麻豆果冻传媒

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Budget Update #60

November 16, 2020

Dear Sac City Unified Community,

Since I joined the District in 2017, I have repeatedly communicated about our precarious fiscal situation. Our District is operating under a structural deficit, which means our expenses exceed revenue. 

In December 2019, the California State Auditor conducted a thorough and independent audit of the District鈥檚 finances. . The California State Auditor鈥檚 recommendations and findings echoed what our district had heard before. In fact, over the last few decades the District鈥檚 finances have been audited or reviewed over and over by independent auditors and experts who all say the same thing: that Sac City Unified is operating under a continued structural deficit and that if action is not taken to reduce expenditures that the District cannot afford, the District will be be required to seek a loan from the state to meet the reserve level required by law, which would trigger a state takeover of the District.

These entities include:

• Fiscal Crisis and Management Assistance Team (FCMAT) in 2006, 2018, 2020
• Sacramento County Office of Education (Budget Disapproval October 2020 and response to SCTA)
• Public Employee Relations Board (PERB) Fact-finding Report in 2003 and 2017
• Sacramento County Grand Jury Report in 2010 (Sacramento City Unified School District, Last Chance to Put Children First, May 19, 2010)

While the exact date of insolvency may adjust to changing conditions or budget fluctuations, the fact remains that insolvency is inevitable without structural changes to the District鈥檚 budget that lead to ongoing improvement to the district鈥檚 finances. And while experts have sounded the alarm for decades, there is insurmountable evidence that our time to address this fiscal crisis is running out.

, the District will present a draft Fiscal Recovery Plan on November 19, which will include scenarios of potential reductions or budget changes to address the structural deficit. The plan will come back to the Board for adoption at the Board meeting on December 10. 

Over the past two years, the district has made significant budget cuts 鈥� approximately $50 million 鈥� to stave off insolvency. These cuts have been painful, and leave few flexible choices in the budget.

Independent entities have long-warned that without addressing the high cost of salaries and benefits, 麻豆果冻传媒 would be forced to make even more difficult decisions about its budget, which would further impact students and the services we provide them. Unfortunately, it is time to begin having these difficult conversations. 

Here is the current financial status as of the 2020-21 Revised Adopted Budget:

As you can see, Sac City鈥檚 budget is literally heading into the red. We are projected to spend money that we simply do not have. At this time, we cannot reach the required reductions to balance the district budget without making difficult cuts.

We know that a narrative exists that the District does not have a structural deficit, that these facts are nothing more than scare tactics, or that the District is 鈥渃rying wolf鈥� about the severity of the deficit. Let me clear: there is nothing I wish more than for those narratives to be accurate, because it would mean that we could address students鈥� needs without concern for our ongoing budget. It would mean that we wouldn鈥檛 have to choose between services for our students or reductions and eliminations to such services. It would mean that I wouldn鈥檛 have to send you these grim emails and updates, and that we wouldn鈥檛 have to make these difficult decisions. It would mean that we have the freedom to invest in programs and students, and sustain programs that need additional support from our general fund because of their value to students.

Health Benefit Costs Remain High and Must be Negotiated 

麻豆果冻传媒鈥檚 health benefit costs are high because of a collective bargaining agreement (CBA) negotiated almost a half a century ago. The agreement stipulates that members of the Sacramento City Teachers Association be entitled to a specific healthcare provider, HealthNet. The CBA further stipulates that 麻豆果冻传媒 covers 100 percent of the employee and family plan costs. This results in the District currently paying well over $30,000 for each member that selects the family HealthNet plan, making 麻豆果冻传媒鈥檚 health plan one of the five costliest plans in California.

Since 2018, the district has attempted to engage SCTA in negotiation on its successor contract to renegotiate this expensive health care plan.

Possible Negotiable Items and Potential Savings

The District will continue attempting to negotiate savings with labor partners, but these cuts will require agreement from our employees.

