Coachella Valley Unified projects $18 million deficit for 2025–26; officials say deeper cuts likely
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Summary
District staff presented a proposed 2025–26 budget showing continued structural deficit despite reductions; board and county advisers warned more cuts will be needed in later years to meet required reserves.
Coachella Valley Unified School District staff told the board on June 12 that the district expects a $18 million operating deficit for the 2025–26 fiscal year even after the cuts from its stabilization plan.
The district budget presentation by Chief Financial staff projected 2024–25 estimated deficit spending of about $31 million and a 2025–26 deficit of about $18 million, with revenues of roughly $344 million and expenditures of roughly $362 million for the 2025–26 year, according to the presentation.
The numbers matter because the state requires districts to maintain minimum reserves. Director of Fiscal Services Daniela Tabarez told trustees that temporary reductions have improved the district’s reserve position but “cannot, for the long-term solvency of the district” eliminate a structural deficit. She said the district must identify additional reductions to maintain a 3% reserve in later fiscal years: about $4 million more in 2026–27 and another roughly $6.2 million in 2027–28 if enrollment and revenues do not improve.
Why this matters: trustees heard that the district’s primary revenue driver — average daily attendance (ADA) — is declining, and one-time federal and state funds that helped shore up earlier budgets are being spent down. The presentation noted that the district’s funded ADA assumptions and prior-year averaging rule mean enrollment declines reduce LCFF revenue in later years.
Key details from the presentation and board discussion: - The district reported a funded ADA assumption of 15,008.20 for planning, with actual ADA running lower (the presenter said actual ADA was about 14,005.093 for 2024–25 and projected 14,634 for a different calculation). The district is funded on a three-year average of ADA. - For 2024–25, the budgeted revenues were listed at about $374 million and expenditures at $405 million, producing the projected $31 million deficit. - For 2025–26 the district’s projected revenues fall to about $344 million and expenditures to about $362 million, producing the $18 million shortfall. - Staff emphasized that one-time grants and carryover funds previously offset deficits but are largely expended; Tabarez said the district starts 2025–26 with about $4 million of remaining one-time funds. - County and fiscal advisers explained that a structural deficit means expenditures are persistently higher than ongoing revenues and compared it to drawing down a household savings account to pay monthly bills.
Trustees and the superintendent pressed staff on next steps. Tabarez and outside advisers said the district can meet minimum reserve requirements this year, but without additional reductions or revenue gains the district would again face deficits in 2026–27 and 2027–28. Tabarez said the district is modeling further reductions and that “more reductions and more hard decisions are gonna be needed.”
Board members and the superintendent repeatedly emphasized transparency to families and staff. Superintendent Dr. Esparza said the district has submitted a fiscal stabilization plan to the county office and is working on recommended improvements from FCMAT and other audits. Several trustees said they would prefer to continue pursuing enrollment growth and program efficiencies before seeking more state-level reviews.
Ending: The district will revise the budget again after the state enacts its final budget and adopt unaudited actuals in the fall; trustees and staff said they expect to bring additional reduction proposals in coming months if revenue or enrollment do not improve.
