The Portola Valley School District's budget remains healthy, but the district will need to make over $1 million in budget cuts unless a parcel tax is renewed, district staff wrote in a report.
The school board voted 5-0 to approve the district's 2019-20 budget on June 26, according to the district. It also discussed beginning the process to put renewal of the soon-to-expire Measure O on an upcoming ballot.
The Measure O parcel tax expires in June 2021. It generates about $1.2 million annually for the district and goes toward advanced math, science and technology programs; reading and writing programs; art and music programs; reduced class sizes; and retaining qualified, experienced teachers, according to the district website.
The parcel tax "must be renewed" to support the programs, the report states.
The district will have to start talking to constituents about where cuts would have to be made -- be it increasing class sizes or cutting music and art program -- if Measure O is not renewed, said Chief Business Officer Connie Ngo. The money raised each year through the Measure O parcel tax pays for the equivalent of 12 teaching positions, she said.
At the June 26 meeting, the board began discussions about considering asking voters to renew the tax on the March 2020 primary ballot, the November 2020 general election, a special election, or on a stand-alone election, according to the staff report.
Passed in 2013, Measure O consolidated two expiring measures: Measure C ($290 per parcel) and Measure D ($168 per parcel) and increased the rate by $123 per parcel to $581, Ngo said.
Meanwhile, the 2019-20 budget includes a projected surplus of $469,249, according to the staff report. The district increased spending on salary and benefits, but decreased spending on materials and supplies, services and operating expenses, and special education, according to the budget.
There are forthcoming increases in pension costs, according to the staff report. Pension rates will continue to increase up to 19.1% for the California State Teachers' Retirement System in 2020-21 and 25% for California Public Employees' Retirement System in 2022-23, according to the report.
The district has not settled salary negotiations with its employee groups for the 2019-20 fiscal year, which begins July 1. Negotiations with the teachers union should begin in the fall, said John Davenport, Portola Valley Teachers Association president in an email.
The budget includes total expenditures of $15.1 million, with 78.5% going to salaries and benefits. District employment remains flat, as enrollment is declining, Ngo said.
The budget projects total revenues of $16.1 million, with 91.4% of revenues coming from property taxes, parcel taxes and donations from the Portola Valley Schools Foundation.
Board policy recommends holding at least 12% of total annual spending in reserves. The budget shows the district surpassing that minimum with 15.3% of its total annual spending in reserves.
The district also relies on Measure Z, a $49.5 million facilities bond that passed last November, to pay for repairs, renovations and new buildings on the district's two campuses.
The full 2019-20 budget can be viewed here.