title
Approve a resolution authorizing the transfer of up to 85% of FY2019/20 anticipated revenues from the Treasury Pool funds to the Dixon Unified School District (DUSD) as mandated under Article XVI Section 6 of the California Constitution from July 1, 2019 to April 27, 2020
body
Published Notice Required? Yes ____ No _X _
Public Hearing Required? Yes ____ No _X _
DEPARTMENTAL RECOMMENDATION:
It is recommended that the Board of Supervisors approve a resolution authorizing the transfer of up to 85% of FY2019/20 anticipated revenues from the Treasury Pool funds to the Dixon Unified School District (DUSD) as mandated under Article XVI Section 6 of the California Constitution from July 1, 2019 to April 27, 2020.
SUMMARY:
In accordance with Article XVI, Section 6 of the California Constitution, the County Treasurer will make mandatory advances of up to 85% of anticipated revenues accruing to school districts during FY2019/20 as needed to cover any cash deficits they may experience in meeting their operational requirements.
On June 4, 2019 this Board adopted resolution 19-413 authorizing $85.3 million in total constitutional advances for the Benicia, Dixon, Fairfield-Suisun, Vacaville, and Vallejo City unified school districts. The amount of advance authorized for each district was based upon the amount requested by the respective district, so long as the requested amount complied with the 85% of anticipated revenues limit as established by code.
In accordance with DUSD resolution 19-1604, the original requested constitutional advance for the DUSD was set at $4 million of a then estimated $7.9 million in available advance based solely on anticipated property tax revenues and not all anticipated revenues of the district.
Subsequent analysis has determined that the currently approved $4 million in constitutional advance funding may be insufficient for the district’s continuing funding needs. To meet their needs, the DUSD adopted resolution 19-1611 formally requesting authorization for an addition $4.5 million in constitutional advance funding, for a total authorization of $8.5 million, based on a total currently anticipated district revenue of $10 million from all sources.
All advances will be repaid prior to April 27, 2020 as required by law.
The attached resolution will enable the DUSD to fulfill their educational mandates by providing them with a stable source of required operational cash from July 1, 2019 to the last Monday in April of 2020, while keeping the County in compliance with all applicable mandatory statutes. Transfers will be payable with interest at the rate the County applies to funds of the districts on deposit with the County.
FINANCIAL IMPACT:
Constitutional advances of funds are made using cash available in the Treasury Pool. The Treasurer has determined that the temporary transfers of funds will not adversely affect the County Treasury Pool. There is sufficient liquidity in the Treasury Pool to fund this advance. The advance will be repaid from the first available revenues accruing to the district.
The costs associated with preparing the agenda item are nominal and absorbed by the department’s FY2019/20 Adopted Budget
ALTERNATIVES:
The Board of Supervisors could elect not to authorize the transfer of funds to the District; however, this is not recommended as the transfers are mandated. A failure to adopt the resolutions will cause the DUSD to be unable to meet their functional mandates and place the County in noncompliance with State mandates.
OTHER AGENCY INVOLVEMENT:
The Auditor-Controller, County Counsel, County Administrator, Solano County Office of Education, and the DUSD have been directly involved in this request. The formal transfer request resolution from the district is attached.
CAO RECOMMENDATION:
APPROVE DEPARTMENTAL RECOMMENDATION