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Lancaster district presents second interim budget showing deficit tied to one-time fund liquidation
Summary
Budget presenter Maria told the Board the district’s second interim report projects $279.9 million in revenue against larger expenditures after liquidating one-time grants, producing a current-year deficit and a multi-year projection that varies with COLA changes; the district reported a positive certification to meet obligations.
Maria, the district budget presenter, told trustees the second interim budget reflects the impact of one-time grant liquidation and shifting cost-of-living adjustments. “We have to liquidate all those onetime funds that we have to liquidate at September 30, 2024…that’s why our expenses have to be greater than our revenues,” she said.
The presentation listed the district’s largest revenue source as LCFF, with federal funding at roughly 7 percent and state funding increasing partly because of a $24 million Expanded Learning Opportunities (ELO) allocation. Maria reported total revenues for 2024–25 presented in the slide deck as about $279.9 million and total expenditures shown as about $324.8 million, and she described a net decrease (deficit) reflected in the current-year numbers.
Maria walked trustees through multi-year projections: a dip in revenue in the middle projection year tied to a lower COLA estimate and a modest recovery in a later year if projected COLA increases materialize. She explained that multi-year figures reflect prior-year one-time funds (ELO/ESSER) being spent in the current year, which makes this year look like deficit spending even though those dollars were received earlier.
The presenter said the district’s ending fund-balance components include restricted funds and assignments, leaving a reserve for economic uncertainties above the 3 percent minimum (presented in the packet as about $18.9 million, or roughly 5.8 percent). Maria also stated the district has a "positive certification," meaning it can meet current-year and two subsequent years' obligations.
Board members asked clarifying questions about COLA assumptions and staffing costs. Maria noted that some figures in the multi-year projection do not yet include pending bargaining outcomes and that she expects final numbers from the governor’s May budget.
The board previously approved a fiscal stabilization plan earlier in the meeting; trustees were told the plan guides administrative choices about program continuance and prioritization to maintain fiscal responsibility.
What’s next: the district will monitor the governor’s May budget and bargaining outcomes and return with updates; no changes to the budget were voted at this meeting beyond approving the stabilization plan earlier in the agenda.
