BUDGET IMPASSE LEAVES COLLEGES SANS PAYMENT.

Byline: HARRISON SHEPPARD

Staff Writer

SACRAMENTO -- With California lawmakers at an impasse on the budget, community colleges will feel the pinch beginning today, when the state fails to make its first monthly payment of about $327 million.

The two-year colleges face the largest hit of the various programs that the state cannot fund without an approved budget.

Overall, the State Controller's Office is withholding about $1.1 billion this month for various state programs, including $170 million to K-12 schools for programs including summer school and special education; and $140 million to private-sector vendors who provide the state with property, food and other products and services.

Elected officials and their politically appointed staffers also do not receive their paychecks. Most other state services still receive funding because of constitutional, legal and financial requirements.

State Controller John Chiang said the legislative staffers, small vendors and others who aren't receiving state payments this summer generally expect problems after years of late budgets but still can't always handle the financial stress.

"People expect it, but that doesn't mean they plan for it or have the ability to change their life circumstances to meet the cash flow," Chiang said. "You have a lot of individuals who go paycheck to paycheck.

"This obviously has a powerful impact in their lives during the period in which a budget isn't signed."

The budget stalemate leaves many community college campuses scrambling for money and digging into reserves to avoid disruptions in their summer programs and preparations for students to return in the fall.

"A state budget does interrupt the normal distributions of state aid payments to various districts," said Ron Owens, a spokesman for the California Community College system. "Some districts have reserves; others have special fund accounts from which they can borrow to cover the lack of payment in the short run."

In Los Angeles, 21 community colleges will miss payments today totaling about $103 million.

The Los Angeles Community College District, which comprises nine of those schools, said it has enough money in reserve to continue campus operations and make payroll without disruption.

"It really won't have any effect on our district," said Jeanette Gordon, chief financial officer of the LACCD. "We have a payday (today). We have enough money to cover that payroll.

"We will probably have enough money to make it through an August payroll also. We are in healthy financial condition with our cash right now."

The district has about $45 million on hand right now, Gordon said, plus another $70 million available in other accounts that it could borrow temporarily.

Its biggest expense, monthly payroll, is about $23 million, she said.

Statewide, the community college system has a proposed budget of about $8.6 billion this year.

The state budget has been approved by the Assembly, but it is still two votes short of the necessary two-thirds threshold in the Senate, as Republicans withhold support until more cuts are made. The budget, which is due by June 30, has been late seven times in the past 10 years.

harrison.sheppard(at)dailynews.com

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