NUMBER TWO, CAP AND NORM POSITIONS IN FISCAL YEAR 27. 
          SO RELATED TO THE FIRST ONE AND THE AMOUNT OF MONEY THAT'S BEING CARRIED FORWARD IN AT SCHOOL SITES, WE ALLOCATE A PORTION OF THE GENERAL FUND AS DISCRETIONARY MONEY FOR OUR SCHOOLS TO DO THEIR OWN HIRING, RIGHT? WE ARE NOT SUGGESTING THAT WE DON'T ALLOCATE THAT MONEY ANYMORE. 
          WE ARE SUGGESTING IN THE FISCAL STABILIZATION PLAN THAT WE GO BACK TO THE PRE COVID LEVEL. 
          SO CURRENTLY WE'VE BEEN ALLOCATING 700 MILLION. 
          THIS BRINGS US BACK TO FIVE, WHICH IS WHAT WE WERE PRE COVID, AND WE HAD MORE STUDENTS BACK THEN. 
          SO WE'RE GOING BACK TO A FIVE IN THIS PROPOSAL WITH 400 MILLION BEING NORMED. 
          IN OTHER WORDS, THAT WE COME UP WITH A FORMULA, LOOKING AT WHAT THESE SCHOOL ARE SPENDING THEIR DISCRETIONARY MONEY ON FOR HIRING, AND WE GIVE THE SCHOOLS THE MOST FREQUENT THINGS THAT THEY'RE HIRING. 
          BUT THEN THE CENTER, THE DISTRICT PAYS FOR THE EMPLOYEES, INCLUDING THE INCREASES IN COST YEAR OVER YEAR, MOVES THE EMPLOYEES BACK TO BEING WORKING AT THE CENTRAL SITE. 
          THIS WILL REMOVE THE ISSUE THAT WE'RE GOING THROUGH NOW, WHEREAS EMPLOYEES ARE HIRED FOR ONE YEAR, BECOME A PERMANENT EMPLOYEE, AND THEN THE SITES CHOOSE THAT EITHER THEY CAN'T AFFORD THEM OR THEY WANT A DIFFERENT STAFFING PATTERN THE NEXT YEAR, WHICH THEN CREATES EMPLOYEES THAT ARE NOT FUNDED THAT WE HAVE TO FIND HOMES FOR OR THAT WE CAN'T AFFORD, WHICH IS THE PATTERN THAT WE'RE IN CURRENTLY. 
          THE THIRD LINE REDUCTION OF UNFUNDED POSITIONS. 
          PREVIOUSLY, WE TALKED ABOUT THE FACT THAT EVEN IF YOU DON'T FIND FUNDING, WE HAVE NOT DONE A REDUCTION FOR YEARS. 
          THAT AMOUNT OF MONEY THAT IT COSTS, THE DISTRICT VARIES YEAR TO YEAR. 
          I'VE SEEN IT AS LOW AS 45 MILLION. 
          [01:15:01]
I'VE SEEN IT AS HIGH AS 120 MILLION THIS YEAR. 
          WE'VE MADE THOSE MOVES. 
          IT'S $60 MILLION. 
          WHATEVER IT IS, WE NEED TO PROTECT THE WORKFORCE THAT IS BEING ASSIGNED, THAT IS BEING NECESSARY. 
          AND SO THE THIRD LINE IS TO REDUCE ANY POSITIONS THAT DON'T HAVE FUNDING FOR THAT YEAR. 
          THE FOURTH LINE SAYS TO CONSOLIDATE THE DISTRICT FOOTPRINT, CAMPUSES AND PROGRAMS AND, AND EVALUATE ACADEMIC RETURN ON INVESTMENT. 
          THAT MEANS THAT WE NEED A PLAN. 
          THIS IS SOMETHING THAT STRATEGIC INITIATIVES HAS BEEN WORKING ON FOR A NUMBER OF YEARS AS FAR AS THE WAYS TO DO THIS. 
          BUT WE NEED TO START REALLY LOOKING AT A PLAN THAT CONSOLIDATES OUR FOOTPRINT. 
          WE ARE NOW OPERATING OVER 900 PROGRAMS AND CAMPUSES. 
          OUR AVERAGE ELEMENTARY SCHOOL, LESS THAN HALF OF THEM HAVE UNDER 300 STUDENTS FOR THE ENTIRE SCHOOL. 
          TK THROUGH SIX SECONDARY MORE THAN HALF ARE NOW UNDER 500 STUDENTS. 
          IT'S NOT AN ISSUE THAT WE DON'T WANT SMALL COMMUNITY SCHOOLS, BUT YOU START SPREADING THE RESOURCE SO THINLY THAT PEOPLE CAN'T EVEN FRACTIONALLY GET A PART OF AN FTE OR A SERVICE. 
          THAT WOULD HELP BECAUSE WE'RE SPREADING THE RESOURCE SO THINLY THROUGHOUT THE ENTIRE DISTRICT. 
          SO THAT'S THE FOOTPRINT WE HAVE PUT IN AN ESTIMATE OF WHAT THAT WOULD SAVE AFTER CONSOLIDATING CAMPUSES AND PROGRAMS. UH, THAT COULD, THAT COULD BE HIGHER OR LOWER DEPENDING UPON THE APPROACH FROM STRATEGIC INITIATIVES AND THE DIRECTION OF THE BOARD. 
          IF IT GOES HIGHER, IF WE SAVE MORE. 
          AND THAT'S TRUE FOR ALL OF THESE. 
          THESE ARE VARIABLES. 
          IF IT GOES UP, THAT MEANS THAT OTHER REDUCTIONS WILL GO DOWN. 
          OKAY? UH, THE NEXT LINE IS TO REASSESS THE EFFECTIVENESS OF EARMARKED UNSPENT INVESTMENTS. 
          THIS WAS BY BOARD REQUESTS THAT THERE ARE SPECIAL INVESTMENTS THAT HAVE BEEN MADE BY RESOLUTION OR BY DIRECTION AT SOME POINT, SUCH AS TUTORING, UH, SUCH AS C, THAT THEY BE EVALUATED BY INSTRUCTION AND STRATEGIC INITIATIVES. 
          AND THAT, IF ANY, ARE NOT SHOWING THE IMPACT DESIRED INITIALLY, THAT THEY ARE DISCONTINUED, BECAUSE THAT MEANS THAT THE MONEY IS NOT SHOWING THE IMPACT THAT WAS DESIRED. 
          SO THAT'S SOMETHING ELSE FOR THAT, THAT PLANNING AND STUDY YEAR TO ADDRESS STRATEGIC CLOSURE OF VACANT SCHOOL POSITIONS ANNUALLY IN FEBRUARY. 
          UH, THIS ONE'S A LITTLE MISLEADING 'CAUSE IT'S NOT REALLY CLOSURE, IT'S SWEEPING OF FUNDS. 
          WHAT DOES THIS MEAN? THAT MEANS THAT IF I'M BACK IN MY PRINCIPAL ROLE AND I CAN'T FIND TWO PEOPLE CLASSIFIED CERTIFICATE, IT DOESN'T REALLY MATTER, THAT ARE NOT STATUTORILY REQUIRED, SUCH AS A SPECIAL EDUCATION TEACHER. 
          AND IT COMES TO FEBRUARY, AND I'M RECRUITING, AND I CAN'T STILL FIND THEM BECAUSE WE'RE IN A DEFICIT. 
          WE HAVE A HOLE THAT'S GROWING AT THE CENTER THAT WE NEED TO FILL. 
          SO EVERY YEAR IN FEBRUARY, THE POSITIONS WILL STILL RECRUIT, BUT WE WILL TAKE THE MONEY BACK TO FILL THE HOLE IN FOR THE WHOLE DISTRICT AS IT'S OPENING. 
          THIS HELPS US FILL IN THE HOLE ANNUALLY. 
          NOW, THOSE POSITIONS REAPPEAR AT THE BEGINNING OF THE NEXT SCHOOL YEAR, AND IF YOU HIRE THEM BETWEEN FEBRUARY AND JUNE, YOU'LL STILL HAVE THE MONEY, BUT WE'LL TAKE THE CASH TO FILL IN THE HOLE THAT'S OPEN IN THE DISTRICT. 
          THIS ACTUALLY HELPS SO THAT EVERY YEAR WE HAVE THE MONEY CENTRALLY TO FUND ALL THE POSITIONS THAT WE ALREADY HAVE ON THE BOOKS. 
          SECOND TO LAST ONE HERE, BRING STUDENTS CLOSER TO THEIR SCHOOL OF RESIDENTS. 
          THAT IS LARGELY ABOUT SPECIAL EDUCATION STUDENTS, BUT ALSO OTHER STUDENTS THAT WE TRANSPORT THROUGHOUT THE DISTRICT LONG DISTANCES. 
          SO WHAT'S THE IDEA? THE CLOSER WE CAN GET OUR KIDDOS TO THEIR HOMESCHOOL, THE MORE OPPORTUNITIES THEY HAVE, WHETHER IT'S LEAST RESTRICTIVE ENVIRONMENT, WHETHER IT'S INCLUSION, BUT ALSO FOR OUR STUDENTS NOT TO BE SPENDING HOURS ON A BUS DRIVING FROM ONE SIDE OF THE DISTRICT TO ANOTHER, LOOKING FOR A REGIONAL PROGRAM AND NOT BEING A PART OF THEIR LOCAL SCHOOL COMMUNITY. 
          OKAY? NOT A HUGE SAVINGS, BUT IT'LL HELP. 
          AND PROBABLY MORE IMPORTANTLY, UH, THOSE STUDENTS WILL NOT BE ON THE BUS FOR AS MUCH OF THEIR EDUCATIONAL DAY AS THEY ARE RIGHT NOW. 
          CENTRAL OPERATIONS, NON-SCHOOL BASED REDUCTIONS. 
          SO AT THIS POINT, WHATEVER SAVINGS WE CAN'T YIELD UP HERE, WE HAVE PUT THOSE SAVINGS DOWN HERE. 
          WHAT DOES THAT MEAN? THAT'S, THAT IS A REDUCTION IN CENTRAL OFFICE, CENTRAL PROGRAM POSITIONS. 
          AND FTE 70 MILLION WAS HOW WE HIT THE NUMBERS. 
          TO BE ABLE TO SUBMIT A PLAN TO GET TO $1.4 BILLION OF REDUCTIONS, THAT EQUATES TO ABOUT 17.5% REDUCTION OF ALL CENTRAL STAFF, RIGHT? IF WE CAN SAVE MORE IN SOME OF THESE OTHER BUCKETS, THAT NUMBER CAN GO DOWN. 
          IF WE SAVE LESS THAN IT WOULD HAVE TO GO UP. 
          BUT THE GOAL WAS WE HAVE TO SUBMIT A NUMBER TO THE COUNTY THAT DEMONSTRATES THAT 
          [01:20:01]
WE ARE ATTACKING OUR LONG-TERM DEFICIT. 
          NOW, PLEASE NOTE OUR STRATEGIC BUDGETING. 
          THIS YEAR, WE CLOSED OVER 3% OF ALL OF THOSE CENTRAL VACANT POSITIONS. 
          THIS IS ON TOP OF THAT. 
          IT'S ON TOP OF THAT. 
          SO AFTER THE FISCAL STABILIZATION PLAN, HOW WILL THIS MAKE OUR MULTI-YEAR PROJECTION LOOK? SO PLANNING YEAR, SO FISCAL YEAR 26, THE ONE THAT WE'RE ABOUT TO ADOPT DOES NOT CHANGE. 
          WE ARE GOING TO SPEND THIS GREEN BAR TO SUPPORT ALL OF OUR STAFF AND OUR BIG DEFICIT, THE STABILIZATION PLAN, YEAR ONE, IF WE IMPLEMENT NOTICE THAT THE GREEN BAR GROWS SO THAT WE HAVE ENOUGH TIME TO THEN IMPLEMENT THE NEXT YEAR, AND IF WE IMPLEMENT IT, WE ARE STABLE FOR FISCAL YEAR 28. 
          NOW, I'VE ALREADY HAD PEOPLE COMMENT ON THIS SLIDE. 
          WAIT A MINUTE. 
          YOU'RE STABLE, BUT ALL YOU HAVE LEFT, ALL OF YOUR CARRY FORWARDS ARE GONE. 
          THE ONLY THING YOU HAVE LEFT ON THIS SLIDE IS THE 1% REQUIRED BY THE STATE AND THE 5% THAT'S THE LOCAL BOARD. 
          THAT'S CORRECT. 
          SO THERE'S NO MORE GREEN MONEY. 
          THIS DOES IMPLY EVERY YEAR YOU'RE GOING TO HAVE TO CONTINUE THAT PATTERN. 
          THIS JUST MEETS THE MINIMUM REQUIREMENT OF BALANCING THE BUDGET FOR THIS THREE YEAR PERIOD. 
          IT DOESN'T DO MORE THAN THAT. 
          SO THESE ARE THE ASSUMPTIONS FOR THE BUDGET ADOPTION, WHICH WE'LL BE GOING INTO DETAIL IN JUNE. 
          WE PRESERVE OUR UNFUNDED POSITIONS BECAUSE WE HAVEN'T DONE LAYOFFS FOR THE LAST COUPLE OF YEARS. 
          DURING OUR DEFICIT PERIOD, WE MAINTAIN THE BOARD RESERVE AT 5%. 
          THE JUNE ADOPTED BUDGET WILL BE QUALIFIED. 
