make clear a vote of affirmative on this. a vote for cpre is not going out to bid. roll-call, please. student delegate tom: yes. commissioner fewer: no. commissioner maufas: yes. commissioner mendoza: yes. commissioner murase: aye. vice president norton: yes. commissioner wynns: aye. president yee: aye. i would like to say that, although we passed this year, i am hearing enough interest on the board for next year, we may consider bidding again to see what kind of results we can get. then we can have a better dialogue around that.

i would like to pass the facilities committee. to have some discussion on this issue. >> i know this was brought up in the building and grounds committee. i attended one of the meetings were this was the topic. it was just those committee members. it was and augmented meeting. maybe with a little more emphasis, this topic is coming. we are all very aware that this is the time to speak up and offer your suggestions. i think i might have been rolling through but i decided to sit and stay for the meeting. commissioner mendoza: i think it would be worth having this discussion, buildings and grounds. one of the things we want to consider is not necessarily

reopening the position we cut, but to think about what position we do need. i do not think it necessarily has to be the position that was held by the previous staff member. i wanted to be really clear about that. president yee: the next one would be k20 and k21. would you like to take them together or separate? >> together. i was confused because the descriptions are similar, of the two items. they are both significant large amounts of money. i wanted to get more understanding of how they differ and what they are for. >> before mr. heinrich speaks, i do not know if he has come. he is our director of networking and infrastructure on the i.t. team.

we have someone on paternity leave and mr. heinrich is acting at -- as chief technology officer. he is doing a fantastic job and he will demonstrate that in a minute. >> you are the one who sends the spam alert. >> thank you very much and thank you for the opportunity to meet you this evening. in response to your concern, i agree, given the wording, it is difficult to interpret the difference between these

resolutions. the key difference is in k-21, you will notice the term back up and archiving. these are the solutions you have. one component is storing a thelive data. the amounts are similar because you need a similar-sized solution to archive and back of that data. this meets our retention needs for long-term, historical data. between these resolutions. the key difference is in k-21, you will notice the term back up and archiving. these are the solutions you have. one component is storing a thelive data. the amounts are similar because you need a similar-sized solution to archive and back of that data. >> thank you for explaining that. president yee: great job. roll call please. student delegate tom: yes. commissioner fewer: yes. commissioner maufas: yes. commissioner mendoza: yes. commissioner murase: aye. vice president norton: aye. commissioner wynns: aye. president yee: aye. item k-92. i severd this. when i was listening to the remarks of dennis kelly, i was

confused with the relationship between his remarks and this particular item. i wanted an explanation. >> there is no relationship. [laughter] president yee: that is simple. i would like to see if the superintendent can -- that takes care of this item. i would also like to have an explanation of some sort of what mr. kelly was talking about in terms of people not give in theirpars. you do not have to say it here. superintendent garcia: we will look into that. i cannot speak for anyone else in the room, but that is the first i have heard about it. do you know anything about it? would you rather send a memo to the board about what is going

on? >> i can do that. there has been discussion over the last few weeks about this. superintendent garcia: could we follow up and give it to the board? president yee: thank you. student delegate tom: yes. commissioner fewer: yes. commissioner maufas: yes. commissioner murase: aye. vice president norton: aye. commissioner wynns: aye. president yee: aye. we are finished with this item. item q, superintendents proposals for first reading. this would be 126-12sp1, adoption of fiscal year 2012-

2013 recommended budget. could i have a motion and a second? we will be referring this item to the special meeting of the board. >> it will be the government and budget and then a special meeting. president yee: this budget will be heard at a special meeting. got it. where is it going to go? it will be next tuesday, the 19th. we will post a time for that as soon as we determine what time we can do this. is this allowed for public comment or do i do that later? clarification? ok.

let's have the presentation first. >> deputy superintendent, is your plan to do a brief presentation since we are going to spend a significant amount of time on tuesday? >> it sounds like that would be the right approach. >> ok. i am just asking for a point of clarification. president yee: we have some information. we will refer to this information at the next meeting. thank you. >> he did a lot of work on that. president yee: ok, would you like to make a public comment on

this? >> i would like to encourage the board to review those. >> there is no presentation today then. president yee: that is going to be next week. >> i am going to object to that. we purposely changed the rules for the board so that we could treat this as an agendized item because we wanted people to pay attention to budget, not on the night that we vote for it, but to be thinking about it and participate in the process. i have tried to review this. i like having people tell me what they think. this is the most serious decision that we make and i do not think we should treat it like any other thing that we vote on.

