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Franklin‑McKinley board adopts 45‑day budget revision after staff warn of shrinking reserves
Summary
The Franklin‑McKinley school board approved a 45‑day budget revision that reflects new state TK funding and other one‑time gains, but district staff warned multiyear projections still show a negative reserve by FY27‑28 and said roughly $11 million in cuts may be needed to stabilize finances.
The Franklin‑McKinley Elementary School District board on Tuesday approved a 45‑day budget revision that incorporates recent state changes to early‑education funding and other adjustments but leaves the district facing a declining multiyear reserve.
Jason, the district finance lead, told the board the revision includes a TK per‑ADA funding increase of $2,397 and higher LCFF revenue tied to larger‑than‑expected TK enrollment. He said the district projects an ending fund balance of about $17,700,000 for fiscal year 2025‑26 but a sharply lower unrestricted reserve thereafter, with projections of 6.3% (FY25‑26), 0.7% (FY26‑27) and a negative 6.1% (FY27‑28). "Hope for the best, but also plan for the worst," Jason told the board as he urged continued expenditure review and monitoring.
Board members pressed staff on enrollment assumptions and the longevity of the TK enrollment bump. Board Member Rodriguez asked whether the multiyear projections already accounted for larger TK cohorts; staff replied the projection reflects a one‑year TK increase but will be updated as enrollment patterns emerge. Jason warned the district may need about $11,000,000 in reductions to stabilize long‑term finances and said staff will return with a proposed fiscal stabilization plan. The board approved the 45‑day revision by voice vote and directed staff to continue updating projections and return with additional proposals.
The revision also noted temporary improvements from new block grants and a learning recovery grant; Jason said the district expects discretionary student support funding of about $1,680,000 and a learning recovery emergency block grant of roughly $500,000 per year for three years. He cautioned that some revenue timing (deferrals) and restricted carryovers mean those dollars do not fully offset operating pressure. Staff said the next detailed update would come at the next board meeting with a September actuals presentation.