          LACO REQUIRES THAT A FISCAL STABILIZATION PLAN BE APPROVED IN TANDEM WITH THE JUNE ADOPTED BUDGET, AND IT INCLUDES FUNDING TO PROTECT AGAINST FEDERAL UNCERTAINTIES PENDING BOARD APPROVAL. 
          I'LL GO INTO THAT A LITTLE BIT MORE ON THE LAST SLIDE. 
          AND SO WE STILL HAVE BUDGET PRIORITIES, RIGHT? UM, WE STILL HAVE STRATEGIC INVESTMENTS THAT WE WANNA MAKE BECAUSE WE KNOW THAT IT'S IMPORTANT. 
          WE'VE DECIDED NOT TO DO REDUCTIONS, BUT WE HAVE TO PRESERVE AND EVEN BUILD ON SOME PROGRAMS. SO WE HAVE INCREASES HERE. 
          SUPERINTENDENT, WOULD YOU LIKE TO YEAH, I'LL JUMP ON THESE. 
          THESE, UH, ARE SOME OF THE AREAS THAT I REFERENCED. 
          UH, EVEN THOUGH WE ARE MOVING FORWARD WITH REDUCTIONS, NECESSARY REDUCTIONS IN SOME AREAS AND EQUITY-BASED BUDGET STILL ADVANCES ADDITIONAL INVESTMENTS IN KEY AREAS TO THE EXTENT THAT THEY ADDRESS PERENNIAL HISTORICAL NEEDS IN OUR SCHOOLS. 
          THAT IS THE CASE WITH BSAP. 
          BSAP IS, UH, HAS BEEN FUNDED INITIALLY AT A HUNDRED MILLION DOLLARS. 
          UH, I REMEMBER TWO YEARS AGO WE INCREASED IT BY 25 MILLION, AND I BELIEVE IT IS APPROPRIATE TO INCREASE IT BY AN ADDITIONAL 25 MILLION FOR FY 26, UH, ARTS IN SCHOOLS. 
          WE, WE PUT IT HERE BECAUSE I SUSPECT, I ACTUALLY ANTICIPATE WITH ALL CERTAINTY THAT WE WILL, UH, PROVIDE A SIGNIFICANT SUPPLEMENTAL, UM, ALLOCATION FOR ARTS IN SCHOOLS. 
          BUT I'D RATHER, FOR A NUMBER OF REASONS, UH, I'D RATHER PAUSE FOR A SECOND, NOT DECLARE WHAT THAT NUMBER IS. 
          THAT VALUE IS BASED ON ONGOING CONVERSATIONS WITH A NUMBER OF DIFFERENT ENTITIES. 
          UH, GREENING WITH PARTNERS A MILLION DOLLAR INCREASE FOR, UH, THREE CONSECUTIVE, UH, THREE YEARS IN A ROW, UH, FOR A TOTAL OF $3 MILLION. 
          UM, STUDENT CENTERS. 
          UM, WE WISH TO MAKE AN ADDITIONAL INVESTMENT OF $1.2 MILLION. 
          WE BELIEVE THAT THIS WILL ADD AN ADDITIONAL FOUR STUDENT CENTERS DISTRICTWIDE. 
          UH, WE HAVE PREVIOUSLY INFORMED THE BOARD OF, UM, ALREADY ANNOUNCED REDUCTIONS FROM THE FEDERAL GOVERNMENT, UH, INTO, UH, A NUMBER OF DIFFERENT PROGRAMS TO PROVIDE STABILITY. 
          GOING TO NEXT YEAR, WE'RE PROPOSING THE ESTABLISHMENT OF A FEDERAL PROGRAM RESERVE THAT WOULD INVEST GENERAL FUND DOLLARS, UH, IN WHAT USED TO BE FUNDED THROUGH, UH, FEDERAL, UH, INVESTMENTS, UH, WHETHER WE'RE TALKING ABOUT MEDICAID OR OTHER PROGRAMS. THEN LAST BUT NOT LEAST, THE WORKFORCE PROTECTION PROGRAM. 
          YOU HEARD CHRIS MENTION, UH, THE FACT THAT WE BEGAN THIS FISCAL YEAR ABOUT $80 MILLION, UH, INVESTED INTO THE PROTECTION OF INDIVIDUALS, UH, MOST OF WHOM, UH, HAVE POSITIONS THAT WERE FUNDED THROUGH ESSER AT THE, AT THE CESSATION AT THE END OF ESSER IN SEPTEMBER, 2024. 
          WE SHIFTED THOSE INDIVIDUALS, UH, MAINLY INTO GENERAL FUND IN SOME INSTANCES TO OTHER PROGRAMS, UH, TO CONTINUE THE PROTECTION OF THOSE INDIVIDUALS. 
          GOING TO NEXT YEAR, WE'RE PROPOSING THE ESTABLISHMENT OF A $60 MILLION WORKFORCE PROTECTION PROGRAM, UH, TO PROVIDE THE PROTECTION FOR THOSE, UH, INDIVIDUALS FOR NEXT YEAR. 
          OBVIOUSLY, BEYOND THAT POINT, WHEN YOU LOOK AT FY 27 28, WE'RE LOOKING AT EFFICIENCIES. 
          OBVIOUSLY, THIS IS A BALANCING ACT BETWEEN WHAT WE CAN DO FOR THE 
          [01:25:01]
REMAINDER OF THIS YEAR, WHICH IS ALMOST OVER NEXT YEAR. 
          THE MORE EFFICIENCIES WE CREATE, THE LESS THE IMPACT WILL BE ON THE WORKFORCE OR SOME, SOME OF THESE PROGRAMS THAT COULD BE TARGETED. 
          I CALL THE BOARD'S ATTENTION TO FY 27 AND 28. 
          WHAT'S PLANNED TO BE DONE HERE IS JUST THAT IT IS A PLAN. 
          IT IS FLEXIBLE. 
          IF WE OVERPERFORM IN TERMS OF WHAT WE CAN ACCOMPLISH IN FY 26, OBVIOUSLY THIS WILL CREATE OPPORTUNITIES TO REDUCE THE PAIN IN FY 27 OR FY 28. 
          WE'RE GONNA BE SPENDING, UH, YOU KNOW, THE REST OF THIS, UH, THIS YEAR, FISCAL YEAR, ALL SUMMER, UM, IN THE PLANNING PROCESS FOR THAT FY 26 TO LOWER THE LEVEL OF LIABILITY TO ENSURE THAT TO THE EXTENT WE BOOK ADDITIONAL REDUCTIONS THAT DON'T IMPACT THE WORKFORCE SOONER RATHER THAN LATER, IT WILL CREATE A POSITIVE EFFECT IN TERMS OF THE SHEER VOLUME OF IMPACT IN FISCAL YEAR 27 AND 28. 
          BACK TO YOU, CHRIS. 
          GREAT, THANK YOU. 
          AND THAT BRINGS US TO THE END, AND I KNOW THAT FOLKS, UH, LIKELY HAVE QUESTIONS. 
          UH, SO NOW IS THE CHANCE THAT WE HAVE FOR DISCUSSION AS WELL AS FOR MY TEAM AND I TO LISTEN, UH, TO HEAR ANY OTHER, ANY OTHER SALIENT POINTS THAT WE NEED TO INCORPORATE. 
          I APPRECIATE THAT YOU'RE ALWAYS WILLING TO, TO BREAK THE ICE. 
          THANK YOU. 
          ASSUMING THAT WE'RE SUPPOSED TO BE ASKING QUESTIONS NOW, I THINK. 
          OKAY. 
          UM, SO ON SLIDE SIX, WELL, THERE'S A, IT'S MENTIONED SEVERAL TIMES THE UNFUNDED POSITIONS THAT WE ARE COVERING THE COST OF, UH, $60 MILLION, UM, IN THE CURRENT FISCAL YEAR, I BELIEVE. 
          CAN YOU SHARE MORE ABOUT ONE, WHERE THESE POSITIONS ARE LOCATED? ARE THEY EXCLUSIVELY AT SCHOOL SITES? AND THEN, UM, THE, THE TYPES OF POSITIONS, IF THERE IS A, LIKE A LARGE PROPORTION OF A CERTAIN TYPE OF EMPLOYEE THAT'S INCLUDED IN THERE? UH, I DON'T KNOW IF I CAN GET THAT LEVEL OF SPECIFICITY. 
          I WOULD, I WOULD BE TEEING IT, UH, TO A COLLEAGUE. 
          UM, BUT THE MAJORITY OF THEM, AND WHEN I SAY MAJORITY OF THEM, I WOULD SAY WELL OVER 98% ARE AT SCHOOL SITES, RIGHT? UH, THERE ARE THOSE THAT EXIST IN THE, IN THE DISTRICT OFFICE. 
          SO, FOR EXAMPLE, UH, I CAN SHARE THAT I HAD A, UH, A MANAGER OF ONE SORT OR ANOTHER IN ONE OF MY DIVISIONS, UH, THAT, THAT WASN'T NEEDED ANYMORE. 
          AND SO WE UNFUNDED THE POSITION HOPING THEY WOULD GET PICKED UP BY SOMEBODY ELSE AS WE SHUFFLED THE, THE DECK, THEY DIDN'T. 
          SO THEY'RE JUST STILL THERE, RIGHT? BUT THAT'S, THAT'S UNUSUAL. 
          SO IN MY ENTIRE DIVISION, I HAVE ABOUT, I DON'T KNOW, UH, 12, 1300 EMPLOYEES IN ALL OF MY DIFFERENT UNITS. 
          UH, THAT'S, IT'S AN EXAMPLE OF ONE, BUT THE VAST MAJORITY ARE AT THE SCHOOL SITES. 
          AND THEY'RE AT THE SCHOOL SITES. 
          AND MOST OF THEM, I WILL TELL YOU, THE MAJORITY ARE ALSO NOT FULL-TIME. 
          SO DURING THE LAST FIVE YEARS, WE HIRED A LOT OF, UH, PART-TIME POSITIONS, LOTS OF HANDS TO HELP E ESPECIALLY DURING THE RETURN OF COVID. 
          BUT INSTEAD OF MAKING THEM TEMPORARY, WE MADE THEM PERMANENT. 
          AND SO THAT'S THE ISSUE THAT DEVELOPED, UH, IS THAT WE HAVE THOSE PERMANENT EMPLOYEES, BUT IF THEY'RE NOT PICKED UP, IT'S NOW BEEN TWO OR THREE YEARS THAT WE'VE RESTORED POSITIONS. 
          WE TRY TO FIND HOMES FOR EVERYBODY, BUT, BUT WE HAVE TO FIND A FUNDED POSITION. 
          NOW, THEY STILL ARE PUT TO WORK, RIGHT? SO I DON'T WANT YOU TO THINK THAT IF THEY'RE UNFUNDED, WE'RE NOT HAVING AN EMPLOYEE SHOW UP AND WORK. 
          THEY ABSOLUTELY ARE ASSIGNED A SITE AND THEY'RE ASSIGNED DUTIES, AND WE TELL THEM, IF ONE OF YOUR POSITIONS OPENS SOMEWHERE ELSE, YOU MAY BE MOVING TO IT DURING THE SCHOOL YEAR. 
          UH, WHAT ARE THOSE RIGHT NOW, SPECIFIC POSITIONS? I KNOW THERE'S A LOT OF AIDES, A LOT OF VARIOUS TYPES OF CAMPUS SUPERVISORS. 
          UH, THERE'S A LOT OF, UH, UH, IT ES FORMERLY, IT FORMERLY ESSER FUNDED IT FOLKS THAT WERE THERE FOR SUPPORT, UH, THAT WE STILL HAVE QUITE A FEW OF. 
          UM, THERE'S 1100 OF THEM. 
          I'M JUST NAMING A FEW OF 'EM OFF THE TOP OF MY HEAD. 
          BUT THERE'S, THERE'S A LOT OF DIFFERENT POSITIONS. 
          WHEN YOU SAY SUPERVISOR TYPE, DO YOU MEAN LIKE SUPERVISION, AIDES AND CAMPUS AIDES? ARE THOSE THE TYPES OF POSITIONS? YEAH. 
          SO IMAGINE IF YOU WERE A PRINCIPAL THAT WHEN COVID WHEN WE FIRST STARTED COMING BACK, YOU HIRED UP A BUNCH OF THEM, UH, BECAUSE, YOU KNOW, STUDENTS HADN'T BEEN WITH US FOR A WHILE AND IT, AND THINGS WERE SORT OF, UH, UNPREDICTABLE AND PEOPLE HAD TO GET 
          [01:30:01]
BACK TO COMING TO SCHOOL. 
          SO YOU HIRED UP A BUNCH OF THEM. 
          WELL, WE STILL HAVE A BUNCH THAT, UH, AS THINGS CALM DOWN, PEOPLE HAVE NOT CHOSEN TO ADD BACK TO THEIR STAFF EVERY YEAR BY FUNDING THEM. 
          AND SO THEY CURRENTLY DON'T HAVE A, A PERMANENT ASSIGNED POSITION. 
          SO THERE'S A BIG DELTA THERE. 
          OKAY. 
          AND I MIGHT, NOT THAT IT'S SUPER IMPORTANT, BUT I MIGHT MAKE LIKE A SITE THE ASTERISK. 
          I DON'T THINK IT'S REALLY CHOOSING NOT TO KEEP PEOPLE. 
          I THINK THAT SCHOOLS HAD A GREATER AMOUNT OF FUNDING AND NOW, AND THERE HAVE BEEN LARGE, UM, COMPENSATION INCREASES FOR A NUMBER OF OUR EMPLOYEES. 
          AND SO POSITIONS COST MORE. 
