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tv   [untitled]    May 23, 2014 10:00pm-10:31pm PDT

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these devices and projectors and those kind of things, is about the security. i know some schools struggle with having to buy cases for i pads, so just about security and make sure we get a count of what is actually sfusd property as far as devices, because to be quite frank with you, i've been a pta president at many schools and ptas have bought much equipment for the schools and then we don't know where it goes. televisions get lost, projectors get lost, so i can imagine devices would be a really hard thing to keep track of. how are we going to do that? what's the plan? thank you very much. thanks. i think we have another item now. it's a public education enrichment fund update.
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deputy superintendent. >> we're going to press our luck with a third powerpoint presentation. we know how you all love powerpoint, but this is going to be a brief presentation. at least it's only six slides long, so hopefully it won't take terribly long, but we did want to do a couple of things this evening, just the latest in a series of discussions that we've been bringing information to the board about renewal effort for the public education enrichment fund so one is to provide a process update, kind of where things stands in the proceedings, especially over at city hall with respect to the drafting of legislation that would extends the public
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education enrichment fund and create collaborative structures and and secondly we wanted to have a discussion regarding some possible changes to the rainy day reserve, which is a future of the current city charter and we've provided some information to all the commissioners in prior meetings about some of the concepts in the rainy day reserve. i think you're right in the line of the projection there.
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>> i'm sorry, i know there is maybe conversation happening, but i cannot focus on what you are saying. i'm just hoping that if you have something important to say, you need to take it outside the room. thank you. >> thank you commissioner. the 30 day rule basically means that any subsequentive proposal introduced as legislation at the board of superintendents cannot be taken up by a committee for 30 days so this is -- i think in the interest of good government and time for the community, as well as perhaps the elected officials themselves to become familiar with the contents of the proposed legislation. so that rule applies to these charter amendments so what that means is they will not be taken
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up in the rules committee for at least 30 days following the introduction, which took place on april 29, so we have led to believe -- this is from supervisor yee's on either june 12 or june 19. that's the date at which these -- all three of these pieces of legislation will be taken up. it's possible, still unclear at this point that the three measures could be combined into one ballot measure and that depends on whether there is a set of agreements from each of the elected officials regarding the contents and substantive terms of the three measures most specifically related to the children's funds. i think there is also a possibility that if such
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agreements were to be reached, that a separate piece of legislation could be introduced as late as next tuesday. i'm not sure what the prospects for that are. i think that's looking rather unlikely at this point, but i think there's a possibility that that could happen, but in that case that would also be subject to the 30 day rule at the city and taken up by the rules committee. and then finally when the committee work has been done at the board of supervisors, the full board has to submit charter amendments to direction of elections by july 25. that's just the overall process for these three pieces of legislation. and if i can transition to the rainy day reserve and just have three slides about this. i think all the commissioners are familiar with this, that in the course of developing the proposal to extent peef, and
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the city and district and leaders of the city and the district have been discussing some possible win-win improvements to the rainy day reserve, but those would need to be made through a charter amendment which would require a voter approval. the process for that is because this is not a component that's related to any legislation that's been introduced, then additional legislation would need to be introduced by the mayor or supervisor, and that would need to happen by next tuesday. if it is introduced, then by the city's process, that language could be incorporated
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into a single ballot measure, along with peef and perhaps children's fund and the children's of family counsel as well. that remains to be seen. just a recap of the provisions, one -- this is about how money gets into the reserve under the existing language so if year to year growth in the city general funds, total revenues exceed 5 percent, in other words if the growth is more than 5 percent, then half of the xe excess above 5 percent is directed to the rainy day reserve. that's how money makes its way into the city's rainy day reserve and that's not proposed to change at all. for withdrawals from the city, if the city controller projects total general fund revenues for the up coming budget year are less than revenues for any current year or prior year,
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then up to half of the rainy day reserve balance can be in the city budget for the upcoming year.
