Mill Valley board approves second interim budget, certifies finances after cuts

Mill Valley School District trustees on Tuesday approved the district's second interim financial report and issued a positive certification indicating the district can meet its financial obligations for the current year and the next two years.

The action came after Superintendent Dr. Kaufman and district finance staff presented updated revenue and expenditure projections and described a set of cuts and one‑time adjustments the board adopted since the first interim report. Matt Phillips, a consultant with School Services of California who reviewed the district's assumptions, told trustees the projected deficit shown at first interim was “very much real” and praised the district's documentation while urging caution.

The second interim is the district's quarterly check on revenues and expenses; under state education code it must show whether a district can meet obligations in the current year and two subsequent years. A positive certification allows the district to proceed under normal spending rules; a qualified or negative certification can trigger additional oversight from the county office of education.

Board and staff emphasized that the positive certification followed tough decisions to reduce ongoing spending and identify one‑time savings. Paula, a district business staff member who presented the packet, said the second interim showed the district “is meeting our financial obligations” after the reductions.

School Services consultant Matt Phillips said the concern is not flawed assumptions but a spending pattern that outpaced revenue growth: “budgets are exactly wrong, but we want them to be approximately right,” he said, adding that “reserves are our one‑time savings account.” Phillips noted that while the district entered the year with reserves higher than many districts — “just under 40%” at the end of 2023–24 — projected multi‑year deficits meant trustees had to act to protect longer‑term financial stability.

Trustees and staff listed the main drivers of the multi‑year projection: salary and benefit increases (including negotiated raises, step/column movement and additional staffing), higher maintenance and operations costs and unanticipated facility repairs partly offset by small revenue gains tied mainly to property taxes. The district also reported insurance recoveries that increased both revenue and matching facility expenses in the current year.

The board packet included a plan to develop a formal five‑year deferred maintenance program so routine maintenance is budgeted and tracked apart from capital bond projects. Staff said current practice had placed some recurring maintenance work in the bond or one‑time buckets and that the district will reallocate and plan to avoid future spikes.

Vote and next steps The board voted to approve the second interim and file a positive certification. Trustees present voted in favor. Staff said they will continue multi‑year budget development and bring more frequent updates to the board, including moving budget updates off the consent agenda into discussion items so trustees and the public can ask questions in real time.

The district will also present its restoration plan and the reductions it adopted to the county office as required under the county's oversight procedures.

Ending District leaders said the positive certification buys time to complete budget work, but they stressed that further decisions may be needed as enrollment and state/federal funding assumptions change.