          AND SO, UH, SCHOOLS ARE OFTEN IN THE POSITION IN THE LAST TWO BUDGET CYCLES OF HAVING TO MAKE DIFFICULT CHOICES. 
          YOU KNOW, CAN I FUND MY CAMPUS AIDS OR DO I WANNA FUND A CLASS SIZE REDUCTION TEACHER? AND WHILE THEY MIGHT HAVE PREVIOUSLY BEEN ABLE TO FUND BOTH, THEY CURRENTLY CANNOT ANYMORE. 
          SO, UM, JUST, I DON'T, I DON'T THINK THAT IT'S AN ISSUE THAT'S ATTRIBUTABLE TO LACK OF FORESIGHT ON SCHOOL SITES. 
          UH, PART I THINK IT IS MORE, UH, A CHALLENGE BETWEEN INCREASING COSTS OF STAFF, UM, WHILE THE SAME LEVEL OF NECESSITY, BUT NOT HAVING THE LOCAL SCHOOL SITE BUDGET TO BE ABLE TO COVER ALL THOSE POSITIONS. 
          ABSOLUTELY. 
          YEAH. 
          AND IT REALLY DEPENDS. 
          EVERY SCHOOL IS DIFFERENT. 
          UH, SO ALL THOSE SCHOOLS I MENTIONED WE HAVE OUT THERE, EVERY ONE OF THOSE SITUATIONS IS DIFFERENT. 
          THE OTHER BIG SPIKE WE SAW WAS, UH, WHEN ALL FOUR HOUR EMPLOYEES GOT FULL BENEFIT PACKAGES MM-HMM . 
          UH, WE SEE AN AWFUL LOT OF 3.75 HOUR A DAY EMPLOYEES BECAUSE THE COST OF A FOUR HOUR WENT UP SO MUCH. 
          UH, SO THAT ALSO DEFINITELY IMPACTED, UH, AND, AND, UH, IT'S, YEAH, IT'S, IT'S A, IT'S A BUNCH OF DIFFERENT, I I THINK ONE OF THE KEY THINGS IS YES, THE PURCHASING POWER OF SCHOOLS HAS DROPPED, RIGHT? AND, AND CORRESPONDINGLY WHEN YOU SEE INCREASE IN COMPENSATION, INCREASE IN SALARIES AND, UH, HEALTH AND WELFARE BENEFITS AND OTHER GROWING COSTS WHERE IT HASN'T INCREASED ARE TITLE ONE ALLOCATIONS. 
          TITLE ONE HASN'T INCREASED, RIGHT? SO THE REVENUE SIDE OF THE HOUSES, YOU KNOW, CHRIS TALKED ABOUT HASN'T CHANGED. 
          SO WHEN WE PUT FORWARD A 20 TO 30% SALARY INCREASE, THAT DIDN'T TRANSLATE TO A 20 TO 30% SALARY INCREASE IN TITLE ONE. 
          WELL, THE GENERAL, THE GENERAL FUND, UH, ALLOCATION ALSO DIDN'T, BESIDES THE RESTRICTED FUNDING SOURCES ON THE GENERAL FUND SIDE, THE GENERAL WELL, WELL NORM PHYSICIANS, WE DO COVER THE INCREASE OF SALARY COSTS WHEN IT'S NOT A NORMED POSITION. 
          THE, THE RIGHT. 
          SO, SO ON THE NORM SIDE, WE ARE COVERING THOSE COSTS CENTRALLY. 
          IT IS WHERE SCHOOLS ARE ACTUALLY MAKING CHOICES IS ON THE DISCRETIONARY FUND SIDE, WHICH YOU TEND TO SEE WITH YOUR TSP OR YOUR ENTITLEMENT FUNDS. 
          AND THERE IS WHERE YOU HAVE GREATER RESTRICTIONS. 
          SO WHEN YOU LOOK AT SOME OF THE CHOICES THAT WERE BEING MADE BY SCHOOL SITES, THOSE 1100 POSITIONS, THEY TEND TO BE WITH THOSE DISCRETIONARY DOLLARS, WHICH BECOME MUCH MORE LIMITED TO THE POINT THAT THE BOARD MEMBER MADE SUPERVISION AIDS, CAMPUS AIDS. 
          YOU SEE SOME STRATEGIES THERE. 
          BUT WE DO HAVE AN INTEREST IN LOOKING AT THOSE POSITIONS FOR A POSSIBLE NORMING GOING TO NEXT YEAR, TAKING INTO ACCOUNT THE SIZE OF THE CAMPUS, YOU KNOW, THE SQUARE FOOTAGE THEY HAVE TO COVER THE NUMBER OF STUDENTS ON CAMPUS PREVIOUS YEAR, UH, LOAD OF INCIDENTS, FOR EXAMPLE, AND COMING UP WITH A FORMULA TO ENSURE, 'CAUSE RIGHT NOW YOU HAVE SOME SCHOOLS THAT HAVE A LOT OF THEM, SOME SCHOOLS HAVE ALMOST NONE BASED ON BUDGETS. 
          IT IS A CRITICAL AREA IF WE CARE ABOUT SUPERVISION OF KIDS SAFETY AND SECURITY TO PROVIDE SOME NORMING GUIDANCE THAT MAY ACTUALLY PROTECT POSITIONS, THAT TYPE OF POSITION GOING TO NEXT YEAR. 
          BUT NEXT YEAR THERE'LL BE NO SUBSTANTIAL CHANGE. 
          THIS WILL BE FOR FY 27. 
          THANK YOU. 
          YEAH, IT WOULD BE HELPFUL TO KNOW, IT SOUNDS LIKE THE PC IS ALREADY CURRENTLY LOOKING AT, UM, THE, WHAT IS UNFUNDED, BUT WE HAVE PUT PEOPLE IN THOSE POSITIONS WHAT IS FUNDED, BUT IT'S VACANT CURRENTLY. 
          BUT IT WOULD BE, THAT'S WHY HAVING THE PARTICULAR POSITIONS WOULD BE HELPFUL JUST TO HAVE A BETTER UNDERSTANDING OF, UH, WHAT, WHAT OPTIONS EXIST FOR THESE FOLKS. 
          UM, BECAUSE I, I BELIEVE WHAT'S LISTED HERE IS WE WILL NOT BE FUNDING THESE POSITIONS, WHICH WOULD MEAN THAT THESE FOLKS NO LONGER HAVE EMPLOYMENT IF WE ARE NOT ABLE TO FIND ANOTHER POSITION FOR THEM, BUT, WELL, AND NOT NEXT, NOT IN THE FY 26 BUDGET, BUT IN THE FY 27 BUDGET. 
          WELL, AND, AND, AND, AND TECHNICALLY WE'RE NOT FUNDING THEM NOW, RIGHT? WE'RE, WE'RE PICKING THEM UP BECAUSE OF WE'RE MAKING A CHOICE THAT THAT'S IMPORTANT TO US RIGHT NOW. 
          UM, AND SO IT IT'S JUST COMING OUTTA FUND BALANCE. 
          YEP. 
          SO YEAH, WE WON'T HAVE THE MONEY IN 27. 
          I JUST THINK IT'S IMPORTANT TO BE, BECAUSE I THINK THE, YOU KNOW, THE LANGUAGE IS HIGH LEVEL AND NUANCED, BUT IT'S IMPORTANT TO BE CLEAR WHAT THIS MEANS IN TERMS OF THE HUMAN CONSEQUENCES FOR THE INDIVIDUAL PEOPLE WHO ARE IN THESE POSITIONS. 
          AND WHAT IT WOULD MEAN AS CONTEMPLATED IN THE PROPOSED FISCAL STABILIZATION PLAN ON SLIDE 10 IS IF WE'RE NOT ABLE TO FIND A FUNDED VACANT POSITION, YOU WILL NO LONGER HAVE A JOB. 
          UM, THAT'S, UNLESS WE CREATE EFFICIENCIES IN OTHER AREAS, RIGHT. 
          BUT IT IS A, IT IS A POSSIBLE SCENARIO. 
          UH, THAT'S WHY FOR NEXT YEAR WE'RE CREATING THAT WORKFORCE PROTECTION 
          [01:35:01]
FUND EQUAL TO $60 MILLION TO PROTECT THOSE INDIVIDUALS OUTTA GENERAL FUND. 
          IN ADDITION, THAT WILL PROVIDE YOU, UH, WITH AN END COUNT OF, UH, THE TYPES OF POSITIONS THAT ARE CURRENTLY, THOSE 1100 CLASSIFIED POSITIONS, WHAT THEY EXACTLY ARE. 
          OKAY. 
          THANK YOU. 
          AND THEN IT SAYS ON THE SLIDE, 1100 CLASSIFIED EMPLOYEES, JUST TO CONFIRM, IS THIS EXCLUSIVELY CLASSIFIED EMPLOYEES ARE THAT WE'RE TALKING ABOUT, ARE THERE CERTIFICATED EMPLOYEES WHO ARE IN THIS POSITION AS WELL? SO, SO, NO, BECAUSE, BECAUSE WE ARE ABLE TO ADJUST THE AMOUNT OF RECRUITING WE DO WHEN WE LOOK AT STAFFING PATTERNS, BECAUSE MOST OF OUR CLASSROOM TEACHERS ARE NORMED MM-HMM . 
          UH, AND SO, UH, IF SOMEBODY HAS TO GO BACK TO THE CLASSROOM BECAUSE OF, UH, DECLINING ENROLLMENT OR TO KEEP OUR R TWO OR WHATEVER THE FACTOR IS, UH, WE TYPICALLY HAVE TO RECRUIT MORE TEACHERS EVERY YEAR. 
          AND SO THEY, THEY TEND TO FIND A HOME. 
          NOW, WILL THAT BE TRUE NECESSARILY FOR THE WHOLE STABILIZATION PLAN? IT DEPENDS UPON HOW THINGS PLAY OUT. 
          OKAY. 
          I HAVE A BUNCH MORE, BUT I'LL PASS IT OVER TO OTHER, WHEN YOU TALK ABOUT SCHOOL-BASED PEOPLE AND NON-SCHOOL BASED PEOPLE, DO WE DIFFERENTIATE BETWEEN BOWRY PEOPLE AND LOCAL DISTRICT PEOPLE? ARE THEY THE SAME GROUP? SAME GROUP. 
          AND, UM, ALL OF US WORK FOR THE BENEFIT OF THE KIDS TO GIVE THEM A GOOD EDUCATION. 
          SO IT'S KIND OF A DIFFICULT, UH, DECISION BECAUSE, YOU KNOW, WE HAVE THE PEOPLE AT BERI WHO ARE DOING THE PAYROLL AND MAKING SURE EVERYBODY'S PAID EVERY DAY, JUST ONE GROUP AND, AND INVOICES IN INVOICES OUT. 
          SO HOW, HOW DO, HOW DO YOU DECIDE, HOW DO WE DECIDE WHO STAYS AND WHO DOESN'T STAY? WHO'S CLOSEST TO THE KIDS AND WHO'S NOT CLOSEST TO THE KIDS? BECAUSE IT SEEMS LIKE EVERYONE IS CLOSE TO THE KIDS. 
          AND I THINK THE GENERAL PUBLIC NEEDS TO KNOW THAT THERE ARE TWO BIG FACTORS IN THIS NON-SCHOOL BASED PEOPLE, AND THAT'S BERI AND THE LOCAL DISTRICT REGARDING THE CARRYOVER. 
          YOU MENTIONED THAT I THINK ONE OF 'EM, UM, WHERE IS IT? THE CARRY OVER FUNDS FROM SCHOOLS? YES. 
          DO WE HAVE AN IDEA OF HOW MUCH IS CARRIED OVER, HOW MUCH IS NOT SPENT AT OUR SCHOOL SITES? YEAH. 
          UH, SO THIS YEAR IS A GREAT EXAMPLE. 
          THAT'S WHERE WE'RE COMING UP WITH THIS NUMBER. 
          SO ANNUALLY IT'S AROUND $350 MILLION. 
          THIS IS ACTUALLY WHAT IT IS THIS YEAR. 
          UH, AND SO THIS IS MONEY THAT WE ALLOCATED FOR USE EITHER THIS YEAR OR LAST YEAR. 
          SOME SCHOOLS EVEN 2, 3, 4 YEARS AGO, THAT THERE'S STILL CARRYING OVER EXTRA DOLLARS. 
          UH, THE INTERESTING THING THAT I, I WANNA POINT OUT, SO MAJORITY OF THESE POSITIONS ARE AT SCHOOL SITES, AND WE KNOW THAT THIS IS ALSO THE AMOUNT OF CARRY FORWARD WE HAVE AT SCHOOLS. 
          SO THE IDEA OF AN UNFUNDED POSITION, IT DOES SORT OF POINT TO HOW IT'S THE LOCALIZED DECISION MAKING THAT SORT OF CREATES THAT. 
          SO THERE'S MONEY TO FUND THEM. 
          NOW, THAT DOESN'T GET RID OF OUR DEFICIT, RIGHT? AT THAT POINT, IT WE'RE, WE'RE REDUCING POSITIONS THAT PEOPLE ARE SAYING THEY'RE FUNDING 'CAUSE WE DON'T HAVE ENOUGH MONEY TO PAY FOR THEM. 
          BUT IT'S AN INTERESTING STORY RIGHT HERE FINANCIALLY TO SEE THAT WE HAVE THE MONEY AT SITES TO FUND THOSE POSITIONS. 
          BUT THE CHOICES BEING MADE NOT TO, WELL, ARE THOSE CARRY, I MEAN, THAT INCLUDES RESTRICTED AND UNRESTRICTED, RIGHT? THE CARRYOVER. 
