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The Pleasanton Unified School District ended the year 2019 on a high note with an improved ‘AA-’ credit rating from Standard and Poor’s, mirroring another recent credit score upgrade.
The rating report found that the district’s “financial management practices and policies have improved,” and that upgrading from an ‘A+’ to a score of ‘AA-’ was supported by their “strong and stable budgetary performance” this past year.
District officials said the recent findings follow “years of balanced budgets for PUSD built on conservative assumptions and planning for economic uncertainties.” Earlier this year the district also received an upgraded credit rating from Moody’s — AA with a positive outlook — and a clean annual audit of Measure I1 expenditures.
The report also stated that “based on unaudited fiscal 2019 results, the district anticipates realizing a 1.7% operating surplus. Management notes the surplus was driven by conservative budget assumptions and salary savings.”
“We’re proud that the district’s strong fiscal stewardship is translating to credit rating increases which will support our ability to get lower interest rates that represent savings to the Pleasanton taxpayers,” Superintendent David Haglund said in a statement. “We continue to appreciate the overwhelming support from our community and will continue to keep their best interests at heart as we serve as fiscal stewards for our students and future generations.”
Standard and Poor’s also shared suggestions to help further raise the district’s credit: “We could also raise the rating if the district is able to obtain more revenue diversity outside of state-aid revenues, such as a parcel tax and foundation or basic aid status, decreasing its exposure to potential state funding volatility.”
Julia Baum is a staff writer for the Pleasanton Weekly. Reach her at jbaum@pleasantonweekly.com or 925-600-0840, ext. 111.
Julia Baum is a staff writer for the Pleasanton Weekly. Reach her at jbaum@pleasantonweekly.com or 925-600-0840, ext. 111.
PUSD must balance its budget. It should not go tax payers for raising debt capital for capital spending. Residents of Pleasanton end up paying 3-4 times the money raised. PUSD measure M must be defeated by the residents to send a clear and unambiguous message to administrators. They must plan to manage repairs and construction from existing allocation of funds by city, county, state and lottery.
According to our “secured property tax statement information”.
Forty-one percent of our property tax goes to schools, community colleges within the county to fund education.
Now that we no longer are responsible for the coliseum debt because the county sold our debt. I am trying to learn how that debt reduction will apply to our property tax going forward, and for those of us that have prepaid the 2020 property tax, will there be credit forthcoming.
“Salary Savings” Haglund took a 4% raise while the teachers had to fight for 2.5%
Buildings are falling apart, and they’re adding students to already packed classes (34 kids for 5th grade)
Many good teachers are leaving the area because other districts offer smaller classes and better pay.
The budget is not balanced. Why? Unfunded liabilities that are not accounted for in annual budgets are not mentioned. Retirement and healthcare dollars owed keep growing and will affect OPEX at some point. As for the rating agencies, just watch The Big Short if you are not familiar with their ethics.
“Standard and Poors also shared suggestions to help further raise the district’s credit: ‘We could also raise the rating if the district is able to obtain more revenue diversity outside of state-aid revenues, such as a parcel tax and foundation or basic aid status, decreasing its exposure to potential state funding volatility.’”
PUSD has a foundation (and PTAs); basic aid is achieved through state formulas ( https://ed100.org/lessons/lcff )* and can be just as volatile as state funding; and a parcel tax is possible to pass with very specific language as to where it will be spent.
*ed100.org explains the two types of funding in California K-12 education. Basic aid is just as precarious as state funding because you need large reserves to cover the times you might fall “out” of basic aid (local property taxes decrease) and you do not receive increased revenue with new students (difficult in a growing district like ours). There is some state funding for categorical needs.
Naveed, PUSD does not receive funds from the city (if you mean our city government). If you meant our local property taxes, our money (and that of almost all school district communities) is, essentially, sent to Sacramento and doled out based on a funding formula (Local Control Funding Formula). We, and the other districts who can (with the exception of roughly 100 districts), are supporting less fortunate communities across the state.
As for bonds, we pay an estimated amount of nearly 100% more than the original bond indicates. So Measure I1, at $270MM, will cost in the range of $500MM to repay over 30+ years. Measure M, then, at $323MM, would be roughly $600MM to repay.
Measure M does need to be defeated, but our reasoning is different in that I think it is too soon; the district has little to show with money spent so far and can wait until they have added capacity to house growing enrollment and already displaced students. If M is defeated and the district tries again, they will also need to be more specific about the projects that **will** be completed (not generic, non-site specific language like maintain, repair, replace).
It is good this governance team has done a better job managing it’s money; it is not doing a great job of maintaining current facilities (not looked at by S&P’s or Moody’s). I am wondering where those rankings will go if they manage to provide benefits off the salary schedule again, a new and very expensive addition to the budget.
It doesn’t matter, Michael, it’s never enough and it will never ever be enough.
I’m sure “salary savings” are things like jobs being eliminated and hours cut (usually on the classified side, which explains why everything is falling apart) and/or vacated positions not being filled and/or vacated positions being downgraded or the new hire starting at a lower pay. It is a deception if we are not being told what the “savings” actually “cost.”
I don’t think superintendents should take a larger increase than their employees receive, particularly when others are losing hours and jobs and teachers have much larger classes. (This is why I have said any parcel tax attempt has to be specific about class sizes—and everything else—otherwise they will say “to decrease class sizes” and then have a story why it can’t happen—after they have the money.). It is, of course, easier to provide a 4% increase to an individual than a 2.5% to every other employee. It’s practically whack-a-mole: cut a little here, move some money over there, moving that money means this will be cut, take a little out of a reserve (one-time funds), rob Peter, pay Paul, and so on until the indication is a balanced budget (or close enough because we are counting a few eggs as future chickens).
I suppose we are hearing the cost of the savings though: $323MM more in bond dollars. It is unfortunate that our board is not doing a gut check on all of this. We are paying the price of years and years of neglect and budget finagling in order to give raises.
I understand the push/pull of budgets, wanting to pay teachers more, wanting to get benefits off the salary schedule (a new expense), wanting to keep a superintendent—but there are other signals you send to employees when it is implied one person is valued more highly. It’s upside down. Teachers spend their days in isolated spaces charged with the learning experiences of this community’s children (25/year; 34/year; 120/year; and even more depending on the subject). How are the *best* teachers not the most important? We could keep the best; we could attract the best, but I think it would take changes to the system we apparently have little taste for.