Politics & Government
O.C. Schools Facing Hit of $110 Million
Local districts had already been planning for a shortfall in property taxes when the request for $73.5 million came in from the county, which is eager to stave off layoffs.
If the county goes through with a plan to divert property tax money earmarked for schools to county coffers, the total hit to Orange County schools will be close to $110 million, officials with the county Department of Education said today.
By law, the state is supposed to cover the shortfall, said Darren Dang, director of business services. But even if the state is able to bridge the gap, it will still create massive cash-flow issues for school districts.
County Superintendent Bill Habermehl has told Patch .
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In announcing its plan last week, county officials said they would redirect $73.5 million away from local schools so that they could plug a $49.5-million budget hole and stave off planned lay-offs. But education officials were already expecting a $30-million to $40-million shortfall in property taxes in an account called the “education revenue augmentation fund.”
Adding it all together, the potential hit to schools throughout Orange County is upward of $110 million, Dang said.
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The pain is distributed to school districts based on the amount of property taxes are collected in a school district’s area. The high value of property in South Orange County and the size of Capistrano Unified School District mean CUSD takes the biggest hit.
While all counties deal with shortages in their education revenue augmentation funds, and the state has consistently made school districts whole in the past, the $73.5 million more the county seeks is “unique to Orange County,” Dang said.
Last year, the fund was short by $23.5 million, some of which was repaid locally by the Orange County auditor-controller, said Chris Lombardo, coordinator of accounting for the county department of education.
“The state has always backfilled the schools,” Dang said.
Even if the state—which has a “bigger nut to crack” with its own multibillion-dollar shortfall—repays the local school districts, the funds won’t come fast enough, Dang said, and schools will face cash-flow problems affecting their ability to pay the bills.
All of this is on top of news that the state may “” on mid-year state budget cuts that kick in if tax revenues fall short. So far this year, the state is $3.7 billion behind, reports the Sacramento Bee.
