Anticipating a $14 million budget shortfall in the next school year, school district leaders in Santa Monica and Malibu are taking steps intended to reduce the deficit by millions and lessen the impact of cuts.

Santa Monica-Malibu Unified School District officials have noted that the district has lost $10 million in funding due to the state budget crisis over the last two years and is expected to experience additional funding cuts with a projected $21 billion state budget deficit in 2010-11.

The district gets 75 percent of its general fund from the state and with the loss in funding, it is forced to find additional sources of revenue and make significant cuts to close its projected $14 million deficit, officials said.

“Though millions of dollars have already been cut from our local schools’ budgets in response to the state cuts, there is a critical need for additional funding that would allow us to maintain our excellent schools and minimize further devastating cuts,” school board Vice President Kelly Pye said.

The Financial Oversight Committee has identified about $9.4 million in cuts that would be needed to provide a minimal budget balance if additional steps were not taken. Such cuts would include the loss of up to 113 district personnel positions, further increases in class sizes, a reduction in school days and the elimination of the elementary music program, according to the committee.

In an effort to avoid such drastic spending reductions and maintain the schools’ quality of performance, the Board of Education has approved a parcel tax measure and is considering a tentative agreement regarding employee furlough days.

The board voted February 1st to place a temporary tax of $198 per parcel on the ballot for a special mail-in election May 25th, which could generate $5.7 million for the district annually. The measure will need to be approved by two-thirds of Santa Monica-Malibu voters in order to take effect.

School board members are urging voters to support the measure as a way to preserve many teacher positions and maintain the quality of education.

“Passage of this measure will benefit everyone,” Pye said. “It is vital in keeping our instructional programs in reading, math and science strong; protecting against widespread teacher layoffs; and maintaining our excellent schools.”

School board member Ralph Mechur added, “We’re facing a $14 million shortfall so we’re asking everybody to pitch in and help so that we can maintain the programs we have for our kids.”

A parcel tax feasibility committee had recommended that the tax be no higher than $225 per parcel, saying that amount was likely the most that voters would be willing to support. After learning that voters indicated “price sensitivity” with the measure, the board voted to set the tax slightly below $200.

The parcel tax will have a five-year term, offer an exemption for senior homeowners and include annual audits as well independent citizens’ oversight.

But school board members noted that even if the tax measure is approved, the district will still have to make significant reductions to close its budget gap and will need to find other revenue sources. At the February 4th board meeting, district staff announced that a tentative agreement regarding furlough days was reached with the Santa Monica-Malibu Classroom Teachers Association and the Service Employees International Union after months of negotiations.

The agreement with the teachers association, which represents teachers and other certificated employees, and SEIU, which represents classified employees, calls for employees to take five furlough days off both this school year and next year. School administrators would also be required to take six furlough days, though still working in the office, under the agreement, which would shorten the school year by a week.

The move is expected to create $2 million in savings to the district in both years and officials say they appreciate the sacrifices that employees would need to make.

“We are appreciative of all employees making these financial sacrifices at this time to help save jobs and the instructional program,” district Superintendent Tim Cuneo said.

Board President Barry Snell said, “Our employees have shown that they understand our district’s dilemma and this tentative agreement is an example of their willingness to do their part.”

The furlough proposal would lead to no changes in health and welfare benefits for the 2009-10 and 2010-11 school years, and the district will continue to pay full HMO health insurance and dental insurance for its employees.

The teachers union is also aware of the sacrifice with employee furlough days but believes the agreement will help protect jobs and needed programs, said union president Harry Keiley.

“The teachers realize the magnitude of the economic recession and the impact it’s having on all families and the school district,” Keiley said. “By offering and agreeing to furlough days, we believe this will go a long way to protect the integrity of our district and preserve and protect employee jobs.”

The school board is scheduled to discuss the tentative agreement at its meeting Thursday, February 18th and will consider approving the measure at the meeting Thursday, March 4th.