It is painful to say but we do not have the freedom to invest in students and programs as we should when our budget becomes tight. The board will consider the following budget reduction options on December 10:

• $1.749 million reduction to positions, including Assistant Principals, Social Workers, and Counselors
• $2.253 million cut to Central Departments, including Professional Development, Staff, and Supplies
• $9.633 million reduction of staff at programs and sites, including the elimination of the IB and AP Testing, College and Career Visits and Non-Special Education Transportation.
• Reductions to the dual immersion program
• The district might also cut 4.941 million from special programs such as GATE, VAPA or Music programs, Safe Schools, Social Emotional Learning, New Teacher Induction, Improvement and Accountability , Alternative Education, and After School/Youth Development programs. 

I urge you to visit our most recent Budget Update and FAQ page, which discusses our current budget scenario and the options that will be presented to the Sac City Unified Board. I also urge you tune in to the board meeting on Thursday at this link where these options will be discussed.

Thank you,

Jorge A. Aguilar

Superintendent

Budget Update #59

September 17, 2020

At our board meeting tonight, Sacramento City Unified School District reviewed the district鈥檚 unaudited actual financial report for the 2019-20 Annual Budget, which was certified by the Sacramento County Office of Education. You can view the Power Point shared with our Board here and the full report within our Board of Education Agenda here.

Details are as follows:

• Spending was lower than anticipated due to COVID and campus shut downs. 麻豆果冻传媒鈥檚 total revenues were $553.9 million, expenditures were $530.8 million, leaving an ending fund balance of $93 million for the 2019-20 Academic Year. Average monthly expenditures were approximately $44 million.
• The district ran a temporary one-time surplus due to a halt in spending after school closures. This is a 4% difference from previous projections, but is a temporary savings due to the district temporarily stopping many services and responding to the public health crisis.
• This is consistent with what we are seeing from financial report from other districts. Actuals from districts throughout California are coming in higher than previous projections, based on this same information.
• We saw an essential freeze on some of the district鈥檚 purchasing, operating costs, and staffing. To be clear, this meant:
  • No field trips
  • Books not purchased
  • Utilities, fuel, and other supplies not needed
  • Positions unfilled, including temporary positions
  • Contractors unable to perform duties
  • Halted facilities projects and routine maintenance
  • Per diem employees temporarily out of work.
• Positions that remained open and unfilled created savings, but these savings are only temporary. Should the district close or freeze these positions, we would lose bus drivers, teachers, support staff, and other hard-to-fill positions. These positions must be filled when we resume. We cannot close these positions because they are needed.
• In some cases, purchases were put on hold as the district was unsure whether it would receive state and federal reimbursement and was responding to the Governor鈥檚 May revise. Some items have been pushed to the next fiscal year and 麻豆果冻传媒 will see increased expenditures for FY 2020-21. For example, the district鈥檚 purchase of Chromebooks and hot spots and other technology support for staff and students as a result of COVID-19. $5 million in textbook purchases were pushed to 2020-21 fiscal year.
• These one-time savings will help stave off insolvency for a period of time, but our district is still operating in the red. Without significant structural changes, we project insolvency by 2021-22. We project a $40 million deficit for the 2020-21 fiscal year. 
• We anticipate that the impacts of recession will continue. The district is also cognizant of the current economic climate, and that the first year of a recession is rarely the last. With this knowledge, the district cannot rely on a false sense of security or fail to recognize that deficit spending will result in receivership.

What is the projection on cash flow? When will the district now run out?

Because of the reduction in spending this year, our cash position has improved. However, the threat of insolvency remains. These one-time savings will help stave off insolvency for a period of time, but our district is still operating in the red. Without significant structural changes, we project insolvency by 2021-22 with cash issues beginning in May. We project a $40 million deficit for the 2020-21 fiscal year.

Why didn鈥檛 we know this a little sooner? 

We didn鈥檛 know because when we were building the budget, it was early May. At that time, we didn鈥檛 know when we were going to be able to bring staff back for in-person instruction and resume normal operations or with social-distance modifications in our classrooms. The budget at that time was based on the Governor鈥檚 May Revise. Actuals from districts throughout California are coming in higher than previous projections, based on this same information.

