Facing another year of multimillion-dollar budget cuts from the state level, the Santa Barbara School District is considering a new funding model.

Like the Goleta, Hope, Carpinteria and Montecito districts, Santa Barbara secondary schools are looking to become basic-aid schools, meaning they would get their money from district property taxes. Amid California’s chronic budget woes, more districts are becoming eligible as the funds from property taxes exceed money distributed by the state on a per-student basis.

A higher deficit and fewer students means less funds allotted to schools, which makes it easier for districts to change to basic aid, said Meg Jetté, the Santa Barbara district’s director of fiscal services.

“We’re looking forward to it,” Superintendent Brian Sarvis said. “It’s likely to happen for the 2010-11 year.”

One of the implications in the district budget approved June 24 is that all interdistrict transfers most likely will be stopped, starting in the 2010-11 school year.

“If we’re going to deny students from other districts, we want to let them know a year in advance,” Sarvis said.

Not only will students from other districts be denied enrollment, but current students could be taken out of schools. When the elementary school district changed to basic aid, sixth-grade students and their siblings from other districts were allowed to stay, Sarvis said. However, fiscal repercussions will weigh into any decisions.

“The first step (toward basic aid) would be to release the children from another district, that would help tremendously,” Jetté said. Officials are considering sending other children back to their home districts so “property taxes stay within (the education of) our kids,” she said. As of now, Santa Barbara-area property taxes are paying for the education of children from surrounding areas, such as Carpinteria and Lompoc, who attend Santa Barbara School District middle or high schools.

However, the district is not yet considering stopping intradistrict transfers, so children still could transfer from school to school within a district.

The newly approved budget implements the district’s Fiscal Solvency Plan B; the cuts of $4.4 million bring the district’s general fund to $118 million. Plans for 2009-10 include larger class sizes, fewer teacher and administrative positions, fewer grounds and maintenance expenses, and a proposed $250 transportation fee to be paid by parents.

“All this is happening because of the state crisis,” Jetté said. “We were doing really well until this hit us. It hit everybody.”

Larger class sizes, above a 20-to-1 student-teacher ratio, incur financial penalties but will save money overall because of fewer teaching positions, Jetté said.

Plan B also cuts $144,132 in special education, including leaving a special-ed specialist position empty, even after an FCMAT report recommended having two staff members for the secondary schools, and reducing legal expense on special education. The report criticized the district’s special-ed department for a lack of communication, organized leadership, staffing formula and written mission.

“We can’t just make operations cuts anymore or hold back on maintenance or grounds costs,” Sarvis said. The district handed out 60 layoff notices and has rescinded 30 of them, leaving 850 certified staff in the district, including teachers, psychologists, counselors and nurses. Administrative personnel who have been laid off will not be replaced.

Sarvis said he expected remaining staff, especially teachers with larger classes, to make adjustments and rise to the occasion.

“We will be in crisis for a number of years to come,” he said. “We are in it for the long haul.”

At its Tuesday meeting, the district’s board of education voted to approve retirement incentives in hopes of saving some teacher positions.

Those 55 years or older and who have been with the district for 10 years are eligible, Sarvis said. Those who retire now will receive an immediate $25,000 and paid medical insurance for two to five years, and those who retire by next July will receive $10,000 and medical insurance for two to five years. The high amounts are possible because those who retire now still won’t get the first retirement check in the mail for a few months, Sarvis said.

The school board will further discuss the issue of transfers in August, said Barbara Keyani, the district’s administrative services and communications coordinator.

— Noozhawk staff writer Giana Magnoli can be reached at gmagnoli@noozhawk.com.