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Orange Unified board approves positive certification of second-interim budget, shifts reserves toward capital projects and stabilization
Summary
Trustees unanimously approved a second-interim budget certification that moves about $114 million of accumulated reserves into capital and stabilization accounts, funds deferred maintenance, and sets aside a stabilization reserve for potential enrollment declines.
The Orange Unified School District Board on March 12 unanimously approved the district's second interim financial report and a "positive" certification, a move trustees said preserves fiscal flexibility while funding capital improvements.
Assistant Superintendent for Business Mr. Calderon told the board the packet recommends a positive certification "which means basically that we can meet our obligations in the current fiscal year and in the two subsequent fiscal years." His presentation identified a plan to transfer roughly $114 million of accumulated ending fund balance out of the general fund into designated reserves and capital accounts, including a proposed $52 million set-aside for major capital projects and an enrollment-decline stabilization reserve (fund 17) of about $12 million.
The report also highlighted recent district performance and grant awards that affect revenues: district attendance rose to 94.65% (from 93.98%), and chronic absenteeism dropped from 24.3% in 2022 to 12.2% in 2025, Mr. Calderon said. He noted a $525,000, three-year innovation grant from the Orange County Department of Education to pilot a teacher-specialist professional learning model.
Mr. Calderon described changes in revenue mix: the district's LCFF supplemental and concentration funding increased as unduplicated pupil counts rose, adding roughly $1.8 million in concentration funds that will need to be programmed against LCAP goals.
Trustees asked about accounting for federal and restricted funds, the timing of deferred maintenance spending and the district's conservative enrollment projections. Mr. Calderon said some capital projects will roll into the summer and next fiscal year while the district prioritizes routine and deferred maintenance projects and aligns restricted funds so they are spent on eligible programs first.
After discussion, Trustee Goodlander moved to approve the second interim report and certify the district's positive fiscal condition; Trustee P seconded. The motion carried on a 7-0 roll call.
What comes next: the board's action directs staff to implement transfers outlined in the interim report and continue project planning for Measure S and other capital work; staff said they will return to the board with implementation details and any contract or project authorizations that require separate approval.