May 26, 2020

Before our school closure due to the COVID-19 crisis, our district was facing a well-documented $27 million deficit, largely attributable to Sac City Unified鈥檚 unsustainable employee salary and benefit structure, which makes up approximately 90 percent of the district鈥檚 unrestricted budget. This has been confirmed by Sacramento County Office of Education (SCOE), Fiscal Crisis and Management Assistance Team (FCMAT), a , and most recently the

At Thursday鈥檚 Board of Education meeting, we learned more about Sac City Unified鈥檚 fiscal outlook under the Governor鈥檚 May Revised budget. To be frank, the outlook is dire. Sac City Unified can anticipate a significant revenue decline, and  an updated projected deficit of $57 million in the next fiscal year.

The fact of the matter is, we are down to the bare bones. The only viable cost savings that remain are staffing and benefit costs. Had we already reached a negotiated solution with our labor partners to reduce the costs of employee benefits and align them to those of the vast majority of districts, we could have built up a healthy reserve and these cuts could have been avoided. Unfortunately, that is not our reality and our district will continue to face hardship over the upcoming months and potentially years.

Over the next few weeks, we will provide additional information about our budget and plan moving forward. While much may be uncertain, you can be assured that our decisions will be grounded in our mission to meet our students鈥� academic, social, and emotional needs. Any decisions must minimize the negative impact of these budget cuts on our students.  

PowerPoint on Sac City Unified鈥檚 budget

Key takeaways:

• Statewide Funding 鈥� The state鈥檚 proposed May Budget Revision proposes a ten percent cut to the Local Control Funding Formula, our primary source of revenue.  The proposal also includes cuts to Career Technical Education Incentive grants, and Child Care and Preschool Funding, among other programs.
• Federal Funding (CARES Act) 鈥� Sac City Unified will receive $16 million in one-time funds. This must be used by December 30 and is restricted.

What does this mean for Sac City Unified?

• Dramatic cuts to Sac City Unified鈥檚 primary source of revenue, the Local Control Funding Formula 鈥� While the LCFF COLA reduction will be 10 percent, the district will use a 5 percent LCFF reduction outlook due to measures by the state to mitigate some of the reductions. Assuming a 5 percent COLA reduction the district can expect an estimated $57 million deficit in the upcoming year with an ending fund balance of approximately 6.7 million. By FY 2021-22 that deficit will balloon to $81 million, with an ending negative fund balance at approximately -$75 million.
• Out of Cash by April 2021 鈥� Under the current projections, we estimate that our district will face serious cash flow challenges, running out of funding in less than a year, in April 2021.

Again, we will provide updated information over the next few weeks about our budget and plan moving forward. Our students鈥� academic, social, and emotional needs remain our highest priority. We will regularly update you as more information is available and encourage you to visit our Negotiations webpage at /negotiations-updates.

Budget Update #58

May 19, 2020

These last few weeks have been difficult for our school district, for our community, and for our employees. 

Last week鈥檚 news that we could expect additional cuts to education as a part of reductions to the state budget came as an especially devastating blow - especially as we are considering the challenge of how we will reopen our schools when it is safe to do so. And it will take funding, resources, and support 鈥� something our district was lacking even before this current crisis. 

As part of our continued efforts to be transparent and honest about our situation, we must inform you, our community, about our updated fiscal outlook. 

Fiscal Challenges

Before our school closure, our district was facing a well-documented $27 million deficit, largely attributable to Sac City Unified鈥檚 unsustainable employee benefits structure. This has been confirmed by Sacramento County Office of Education (SCOE), Fiscal Crisis and Management Assistance Team (FCMAT), a , and most recently the

Governor Newsom鈥檚 announcement of a 10 percent reduction to the Local Control Funding Formula adds an additional layer of concern and moves the timeline that our district could become insolvent much earlier than our initial estimate of late 2021.

