Sweetwater board gives positive certification to second interim budget report amid warnings of a multi‑year structural deficit

The board voted 5–0 to approve the district’s second interim financial report with a positive certification, allowing staff to submit the report to the county office of education by the statutory deadline.

Chief Financial Officer Jenny Salko presented the report and highlighted variables that shaped updated multi‑year projections: the governor’s revised budget proposal reduced the assumed Cost‑of‑Living Adjustment (COLA) to 2.41% from previously assumed 3.02%; the district’s unduplicated pupil percentage declined and reduced supplemental LCAP funding (from roughly $72 million to $69 million in the current year and projected to $64 million in an out year), and the statewide structural deficit could require the withholding of some Proposition 98 funds. Salko said the district anticipates using reserves to offset a projected structural deficit through 2028 but flagged that the 2028–29 year could see reserve depletion unless additional budget solutions are found.

Salko noted estimates for possible new discretionary block grants for student supports and for special education funding in the governor’s proposal that, if enacted by the legislature, could partially offset pressures. The board thanked finance staff for the analysis and voted to approve the positive certification with a 5–0 vote.

The positive certification indicates, based on current information and assumptions presented, that the district expects to meet its financial obligations for 2025–26 and the next two years, while advising continued monitoring and engagement in the June budget process when the district will present a balanced 2026–27 budget.