>> i would agree, actually. the deputy superintendent went to the trouble of making a presentation. members of the public did come to attend this discussion. this is the most -- i agree. this is the most important thing that we do and we should give its due diligence. president yee: ok. we are going to reverse that decision and have a presentation of the budget. >> ok, commissioners, back by popular demand, we will try to go through this, maybe some sort of compromise. we will hit the highlights and go through some of the information fairly quickly. some of it you have seen before.

this will serve a couple of purposes. the first is to provide information to the board that you have not heard before. also, to provide information to the public that will be posted on our web site, as it always is. for people to have some semblance of stand-alone information. those things, i will go through quickly tonight and we can elaborate on the meeting next tuesday. i wanted to start with a set of guiding principles. these are similar to the guiding principles we have used for the last two years in the budget development process. i think that they are as important as they have ever been. i want to acknowledge coleman advocates for developing a lot of the thoughts behind these guiding principles, which we have adopted but we really did appreciate the thinking that coleman developed a few things

-- a few years ago and we have borrowed and stolen a little bit of their thinking because we think it applies. the state budget, there is not a whole lot more to say that is new. there were a couple of tidbits that we came across. this is from a report released by the state comptroller. under the second bullet point, about the cuts that have been made over the last six years from the state. specifically, the state general fund has been cut by $12.2 billion. about half of that, more than half, has been cut out of k-14 funding. that is the largest and most disproportionate amount of spending cuts in the state budget since then. the fact that the governors of -- proposed but it -- budget

leaves k-14 spending flat is nothing to be overjoyed about. having said that, it is very siificant. if it does not passed and our children future initiative does not pass, we stand to see very deep cuts. the second bullet point is hot off the press. the superintendent alluded to this in his opening comments. the legislature is, by state law, required to pass a budget by this friday and if they do not, then their own paychecks become suspended. until they do pass a budget. that is leading folks who are observing this process to predict they will pass a budget. the committees and their

leadership have introduced versions of the budget in their respective chambers. all signs point to something being passed. the student funding proposal does not appear to be being taken up in an effective way by the legislature. that is likely to be rejected in terms of implementation for next year. otherwise, the funding for k-12, we believe -- this is what we're hearing from our sources -- funding levels will probably reflect those proposals. there is speculation whether differences between the legislature persians and the governors are large enough for there to be a veto possibility. whatever the legislature passes,

there are some things pertaining to social services. it is being debated a little bit. the tea leaves are being read about whether they will reach an agreement or to the extent that they do not reach symmetry in their proposals, that could result in a veto. that does not prevent the legislature from meeting its requirement to pass a budget by june 15. this is all information you have heard before. the fact that the governor's proposed budget includes zero funding, how much of a problem we think that is, and that taxes -- if taxes are not approved, we face significant cuts last year. -- next year. the developments we have talked about have been positive. they are continuing.

they continue to move in the right direction for it transportation funding was included in the may revise. we closed the transaction to sell 705 boulevard to san francisco state university. that transaction closed two weeks ago. so we have the funds and we have given notice to the holders of the certificates of participation who are intent to repay those. $75,000 per year through 200029, beginning next year. the mayor's proposed budget is included, as we expected. we hope the funding for the rainy day reserve, it also reflects an expectation that the 2013-2014 fiscal year will include a drop. all of these things helped to reduce the gap.

on the other hand, we have these statistics that are so great. the major cuts could be up to $23 million in the middle of the year. superintendent garcia mentioned that there is a historically high level of school districts that are facing fiscal insolvency as a result of the statewide fiscal crisis. these are some overall statistics about the general fund reflected in the recommended budget. i am looking at rita and her team has done the heavy lifting to pull these numbers together. they deserve a lot of acknowledgement for that. i also want to appreciate the work of the staff team that the deputy superintendent for his faded on as well as a grid -- a good cross-section of leadership.

this is what we are proposing as the budget for next year. there is still a very significant imbalance between revenues and expenses to the tune of $30 million. we are fairly -- we are barely making it with $230,000 to spare. that will allow us to maintain our 2% reserve at the end of 2013, which we have to do or else we will face a number of consequences we do not want to think about. at the same time, that will put us in a position for 2013-2014 where we have to make fairly significant cuts. 13 will be preparing between now and next week the multi-year projections. i know you are familiar. that format shows the trajectory of the unrestricted general fund balance through 2014-2015.

other revenues, most of this is not new information. one thing i will point out is there is a glimmer of a positive trend. sales tax, which we receive a portion of in the city, is projected to increase by 6%. we saw that increase in this current year. it looks like that is going to happen for 2013 if all the predictions that the city is making is accurate. expenditures, i am sorry for some of the formatting issues. these expenditures, we are continuing to reflect, in our recommended budget, basically a continuation of the expenditure cuts that we have had to make over the last couple of years. at the same time, there are some areas where you will see some additional costs.

