By Diana Lambert, EdSource
A Sacramento City Unified plan to avoid fiscal insolvency was rejected Friday by the Sacramento County Office of Education.
The fiscal sustainability plan approved by Sacramento City Unified at its Thursday meeting would have generated $158.6 million to stabilize cash flow, reduce spending and establish a path to long-term financial stability, according to a statement by the district.
The plan included a three-year agreement with the Sacramento City Teachers Association to allow the district to access a retiree health benefit fund, which has a balance of more than $160 million, according to the teachers union. The agreement would allow the district to save about $67 million in retiree health insurance costs over that period, the union said.
Luz Cázares, the fiscal advisor appointed by county Superintendent Dave Gordon to Sacramento City Unified, said the agreement between the teachers union and district would only temporarily delay SCUSD’s impending insolvency while making it more difficult for the district to make a sustainable long-term fiscal recovery.
The county office also found that several additional actions taken by the board to solve their budget crises were “problematic.”
“SCUSD cannot solve its fiscal crisis by merely delaying it,” said a statement from the county office. “The fiscal advisor’s action is necessary to protect students, families, and employees; the board must now adopt immediate, specific, and viable solutions before the district runs out of cash.”
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