There has been much talk about the opportunities for the Beverly Hills Unified School District now that it has become a basic aid district, meaning it receives general purpose funding from local property taxes rather than a per-pupil allotment.

As a basic aid district, the BHUSD got $33 million for general purpose funding this year as opposed to the $30 million it would have received as a revenue limit district, which is funded based on the number of enrolled students in the school system.

But basic aid doesn't mean unlimited resources.

"BHUSD is deficit spending," Dr. Alex Cherniss, the district's assistant superintendent for business services, told parents last week. He spoke at both the Beverly Vista and Horace Mann PTA meetings.

Cherniss' presentation was an eye-opener for many parents who thought that basic aid status meant there would be more funds available for student programs. Although revenues have increased, so have expenses.

For the 2009-10 school year, the BHUSD took in an estimated $53.5 million. This included $33 million from property tax revenue, $7 million from federal and state funds and $13.5 million from other local sources, such as the Beverly Hills Educational Foundation.

The city spent an estimated $54.5 million on the schools, including $35 million in salaries, $8.5 million in employee benefits, $1.5 million for books and supplies, and $9.5 million for other operating costs, such as special education programs, utilities and legal fees.

For the 2010-11 school year, BHUSD did not fill vacancies for at least 20 positions, reducing spending on salaries by about $2.5 million. This should help the district avoid deficit spending this year, Cherniss said. 

BHUSD keeps a balance reserve of $3.4 million, or 6 percent of its annual operating budget. Cherniss noted that this figure is low compared with many other basic aid districts. He said that educational consultants recommend a minimum reserve of 10 percent because property tax revenues fluctuate from year to year. 

However, some on the BHUSD board believe the reserve should be allowed to fall more so that the district can spend more on students and staff. Watch for a debate on this as the school year progresses, with some members, such as Brian Goldberg, pushing for a lower balance reserve and others, such as Myra Lurie, resisting that notion. 

In the meantime, it was refreshing to see such an open and transparent account of district spending. We look forward to more periodic updates from Cherniss.