          DO WE HAVE A SENSE OF WHAT IS RESTRICTED THAT'S COMING BACK AND WHAT IS UNRESTRICTED? WE DO. 
          SO THE MAJORITY OF IT IS GENERAL FUND, EITHER REGULAR GENERAL FUND OR C, WHICH IS ALSO GENERAL FUND THAT WE'VE LOCALLY NAMED, BUT IT'S NOT RESTRICTED. 
          UH, SO IT'S THOSE TWO SOURCES. 
          THERE ARE SOME SOURCES THAT ARE RESTRICTED, UM, THAT, THAT FOLKS GET TO KEEP AT THEIR SCHOOLS BECAUSE MAYBE WE CAN'T FIND ENOUGH STAFF YET. 
          UM, RIGHT. 
          SO THERE'S, THERE'S, UH, UNFILLED STAFF POSITIONS, BUT THE MAJORITY OF THIS IS GENERAL FUND. 
          OKAY. 
          AND THEN ALL THE SAVINGS THAT WE SEE, THEY DO, WE SEE, DO WE ALSO SEE THEM HERE IN THE, WE SEE THEM IN THE BARS, RIGHT? IN THE, THAT YOU SHOWED THEM. 
          SO WE ALWAYS, WHEN WE DO BUDGETS AND PROJECTIONS, WE HAVE TO HAVE ASSUMPTIONS. 
          SO THAT'S WHAT YOU'LL SEE HERE IS THAT WHERE DID I, SO THIS YEAR AND LAST YEAR ARE, ARE DONE. 
          SO THESE ARE ACTUALIZED. 
          SO FOR NEXT YEAR, RIGHT? THERE ARE NONE BECAUSE IT'S OUR PLANNING YEAR. 
          AND SO THAT'S WHY THE FOLLOWING YEARS YOU HAVE TWO BARS. 
          THE FIRST ONE IS WITHOUT A STABILIZATION PLAN. 
          SECOND ONE IS THE IMPACT THE STABILIZATION PLAN WOULD HAVE. 
          SO IN 27, YOU CAN SEE THAT YOUR UNRESTRICTED GENERAL FUND MONEY STARTS RETURNING, BUT YOU ARE USING IT TO STILL FUND THE DEFICIT. 
          'CAUSE YOU'VE ONLY DONE ABOUT A, A PART OF THE WORK HERE, YOU'RE FUNDING THE DEFICIT STILL FOR 28, AND YOU STILL HAVE TO TAKE ACTION 
          [01:40:01]
IN 28. 
          AND YOU DON'T HAVE ANY, UH, UNRESTRICTED ON UNCOMMITTED ANY LONGER. 
          OKAY? SO WE START TO SEE IT IN THE SECOND PART OF FISCAL YEAR 27TH. 
          THAT'S WHERE WE'LL SEE THIS AMOUNT ACTUALLY. 
          THIS IS, THIS IS ONE WHOLE FISCAL YEAR WITHOUT THE STABILIZATION PLAN. 
          AND THIS IS AFTER WE IMPLEMENT THE STABILIZATION PLAN. 
          OH, OKAY. 
          MORE THAN FIVE. 
          YOU'LL BEGIN TO SEE THE BENEFIT OF THE IMPLEMENTATION STABILIZATION PLAN IN FY 27. 
          AND YOU REACH THAT $1.4 BILLION ELIMINATION OF THE STRUCTURAL DEFICIT BY FY 28 0 0 MOVEMENT IN FY 26, OTHER THAN, AND WE'RE NOT CLAIMING IT THERE YET, BUT ANY EFFICIENCY, ANY REDUCTION, UM, OF BUDGET, UH, NOT ATTACHED TO WORKFORCE THAT WE ARE ABLE TO ACHIEVE WILL MINIMIZE OR LOWER THE NE THE NECESSITY OF IMPACTS TO CARRY OVER OR ANY PERSONNEL. 
          YES, ANY GOOD WORK WE DO HERE WILL SHOW UP IN A GOOD WAY HERE. 
          THE OTHER THING TO REMEMBER THIS IS STATIC BECAUSE AS OF TODAY, WE DON'T HAVE ANY CLOSED CBAS. 
          SO THIS IS ALL WITH NO ADDITIONAL COSTS FROM CONTRACT NEGOTIATIONS, WHICH I GET FROM MY LABOR RELATIONS FOLKS. 
          UM, OR INCREASE IN HEALTHCARE. 
          I HAVE THE COST INCREASES, UH, IN SOME MULTI-YEAR, BUT I ONLY GET THEM A YEAR AHEAD OF TIME, SO I DON'T HAVE THEM IN HERE. 
          AND THOSE USUALLY GO UP BETWEEN SIX AND 10% A YEAR. 
          OKAY. 
          I'LL COME BACK. 
          THANK YOU. 
          A FEW THINGS, BUT ALSO FEEL FREE TO CUT ME OFF AND I CAN DO A SECOND ROUND TOO. 
          I, I THINK IN ONE OF OUR INTERIM PRESENTATIONS, THERE WAS AN ASSUMPTION THAT IN FUND 17 THERE WAS A 2% DECREASE. 
          AND I'M, I WANT TO CLARIFY, BUT I'M ALSO CURIOUS WHY THAT IS NOWHERE HERE. 
          AND INSTEAD WE'RE MAKING MORE JACO, UH, DRACONIAN WILL BE MY ADJECTIVE, BUT CUTS WHEN WE COULD DO DUE A 2% DECLINE, WHICH WAS PREVIOUSLY CONTEMPLATED IN THE FUND 17 RESERVE. 
          UH, YEAH, THANK YOU. 
          THAT'S ACTUALLY DUE TO THE WORK WE DID THIS YEAR. 
          SO IN THE OLD INTERIM PROJECTION, SO THAT WAS, REMEMBER, OUR, OUR, OUR CURRENT PLUS TWO WAS RIGHT HERE. 
          IT WAS CURRENT PLUS TWO, RIGHT? SO THE NEW ADOPTION WE HAD ON A NEW YEAR, BECAUSE OF ALL THE STRATEGIC BUDGETING WORK WE DID THIS YEAR, WE HAVE NOW GOTTEN IN THE, WHAT WAS THE OLD YEAR PLUS TWO? WE'VE GOTTEN THERE, NOT BY A LOT, BUT WE GOT THERE WITHOUT USING 60% OF THE, OF THE BOARD'S RESERVES, WHICH IS WHAT OUR IN ORIGINAL PLAN WAS. 
          AND THAT PLAN WAS PUT INTO PLACE TO ACHIEVE A POSITIVE CERTIFICATION TO PROTECT OUR CREDIT RATING AND TO GIVE US TIME TO MAKE, TO MAKE SOME OF THESE CHANGES. 
          AND SO YOU CAN SEE THAT THAT WORK PAID OFF. 
          SO IF THE BOARD, AS I, AS I SAID BEFORE, IF THE BOARD WANTS TO USE AND THEY WANNA DISCONTINUE THEIR POLICY OF A CERTAIN PERCENTAGE, THEN THAT'S THEIR CHOICE AT THAT TIME. 
          SO WE COULD TAKE THE $532 MILLION EQUIVALENT AND THEN REMOVE $532 MILLION FROM THE FISCAL STABILIZATION PLAN TO GET TO THE SAME OUTCOME. 
          YES. 
          BUT REMEMBER THAT MONEY IS ONE TIME. 
          SO ONCE YOU USE IT, THE NEXT TIME, NEXT YEAR, THE DEFICIT'S BACK. 
          SO IT'S A RIGHT AFTER THAT FIVE 30, RIGHT? ONCE YOU USE IT, IT'S GONE. 
          IT'S A LITTLE SAVINGS ACCOUNT THAT THE BOARD HAS TO THE SIDE. 
          UM, FOR THE, I, SOME OF US HAVE BEEN ASKING TO EVALUATE THE EFFICACY OF A, A LOT OF THESE PROGRAMS FOR A WHILE. 
          AND SO I SEE IT HERE FINALLY, AND MAYBE THIS IS MORE OF A PROGRAMMATIC QUESTION, BUT HOW ARE WE FINALLY AFTER YEARS OF ASKING, EVALUATING THINGS LIKE SE AND TUTORING TO MAKE THESE DECISIONS THAT ARE GONNA LEAD TO THIS $65 MILLION ESTIMATED SAVINGS? SO, SO THIS IS SOMETHING THAT SINCE, UM, THE STRATEGIC INITIATIVE DEPARTMENT HAS COME UNDER ME, WE'VE STARTED, SO THIS WEEK WE ARE FORMULATING A PLAN FOR THAT, AND IT'S GONNA BE A SORT OF AN ALGORITHM OF, UM, WHAT ARE THE, THE MOST COSTLY PROGRAMS. UM, AND, UH, AND THEN AND ANALYZING THOSE TO SEE WHAT THE RETURN ON INVESTMENT HAS BEEN. 
          SO IT WILL BE A MULTI-YEAR PROCESS, WHICH WE DO HOPE TO HAVE SOME RESULTS BY FY 27. 
          UM, BUT THIS PLAN SHOULD GO TO THE SUPERINTENDENT WITHIN THE NEXT FEW WEEKS AND THEN TO THE BOARD AFTER THAT. 
          BUT THAT'S THE PROCESS. 
          YEAH. 
          AND THE BOARD SHOULD KNOW THAT WE ARE CONDUCTING, UH, AT ALL LEVELS, NOT ONLY ON THE BUSINESS SIDE OF THE HOUSE, BUT ALSO ON THE INSTRUCTIONAL SIDE OF THE HOUSE. 
          IMPACT REVIEW SESSIONS, UH, WITH PRIVATE SECTOR PROVIDERS, WHETHER WE'RE TALKING ABOUT THE CURRICULUM, WE BUY TUTORING PROGRAMS THAT ARE OFFERED, UH, BY DIFFERENT COMPANIES. 
          WE LOOK AT, UH, WHAT'S IREADY DATA, BUT MAINLY END OF YEAR, UH, ACHIEVEMENT DATA AND CONFRONT THOSE VENDORS, UH, WITH OUR PERFORMANCE, UM, AND, 
          [01:45:01]
UH, MAKE, UH, MAKE DIFFICULT DECISIONS. 
          UH, WHAT YOU'RE BEGINNING TO SEE IS, IS THE RESULT OF THAT. 
          AND I BELIEVE THAT WILL ACTUALLY INCREASE THE VALUE OF THOSE EFFICIENCIES. 
          THAT'S WHERE I KEEP REFERENCING IN FY 26. 
          EVEN THOUGH THERE ARE NO IMPACTS TO THE WORKFORCE WHATSOEVER, YOU WILL SEE REDUCTIONS IN BUDGET LINES. 
          AND TO THE EXTENT WE MAXIMIZE THOSE, THEN THE IMPACT ON FY 27 28 WILL BE REDUCED. 
          AND THEN SIMILARLY, YOU KNOW, ON THE, MAYBE THIS IS FOR, UM, PEDRO, BUT ON THE, WE'VE BEEN HEARING A LOT ABOUT DIFFERENT MODERNIZATION ATTEMPTS AND EFFICIENCIES AND THINGS LIKE IT AND TRANSPORTATION. 
          AND SO BESIDES LIKE REDUCING TRANSPORTATION OPTIONS TO GET KIDS TO PROGRAMS THAT THEY'VE CHOSEN, UM, UH, OR CHOSEN THAT, WHAT ARE THE, UM, UH, LIKE WHERE ARE WE STARTING TO SEE THE ROI ON SOME OF THOSE MODERNIZATIONS? BECAUSE I STILL THINK COST PER PUPIL, WE HAVE AN INCREDIBLY EXPENSIVE TRANSPORTATION, UM, PROGRAM. 
          AND CURIOUS WHAT, LIKE, YOU KNOW, IS THIS OUR ONLY SOLUTION IN THE NEXT FEW YEARS IS JUST TO LIKE REDUCE OPTIONS FOR FAMILIES? OR ARE WE ALSO SEEING OTHER SAVINGS? I THINK THE INTENTION WITH THE MODERNIZATION EFFORTS, EFFORTS START REALIZING SOME EFFICIENCIES IN FY 27 AND FY 28. 
          UM, WE'RE IN THE PROCESS OF JUST IMPLEMENTING THE TECHNOLOGY, UM, INSTALLATIONS ON OUR BUSES. 
          AND WHAT THAT WILL DO IS ALLOW US TO TRACK REAL TIME RIDERSHIP OF STUDENTS, UM, AS WELL AS OPTIMIZE ROUTES. 
          UM, ESSENTIALLY IT'S AN OPPORTUNITY TO THINK ABOUT DO WE NEED AS MANY CONTRACTED ROUTES, UH, TO SERVE THE UNIVERSE OF STUDENTS THAT WE HAVE TODAY? AND REALLY PRESERVING THE CURRENT WORKFORCE THAT WE HAVE TO SERVE, YOU KNOW, OUR SPECIAL ED STUDENTS AS WELL AS, UH, STUDENTS WHO HAVE PARTICULAR TRANSPORTATION NEEDS IN ORDER TO GET THERE. 
          WE HAVE TO IMPLEMENT THE INSTALLATION FIRST. 
          WE START THAT ACTUALLY IN JUNE WITH A COMPLETION DATE FOR THE FOLLOWING YEAR, COMPLETING ALL BUSES. 
          WE WILL START ROLLING OUT ON A EARLY PHASES, A SET OF, OF BUSES TO GET THE ROUTING DOWN. 
          UM, BUT THAT'S JUST IN THE TRANSPORTATION REALM. 
