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Santa Paula Unified projects slimmer reserves and multi-year budget pressures, board approves first interim
Summary
Trustees approved the district's first interim budget, which shows an improved beginning fund balance driven by one-time revenue and interest but warns of declining ADA and expiring restricted grants that produce multi-year structural pressure.
Santa Paula Paula Unified School District trustees approved the district's first interim budget after a detailed presentation showing a higher-than-expected beginning fund balance this year and notable out-year pressures.
Business staff told the board that unaudited actuals and stronger-than-projected interest income increased the beginning fund balance and created a combined ending fund balance projection of about $17.4 million for 2025-26. That gain, they said, is partly driven by one-time and restricted revenues that must be spent before they expire.
"We saw a rise in beginning fund balance from adopted because we got gangbuster interest that we didn't foresee," the business director said, explaining the difference between the adopted budget and first-interim figures. Staff also flagged carryover of LCAP allocations and other restricted grants as reasons for higher current-year revenues and expenditures.
The presentation emphasized risk in later years: district staff projected declining ADA and the loss or reduction of several restricted funding streams, including mental-health and certain federal titles, which together could widen a structural deficit. The slides showed combined revenues of about $101 million in the first interim year versus a projected $94 million in the following year, and staff warned that a mix of expiring one-time funds and conservative revenue assumptions contributes to the drop.
Board members pressed staff on assumptions, asking whether saved one-time dollars were masking long-term problems and whether planned expenditures included any unidentified cuts. "We need to define our structural deficit and right-size," one trustee said, urging the district to be conservative about projecting future revenue.
The board approved the first interim budget on a recorded vote after trustees requested additional data points for future reports, including periodic actuals to show intra-year trends.
The district will continue to monitor enrollment, carryover spending and legislative changes that affect Title funding and COLA assumptions. Staff said the PARS retirement-incentive analysis and choices about replacing positions will be factors for future budget decisions.
