GLENDALE COMMUNITY COLLEGE DISTRICT

BUDGET COMMITTEE MEETING

MINUTES

October 9, 2008

12:00 – 1:30 pm

The Budget Committee Meeting was called to order at 12:00 p.m. with Ron Nakasone chairing.

Present: Amir Nour (Resource), Paul Buehler (CSEA), Michael Scott (guest), Hoover Zariani (CSEA), Ron Harlan (Admin), Dr. Dawn Lindsay (Admin), Paul Mayer (Senate), Vicki Nicholson (Resource), Sarkis Ghazarian (Guild), Poorna Pal (Program Review), Rick Perez (Admin), Arnel Pascua (Admin)

Absent: Larry Serot (Admin), Peggy Renner (Resource)

The Minutes of the September 23, 2008, 2008 meeting were approved with the following amendment by Rick Perez: Dr. Perez had retracted his proposal to restore operating budget costs @ $250k due to mid-year budget cuts.

DISTRICT RESERVES:
Ron Nakasone presented Larry Serot’s policy on District Reserves to be presented to the Board of Trustees:
·  The Board has already approved maintaining a general reserve of 5% of the prior year’s actual expenditures within the Unrestricted General Fund;
·  It was agreed to strike sentence #2 of the proposal that the Professional Development Center reserve be reduced by $100,000 each year.
·  The District will begin the 08-09 fiscal year with a Reserve for Contingency in the Unrestricted General Fund of $500,000 in ongoing funds with an increase of $50,000 each year until it equals 1% expenditures.
SAVINGS FROM THE RETIREMENT INCENTIVE:
Ron presented a spreadsheet on retiree savings in ongoing and one-time 01 funds:
·  Projections had been based on 20-25 retirees. There are 38 retirees so far and more are expected; there is a total net savings of $378k in ongoing 01 funds and $1,189 in one-time savings.
·  Benefit savings do not include health benefits as it is assumed that replacements for retirees will have the same benefits as retirees. There are no projected savings for cafeteria workers or grant funded employees.
·  Savings were based on estimated length of vacancy for each position;
·  Total cost of retirement incentive is to be paid over 5 years.
GASB45:
The committee reviewed the GASB45 proposal, which is based on a retirement benefit allowance established for all new employees calculated at 2% of annual salary. GCC’s payment should increase $710,000 a year over current payments to address its liability. GCC is not in a financial position to fund the liability at this time. Ron said that the policy should define when we will make deposits. We are trying to transition because the budget cannot handle the entire cost at once. In January after the retirements, Ron will present a new census to get a clear picture of what our liability is.
OTHER:
Budget Workshop:
·  $450k in COLA is provided;
·  The Prop 98 minimum guarantee will go down if revenues go down which may require the repayment of the COLA;
·  The $800k property tax backfill was funded;
·  Economic forecast projects no improvement over the next 2-3 years;
·  Block scheduling will impact GCC reserves beginning in 2010.
·  Funding for Child Development Center and Cafeteria tabled until October 28th;
·  Hiring of Retirees tabled until October 28th
The meeting was adjourned at 1:30 pm.
The next meeting will be held on October 28, 2008.
Minutes submitted by:
Mark Darcourt
Administrative Services / Outcome:
It was MSC to approve the proposed Board Policy on District reserves with the amendment to strike the reference to the Professional Development Center;
The Guild and CSEA will make recommendations on the policy