some of them are articulated here. we will go into more detail about these items next week. two or three programs. this is apropos of the discussion that you have -- that you had a few minutes ago. to recap, the tier 3 represents flexibility established by the state related to funding sources that were previously restricted for various uses, retired populations. that was the list that you saw earlier in your meeting. a primary advantage of that is the reason why the state established that flexibility, to allow districts another set of tools to get through this fiscal crisis. it extended well beyond what folks initially thought at that time. it has been extended beyond the original window that was

established back then. in our district, we are recommending that $16.5 million of the $62 million that we received in total refunds be flexed. $41.6 million would remain invested in problematic areas that have existed since before this flexibility was provided. the majority of that is in the targeted instruction improvement block grant. there is a page in the budget book, page 54 of the budget book, has a table. we will pull this together so it is all in one place and more easily understandable. page 54 has some of the information that a couple of the commissioners were asking for. to no one of the total soared -- what are the total sources? what is the amount proposed to be flexed?

what is the amount proposed to be extended on the original tier 03 purposes? we will incorporate that with the information you saw before. the equity reports, we are still intending to update our equity assessments, as we have done for the last couple of years. again, describing our principles, priority areas, areas of concern from an equity perspective. there are some examples of information that will be -- that we will be updating, like layoffs, updated resources. i want to comment on the second set of points about this assessment of our work increasingly reflecting implementation of the district's strategic initiatives. we are getting much clearer. i want to acknowledge the work of the deputy superintendent and

others for pulling together some very thoughtful analysis of what it will take to implement, for example, the state standards, and for the first time, we have very detailed implementation plans for this type of work. we're looking forward to being able to share more information about that as we prepare this equity analysis. here are the next steps. the budget committee is scheduled for next tuesday. we will have the special meeting that is going to take place that same evening. the board will take a budget for a second reading in two weeks. the state, when that will take place, we do not know. especially because of the

possibility of the veto by the governor, whenever the legislature approves, the staff, we will analyze the budget after it has been enacted. the schools will revise their final budgets in september or october, audit the current process for the fiscal year. that will take place over the summer and wrap up in december. the first report for next year will take place in december as well. one final note. a couple of the events on the timeline which are not referenced here but i want to point them out. we do have some community engagement meetings taking place in the next couple of weeks. all of this information is available on the district website. we have to community meetings

on june 18, which is a monday, at third marshall high school from 6:00 of 7:00 p.m., and that thursday, june 21, also from 6:00-7:00, a meeting at everett middle school. we will also have our office hours for our third annual office review that will take place on june 18 from 2:00-5:00 p.m. anyone can e-mail us to schedule an appointment to have one-on- one or a small group discussed their concerns about the budget. we are looking forward to all of those. we want to thank our parent partners, our community partners for helping get the word out about these events and we are looking forward to good discussions in each of those. the last items are slides. you have seen these before. i do not want to belabor them,

but it is important to remind our community about the large picture, chronic under-funding that has taken place in the school districts in the state. these are perhaps that we trot out to drive those points home, about how severely we are being under-funded and the problem is being worse. with that, let me wrap up. i will encourage the board members that if you have questions, that you review the materials and review the budget document itself. please identify them and let us know. we want to be in as good a position as we can to respond to your questions, follow up. it is obviously easier for us to do that if we have those questions as soon as possible, so we are not scrambling to answer questions of an

encyclopedic nature. we will do our best for those types of questions as well. do you have anything to add? president yee: thank you, deputy superintendent. commissioner fewer: i wanted to know, what were the instructions at school sites? last year, we had scenario a and b. are school sites given this same kind of, this is doomsday, but planning for this? last summer, the notification to switch from scenario a to b was a little bit late. there was a scramble to redo the schedule. i am wondering about the timing this year. >> we did not send two sets of allocations out this year.

it becomes kind of confusing and hard to keep track of. last year, the state budget context was that there was a lot of speculation about whether the legislature would approve increasing taxes for it that was part of the governor's proposal, as early as january. there were months and months of speculation and political conversations about the assembly in the senate. we are going to follow the recommendation or that proposal by the governor. there were two votes short in both the assembly and the senate so that never materialized. all through the spring, that was an active possibility. that was the reason why we said the schools, plan for a and b. we do not know whether that action will be taken by the

legislature. if it had been taken, we thought we would know that sometime in the spring. what is different this year is that there is no prospect of a legislative action. it is all about the ballot measure that takes place in november. we would have no basis for any new information until november. because of that, it did not make sense to us to put schools in a situation where they had to pledge t onwo tracks. we would not have any more information not only in april, may, or june, but in october, then we have now. we have not subjected our schools to doing the same thing on their sights. commissioner fewer: we decided last year that we would not last year that we would not implement midyear cuts becau