Four school districts warn of financial distress including San Marcos-San Diego UT

Qualified’ rating on state watch list means potential trouble paying bills

BY MAUREEN MAGEE- San Diego Union Tribune

Four school districts in San Diego County have made a state financial warning list — a signal they may not be able to pay their bills through the 2012-13 school year, the California Department of Education announced Monday.

The Borrego Springs, Mountain Empire, Ramona and San Marcos districts are among 97 in the state to receive a “qualified” financial certification; that’s down from 114 last year. The number of districts and education agencies to make the lowest “negative” certification list — an indication they will not be able to pay their bills — rose to 13 from 12 last year at this time.

The remaining 992 districts earned positive ratings from the state.

“The emergency confronting California’s schools is widening and deepening,” state Superintendent of Public Instruction Tom Torlakson said in a prepared statement.

The four disappointing financial report cards in the county are not a sign of mismanagement, said Lora Duzyk, assistant superintendent of business services at the San Diego County Office of Education. Rather, she said, they point to the state’s fiscal crisis.

“It’s a sign of the $25 billion deficit our state has, and the fact that the state doesn’t have any cash and they are taking our cash,” Duzyk said.

The state list is based on results of the semiannual Interim Status Report, which represents budget certifications for districts through October 2010. Districts must grade their financial stability by self-reporting their financial certification in budget reports that are issued to the county and state.

Earlier this month, districts submitted a more current interim budget report to their county education offices, which will either agree with the ratings or override them before forwarding the documents to the state.

The 535-student Borrego Springs district, nearly 7,000-student Ramona district and 18,000-student San Marcos district self-reported a “qualified” certification on both the October and March status reports.

The 2,400-student Mountain Empire reported a positive certification this month, and its superintendent said the first interim “qualified” rating was due to an accounting error.

The 12,000-student La Mesa/Spring Valley district gave itself a “qualified” rating in the March report, Duzyk said. Its placement on the state list depends on whether the county Office of Education concurs.

For the San Marcos district, its qualified certification is a result of the ongoing reductions in state education funding, said Gary Hamels, assistant superintendent of business.

“We are being realistic,” Hamels said. “We need to cut some combination of salary or benefits, or we need new revenue.”

Budget certifications are based on several factors, including student enrollment trends, cash flow, how much money has been set aside in reserve accounts, and whether realistic cuts have been approved to balance the budget. READ MORE VIA SAN DIEGO UT

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