          WOULDN'T BANK ON SIGNIFICANT, YOU KNOW, SAVINGS THAT WOULD, UH, CORRECT THE MYP UH, DEFICIT, BUT IT'S ONE STEP, UM, AND AN EXAMPLE WHERE WE CAN ACTUALLY OPERATIONALIZE SOME SAVINGS. 
          UM, I THINK WHEN YOU'RE LOOKING AT, ACROSS OTHER PROGRAMS, IT'S PART OF THE KIND OF INTERNAL REVIEWS THAT WE'VE DONE ACROSS, UH, THE IT DIVISION LOOKING AT WHAT, UH, PROJECTS CAN BE DONE IN-HOUSE VERSUS, UH, SOME OF THE CONTRACTED AMOUNTS THAT ARE DEVELOPMENT THAT WE DO EXTERNALLY. 
          UM, WE HAVE A SIGNIFICANT AMOUNT OF RESOURCES THAT GO INTO, UH, CONTRACTED SERVICES THERE. 
          UM, FACILITIES, SAME THING. 
          SO NEIL, THAT THAT'S EXACTLY WHAT WE'RE DOING, DIVISION BY DIVISION. 
          UM, AND THANK YOU PEDRO. 
          JUST A FEW MORE THOUGHTS FOR NOW. 
          ONE FOR THE CAP AND NORM POSITIONS. 
          I MEAN, ONE OF THE THINGS THIS PROPOSAL DOES, UM, WHICH MAYBE MAKES SENSE FROM A FISCAL PERSPECTIVE, BUT IT REMOVES A LOT OF DISCRETION AT THE SCHOOL SITE. 
          UM, THIS WAS KIND OF WHAT MS EZ WAS TALKING ABOUT EARLIER, BUT, AND AS SHE ARTICULATED ONE OF THE CHALLENGES FROM AN EQUITY PERSPECTIVE, MOSTLY 'CAUSE IT HA IT AFFECTS USUALLY CLASSIFIED EMPLOYEES DIFFERENT THAN CERTIFICATED, BUT THE, THE, THE MECHANISM IS THROUGH NORM POSITIONS, UM, IS, UH, PUTS THE ONUS OF THOSE, RAISES THOSE RAISES AND BENEFITS ON THE SCHOOL SITE FOR NON NORM POSITIONS. 
          NOW, ONE SOLUTION THAT YOU BOTH DISCUSSED IS NORMING THOSE POSITIONS, BUT AGAIN, I'M NOT USUALLY IN FAVOR OF THAT BECAUSE IT REMOVES THAT DISCRETION. 
          UM, AND I THINK, YOU KNOW, TO MR. M'S POINT, LIKE WHO BEST KNOWS THE KIDS AND YOU KNOW, THAT KIND OF PRINCIPLE OF SUBSIDIARITY, LIKE HOW ARE WE MAKING DECISIONS CLOSER TO THE SCHOOL? SO I'M CURIOUS IF THERE ARE IDEAS THAT YOU'VE THOUGHT ABOUT OR IF WE CAN THINK ABOUT WAYS TO KIND OF SPLIT THE DIFFERENCE, IF YOU WILL. 
          LIKE, IF THERE'S A $200 MILLION PROPOSED SAVINGS FROM NORMING, MAYBE YOU DO NORM SOME POSITIONS, BUT MAYBE YOU JUST SAY FOR THE COST OF RAISES AND BENEFITS TO SCHOOL SITES, WE HAVE A FUND OF A HUNDRED MILLION DOLLARS AND IT'S LIKE A MATCH FROM THE CENTRAL OFFICE, WHICH MAY BE NOT WELL THOUGHT OUT OR RUDIMENTARY, BUT THE IDEA IS LIKE, HOW DO WE PRESERVE SCHOOL SITE DISCRETION BUT REMOVE THE BURDEN OF RAISES AND BENEFITS SUCH THAT, UM, IT'S NOT JUST ABSORBED BY THE SCHOOL SITE. 
          AND THERE, THERE'S THEN KIND OF BRING SOME EQUITY TO THIS IDEA BETWEEN, YOU KNOW, WHICH IS MOSTLY BETWEEN CLASSIFIED AND CERTIFICATED POSITIONS, BUT PARTICULARLY BETWEEN NORMED AND AND NON NORM. 
          SO I GUESS MY QUESTION OR REQUEST IS, CAN WE LOOK AT OTHER WAYS TO REDUCE THE BURDEN ON SCHOOLS THAT DON'T REQUIRE JUST NORMING? 'CAUSE THEN ALL OF A SUDDEN PRINCIPALS HAVE NO DISCRETION IN TERMS OF THEIR STAFF. 
          I THINK THERE'S AN OPPORTUNITY TO CREATE A POSITION OF BALANCE. 
          I MEAN, WHEN WE TALK ABOUT NORMING, UH, IT'S 
          [01:50:01]
NOT, IT'S NOT APPROACHED WITH THE INTENT OF DEPRIVING PRINCIPALS OF THE AUTONOMY AT THE SCHOOL SITE TO A CERTAIN EXTENT. 
          CERTAINLY MY VANTAGE POINT IS, SO SPEAKING ABOUT SAFETY AND SECURITY ISSUES, I DO THINK THAT THERE SHOULD BE A MINIMUM THRESHOLD OF INDIVIDUALS THAT SHOULD BE HIRED AT THE SCHOOLS FOR THE SUPERVISION OF CHILDREN. 
          BEYOND THAT POINT, TO THE EXTENT THAT THAT IS MET, THEN PRINCIPALS SHOULD CONTINUE TO HAVE LATITUDE AND AUTONOMY TO DO MORE. 
          BUT AS CHRIS, UH, PRESENTED EARLIER, 93% OF ALL OF OUR FUNDS ARE INVESTED INTO PERSONNEL. 
          THE VAST MAJORITY OF THAT IS AT SCHOOLS. 
          AND, UH, WE DIDN'T WANNA SHOCK YOU WITH THAT. 
          I MEAN, WE ARE ALREADY, THE NORM ACROSS THE COUNTRY IS 80, MAYBE 85% OF YOUR BUDGET INVESTED IN PERSONNEL. 
          WE'RE AT 93%. 
          YOU CAN TIE THAT INCREASE OVER TIME ALMOST UNIQUELY TO TWO THINGS. 
          AND YOU MENTIONED BEFORE ONE, THE IONS THAT WERE ADDED, UH, TO ESSER THAT NOW ARE A FUNCTION OF THE GENERAL, UH, OF THE, UH, GENERAL FUND BUDGET IN ADDITION TO COMPENSATION INCREASES. 
          UM, THE VAST MAJORITY OF THAT 93% IS ABSOLUTELY AT SCHOOLS. 
          SO YOU DON'T GET THEM MEAN YOU COULD CLOSE ALL THE RI ALL THE REGIONS AND YOU DON'T FIX THE STRUCTURAL DEFICIT OF THIS. 
          IT'S JUST THE REALITY. 
          BUT I DO THINK I APPRECIATE YOUR COMMENT AND WE COMMIT TO YOU THAT WE WILL FIND A BALANCED APPROACH. 
          THAT'S WHY WE HAVE ALL OF, YOU KNOW, REMAINDER OF THIS YEAR, THE SUMMER, AND THEN ALL OF NEXT YEAR'S FISCAL YEAR TO ADDRESS THIS, WE'RE NOT GONNA JUMP INTO THIS. 
          WE'RE GOING TO BRING IN PRINCIPALS HAVE CONSULTATION SESSIONS TO ARRIVE AT A BALANCED POSITION. 
          THAT TAKES INTO ACCOUNT HOW MANY SUPERVISION AIDS CAMPUS A SHOULD A SCHOOL ON THE BASIS OF ITS SIZE, RIGHT? SQUARE FOOTAGE AND MEMBERSHIP ENROLLMENT HAVE HOW MANY COUNSELORS I THINK WE'RE ALREADY AND WANNA LET THE CAT OUT THE BACK. 
          I THINK WE ALREADY BEGAN TO MAKE DECISIONS IN TERMS OF WHAT'S APPROPRIATE, RIGHT? SO NORMING SOME POSITIONS OFFER SOME DEGREE OF PROTECTION FOR THE STUDENTS, FOR THE SCHOOL, FOR THE PRINCIPAL. 
          BEYOND THAT, CONSIDERING OUR FISCAL POSITION, WE NEED TO NEGOTIATE THAT A BIT. 
          ONE OF THE THINGS THAT I THINK WOULD BE HELPFUL AT A FUTURE WORKSHOP, AND ONE OF MY FINAL QUESTIONS IS KIND OF WHAT ARE THE WHERE TO FROM HERE? HE IS LOOKING AT SOME, UM, SCHOOL SITE BUDGETS, YOU KNOW, MAYBE A TYPICAL ELEMENTARY AND MIDDLE AND HIGH SCHOOL TO LOOK AT THE NUMBER OF POSITIONS WHICH ARE NORMED, WHICH ARE NON NORMED, A NORMED, WHICH ARE, UM, AND THEN THEREFORE AS WE THINK ABOUT RACES AND BENEFITS, WHICH ARE COVERED CENTRALLY, BECAUSE THAT ALSO, AGAIN, MS GO RAISED THE POINT EARLIER, BUT IF, IF WE ARE MAKING DECISIONS AS A BOARD ABOUT RAISES AND WE'RE GONNA COVER THE COST OF THOSE NORM TEACHERS, THEN SCHOOLS, THERE'S NO DISINCENTIVE FOR THEM TO HIRE MORE NORMED TEACHERS, EVEN THOUGH THAT'S SOMEWHAT OF A, UM, MISNOMER BECAUSE NORM WOULD BE CENTRAL. 
          BUT THOSE DISCRETIONARY EMPLOYEES, THE SPECIAL EDUCATION AIDES, THE BEYOND THE BELL, WHATEVER, YOU KNOW, THE OUTTA CLASSROOM, THEY'RE GONNA BE RE UM, DISINCENTIVIZED TO HIRE. 
          'CAUSE THEY'RE GONNA HAVE TO COVER THE COST. 
          AND SO JUST THAT VISUALIZATION WOULD BE HELPFUL. 
          UM, WE CAN DO THAT. 
          UH, AND I GUESS, SO WHAT IS, UH, WILL BE MY LAST QUESTION FOR NOW. 
          UM, WHERE TO FROM HERE, KNOWING THAT THIS WOULD HAVE TO BE ADOPTED IN JUNE, AND THIS IS THE FIRST TIME THE BOARD AND THE PUBLIC HAVE SEEN THESE, WHAT ARE THE NEXT CONVERSATIONS AND NEXT STEPS TO KIND OF, NEXT STEPS WILL BE A SERIES OF ONE-ON-ONE CONVERSATIONS WITH BOARD MEMBERS TO GO INTO GREATER LEVEL OF DETAIL AND ANALYSIS OF WHAT'S BEING PROPOSED WITH A FULL RECOGNITION THAT, UM, WE ARE TALKING ABOUT A PLAN THAT KICKS IN TWO YEARS FROM NOW. 
          SO A LOT COULD, COULD CHANGE AND A LOT WILL CHANGE. 
          THAT'S WHY WE THOUGHT IT WAS IMPORTANT FOR YOU TO FIRST HEAR FROM, UH, FROM, UH, FROM THE TWO PREVIOUS SPEAKERS TO REALLY ANALYZE, NOT ONLY MAY REVISE, BUT THE PROJECTIONS GOING INTO THE OUTER YEARS. 
          RIGHT? UM, THE, THE OUTLOOK AT THIS POINT IS NOT GOOD, BUT AS YOU HEARD FROM THEM, WE ARE IN A SIGNIFICANTLY BETTER POSITION MANY OTHER DISTRICTS, AND WE HAVE A YEAR TO PLAN, RIGHT? SO IMMEDIATELY AFTER THIS MEETING, WE'LL BEGIN, UH, SCHEDULING ONE-ON-ONE, UH, MEETINGS WITH THE BOARD TO CONTINUE TO EXPLAIN WHAT'S BEING PROPOSED AND MAKE SOME, UH, MODIFICATIONS AS APPROPRIATE WITH A RECOGNITION THAT WE MAY FIND OURSELVES A YEAR FROM TODAY BACK IN THIS ROOM, EITHER CELEBRATING THE FACT THAT EFFICIENCY OR EXERCISES AND IMPACT REVIEWS RESULTED IN GREATER EFFICIENCIES THAN WE HAD PROJECTED AT THIS POINT. 
          THEREFORE, THE PLAN FOR FY 28 DOES NOT HAVE TO BE AS AGGRESSIVE A COMBINATION OF ELEMENTS. 
          THE BOARD MAY DECIDE, YOU KNOW WHAT, I CERTAINLY WOULD NOT RECOMMEND, UH, YOU KNOW, ZEROING OUT THE FUND 17 TO ZERO 'CAUSE THEN ALL YOU HAVE IS THE STATE REQUIRED RESERVE. 
          [01:55:02]
UH, BUT THERE ISN'T A POSSIBILITY THERE WHEN YOU COME TO A POINT THAT, YOU KNOW WHAT, WE WANNA PRESERVE SOME DEGREE OF AUTONOMY AT THE SCHOOLS, SO WE WANT TO REDUCE, UH, THAT CARRYOVER CLAWBACK AND INVEST SOME OF THE RESERVES. 
          THAT'S FINE. 
          BUT JUST UNDERSTAND THAT YOU'RE ONLY GONNA DO THAT ONE ONE TIME. 
          ONCE THAT MONEY IS GONE, THEN YOU'RE RIGHT BACK WHERE YOU STARTED. 
