CUSD Proposes $3.1M Financing to Address Budget Deficit and Maintain Services

Coronado Unified School District is taking significant steps to address its budget challenges by proposing a $3 million financing plan aimed at ensuring fiscal stability until the district transitions to basic aid funding. During a recent school board meeting, officials outlined two financing options: a $1 million taxable loan and a $2.1 million tax-exempt loan, both designed to alleviate financial pressures and maintain essential programs for students.

The taxable loan, while carrying a higher interest rate, offers flexibility for the district's general fund and allows for prepayment as early as September 2027. This option is expected to save the district approximately $400,000 annually by restructuring existing debt obligations. The tax-exempt loan, on the other hand, comes with a lower interest rate but has a longer prepayment timeline, kicking in five years later.

The urgency for this financing stems from a directive from the county department of education, which emphasized the need for budget solutions ahead of the first interim budget presentation in December 2025. The district has committed to identifying budget solutions not to exceed $2 million, with the financing plan serving as a critical tool to avoid painful staffing reductions and program cuts.

As enrollment continues to decline, the district anticipates necessary staffing adjustments in alignment with student numbers, rather than as a direct response to budget cuts. The proposed loans will provide a buffer against unforeseen expenses, such as maintenance and repairs, which could otherwise strain the general fund.

The board's discussions highlighted the importance of this financing strategy in maintaining the quality of education while navigating the transition to a more stable funding model. With the potential for increased revenue once basic aid is achieved, the district aims to position itself for long-term financial health, ensuring that it can continue to serve its students effectively.