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Chico Unified projects multi‑year budget shortfall; board approves first interim budget
Summary
Business staff presented the district's first interim budget showing a projected $3.78 million negative change in fund balance for 2024‑25 (largely from a one‑time $2.5 million salary payment), a forecasted $1.6 million deficit in 2025‑26 and a potential $4.3 million deficit in 2026‑27; the board approved the interim budget and self‑certified as "positive."
Chief business officials Marie Hartman, Sharice Bromley and Jaclyn Krueger presented Chico Unified’s first interim budget for 2024‑25, which the board approved by motion and unanimous vote.
Hartman told trustees that the district’s financed assumptions use state adopted LCFF funding with a COLA assumption of roughly 1.07% for the current year and a funded average daily attendance (ADA) of 11,594.43. Staff estimated the district’s three‑year unduplicated pupil percentage at about 54.02% and warned the district would likely fall below the 55% threshold required to receive concentration dollars.
The presentation identified a projected negative change in fund balance of $3.78 million for 2024‑25; staff attributed most of that swing to a one‑time off‑schedule 2% payment to employees totaling about $2.5 million. Hartman said, "If we took the payment to employees out we really are operating at a deficit of $1.28 million rather than $3.78 million." The multi‑year projection showed a reduced deficit (about $1.6 million) in 2025‑26 but a larger projected deficit (just over $4.3 million) in 2026‑27 as one‑time funding streams end and restricted dollars must be replaced by the unrestricted general fund.
Staff emphasized that the district currently maintains healthy reserves and that the interim certification is "positive," meaning the district expects to meet its obligations. They also flagged several budget drivers: staffing costs (including special education contributions and step/column increases), enrollment assumptions (noting full TK implementation in 2025‑26), rising utilities and the potential end of certain block grants used to fund counselors and targeted case managers. Trustees asked for continued monitoring and for staff to return in March with a second‑interim update.
The board approved the first interim budget and the certification noting the district’s capacity to meet obligations this year with existing reserves while directing staff to monitor multi‑year risks.