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and the second frankly is that the decision making process about appropriating funds from the reserve to the district is now resting with the mayor and the board of super visors so certainly that was the intent of the original language, but that is something that the city has -- you know, the willingness to revisit and change. that's some of the discussion that's taking place now. the possible changes. one is that there would be two separate reserves created so right now instead of having the one plot of funds in the rainy
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day reserve, that there would be a split of the one reserve into two reserves. one would be for the district and one would be for the city and the city would receive 75 percent of the current balance and the district would receive 25 percent. and then if the say -- if and when the city in any year where they would make an additional deposit to the reserve then the same per centages would apply.
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in other words, we would use the funds to avoid lay offs rather than rescinding lay offs and that's proving to be a very process. the second change is who decides whether a draw should be taken. this change would allow the board of education without needing approval to decide --
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to take a draw under certain conditions. the third change is that -- all of this is subject for the board to weigh in on and none of it is set in stone. it's just proposals we're bringing to you. the third is to increase the withdrawal allowance from 25 percent to 50 percent. now, this would be 50 percent of the district's reserve, of the district portion of the reserve. and then here are three, possibly among others, but three different options for conditions for the withdrawals so one is to -- in a way sort of mirror the current language so to continue to base the maximum draw on a decline in inflation adjusted for people revenues. that's closest to what is in place now. another is to allow a draw
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based on budget deficits that would be much less restrictive than what's in place now. on the flip side another option is to allow an actual decline in revenues rather than a decline that's inflation adjusted so that would be more restrictive than what's in place now. then finally a concept.
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then the final piece of information that you received was just a summary of the three pieces of legislation that were introduced by supervisors kim, avalos and yee. that's --
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>> is there any public comment on this item? seeing none, public comment is closed. commissioner wynns. >> i have a few questions. the first is there is nothing here as far as i can tell, but i haven't read the actual proposed language yet i have to say that -- we just got it that addresses the link between peef and the rainy day fund. there is nothing here -- all that i want is some language in
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the -- >> i think the superintendent can respond to that. >> that language is actually being crafted as we speak through the supervisors who have introduced their language. we were going to bring some preliminary language. >> that would be in the p 3 authorization. what it needs to say is for purposes of -- third third money will not count toward calculations for purposes of eligibility for the rainy day fund, period or something to that effect. >> to that effect, absolutely. >> that's the first thing and most important. i was just wondering why -- because i read through all of these scenarios that you gave us
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and most of them don't give us rainy day fund. and so i'm asking if that's just conservative, if we're just saying just in case there's no further because the way -- if we're not changing the way money is put into it, we should be -- just when we look at possibilities in the future, it seems to me that we should be thinking -- there's likely to be growth in the rainy day plan because that was one of the big issues is that there was growth. for us, the issue was that we didn't have any control over how we got the money. and it was -- and the link between it and peef was problematic at best because on
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more -- these one occasion, maybe really more than one, that was held up. we won't give you access to the rainy day fund unless you take what peef want you to do. so we want to decouple that, but my memory of what happened with the rainy day fund, there were two frustrations -- one, money was going into the rainy day fund even though they had a budget problem, because the problem wasn't revenue, it was growth and expenditure. they had money coming in, some of which was required to go into the rainy day fund, even though they had to make cuts to meet their budget. in recent years we were
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actually getting less money with actual cuts to our budget so that's confusing to me. the second thing is -- again, this is only for discussion purposes because theoretically it doesn't matter to us, but still it seems odd if they -- the other frustration of the city was they were not able to access it and that seemed to me the tension between us and the city is that we were able to access the rainy day fund under the rules, and they were not even though we were both facing difficult budgets. i just really want you to clarify whether my impression is correct. that could still happen. >> i'll try to address as much as i can.
