Big boost for Chamber of Commerce funding

The Yorba Linda Chamber of Commerce's celebration of its 100th anniversary turned a bit more festive for the business group's more than 300 members with a City Council decision to increase funding for the organization by 56 percent over past years.

However, the boost—from $16,000 to $25,000 for a one-year period that began July 1 —was less than chamber officials had requested, and the decision wasn't unanimous, as the council's senior member, Mark Schwing, cast a negative vote.

Originally, the chamber's 19-member board of directors sought an increase to $40,000 each year for two years, according to a memo from executive director Phyllis Coleman. Chamber income mostly comes from member dues and fees for various events.

The requested increase was due to “the rising costs of doing business and a decrease of revenue at some of our events,” stated Coleman.

“The chamber has incurred a huge increase in insurance premiums for liability, special events and workers compensation,” Coleman said. She also cited increases “in utilities and rental of a facility to hold our events.”

Mayor Tom Lindsey and Councilman Gene Hernandez proposed an increase to $30,000 per year for two years, but colleagues John Anderson, Craig Young and Schwing nixed that plan.

Finally, all council members except Schwing agreed to a $25,000 stipend for one year, with a requirement the chamber quarterly present council with “deliverables that can be measured.”

Schwing said he couldn't support the motion, noting council members haven't increased their own monthly $500 stipends since 1992. But most council compensation comes from the city's monthly “cafeteria plan” contributions to members' 401(k)-type retirement accounts.

In March, council voted 5-0 to boost the per-month amounts they earn nearly eight percent, from $945 to $1,020 effective January 2013, with another $75 monthly step-up due in 2014.

Previously, council hiked the benefit 13.4 percent, from $833 to $945 in 2010. The same amount is given full-time employees and can be used for health benefits, but the current council members have the entire amount paid into retirement plans.

Schwing also cast the lone vote against city approval of a Savi Ranch Land Use and Mobility Vision Plan, financed by a $240,000 Caltrans grant and an additional $24,000 in city funding.

According to Community Development Director Steve Harris, the “objectives of the study are to ensure that Savi Ranch maintains its position as the city's number one employment center, as well as its leading business district for sales tax revenue generation.”

Harris noted the study also is aimed at “improving the area's livability” in light of already-approved low cost, multi-family housing. A final document is expected September 2014.

And, finally, a Hernandez motion to add $3,760 for annual Orange County Human Relations Commission membership dues to the city budget died without a second.

Black Gold golf, school finance numbers

This week I'll update two money-related matters from past columns:

First, considerable savings on interest payments for the Black Gold Golf Club bond debt —totaling some $15.6 million on June 30—is expected when the bonds are refunded for a second time, according to a recent report from city Finance Director Dave Christian.

Interest expense on the long-term construction financing can be trimmed about $250,000 per year from the current annual payments of about $700,000. The bonds, refunded previously in 2003, “are now eligible to be refunded again in 2013,” Christian noted.

Refunding to take advantage of interest rates now “at historic lows” won't add to the life of the bonds, which are scheduled “to be fully paid off by 2033,” Christian stated.

Golf course revenues are projected to reach $5.9 million for the just-commenced 2013-14 fiscal year and $6.1 million in 2014-15, with expenses, not including the interest payments, totaling $5.7 million in each of the two fiscal years.

Interestingly, according to city-supplied figures, 2012-13 revenue from green fees and cart rentals have dropped nearly 29 percent from the first full year of operation, while food and beverage sales have increased just over 65 percent.

In fact, Black Gold's first full fiscal year, 2002-03, has been the historic high for green fees, with a $3.76 million total, versus $2.7 million expected in 2013-14. The food and beverage income was $1.51 million in the earlier year versus about $2.18 million expected this year.

Pro shop revenue jumped close to 43 percent and driving range income nearly 37 percent from 2002-03 to 2012-13, with estimated totals for 2013-14 at $655,475 for pro shop sales and $299,976 for range revenue.

Black Gold's best overall year was the pre-recessionary 2006-07, with income close to $6.6 million. Low point, deep into the recession, was 2010-11, with revenues right at $5.2 million.

Total revenue since opening Nov. 16, 2001: nearly $63 million.

Second, some 73 percent of the Placentia-Yorba Linda school district's income comes from what is often termed the “base revenue limit,” which is calculated on an “average daily attendance” that's expected to drop 126 students this year.

In round numbers, the district is expecting $141 million of an estimated $192 million total revenue to come from this state-financed formula. Although a cost-of-living adjustment is usually applied to the formula, declining enrollment impacts programs and services.

Average daily attendance has dropped from 25,112 in the 2008-09 school year to 24,567 for the coming school year and is anticipated to drop to 24,477 in 2014-15.

This year's drop in federal revenue due to “sequestration” is projected to be 5.5 per

-cent or a total expected income of nearly $9.7 million from last year's $10.9 million.

