IRVINE : Schools Official Sounds Fiscal Alarm

Shortly after the Irvine Unified School District board raised the salaries of the superintendent and his top aides, the district’s chief financial officer this week warned that the district will quickly deplete emergency savings and go bankrupt without cuts in spending.

Paul H. Reed, deputy superintendent for business services, told the school board Tuesday that because prospects for increased state funding for public education are bleak, the school district should begin plans to “downsize” its programs by about 5%, which could include layoffs.

Reed also described a worst-case scenario under which the district will run out of money by the end of the 1993 school year if schools continue to spend at current levels.

Before discussing the school district’s financial future, the school board voted 4-1 to give the superintendent and his four deputy superintendents a 3% pay increase. The percentage increase is the same given earlier to non-teaching staff and other managers. The pay will cost the district an extra $12,915 a year and bring Brown’s base salary to $102,000 a year.

Reed made the grim budget predictions based on figures from Gov. Pete Wilson’s proposed education budget unveiled this month. Although the Legislature could increase school funding beyond Wilson’s recommendations, that possibility is slim because of the state’s financial problems, Reed said. The best the district can hope for next year is funding at current levels, he said.

But because the district’s operating and staff costs will continue to increase, Reed said, the school board should immediately consider holding discussions at schools and in the community about what programs and services the district could live without.

The district has cut a total of $5.6 million from the past two budgets because of decreased state funding. District officials are recommending community discussions about further cuts because those cuts will have “major policy implications for the kind of school system Irvine will be in the future,” a financial report to the school board says.

Under a plan endorsed by Reed and district Supt. David E. Brown, the school and community discussions would conclude in October, with community forums held by the school board to hear cost-savings proposals. The school board would then make cuts in January, 1993.

School board President Greg Smith said Tuesday that although the district’s financial troubles will force some changes, the changes might not result in programs being cut. The district could find ways to save money by operating more efficiently or finding other savings, he said.

School board members said they wanted more financial information before approving the community discussion plan. The board is expected to pick up the budget discussion at its Feb. 4 meeting.