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Gilroy Unified receives clean audit; first interim shows reserves but structural pressures from special education costs
Summary
External auditors issued an unmodified opinion on the district’s financials and bond measures. The board accepted the audit and discussed a multiyear projection showing reserves above the board’s minimum but a structural operating deficit driven in part by special-education underfunding.
Auditor Spencer Blanda (speaker 17) told the Gilroy Unified Board that the fiscal-year audit for 2024–25 resulted in an unmodified (clean) opinion for both the district’s financial statements and Measure P and Measure E bond audits. He said auditors found no material misstatements and reported no internal-control or compliance findings.
The auditor highlighted that total assets were down from the prior year primarily due to depreciation and the absence of certain one-time state and federal grants that had boosted prior-year balances. Net position increased about $12 million, and the district’s general-fund reserves remained well above minimum thresholds cited in the audit narrative.
Chief Business Officer (speaker 15) presented the first interim financial report and the district’s multiyear projection. He reported roughly $184.6 million in general fund revenues and noted a structural operating deficit of about $6 million in the ongoing budget (a larger figure than last year’s $3 million). The report called out a major ongoing pressure: special-education costs that substantially exceed state and federal funding, leaving a large local contribution. The CBO said the district’s reserve ratio remained near board targets in the base year but will require monitoring.
Trustees asked staff for staff FTE breakdowns (certificated vs. classified) and clarified assumptions used for ADA and COLA; finance staff said they would follow up with FTE figures and monitor the governor’s January budget release.
The board voted to accept the audit reports and the interim report as an action item.
Quotations: Spencer Blanda said auditors "issued an unmodified opinion," and the CBO noted the district has been working through one-time federal stimulus funding that reduced in the current year. The board will review follow-up budget actions as state budget details are released.
Provenance: audit presentation and interim financial discussion were presented by speaker 17 (auditor) and speaker 15 (CBO) during agenda items on audit and first interim.
