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Torrance Unified board certifies positive first interim report, despite projected multi-year deficits
Summary
Board staff presented the first interim financial report showing a near-term projected deficit driven by LCFF calculations but a fund balance above state reserve requirements; the board approved a "positive" certification and the county recommended the same.
Torrance Unified's board approved a positive certification for the district's first interim report for 2024'25, after staff reviewed revenue assumptions, LCFF calculations and expenditure adjustments.
Presenter (fiscal services) summarized key drivers: the state'set COLA projections provided by School Services of California, enrollment and ADA assumptions, the mechanics of LCFF'funding and the district's "negative funded COLA" effect resulting from a change in three-year rolling protections. Staff noted that attendance and enrollment are recovering from COVID lows, which partly offsets pressure on revenues, but standard step/column salary increases and the end of one-time COVID funds contribute to projected multi-year deficit spending.
"Even with a positive COLA we are now showing a negative funded COLA," the presenter said, explaining how the LCFF formula and prior-year protections affect current-year funding. The report projects a deficit for the current year and the two out years but maintains the district reserve above the state-required minimum (discussed as a 3% floor). The county office of education reviewed the report and recommended a positive certification.
Trustees praised the presentation and expressed guarded optimism. "I was very dire; I thought it was going to be a lot worse than this," one trustee said, thanking fiscal staff for conservative management and pointing to possible improvement in future COLA projections.
What the vote did: The board voted to approve a "positive" certification for the first interim report, a procedural action that signals the district believes it can meet its financial obligations for the current and next two years under existing assumptions, even as staff plans adjustments for projected deficits.
Next steps: staff will return with the second interim report in March and the auditor'issued 2023'24 audit report in January; ongoing monitoring of ADA, state budget proposals and negotiated settlements will inform future updates.
