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South Pasadena budget presentation warns of shrinking COLAs, multi‑year revenue loss and continued reliance on one‑time funds to avoid layoffs
Summary
District staff told the board the 2025‑26 adopted budget is fragile: state cost‑of‑living adjustments (COLAs) in revised proposals are lower than earlier assumptions, reducing expected revenue by roughly $2.8 million across recent cycles and forcing one‑time measures, FTE reductions and service changes to preserve a 3% reserve.
District staff presented the fiscal assumptions and multi‑year projections underpinning the 2025‑26 adopted budget, stressing that reductions in state cost‑of‑living adjustments (COLAs), declining enrollment and rising benefit costs have pushed the district into structural deficits.
Staff summarized how state budget revisions affected planning: when the district adopted its 2024‑25 budget it assumed a 4% COLA, but subsequent revisions reduced that to 1% for the year, creating an immediate revenue shortfall staff estimated at about $1.8 million. For the 2025‑26 adopted budget, staff reported the January proposal trimmed an assumed 3.94% COLA to 2.43% and the May revision further reduced it to 2.3% — a change staff said equated to approximately $1 million less than…
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