          BUT WE CAN, WE CAN IMPLEMENT IT IN A GRADUAL WAY, RIGHT, BASED ON THE FEEDBACK THAT WE'LL GET FROM THE BOARD. 
          BUT THE ONE THING WE HAVE THAT MANY DISTRICTS DON'T SAY FOR THE THIRD TIME IS WE HAVE TIME, WE HAVE TIME TO CONTINUE TO PLAN AND PREPARE FOR WHAT MAY BE A VERY DIFFICULT YEAR IN FY 28. 
          WELL, THANK YOU. 
          UM, IT'S NEVER A PLEASANT CONVERSATION, BUT NONETHELESS, WHEN WE LOOK AT, UM, THE SAVINGS THAT WOULD COME FROM THE REDUCTION IN THE 60 MILLION, ARE WE TAKING INTO CONSIDERATION ANY OF RETIREMENTS, THOSE THAT WILL NOT BE RETURNING TO THE DISTRICT? WHERE DOES THAT COME INTO PLAY IN THIS? GOOD QUESTION. 
          UH, SO BOTH ON THE CERTIFICATED SIDE AS WELL AS CLASSIFIED, WE'RE TALKING ABOUT FRANK AND DAVID, UH, COORDINATING CAREFULLY WITH KRISTEN. 
          WE'RE LOOKING AT PRIOR TRENDS OF SEPARATION FROM DUTY, RETIREMENT, ET CETERA. 
          WE KNOW ON AVERAGE WHAT THAT IS PER YEAR. 
          WE ARE BANKING, UH, ON A NUMBER OF THOSE INDIVIDUALS WHO SIT IN THOSE UNFUNDED POSITIONS. 
          THERE'S $60 MILLION, AS YOU CORRECTLY SAID, MIGRATING TO POSITIONS THAT BECOME OPEN AND HAVE FUNDING BEHIND THEM, RIGHT? THAT, BY THE WAY, IS TO A CERTAIN EXTENT. 
          WHAT HAPPENED FROM BEGINNING OF THIS YEAR WHEN WE CARRIED THE LIABILITY OF $82 MILLION OVER THAT YEAR PERIOD, A LOT OF PEOPLE FOUND PLACES, UH, THROUGH VACANCIES THAT POPPED UP IN THE SCHOOL SYSTEM. 
          THEREFORE, THE LIABILITY WAS REDUCED FROM 82 MILLION NOW TO 60 MILLION. 
          WE ANTICIPATE THAT THE SAME WILL OCCUR GOING TO NEXT YEAR. 
          WILL IT BE 20 MILLION? WILL IT BE 30 MILLION? WE DON'T KNOW AT THIS POINT. 
          BUT THE TREND, THE TREND TELLS US THAT FOR CERTIFICATED PERSONNEL, WE HAVE ABOUT OVER 2000 INDIVIDUALS THAT RETIRE ANNUALLY AND WE HIRE NEW TEACHERS, RIGHT? SO TEACHERS, IF WORSE COMES WORSE IN DOING FY 26, THAT WILL HAPPEN. 
          SO YOU'LL HAVE AN OPPORTUNITY FOR INDIVIDUALS WHO ARE WORKING OUTSIDE OF THE CLASSROOM, RIGHT? GOING INTO THE CLASSROOM OR CLASSIFIED PERSONNEL AS A RESULT OF RETIREMENTS OR SEPARATIONS. 
          AND THERE'S SOMETIMES HIGH LEVEL OF TURNOVER. 
          THEY'LL CREATE VACANCIES AND THOSE INDIVIDUALS WHO WILL REPOPULATE THOSE FUNDED POSITIONS, THAT'S WHAT WE WILL KEEP A KEEN EYE ON TO REDUCE, AGAIN, THE WORST THING WE WANT IS TO PUT PEOPLE ON THE STREET. 
          AND I THINK WORKING HARD THROUGH EFFICIENCIES, WE'RE GOING TO ATTEMPT TO MINIMIZE THAT BETWEEN NOW AND THE CLOSE OF FY 26. 
          SO WOULD, AS YOU SAID, YOU WOULD BE OBVIOUSLY OPENING THE DOOR FOR NEW HIRES, WOULD THERE BE SOME TYPE OF A FREEZE, A WINDOW IN ORDER TO SEE THE STABILITY THAT WE'RE LOOKING FOR? THAT IS EXACTLY WHAT WE PLAN TO DO. 
          AS WE ENTER FY 26, THERE IS ALREADY, UH, AN IRONCLAD FREEZE IN NON-SCHOOL SITE POSITIONS. 
          UM, AND BY THE WAY, VERY FEW GET HIRED. 
          UH, VERY FEW POSITIONS ARE ACTUALLY FILLED, UH, GOING THROUGH THE HIRING FREEZE. 
          BUT THAT IS AT THE REGIONAL LEVEL. 
          IT'S A CENTRAL OFFICE AT BEARY. 
          RIGHT. 
          WE HAVE NOT IMPLEMENTED THE HIRING FREEZE AT SCHOOLS AT SOME POINT. 
          THEN AGAIN, WE NEED TO SEE HOW THE EVOLUTION OF PERFORMANCE OF THE FINANCIAL SYSTEMS AND HIRING ARE WORKING. 
          AS WE GO INTO FY 26, WE MAY ADOPT SOME STRATEGIES, UH, DEPENDING ON WHERE WE ARE TO POPULATE POSITIONS IN SCHOOLS WITH CERTIFICATED TALENT, FOR EXAMPLE, THAT MAY COME FROM REGIONS OR CENTRAL OFFICE BACK INTO SCHOOLS, AND THEN CLOSE THE POSITIONS IN CENTRAL OFFICE TO CONTINUE TO FILL THE POSITIONS AT SCHOOL SITES. 
          YOU DON'T ACHIEVE THAT BY ALLOWING RAMPANT HIRING AS THE POSITION COMES UP WHEN WE FIRST NEED TO SCOUR INTERNALLY FOR THE TALENT WE HAVE OUTSIDE OF THE SCHOOL BEFORE WE FILL IT WITH, UH, OUTSIDE CANDIDATES. 
          WITH THAT SAID, WE KNOW BETTER, RIGHT? THERE WILL ALWAYS BE OUTLIERS. 
          YOU'RE NOT GONNA FIND MANY PHYSICS TEACHERS THAT ARE WORKING CURRENTLY AT BERI. 
          YOU'RE NOT GONNA FIND THAT MANDARIN TEACHER, RIGHT? OR FRENCH TEACHER. 
          UH, THERE'LL BE SOME VERY SPECIALIZED POSITIONS THAT WE NEED TO OPEN THE DOOR FOR HIRING AS SOON AS THE VACANCY OPENS. 
          THANK YOU. 
          NOW, AND THEN ON HERE WITH THE ACTIONS THAT WERE LISTED, WERE THERE ADDITIONAL ACTIONS THAT WERE NOT HERE THAT COULD HAVE BEEN HERE, THAT COULD CREATE ANOTHER PIECE THAT WE'RE NOT SEEING IN THIS FISCAL STABILIZATION PLAN? UH, WE, WE CAN ALWAYS CHANGE AND ADD TO IT. 
          REMEMBER? UH, WERE THERE ONES THAT WE DISCUSSED 
          [02:00:01]
IN, IN CLOSED SESSION UNDER DIFFERENT, UH, TOPICS WITH ALL THE BOARD MEMBERS THAT, UH, FOLKS GAVE ME PRETTY DIRECT FEEDBACK. 
          YOU KNOW, WE CAN'T SUPPORT THAT. 
          I, I I CLEARLY WOULDN'T PUT THEM IN THERE IF THE MAJORITY OF THE BOARD WAS WAS SAYING THAT. 
          SO WITH THAT BEING SAID, NO. 
          AND THEN LAST WITH THE CENTRAL OPERATION, NON-SCHOOL BASED REDUCTIONS, IT'S, YOU SAID ABOUT 17% IS THAT POPULATION OF PEOPLE. 
          UH, SO WHEN WE DO A REDUCTION, WE DO IT IN FTE. 
          UH, SO RECOGNIZING THAT THERE ARE SOME PART-TIME PEOPLE THAT WE THEN HAVE TO AGGREGATE INTO AN FTE THAT'S NOT AS COMMON IN CENTRAL OFFICE OR CENTRAL SERVICE UNITS. 
          THAT'S MORE COMMON AT SCHOOL SITES. 
          SO IT'S MOSTLY, UH, FTE 17.5% OF OUR WORKFORCE CENTRALLY. 
          GOT IT. 
          UM, YEAH, JUST FOLLOWING UP ON THAT ONE, ON THE CENTRAL OPERATIONS REDUCTIONS, UM, I WOULD ASSUME THAT SOME FOLKS WHO WORK IN NON-SCHOOL BASED POSITIONS HAVE RETURN RIGHTS TO SCHOOL SITES. 
          SO WOULD WE ASSUME THAT MAKING A 17% REDUCTION IN CENTRAL OFFICE OFFICES, INCLUDING REGIONS, MIGHT THEN ALSO TRICKLE DOWN TO SCHOOL SITE STAFF BEING LAID OFF IF THEY LACK SENIORITY? I DON'T THINK WE'VE GOTTEN INTO THAT LEVEL OF GRANULARITY BECAUSE TO, UH, BOARD PRESIDENT MURIEL'S COMMENT EARLIER, WE'RE JUST SHOWING YOU THE MATH OF WHAT IT WOULD TAKE AS AN AVERAGE COST TO AN FTE, BUT THERE ISN'T A SPECIFIC LIST OF FOLKS, SO WE WOULDN'T BE ABLE TO MAKE THAT DETERMINATION. 
          WOULD I THINK THAT THAT WILL OCCUR YES. 
          IN A DISTRICT OUR SIZE WITH THAT LEVEL OF REDUCTION? ABSOLUTELY, BUT I I WE WOULD HAVE TO ACTUALLY GET INTO THE, I MEAN, IT'S A CERTAINTY, RIGHT? THAT IT WILL HAPPEN TO SOME EXTENT, I WOULD IMAGINE TO SOME EXTENT, YEAH. 
          OKAY. 
          AND I UNDERSTAND THAT THIS IS THE, WELL, YOU'RE THE NUMERICAL PERSON, LIKE IT, IT'S YOUR JOB TO PROVIDE THE FISCAL DETAILS. 
          I THINK AS THE BOARD CONSIDERS, AND WE'LL BE TAKING A VOTE ON THIS IN A FEW WEEKS, THAT WE HAVE TO CONSIDER THE IMPACTS ON, ON SCHOOLS. 
          THAT'S, THAT'S WHERE OUR WORK STARTS, IS AT SCHOOL SITES IN CLASSROOMS. UM, SO I THINK THAT THOSE PERHAPS UNINTENDED OR UNSPOKEN CONSEQUENCES HAVE TO BE LIFTED UP ALONG THOSE LINES. 
          MR. MOUND, I THINK YOU NOTED, UM, IT'S NOT EXPLICITLY LISTED IN THE FISCAL STABILIZATION PLAN, BUT THAT CAP AND NORM, THE CAPPING AND NORMING OF POSITIONS IN FY 27 WOULD INCLUDE A REDUCTION OF C FROM 700 MILLION CURRENTLY TO 500 MILLION. 
          IS THAT RIGHT? YES. 
          THE, UH, THE C WENT FROM FIVE TO SEVEN USING ESSER MONEY BACK IN 2021. 
          AND SO, UH, THE CAPPING AND NORMING IMAGINES THE APPLICATION OF 400 MILLION OF THE BASE FIVE GOING TO POSITIONAL CAPTAIN NORMING, AND THE ONE AND 100 BEING DISCRETIONARY, NOT FOR ADDITIONAL STAFF, IN OTHER WORDS, TO KEEP PROGRAMS OR SPECIAL FUNCTIONS GOING AT SCHOOL SITES. 
          OKAY. 
          SO, AND OBVIOUSLY, YOU KNOW, THERE ARE, UM, THERE WAS A LONG ADVOCACY CAMPAIGN TO GET OUR DISTRICT TO A PLACE WHERE WE ARE FUNDING OUR SCHOOLS IN A MORE EQUITABLE MANNER, WHERE OUR HIGHEST NEEDS SCHOOLS RECEIVED MORE RESOURCES TO ADDRESS THE NEEDS OF THEIR STUDENTS. 
          UM, SO I, I THINK IT'S JUST IMPORTANT TO HIGHLIGHT THAT A REDUCTION IN IEN IS SIGNIFICANT, OBVIOUSLY WOULD IMPACT ALL SCHOOLS, BUT, UM, OUR HIGHEST NEED SCHOOLS MIGHT FEEL THOSE IN IMPACTS MORE. 
          UM, AND THEN THERE'S A REFERENCE TO ON PAGE 10, IMPLEMENTING, SORRY, THIS IS IN THE FY 26 PART OF THE GANTT CHART, IMPLEMENTING TIERED EQUITABLE STRATEGIES TO OPTIMIZE WORKFORCE IN FY 27. 
          WHAT DOES THAT MEAN? THAT MEANS, UH, ASSESSING THE CURRENT, UH, STAFFING PATTERN AND WHATEVER PORTION THAT WE AREN'T ABLE TO FUND ANYMORE, WE'D HAVE TO DETERMINE AS FAR AS, UH, PRIORITY ORDER, UH, WHAT, WHAT WE DISCONTINUE DOING AND HOW DOES EQUITY FACTOR INTO THAT DECISION MAKING EFFORT. 
          SO, UH, THAT AND THE ACTUAL PROCESS ISN'T CONTEMPLATED HERE, JUST THE MATH AS YOU, AS YOU POINTED OUT EARLIER. 
