Sacramento City Unified School District leaders expressed optimism Friday about making progress toward resolving its financial crisis despite facing a larger budget deficit than previously believed. “I am feeling incredibly hopeful today,” said Tara Jeane, president of the Board of Education, on Friday. “Our cash is in a better situation than we thought it was and we are tentatively saying that we will not be in need of a loan this school year.”The district believes it can avoid fiscal insolvency and a state takeover, for now. “Last night’s board meeting turned a corner,” Jeane said Friday. “We moved from identify the problem and feeling almost hopeless and sucked into that to going, no, this is what the data is really saying and here’s our movement towards a solution.”The district is in financial trouble. That trouble is serious enough that the district could be deemed fiscally insolvent, which would allow the district to receive a loan from the state but would also require an outside trustee to replace the superintendent and board. While it appears a state takeover has been avoided for now, significant cuts need to be made. A district spokesperson said a “history of poor budgeting practices” and inaccurate representations of the district’s finances contributed to the financial mess.New figures presented to the board on Thursday by Interim Chief Business Officer Lisa Grant-Dawson indicate the district should end the 2025-2026 school year with about $3 million, even as the larger deficit looms. The overarching goal for the district is to avoid running out of cash.The new figures presented, however, also showed the budget deficit is $113 million, despite a December report that showed the deficit at $51.6 million.“We got a lot of data that we’re now realizing wasn’t good data,” Jeane said of the discrepancy. “We made decisions based on that not good data and that is part of what has led us here.”Grant-Dawson has identified roughly $44 million in savings, which includes laying off roughly 68 administrative positions, reducing non-school department budgets by 20%, freezing non-custodial supply purchases and other measures. That still leaves some $70 million in cuts to be identified to get the district out of the deficit. “We’re really committed to both the short-term that we need to do to stay out of fiscal insolvency, but more importantly, the long term,” Jeane said. “Our community keeps getting hit with this and that’s not fair or right. Our system has to change.”For district families feeling overwhelmed or confused about the district’s financial situation, SCUSD Chief Communications Officer Brian Heap shared the message below on Friday afternoon:”I think what I want parents to know tonight is where we are right now is the truest picture that we have been able to give you since this crisis began. I feel really confident in saying that,” he said. “I also feel confident in saying that we do have a plan in place to make sure we have enough cash to get through the 25/26 school year. If we can do that, we can really put together an actionable plan to attack this deficit in the long term.”Another update on the district’s financial plan is scheduled for Feb. 18. The board has called for increased transparency as it attempts to resolve its financial state and overhaul a culture of overspending.See more coverage of top California stories here | Download our app | Subscribe to our morning newsletter | Find us on YouTube here and subscribe to our channel

SACRAMENTO, Calif. —

Sacramento City Unified School District leaders expressed optimism Friday about making progress toward resolving its financial crisis despite facing a larger budget deficit than previously believed.

“I am feeling incredibly hopeful today,” said Tara Jeane, president of the Board of Education, on Friday. “Our cash is in a better situation than we thought it was and we are tentatively saying that we will not be in need of a loan this school year.”

The district believes it can avoid fiscal insolvency and a state takeover, for now.

“Last night’s board meeting turned a corner,” Jeane said Friday. “We moved from identify the problem and feeling almost hopeless and sucked into that to going, no, this is what the data is really saying and here’s our movement towards a solution.”

The district is in financial trouble. That trouble is serious enough that the district could be deemed fiscally insolvent, which would allow the district to receive a loan from the state but would also require an outside trustee to replace the superintendent and board.

While it appears a state takeover has been avoided for now, significant cuts need to be made. A district spokesperson said a “history of poor budgeting practices” and inaccurate representations of the district’s finances contributed to the financial mess.

New figures presented to the board on Thursday by Interim Chief Business Officer Lisa Grant-Dawson indicate the district should end the 2025-2026 school year with about $3 million, even as the larger deficit looms. The overarching goal for the district is to avoid running out of cash.

The new figures presented, however, also showed the budget deficit is $113 million, despite a December report that showed the deficit at $51.6 million.

“We got a lot of data that we’re now realizing wasn’t good data,” Jeane said of the discrepancy. “We made decisions based on that not good data and that is part of what has led us here.”

Grant-Dawson has identified roughly $44 million in savings, which includes laying off roughly 68 administrative positions, reducing non-school department budgets by 20%, freezing non-custodial supply purchases and other measures. That still leaves some $70 million in cuts to be identified to get the district out of the deficit.

“We’re really committed to both the short-term that we need to do to stay out of fiscal insolvency, but more importantly, the long term,” Jeane said. “Our community keeps getting hit with this and that’s not fair or right. Our system has to change.”

For district families feeling overwhelmed or confused about the district’s financial situation, SCUSD Chief Communications Officer Brian Heap shared the message below on Friday afternoon:

“I think what I want parents to know tonight is where we are right now is the truest picture that we have been able to give you since this crisis began. I feel really confident in saying that,” he said. “I also feel confident in saying that we do have a plan in place to make sure we have enough cash to get through the 25/26 school year. If we can do that, we can really put together an actionable plan to attack this deficit in the long term.”

Another update on the district’s financial plan is scheduled for Feb. 18. The board has called for increased transparency as it attempts to resolve its financial state and overhaul a culture of overspending.

See more coverage of top California stories here | Download our app | Subscribe to our morning newsletter | Find us on YouTube here and subscribe to our channel