How can Sacramento City schools find $40 million without classroom cuts?

Sacramento City Unified School District leaders are navigating a tough reality as they consider tens of millions of dollars in cuts necessitated by a multi-year budget deficit, while keeping the effects of those decisions as far from the classroom as possible.

Current projections estimate that the school district will end up $43 million in the red by the end of this school year, increasing to $88 million by the end of the 2027-28 school year, if they do not establish a strict plan to reduce spending.

The Sacramento County Office of Education expressed formal concern to the district based on its projected budget shortfalls for the next couple of years. The board was presented a draft version of the plan Thursday night to meet the county education office’s Nov. 15 preliminary deadline and will refine a final version to be submitted by Dec. 1.

If the district does not succeed in proving its plan for fiscal solvency to the county, it would have to cede control over its budget to the county education office or the state.

Most of the reductions on the updated draft fiscal solvency plan were discussed at a board meeting earlier this month, but Thursday night Chief Business Officer Janea Marking offered ballpark estimates associated with each area of reduction.

Many of the discussed actions to reduce costs are a matter of making district operations more efficient, something that Board President Jasjit Singh said was overdue.

“Some of the things that we’re addressing tonight are things that should be addressed regardless,” Singh said. “I see this as an opportunity to right-size for the future.”

Immediate and future cuts

To become solvent this year, the school district must identify $58 million to axe from the budget, based on a $23 million projected deficit plus $35 million added through the contract negotiations process.

Here are the district’s proposed ideas for the 2025-26 budget and how much money they could save or generate.

Increasing revenues — $40 million

This includes better utilizing restricted funds (money that can only be spent in certain areas), grant adjustments and taking funds from an Other Post-Employment Benefits trust, which prefunds health benefits for employees.

Marking also proposed an attendance recovery program in which students could recoup up to 10 days of attendance, allowing the district to collect more money from the state. She said that the district can use existing services offered, like after school programs, to help students make up attendance without spending more money.

“We can use, essentially, the dollars that we have to provide before and after school services to try to also recoup general fund attendance dollars,” she said.

Reducing salary costs — $12.3 million

Cutting salary costs includes improving the district’s management of job positions, freezing hiring of nonclassroom positions and reassigning management to classroom positions.

Reducing supply expenditures — $12.5 million

This includes eliminating blanket purchase orders, reducing each department’s (save for custodial) supply budgets by 30% and delaying the purchase of new math curriculum and Google Chromebooks.

Reducing contracts and services costs — $2.5 million

This includes freezing staff travel, canceling contract agreements and deactivating cellphones for employees that don’t use them.

The road ahead

The toughest cuts would come in future budgets, but trustees resisted a couple of line items that would more directly affect kids.

Singh was especially opposed to cutting funding for testing related to Gifted and Talented Education, International Baccalaureate, Advanced Placement and the PSAT. He talked about how socioeconomically disadvantaged families losing access to those programs could take away opportunities from Black and Brown students, especially those in south Sacramento.

“We are in a minority majority district,” Singh said. “When we come to talk about equity, it needs to include ensuring those opportunities exist for all students, and if we’re going to improve the outcomes of our students, especially those students on the south side of the city, we cannot be taking away the one ability for them to actually test into these things because financial motivations and not being able to pay for a test.”

In the long term, right-sizing the school district’s services could mean school consolidations or closures.

“We have the same number of schools as we had when we had 50-60,000 kids, and our enrollment has dropped below 40,000 at this point,” Marking said.

The district will submit the plan as written, despite the board’s resistance to certain parts of it. The final plan will be approved before the end of the month. The county eduction office expects that the plan may need further refinement as reductions are implemented and more financial information becomes available.

The Fiscal Crisis and Management Assistance Team, a state agency that provides guidance to schools in the areas of business and financial management, is conducting a fiscal health risk analysis for the district which will be presented to the board Dec. 18.

Singh asked that staff provide a monthly update to see how much the district is actually saving as it implements the fiscal plan.

The school district faced a similar crisis in 2019, narrowly avoiding state takeover after facing a $30 million deficit that a state auditor said was caused by a failure to proactively address its financial challenges.

Jennah Pendleton

The Sacramento Bee

916-321-1068

Jennah Pendleton is an education reporter for The Sacramento Bee. She previously covered schools and culture in the San Francisco Bay Area. She grew up in Orange County and is a graduate of the University of Oregon.