          YEAH. 
          OKAY. 
          YEAH, I MEAN, I, I LIFTED IT UP BECAUSE, WELL, I'M C I'M CONCERNED ABOUT THE IMPACTS ON ALL OF OUR SCHOOLS, BUT PARTICULARLY THOSE IN THE MOST FRAGILE POSITIONS. 
          UM, A REDUCTION IN SENDING MEANS FEWER POSITIONS BECAUSE SCHOOLS UTILIZE SUNNY TO, TO PAY FOR PEOPLE OFTENTIMES. 
          SO AGAIN, I LIFTED UP THE, THE REDUCTION IN UNFUNDED POSITIONS. 
          THAT'S WHAT 1100 EMPLOYEES CURRENTLY THAT ARE IN THOSE POSITIONS RIGHT NOW. 
          YOU TALK ABOUT THE REDUCTION IN C THAT MEANS FEWER SCHOOL SITE POSITIONS, BECAUSE WHEN WE CUT SUNNY SCHOOLS CAN'T PAY FOR THOSE POSITIONS ANYMORE. 
          UM, AND, AND THE LOSS OF CARRYOVER, I MEAN, CARRYOVER 
          [02:05:01]
IS ALSO ANOTHER, I, I NOTE, UH, THAT YOU NOTE THAT WE ARE AN OUTLIER IN CARRYOVER, BUT CARRYOVER IS UTILIZED BY SCHOOLS TO, TO ALSO, UM, PAY FOR ESSENTIAL PERSON WHAT THEY DEEM AS ESSENTIAL PERSONNEL AT SCHOOL SITES. 
          UM, AND THEN WITH THE POTENTIAL OF, UH, BUMPING BACK OF EMPLOYEES WHO HAVE SENIORITY, WE KNOW THAT OUR HIGHEST NEED SCHOOLS TEND TO EMPLOY THE LEAST SENIOR EMPLOYEES. 
          UM, SO THIS SPEAKS TO MAYBE DISPROPORTIONATE IMPACTS THAT WE MIGHT FORESEE AT OUR HIGHEST NEEDS SCHOOLS. 
          SO I WANTED TO POINT THAT OUT. 
          I JUST WANTED TO ADD, AND THANK YOU FOR MAKING THE CONNECTION ACROSS THE IMPLICATIONS AS WE'RE LOOKING AT THE DIFFERENT CONSIDERATIONS THAT WE HAVE HERE, RIGHT? BECAUSE THEY LAYER UPON ONE ANOTHER. 
          I JUST WANTED TO CLARIFY FOR, FOR CE E, WE WENT IN ONE YEAR FROM $283 MILLION TO A $700 MILLION COMMITMENT, WHERE WE HAD NO IDENTIFIED FUND SOURCE TO ACTUALLY SUSTAIN THAT. 
          LUCKILY, WE HAD ESSER IN PLACE, AND AT THE TIME, THE BOARD WAS CONSIDERING AN INCREASE FROM 2 83 TO 400 MILLION, WHICH WE THOUGHT WE COULD SUPPORT. 
          WHAT WE ARE DOING HERE IS TRYING TO AT LEAST SUSTAIN A GROWTH FROM THAT INITIAL $400 MILLION CONSIDERATIONS OF 500 MILLION. 
          UH, BUT THE REALITY IS, IS THAT WE'VE BEEN ABLE TO SUSTAIN SEI THROUGH UNSUSTAINABLE RESOURCES. 
          UM, AND I THINK THAT'S WHAT HAPPENS WHEN WE HAVE KIND OF BUDGETING VIA RESO. 
          AND THERE WASN'T AS MUCH CONSIDERATION AT THE TIME ABOUT WHAT THE IMPLICATIONS WERE FROM A BUDGET STANDPOINT. 
          BUT I THINK THAT THE TEAM IS LOOKING AT IT LIKE, HOW DO YOU CONCENTRATE, EVEN IF YOU HAVE A SUSTAINED INVESTMENT OF 500 MILLION, HOW DO YOU SUSTAIN THAT IN YOUR HIGHEST NEED SCHOOLS? HOW DO YOU ACTUALLY MAKE SURE THAT THERE'S A PROPORTIONATE BENEFIT TO THE SCHOOLS THAT WERE INTENDED TO BE, UH, IMPACTED AS A RESULT OF ASCE INVESTMENT? SO THAT, THOSE ARE, I THINK, THE BROADER CONSIDERATIONS THAT WE NEED TO HAVE AS WE LOOK A LITTLE MORE CLOSELY AT THESE FUND SOURCES. 
          AND IF WE'RE GOING TO DEVIATE FROM THE WAY, YOU KNOW, WE HAVE FUNDED VIANI IN THE PAST TO SHIFT TO MORE NORMING, THEN I WOULD ASSUME THAT EQUITY IS GOING TO BE INCLUDED AS PART OF ANY NORMING FORMULA. 
          AND WE KNOW THAT THAT'S NOT TYPICALLY THE WAY THAT NORMING WORKS, BUT I WOULD HOPE THAT THAT'S AN EXPECTATION. 
          I APPRECIATE YOU MAKING THAT COMMENT. 
          LOOK, AGAIN, NO IMPACT FOR FY 26. 
          FY 26 IS WHEN WE WILL MAKE, DEVISE THE MECHANISMS BY WHICH WE'RE GOING TO FY 27. 
          AND REGARDLESS OF A NUMERIC VALUE FOR REDUCTION EQUITY, UH, WILL DRIVE PART OF THAT MECHANISM. 
          UH, THE, THE GREATEST IMPACT WILL BE FELT THE LEAST IN THE HIGHEST NEED SCHOOLS. 
          OKAY? YOU HAVE THAT COMMITMENT FROM US. 
          UH, SO, YOU KNOW, CHRIS IS RIGHT. 
          I MEAN, HE DOES NOT, HE'S, HE'S, HE'S THE NUMBERS GUY. 
          AS AS MUCH COMPASSION AS WE TRY TO EMBED INTO HIM, HE'S, IT'S, UH, HE, HE DOES WHAT HE DOES. 
          IT'S HIS RESPONSIBILITY. 
          BUT TRUST ME, THE TEAM HAS PLENTY OF ADVOCATES, INCLUDING MYSELF, WHO ARE VIGILANT IN TERMS OF PROTECTING, UH, THE BUDGET, UH, THROUGH A, AN EQUITY LENS, PRIORITIZING A, UH, A MINIMIZING OF, OF IMPACT IN THE MOST FRAGILE SCHOOLS, HIGHEST NEED SCHOOLS. 
          AND ON DOWN FROM THAT, FROM THAT POSITION, THAT WILL CONTINUE TO BE THE WAY WE APPROACH THIS WORK. 
          I, I APPRECIATE HEARING THAT COMMITMENT. 
          UM, AND ONE LAST QUESTION FOR ME IS ON THE CONSOLIDATION OF THE DISTRICT FOOTPRINT, UM, HOW DID WE GET TO AN ESTIMATE OF $20 MILLION IN SAVINGS TO, UH, TO MAKE, TO MAKE THE 1.4 BILLION HANG TOGETHER? NOTICED WHAT I WAS POINTING OUT EARLIER, WE HAD TO COME UP WITH AN ESTIMATE, A DOLLAR ESTIMATE, TO EQUAL OUR CURRENT STRUCTURAL DEFICIT, WHICH IS 1.4 BILLION. 
          SO TO JUST LEAVE IT BLANK MEANS THAT I HAVE TO PUT MORE IN REDUCTIONS, RIGHT? AND SO CONSIDER IT, SINCE WE HAVE A YEAR TO DO THE WORK, IT'S A PLANNING FIGURE. 
          UM, I WOULD CERTAINLY HOPE THAT WE EXCEED THAT BECAUSE WE'RE A LARGE ENOUGH DISTRICT HOPE THAT WE WOULD EXCEED THAT, BECAUSE THEN IT MEANS LESS REDUCTIONS ON THE BOTTOM SIDE, RIGHT? I BELIEVE WE CAN GET TO 20 MILLION WITHOUT ANY PAIN WHATSOEVER THROUGH WHAT WE REFER TO THERE. 
          THERE'S, THERE'S DIFFERENT PHASES OF CONSOLIDATION. 
          PHASE A OF CONSOLIDATION THE TEAM IS WORKING ON THAT RIGHT NOW IS THERE'S NOT ENVISION CONSOLIDATION OF SCHOOLS, MEANING GOING FROM TWO SCHOOLS TO ONE SCHOOL OR THREE SCHOOLS TO TWO SCHOOLS. 
          IT ENVISIONS SCHOOLS THAT HAVE LOW ENROLLMENT, BUT GREAT UTILIZATION OF FACILITIES. 
          AND BY THE WAY, A LOT OF OUR SCHOOLS WERE NOT, ALL THE BUILDINGS IN SCHOOL WERE NOT BUILT AT THE SAME TIME. 
          SO YOU HAVE NEWER BUILDINGS. 
          SO THE CONSOLIDATION IS ACTUALLY CLOSING SOME BUILDINGS WITHIN, UH, THE, THAT CAMPUS ACROSS THE DISTRICT, UH, SAVING MONEY ON ELECTRICITY, WATER, THE MAINTENANCE, THE CLEANING OF, OF THOSE FACILITIES. 
          I BELIEVE BY DOING THAT ALONE, WE PROBABLY CAN 
          [02:10:01]
EXCEED $20 MILLION ANNUALLY. 
          UH, THAT'S PHASE A, PHASE A, PHASE B IS THE POSSIBILITY OF CONSOLIDATION OF SCHOOLS WE'RE NOT THERE. 
          WE NEED TO FIRST EXHAUST PHASE A, WHICH IS INTERNAL CONSOLIDATION, VA EFFICIENCY, WHICH WE ARE IN DIRE NEED OF DOING. 
          WE HAVE VERY LARGE CAMPUSES IN MANY INSTANCES, THAT NEED TO BE PROTECTED, SUPERVISED, CLEANED EVERY DAY FOR A POPULATION, UH, THAT REQUIRES UTILIZATION, PROBABLY OF A FRACTION OF THE BUILDING, OF THE FOOTPRINT THAT THEY CURRENTLY UTILIZE. 
          OKAY. 
          THAT'S, THOSE ARE, THOSE ARE THE DETAILS THAT'LL, THAT ARE HELPFUL TO KNOW, BECAUSE I THINK, UM, MOST PEOPLE WOULD UTILIZE CONSOLIDATION, WOULD READ CONSOLIDATION AS SCHOOL CLOSURES. 
          AND I THINK THERE'S A LARGE BODY OF RESEARCH ON HOW DAMAGING SCHOOL CLOSURES CAN BE, AND THE FACT THAT THE SAVINGS THAT YOU GET FROM IT ARE, ARE FAIRLY LIMITED WHEN COMPARED TO OTHER, UM, POTENTIAL OPTIONS YOU MIGHT CONSIDER. 
          UM, SO PERHAPS, AGAIN, I, IN ANTICIPATING A VOTE, I WANNA ENSURE THAT I'M, UH, VERY FAMILIAR WITH AND COMFORTABLE WITH WHATEVER I WOULD VOTE FOR. 
          SO I WOULD JUST URGE FOR SPECIFICITY OF LANGUAGE, UM, AND CLARITY SO THAT, YOU KNOW, IF WE'RE SUPPORTING $20 MILLION IN BUILDING CONSOLIDATION, THAT'S DIFFERENT THAN AN ESTIMATED $20 MILLION IN SCHOOL CLOSURES. 
          SO, UM, PERHAPS FOR JUNE, WE CAN, I KNOW THIS, THIS IS THE FIRST LOOK, BUT I WOULD ASK FOR THAT. 
          OKAY. 
          REGARDING THE CAP AND NORM POSITIONS IN FY 27, I THINK, I THINK THIS WILL DEFINITELY IMPACT OUR SCHOOL SITES A LOT. 
          AND SO I WOULD URGE THAT WE GATHER INPUT FROM NOT ONLY PRINCIPALS, BUT ALL STAKEHOLDERS WHO ARE IMPACTED AT A SCHOOL SITE. 
          SO FROM THE EDUCATORS WHO WORK THERE, FROM PARENTS, FROM STUDENTS, IN TERMS OF WHAT ARE THEIR PRIORITIES. 
          A PRINCIPAL MAY HAVE A PRIORITY FOR WHATEVER REASONS, BUT THE STUDENTS MAY HAVE A PRIORITY BASED ON THEIR PARTICULAR NEEDS PARENTS. 
          AND I THINK THAT GETTING PEOPLE'S INPUT INTO WHAT THEY, THEY THINK IT'S THEIR PRIORITY AT THEIR SCHOOLS IS GONNA BE VERY IMPORTANT IF WE WANT THIS TO WORK. 
          UM, I ALSO THINK THAT LOOKING AT SOME WAYS THAT WE COULD STILL GIVE SCHOOL SITES SOME FLEXIBILITY IS, IS ALSO GOOD. 
          AND I KNOW THAT YOU BROUGHT IT UP AND, AND, UM, IT WAS SUPPORTED. 
          I THINK THAT THAT IS ALSO VERY IMPORTANT BECAUSE SCHOOL SITES HAVE VERY UNIQUE NEEDS AND, UM, AND WE DON'T WANNA TAKE ALL OF THEIR AUTONOMIES AWAY. 
          SO, BUT I THINK THAT GETTING COMMUNITY INPUT, AND, BUT WHAT I MEAN BY THAT IS THE SCHOOL SITE COMMUNITY INPUT IS VERY IMPORTANT TO ROLL THIS OUT, INCLUDING THE CONSOLIDATIONS. 