And although secondary-level class-size reductions were eliminated in 2004, maximum ratios through third grade are to remain at 24 to 1.  

School budget presents regular challenge

Apportioning a $197 million budget to meet the diverse needs of about 25,000 students at 35 campuses in the Placentia-Yorba Linda school district remains a challenge, despite statewide progress on a goal to restore public school funding to pre-recession levels by 2020-21.

Some $75 million has been cut from the district's operating budget for the past dozen years, ranging from a $1.3 million reduction in 2001-02 to $10.1 million last year, with an additional $11.5 million trim to balance spending with income for the current 2013-14 fiscal year.

Since 88 percent of a typical year's budget goes to employee salaries and benefits, large cuts are difficult to limit to the 12 percent devoted to books, supplies, services and other outlays.   A class-size reduction program was eliminated, and class sizes at elementary, middle and high school levels have slowly crept upwards for the past 10 years.

Furloughs were instituted in 2009-10, varying among four, five and six days.  Last year's five-day furlough for 2,670 employees has been reduced to three days for most workers this year, placed in the week of the two-day Thanksgiving holiday.

The upcoming furloughs represent a 1.62 percent salary cut for all workers.  The furloughs for management staff, including Superintendent Doug Domene, will be 3.5 or four days, based on the length of their work year, and the five elected trustees will see their $750 monthly stipends trimmed by $12.15.

The new salary schedule for teachers for the 182-day work year ranges from $44,940 for a fully credentialed, first-year teacher to $93,027 for a 30-year veteran with a defined level of additional college credits, plus $1,500 for an earned doctorate.

Certificated managers, with five years or more experience, will see salaries from $88,430 for psychologists to $147,758 for executive directors.  High school principals will earn $127,930; middle school principals $111,837; and elementary school principals $109,600.

Classified workers, including clerical staff, classroom aides, bus drivers and custodians, are still negotiating, but they're likely to see a three-day furlough.  Current hourly pay is $9.68 to $39.55.  Manager salaries range from $42,471 to $127,929 at the five-year experience level.

Furlough days and salaries might change based on the exact amount of funding the district will receive from the state under the Local Control Funding Formula.  Currently, the estimate stands at about $5 million more than last year, including a 1.56 percent cost-of-living boost.

Negotiations with unionized employees could be reopened with an assumed negative impact on furloughs and salaries if the increase is less than $3.1 million or with an assumed positive impact if the amount is greater than $6.9 million.

School lottery cash totals $3.4 million

Many in Yorba Linda get a bit giddy when a lottery jackpot prize reaches the half-billion dollar mark, based on the crowded counters at this city's high-volume ticket sellers, during the days leading up to a big-dollar drawing.

But if local residents don't win any of the top offerings, they're consoled by the fact that at least 34 cents of every dollar they've spent on their dream goes to support public schools, including the 35 campuses in the Placentia-Yorba Linda Unified School District.

Sadly, the district's 22 elementary schools, six middle schools, five high schools and two special schools aren't awash in dollars as a result of the ever-increasing ticket sales, but district officials say lottery income, about 1.7 percent of total revenue, is “welcome.”

Lottery dollars for the just-commenced 2013-14 fiscal year are expected to total 3.4 million, according to current projections, out of a total $197 million general fund budget for the year.

Annual lottery revenue isn't a stable source of funding for the district, since the income has ranged from $77 per average daily attendance for 1991-92 to $180 in 1988-89.  This year's rate is expected to be $154, of which $124 is “unrestricted” and $30 is “restricted.”

The $30 figure represents 50 percent of the growth in lottery allocations and can only be used to purchase instructional materials.  The $124 figure can be used for any instructional purpose--but excludes acquiring property, constructing facilities or funding research.

This year's income would buy three textbooks per student, four computers per classroom or cover half of the district's energy costs for a year, according to district-provided figures.

But lottery expenditures are committed to the K-12 music program, counseling and the Educational Services Center, south of City Hall on Casa Loma Avenue, officials stated.

Since the first lottery ticket was sold in California in 1985, Placentia-Yorba Linda schools have collected $84.8 million in funding, with the 2012 calendar year total at nearly $4.3 million, only $20,000 behind the historic high attained in 2006, according to state lottery calculations.

Total collected by the North Orange County Community College District is $109 million, with a 2012 year total of nearly $6 million. The old Yorba Linda K-8 district received $950,065 before merging with the Placentia district in 1989.

The lottery was approved in 1984, when voters gave Proposition 37 a 58 percent majority.  Some $25 billion has been distributed to schools statewide: 76.7 percent to K-12, 16.2 to community colleges, 4.3 to Cal State universities, 2.7 to the University of California and the rest to other entities.

Lottery officials noted the $1.32 billion distributed 2011-12 made up 1.5 percent of state spending on public education, stating, “While that amount is relatively minor compared to public education's overall budget, it's still needed money schools are putting to good use.”