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The Serna Center \u2013 headquarters of the Sacramento City Unified School District \u2013 on Thursday, Feb. 5, 2026.<\/p>\n
JOS\u00c9 LUIS VILLEGAS<\/p>\n
jvillegas@sacbee.com<\/p>\n
Sacramento City Unified School District\u2019s projected cash balance at the end of the 2026-27 school year could differ by $31.4 million, depending on how much of its planned spending reductions are implemented.<\/p>\n
During Thursday\u2019s board meeting, district Chief Business Officer Gerardo Castillo said the district\u2019s cash balance could dip to about $1.7 million by the end of the school year if 40% of its planned budget reductions are implemented, compared with $33.1 million if all planned reductions are carried out.<\/p>\n
According to Castillo, the two projections illustrate how the timing and pace of implementing the reductions could affect the district\u2019s ability to maintain enough cash to meet its payroll and other financial obligations throughout the year.<\/p>\n
Board members emphasized that even under the 40% projection, the district would still end the year with a positive cash balance.<\/p>\n
\u201cWe want to implement 100% of our plan,\u201d board Trustee Chinua Rhodes said, adding that the 40% projection was a \u201cconservative\u201d baseline that would allow the district to move forward while leaving room to avoid mistakes and ensure employees are paid.<\/p>\n
During the meeting, the district officials described the cash-flow projection as \u201crealistic,\u201d with Trustee Jasjit Singh calling it \u201cnot a risky plan.\u201d The comments came after an analyst with the Legislative Analyst\u2019s Office questioned assumptions<\/a> in the district\u2019s longer-term projections, which the district\u2019s chief business officer noted carried risks.<\/p>\n The meeting took place as district officials continued to work to address the district\u2019s roughly $222 million structural deficit and avoid state receivership. The district could also face Chapter 9 bankruptcy<\/a> if it fails to make payroll and can\u2019t get an emergency loan from the Legislature quickly enough, potentially putting its collective bargaining agreements at risk and interfering with pensions, Michael Fine, CEO of the state-funded Fiscal Crisis and Management Assistance Team, has warned.<\/p>\n Budget revision and new target<\/p>\n The Sac City Unified board approved revisions Thursday to the 2026-27 budget it adopted in June<\/a> aimed at improving the district\u2019s fiscal outlook, including about $208 million in projected improvements that would leave the district with a positive ending fund balance.<\/p>\n Under the revision, the district expects to reduce expenditures by $137.5 million and add $70.8 million in revenue and other financing sources.<\/p>\n The district\u2019s monthly fiscal sustainability plan update showed that its target had increased to $174.49 million, with $42.76 million reported as achieved as of Aug. 12.<\/p>\n Dispute over the new MOU<\/p>\n Tensions between the district and the Sacramento County Office of Education-appointed fiscal adviser continued over a new memorandum of understanding with its teachers union that the district shared last week and the adviser temporarily suspended<\/a> \u2014 the latest dispute over how SCUSD should address its fiscal crisis.<\/p>\n The new MOU would in part allow the district to receive an additional reimbursement of about $23 million from its retiree health trust fund during the 2028-29 school year, extending the reimbursement arrangement in the rescinded MOU by one year. The agreement\u2019s public disclosure, however, came shortly before the board vote.<\/p>\n District Superintendent Cancy McArn shared the MOU with the fiscal adviser, county and state officials on Sept. 9, the night before a special board meeting at which trustees approved the agreement. The meeting\u2019s agenda packet, which included the MOU, was made public shortly before the meeting.<\/p>\n Fiscal adviser Luz C\u00e1zares sent a letter on Sept. 11 informing the board that she had temporarily suspended the district\u2019s new agreement with its teachers union, citing the district\u2019s failure to comply with Education Code requirements for fiscal reviews and public disclosures.<\/p>\n Taylor Kayatta, vice president of the district board, argued the district\u2019s proposed measures had been developed and discussed publicly for months.<\/p>\n \u201cThe concepts and assumptions that led to tonight\u2019s numbers were developed in coordination with our fiscal advisors, not given to them at the last minute,\u201d Kayatta said during the meeting. \u201cTo say otherwise is dishonest, and it represents the ineffective oversight we recently raised with the state superintendent of public instruction.\u201d<\/p>\n Singh, meanwhile, urged the county office to work with the district and \u201cnot against us.\u201d<\/p>\n \u201cWith our newly approved fiscal recovery plan we have both a short-term and long-term plan to address our budget,\u201d Singh said.<\/p>\n Related Stories from Sacramento Bee<\/p>\n
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