COLLEGE DISTRICT PROJECTS SURPLUS FUNDS.

Byline: Sharline Chiang Daily News Staff Writer

Seemingly going from rags to riches, the Los Angeles Community College District is expected to end the fiscal year with an $11.6 million surplus in its unrestricted funds, according to the district's second quarterly 1998-99 report released Monday.

The projection represents a dramatic turnaround for the much-scrutinized, nine-campus district, which just last year faced a projected $13 million year-end deficit in its unrestricted general fund.

The health of that fund is watched with extra care because it makes up about 80 percent of the district's budget, and covers salaries, utilities and other day-to-day operations.

``The colleges have listened very carefully and they're taking advantage (of reform plans) in a way that's positive for students,'' said Elizabeth Garfield, president of the board of trustees. ``I think what's extremely important is we stay with our progress. If we don't we will fall into our past.''

The latest report, presented Monday by Vice Chancellor of Operations and Finance Bonnie James to the board, cited several factors in the turnaround. Among them:

Responsible spending. Under reform, initiated last September, college presidents must spend within budgets or risk their jobs. In prior years campuses could borrow from district reserves to make up overspending. Through the years, unpaid campus debt mounted.

More efficient programming. Class offerings have been streamlined and catered so classes are offered during hours when the most students are available to take them.

Cutbacks. After districtwide cutbacks to close last year's projected deficit, the district ended 1997-98 with a $2.5 million surplus in its unrestricted general fund. Cutbacks included course offerings reduction, layoff of student workers and temporary staff, limited library hours and limited supply purchases.

Layoffs and transfers. Under reform more than 26 positions have been eliminated from the district office. Most of those individuals have been transferred to campuses. By using district staff, rather than hiring from outside, the district saves money.

Increased state funding. The district received $2.78 million this school year for increasing basic skills enrollment during 1997-98.

Returned funding. The state returned $2.8 million it withheld from the district as a penalty for failing to meet the state law mandating that at least 75 percent of all classes must be taught by full-time instructors. The state later recalculated figures and declared LACCD in compliance.

The district's 1998-99 general fund budget is about $369 million.

Garfield said the surplus will likely go to expand summer classes and improve technology in the district offices and campuses, among other areas.

``Whereas last year, every campus except one was facing a year-end deficit, this year all but one are anticipating surpluses from about $63,500 to $1 million. The district headquarters in downtown Los Angeles is facing a $933,000 deficit as a result of reform and decentralization.

The board's regular meeting was held at Los Angeles Southwest College.