The Sacramento City Unified School District is confronting a $170 million budget deficit, with experts warning it could run out of cash by July, potentially prompting state intervention. Finance experts presented the situation to district leaders during a meeting, emphasizing the urgency of the crisis. The CEO of the Fiscal Crisis and Management Assistance Team, a state organization that helps districts in budget emergencies, said the district has taken assertive steps to address the deficit but stressed that it is “too little too late.” “They have no buffer left. They are really right at the edge of the cliff. They have no buffer. They don’t have any space. The ground’s crumbling beneath them and they don’t have a place to step back to that is safe,” Michael Fine said. The district is projected to run out of money by July, with some options to borrow internally. However, Fine said borrowing would only sustain operations until January or February, at which point the district could again face the inability to pay employees. The board must decide whether to ask the state for help and when to make that decision. While the presentation Thursday night was informational, the CEO said he hopes the board will review the data and make a decision soon. Board members asked questions following the presentation – looking for any other options available to avoid insolvency.Additionally, the board was scheduled to vote on sending final layoff notices to just over 500 employees. Officials noted that not all of these notices will result in job losses, as some are expected to be rescinded.See more coverage of top California stories here | Download our app | Subscribe to our morning newsletter | Find us on YouTube here and subscribe to our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 COUNTY, Calif. —
The Sacramento City Unified School District is confronting a $170 million budget deficit, with experts warning it could run out of cash by July, potentially prompting state intervention.
Finance experts presented the situation to district leaders during a meeting, emphasizing the urgency of the crisis.
The CEO of the Fiscal Crisis and Management Assistance Team, a state organization that helps districts in budget emergencies, said the district has taken assertive steps to address the deficit but stressed that it is “too little too late.”
“They have no buffer left. They are really right at the edge of the cliff. They have no buffer. They don’t have any space. The ground’s crumbling beneath them and they don’t have a place to step back to that is safe,” Michael Fine said.
The district is projected to run out of money by July, with some options to borrow internally. However, Fine said borrowing would only sustain operations until January or February, at which point the district could again face the inability to pay employees.
The board must decide whether to ask the state for help and when to make that decision. While the presentation Thursday night was informational, the CEO said he hopes the board will review the data and make a decision soon.
Board members asked questions following the presentation – looking for any other options available to avoid insolvency.
Additionally, the board was scheduled to vote on sending final layoff notices to just over 500 employees. Officials noted that not all of these notices will result in job losses, as some are expected to be rescinded.
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