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i think the first point is that the -- to the extent that there's one common pot of funds now, that in my observation, has been the source of, you know, a number of these tensions political debates and from the credit rating perspective, the critique that the city's agencies have made. they can also appropriate to the district in certain circumstances, separate circumstances. that, by creating a split or bifurcated reserve, that would alleviate that because the funds would be mutually
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exclusive so the city would have control of its portion, the district would have control of its portion, the city would continue to make deposits under the same circumstances as now, but the city has very little interest in what happens with the district's portion of the reserve. a lot of these issues would be alleviated. that has been the tension, in my observation has been around the fact that the funds are comingled, there's one pot that the city could use but there's also -- >> in if fact -- and i understand that perfectly. and of course the only thing for us to -- which we kind of don't really get to agree to, but we're talking about it anyway, is that in the very unusual circumstances, we could have access to more than what we would get here, but those
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are quite extraordinary circumstances in theory. as i understand it, whereas we've had a couple of years where the budget was so terrible we got a lot of money out of the rainy day fund, that would be unhikely likely in the future, but it could be likely that we would have access to a more modest amount. first of all, we know what's in the parts and we woebt give you access to it if you don't do a, b, c, something else, but we can't evening think of -- because that's what happened before. we never anticipated what they were going to be holding us up for. that's a good explanation because what they seem to be proposing are not many changes to the things that we would be concerned about and the main
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change is this separate fund and if that's their problem and they're fixing it, i don't have a problem with that so thank you for the answer. >> as far as the issue about the length between [inaudible] or the like, we can certainly make that explicit in the language and we'll go ahead and do that. and evening so, even for that language not to be there, you know, per what i was saying a few minutes ago. the city is very unlikely to care, frankly, about what -- if these two funds are separated, if their interest in the technical calculations for the district's reserve is really made moot practically because they don't have an -- their own financial interest in what happens with the rest of
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the stuff. >> the other thing is that in the past, the things they were holding us up for are the things we think we're changing in the p 3 authorization, but what we know is these were unanticipated issues and that's our concern is that we just can't think of every loophole that somebody is going to go sit down and dream up so just having the language that says they're not linked would seem to me is the only shortest way that we can think we solve that problem. if that's done i'm okay. >> any other questions, comments? you mentioned none of this is set in stone, so can we 60, 40, instead of 75, 25? just kidding. my suggestion about this is
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[inaudible] or whether or not we would be getting [inaudible]. >> not in the materials that i went through tonight, but yesterday i sent an email with scenarios and calculations to you. it's hard to tell because it's speculative. we don't know what the -- among other things, we don't know what the policymakers of the city would do in the future, including the near future about making draws or appropriations to the district under the current language so it's -- part of this depends on one zone predictions about how likely and for how long the city would continue to appropriate funds from the rainy day reserve to the
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district so in my view, it is certainly not guaranteed that the city would continue to make appropriations to the district as they've done for the last four or five years, at least indefinitely, especially as our own revenues hopefully will continue to increase as the lcff rolls outs and gets implemented. we could see that each year we'd certainly make the case, but even in bad years we've had very id owe sin cattic conversations about whether the city would approve a draw and very disconnected things have entered into that conversation such as should we be agreeing to a higher level of services or should we be selling surplus property. i think that's -- >> [inaudible].
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>> it's very unpredictable and not a guarantee. it's been very helpful over the last few years that there has not been as much of that in terms of resistance or objections to the city making changes as we've needed that support, but it's been every other year where there's been a random debate regarding the rainy day reserve. >> when talking about contributing to the fund, that they're required if it's 5 percent over, they're required to put this amount of money into the fund so they would be required if they were to have -- the city government would grow, that the revenues would grow, that they would be required to put this money into this fund, but now this fund would be split 75/25 and we would have sole oversight of
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the 25 meaning they wouldn't be the ones we'd have to go through and this problem you just described would be eliminated; is that correct? >> that's correct. and the numbers i sent yesterday i did include -- >> it was sort of overwhelming so i've just been hearing from some folks that we'd get less money. i'm hearing from other folks that's not necessarily true because they're still adding to the fund, it's just that we would be able to withdraw more than 25 per isn't of cent of that fund if needed; correct? >> one of the changes proposed is if the funds are split into a district reserve and city reserve, from the district reserve the board of ed could approve a draw of up to 50 percent of the