          LIKE HAVING THAT DETAILED INFORMATION TO COMMUNITIES IS VERY IMPORTANT. 
          AND LIKEWISE WITH SPECIAL EDUCATION, I'M CONFUSED BECAUSE I'M THINKING IF WE BRING OUR STUDENTS CLOSER TO THEIR HOMES, THAT MEANS THAT WE ARE, UH, EXPANDING THE SERVICES AT THE SCHOOL SITE. 
          AND YET THE, A LOT OF SERVICES HAVE BEEN CLOSED AT DIFFERENT SCHOOL SITES. 
          SO I JUST WANNA KNOW WHAT THAT PLAN LOOKS LIKE FOR SPEC, FOR SPECIAL EDUCATION, BECAUSE I WOULD THINK THAT IF YOU'RE GONNA HAVE MORE INCLUSION, THAT MEANS YOU'RE GONNA HAVE MORE STAFF. 
          SO HOW WE SAVE BY BRINGING THEM CLOSER JUST BASED ON TRANSPORTATION, I DON'T KNOW. 
          IT DOESN'T QUITE MAKE SENSE. 
          SO I WANNA KNOW WHERE ARE WE GONNA GET THE DETAIL ABOUT OF THOSE PLANTS. 
          SO JUST A REMINDER, NEXT YEAR IS A, IS A PLANNING YEAR, ALTHOUGH THESE HAVE ALL BEEN DISCUSSED AS FAR AS GENERALLY, UH, AND SO YES, YOU'LL WANT DETAILS, BUT THAT, THAT THE PURPOSE OF THE PLAN IS TO SHOW HOW WE FINANCIALLY GET TO A, A, A STABLE BUDGET WITHIN THE PERIOD OF TIME THAT'S BEING REQUIRED. 
          UM, IF ANY OF THOSE VARIABLES CHANGE IN THE STABILIZATION PLAN, THEN THEY DROP DOWN TO STILL A SAVINGS THAT WE NEED. 
          AND MAYBE AN OPTION GOES AWAY, MAYBE WE CAN'T SAVE AS MUCH FROM ONE OF THOSE ITEMS, BUT THEY, THE SAVINGS STILL HAS TO BE MADE. 
          THE OBLIGATION IS STILL THERE. 
          SO I JUST WANNA REMIND US OF THAT. 
          IF WE TAKE OPTIONS OUT OR WE SAY, WELL, HOW ARE WE GONNA DO IT? OR LET'S MITIGATE THAT, THAT PLAN, WE STILL HAVE TO SAVE THE 1.4 BILLION WITH OVERSIGHT FROM THE COUNTY DURING THAT PERIOD OF TIME. 
          QUESTION ON THE PROPOSED, UM, BUDGET PRIORITIES. 
          NOW THEY'RE JUST HERE IN BOXES. 
          WHERE DO WE SEE THAT, UH, NUMBERS WISE IN WHAT YOU SHOWED US PROJECTED 4 26, IF THESE ARE PRIORITIES? UH, SO WE'VE INCLUDED THEM IN THE MULTI-YEAR PROJECTION ALREADY. 
          SO IT'S ALREADY THERE EXACTLY WHAT 
          [02:15:01]
IT IS HERE. 
          YES. 
          AND SO THIS, WE CAN SUSTAIN YEAR 26, 27 WITH WHAT YOU'RE SHARING WITH US NOW, IF THIS FSP WORKS. 
          CORRECT. 
          OKAY. 
          OTHERWISE WE WOULD HAVE TO FIGURE OUT WHAT WE WOULD HAVE TO CUT FROM HERE OR, WELL, THAT'S THE, THAT'S THE EXERCISE, RIGHT? AND IT'S MORE THAN, IT'S COMING TO THE POINT WHERE IT'S MORE THAN JUST THEORETICAL BALANCING NUMBERS ON A PAGE. 
          ANYTHING THAT WE CAN'T, SO WE COULD ADD ANOTHER A HUNDRED MILLION TO THE BUDGET, IT JUST MEANS WE WOULD NEED TO CUT ANOTHER A HUNDRED MILLION. 
          THAT'S, THAT'S WHAT BEING IN A DEFICIT POSITION'S ABOUT. 
          SO IT'S WHAT WE WANT TO FUND AND WHAT WE DON'T FEEL WE CAN FUND ANY LONGER. 
          AND SO THAT'S NOT A, A PAINLESS EXPERIENCE FOR ANY SCHOOL DISTRICT, RIGHT? BECAUSE WE FEEL EVERYTHING AND ALL OF OUR PEOPLE HAVE AN IMPACT. 
          BUT IT COMES DOWN TO DETERMINING WHAT HAS THE LEAST NEGATIVE IMPACT. 
          I THINK I REMEMBER A PAST BOARD MEMBER REFERRING IT TO ME AS THE LEAST BAD CHOICE, BUT THEY'RE ALL BAD CHOICES. 
          UM, THAT'S VERY MUCH THE POSITION WE'RE IN, IN A STABILIZATION PLAN. 
          AND SO THE PRIORITIES WE HAVE HERE, WE DON'T HAVE THEM RANKED SO THAT WHEN IT WAS, IF, IF WE NEEDED TO, I DON'T KNOW, CUT SOMETHING OR DOLLAR AMOUNT, WE WOULD HAVE TO DO THAT. 
          BUT THAT DOESN'T NEED TO BE DONE IN ORDER TO APPROVE FOR THIS FSP, CORRECT? CORRECT. 
          SO AS, AS, UH, PEOPLE HAVE BEEN INDICATING IT'S A PLAN THAT WE'RE PUTTING IN PLACE, UH, AND THEN IT'S UP TO THE BOARD AND THE SUPERINTENDENT TO MAKE SURE THAT THE PLAN IS PURSUED AND OR AT OUR INTERIM ADOPTIONS THAT IT'S CHANGED AND THE COUNTY WILL BE WATCHING TO SEE THAT THE PROGRESS IS MADE. 
          NOW THE ISSUE BECOMES MORE, IF WE DON'T MAKE THAT PROGRESS, AT SOME POINT WE'LL MOVE FROM A QUALIFIED TO A NEGATIVE STATUS, WHICH MEANS THEY WILL BE ASKING FOR IMMEDIATE ACTION. 
          AND WHEN THEY ASK FOR IMMEDIATE ACTION, THEY'RE LOOKING FOR US TO REDUCE ALL OF OUR EXPENSES IMMEDIATELY. 
          GOT IT. 
          OKAY. 
          SINCE WE'RE ON THE PRIORITY PAGES, UM, JUST ON THE TK $186 MILLION, IS THAT ADDITIONAL FOR PROPOSED ADDITIONAL, UM, SORRY, THE SQUARES, UM, THE PROPOSED JUNE ADOPTED FY 26 BUDGET PRIORITIES, THE OTHER SCORES, THERE YOU GO. 
          UM, THE 186 MILLION FOR TK, CAN YOU, UH, SHARE MORE? YEAH, THIS IS, THIS IS AT OUR FULL IMPLEMENTATION. 
          SO L-A-U-S-D WAS SORT OF PIONEERING, LEADING THE WAY. 
          WE DID MORE BEFORE WE HAD TO, THIS IS GREAT FOR US, WE DEVELOP OUR PIPELINE, RIGHT? 'CAUSE ONCE OUR STUDENTS ARE WITH US, THEY TEND TO WANNA STAY WITH US. 
          UH, HOWEVER, WE'VE BEEN DOING THAT AT OUR OWN EXPENSE, MEANING THAT WE'VE BEEN PAYING FOR THE STAFF TO SUPPORT THAT EXPANSION BEFORE IT WAS REQUIRED BY LAW. 
          NEXT YEAR IT COMES FULLY INTO PLACE, WHICH MEANS THE 10 TO ONE RATIO, 10 STUDENTS TO ONE ADULT COME INTO PLACE. 
          AND SO THIS IS WHAT IT REQUIRES TO MAKE THAT RATIO COME INTO PLACE. 
          AND IT'S THE ONE PART OF THE STATE FUNDING, UH, THAT AS YOU'VE NOTICED, IS, IS SOLID. 
          SO IT WILL BE HELPING US WITH THAT INVESTMENT. 
          THAT'S ONE OF THE STATE INCREASES THAT WE BENEFIT FROM, IS THE, UM, FUNDING TO, TO REDUCE THE RATIO CLASSROOMS. OKAY. 
          THANK YOU. 
          I THINK WE'VE RUN OUTTA QUESTIONS, BUT, BUT LET'S HEAR FROM OUR SUPERINTENDENT. 
          UM, I WANNA THANK THE BOARD. 
          I KNOW THIS IS, THIS IS VERY, VERY HEAVY, VERY DENSE CONVERSATIONS. 
          AND, UM, YOU KNOW, WE CERTAINLY HOPE THAT, UH, IT COULD BE AVOIDED, BUT IT CANNOT, UH, YOU KNOW, I'LL SAY FOR A THIRD TIME TODAY, YOU KNOW, WE ARE IN A BETTER POSITION THAN MANY DISTRICTS, BUT, UH, WE'RE NOT IN A POSITION THAT, UH, WE, WE WANT TO BE IN. 
          UM, THE GREATEST THREAT TO US IS, IS NOT, UH, REFLECTED IN THIS PRESENTATION. 
          UH, THE GREATEST THREAT TO US IS NOT THE DEFICIT POSITION. 
          IT'S NOT THE NECESSITY OF REDUCTIONS. 
          THE GREATEST THREAT IS THE UNCERTAINTY OF FACTORS OUTSIDE OF THE DISTRICT. 
          UM, YOU KNOW, THE, THE, THE SPEAKERS, UH, EARLIER TODAY SPOKE ABOUT, UM, THE MANEUVERING, THE AGGRESSIVE MANEUVERING THAT THE GOVERNOR, UM, AND SACRAMENTO ARE DOING TO OVERCOME THE DEFICIT POSITION. 
          SOME OF THOSE MANEUVERS ARE VERY LEGITIMATE. 
          SOME ARE, YOU KNOW, THEY LOOK GOOD ON PAPER, BUT DON'T NECESSARILY PRODUCE, UM, REAL SOLUTIONS OTHER THAN DEFERRING THE PAIN, DELAYING THE PAIN. 
          BUT THE MORE YOU DEFER THE COSTLIER, THE SOLUTION BEGIN, BE, BE, UH, BECOMES, UH, THE REAL THREAT IS THIS UNCERTAINTY OF THE ECONOMIC POSITION ACROSS THE STATE OF CALIFORNIA, COMPOUNDED BY STILL, UH, AN EXODUS OF SCHOOL AGED 
          [02:20:01]
CHILDREN, UH, OUTSIDE OF THE STATE, COMPOUNDED BY THE, UH, THE FEDERAL INSTABILITY OF FUNDING. 
          UH, AND BY THE WAY, THIS USED TO, WE, WE ALWAYS USED TO SAY, NO ONE'S GONNA CUT TITLE ONE IDA MEDICAID, IT'S NOT GONNA HAPPEN. 
          UH, WE'RE NOW SEEING IT DIFFERENTLY THAT, UH, WE ALREADY SAW CUTS TO NUTRITION PROGRAMS. WE ALREADY SOFT CUTS TO MEDICAID, UH, PROGRAMS. UM, AND WE ARE BEGINNING TO SEE, AS I ANTICIPATE AND CONVEY TO THE BOARD A WHILE BACK, THAT WHILE WE MAY NOT NECESSARILY SEE A DOLLAR REDUCTION TO TITLE ONE, UH, PROGRAMS, FOR EXAMPLE, WE WILL SEE A LOT OF QUALIFIERS AND WE WILL SEE A LOT OF TITLE ONE INVESTMENT VIA COMPETITION TO STATES IN VOUCHERS AND SUPPORT FOR CHARTER SCHOOLS AND ALL KINDS OF THINGS THAT WILL DIMINISH THE IMPACT AT THE LOCAL LEVEL. 
          THEN THAT IMPACT IS THE SAME. 
          SO IT'S THAT COMPOUNDED EFFECT OF UNCERTAINTIES THAT REALLY POSE THE BRITISH THREAT TO OUR DISTRICT. 
          UM, WITH THAT SAID, I REALLY THANK THE BOARD FOR YOUR TIME TODAY, AND, UH, AS I PROMISED, I WAS ASKED WHAT ARE NEXT STEPS, INDIVIDUAL MEETINGS WITH THE BOARD. 
          UH, WE'VE TAKEN NOTE OF ALL YOUR COMMENTS TODAY. 
          WE'LL CONTINUE TO TAKE NOTE OF THE COMMENTS. 
          YOU'LL, YOU'LL CONTINUE TO MAKE, UH, HOPING TO GO INTO THE JUNE, UH, MEETING, UH, WITH AS SOLID THE PLAN, UH, AS AS POSSIBLE TO ADDRESS THAT FY 28 DEFICIT POSITION. 
          SO THANK YOU VERY MUCH. 
          THANK YOU SO MUCH. 
          AND ALSO TO THE, UM, CALIFORNIA SCHOOL SERVICES. 
          WE APPRECIATE IT VERY MUCH. 
          THANK YOU. 
          THANK YOU, BOARD. 
          OKAY. 
          LOOKS LIKE THE MEETING CONCLUDED AT ABOUT 3 32. 
          UH, THANK YOU FOR COMING.
* This transcript was created by voice-to-text technology. The transcript has not been edited for errors or omissions, it is for reference only and is not the official minutes of the meeting.