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Cypress School District certifies 'qualified' budget status and weighs furloughs to close gap
Summary
The board approved a second-interim financial report and certified a qualified status, citing reliance on one-time funds and projected shortfalls in 2027–28. Trustees and staff discussed furlough days as a temporary cost-saving measure; staff estimated roughly $198,000 in savings per one furlough day across employee groups and agreed to model restoration scenarios.
The Cypress School District board on March 12 approved the district’s second-interim financial report and certified a “qualified” fiscal status for the remainder of the current and two succeeding years, citing continuing budget pressure from declining enrollment and limited cost-of-living adjustments.
Assistant Superintendent (budget) presented updated projections showing about $58.2 million in projected revenue and $59.8 million in projected expenditures for 2025–26. The presentation highlighted several one-time resources the district is using to balance the current year — including transfers from fund 14 (deferred maintenance), transfers from fund 40 (property-related funds), a catch-up allocation from the Cypress Education Foundation and an increased estimate of property-rental income — and explained that some of the one-time sources will not recur in 2026–27 and 2027–28.
Trustees were told the governor’s proposed 2026–27 COLA for LCFF is 2.41%, down from earlier estimates, and that modest COLA plus declining enrollment will leave the district with a funding gap in future years unless additional actions are taken. District staff said potential one-time state discretionary grants could offset some needs if they survive negotiations.
As part of the discussion on closing the gap, trustees explored furlough days as a temporary measure. Staff provided an approximate estimate that one furlough day across management, confidential and non-represented employee categories would save on the order of $198,000. Trustees emphasized the need to bargain for furloughs with ACT (teachers) and CSEA (classified staff) for represented employees; several trustees urged management and confidential staff to volunteer rather than have the board unilaterally levy furlough days. Trustees asked staff to return with a model showing what positions could be restored if furlough savings were realized and whether furloughs could be reversed if the revenue picture improves.
The board voted to approve the qualified certification and instructed staff to prepare a study session for April 9 to review multi-year projections and options, including further analysis of fund 40 resources and possible program restorations.
