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District reports midyear revisions: 2024–25 deficit trimmed; 2025–26 outlook still shows structural pressure
Summary
The district reported updated estimated actuals for 2024–25 and a proposed 2025–26 budget. A midyear improvement reduced the 2024–25 projected deficit by roughly $451,000, though the multiyear forecast still shows ongoing fiscal pressure fueled by attendance changes, benefit costs and state budget uncertainty.
La Canada Unified School District staff briefed the board on estimated actuals for 2024–25 and the proposed budget for 2025–26, emphasizing state and local fiscal pressures.
Staff said updated revenue and expenditure projections as of mid‑May trimmed the district’s projected 2024–25 deficit by about $451,000 (to a roughly $4.8 million deficit) because of expenditure adjustments and carryover of restricted funds into next year. The largest revenue dent that contributed to the midyear shortfall was a lower than projected average daily attendance (ADA), which reduces state LCFF receipts.
For 2025–26 staff warned the board that the statewide May Revision has worsened the fiscal picture: the governor’s revised projections show lower General Fund growth and the anticipated Prop 98 reserve treatment will reduce available state dollars within the multiyear window. The district’s baseline multiyear projection still shows deficit spending in 2025–26 (approximately $2.1 million) and a structural recovery in later years only under current assumptions. Staff noted cost pressures including rising health‑benefit costs, consumer‑price increases for utilities and services, and the district’s contractual step‑and‑column obligations; the board was told that a one‑percent salary increase for all bargaining units would cost roughly $471,000.
Trustees asked about exposure to tariffs and whether deferred state payments could affect local cash flow. Staff said liabilities from tariffs are more likely to affect capital/bond work than day‑to‑day operating purchases and that routine cash‑flow timing may be affected if the state modifies June apportionments. The board will receive a formal budget for adoption at the June board meeting and staff will return with revised numbers as the state budget settles.
