District finance chief briefs board: small state revenue gains but Martinez still projects multi-year deficits

District budget presenter (identified in the meeting as Andy) briefed the board Aug. 12 on the state budget outlook and its implications for Martinez Unified. He said statewide revenue projections showed modest improvement — including a projected 1.07% cost-of-living adjustment for schools — but cautioned that enrollment declines and stock-market-driven revenue volatility remain risks.

Andy told the board that statewide K–12 enrollment has declined in recent years and is forecast to drop by more than 6% over five years; Martinez is currently trending roughly steady versus an earlier projection of a 40–45 student decline. He explained the state drew down part of its Prop 98/"rainy day" reserve to cover prior overpayments and that a modest deposit is expected next year, reducing reserves for future shocks.

Turning to the district's finances, Andy reported projected deficit spending of $4,100,000 for 2024–25, $3,200,000 for 2025–26 and $2,600,000 for 2026–27, and noted those figures were presented without splitting restricted versus unrestricted dollars. He described small deferrals and block-grant adjustments and said the district will present unaudited actuals in September with more detail on remaining fund balances.

On capital funding, Andy described statewide ballot measures (Propositions 2 and 4) aimed at facilities, parks and water/energy projects and noted the district’s proposed local $90 million measure for junior- and senior-high projects could be eligible for state matching funds if voters approve the state measures.

"We're not seeing dollars necessarily from it but it is positive," Andy said of the state outlook, while cautioning the board that volatility in markets and elections could change projections and that staff will continue monitoring for the first-interim report.