Outlook Under a Current State Budget Proposal

At our May 7 Board meeting, our budget team presented scenarios which included a 10 percent LCFF reduction, indicating that such a cut could impact our budget by approximately $50 million, on top of the current $27 million deficit. 

 

Facing the Hard Truth

There are tough decisions ahead. Our district has already implemented over $30 million in ongoing budget reductions. There isn鈥檛 much left to cut and that is the hard truth. 

Learn More 麻豆果冻传媒 Our Budget 

Our team will present the Third Interim Financial Report for Fiscal Year 2019-20 at the May 21, 2020 board meeting. This presentation will give our community detailed information about our budget outlook. At the following meeting on June 18, 2020, we will present a proposed adopted budget, which will include possible program cuts in order for us to best close our well-documented and likely growing deficit. 

We will regularly provide our community with updates, presentations, and information on our budget and status of negotiations.

Budget Update #57

February 7, 2020

Dear Community Member, 

Last night, at a public Sac City Unified Board meeting, and her team, provided an overview of their If you were unable to attend the Board Meeting, please We want to thank State Auditor Howle and her team for making themselves available to attend last night鈥檚 Board of Education meeting. 

As was mentioned in last night鈥檚 presentation, the District will provide regular updates to the State Auditor as we work to address the District鈥檚 budget crisis. Earlier today, the District submitted an update which you will be able to view following a review by the Auditor at: .

Sac City Unified remains committed to finding solutions to our structural budget deficit. The District proposes to address this crisis by implementing a number of the recommendations made in the Audit Report. We must negotiate with the District鈥檚 labor partners to accomplish this. The District looks forward to commencing negotiations with SCTA on March 3, 2020 to find solutions to our budget challenges that improve Sac City鈥檚 educational programs and enhance learning opportunities that benefit all students.  

We will continue to keep you posted on the latest news regarding our District budget and our efforts to solve the structural budget deficit. As always, the District鈥檚 chief priority is student centered learning. Sac City Unified is committed to resolving the budget crisis while preserving and enhancing educational opportunities that benefit all students. For more information, please visit our budget updates and negotiations updates pages. Thank you.

Budget Update #56

February 6, 2020

Dear Community Member,

We are writing to inform you that the start date for the upcoming 2020-2021 school year will be Thursday, September 3, 2020. The last day of school will be June 17, 2021. 

Our goal is to give families plenty of advance notice about our school year calendar, and the District has received a number of questions about the start date for upcoming school years.  

We hope to be able to share information about the start date for the 2021-2022 school year soon.

As you may know, the District had proposed an earlier start date for both the 2020-2021 and 2021-22 school years. However, this matter requires negotiation with the District鈥檚 labor partners as it impacts their work calendar and we have not reached agreement on a change to the start date with all of our labor partners. We remain hopeful that we will begin negotiations with all of our labor partners on our proposed calendar very soon so that we can provide notice to our community as early as possible next year as to any changes to the 2021-22 school calendar.  

As we have shared with our labor partners, the District has proposed to change the school calendar to begin in mid-August because we believe that schedule furthers our student-focused mission. For details on the proposal please see

By shifting to an earlier start date, our District鈥檚 students will benefit from: 

• Greater opportunities to enroll in summer courses at community colleges 
• Alignment of our high schools鈥� semesters with college and university schedules, with the first semester ending prior to winter break 
• Improved opportunities to apply for summer jobs and internships that begin in early June, which are unavailable to our students due to the District鈥檚 current end of school dates 
• Additional instructional days prior to Advanced Placement (AP) and International Baccalaureate (IB) testing, the SAT, and other assessments that are critical for students applying to colleges and universities. 

To summarize, this shift will better position all 麻豆果冻传媒 students to be better prepared for college and career success, but the change must first be negotiated with our labor partners.  

We appreciate the patience of our 麻豆果冻传媒 community while we work to finalize the school year start dates for the 2021-2022 calendar year. Our goal is to maximize opportunities for 麻豆果冻传媒 students to participate in college and career readiness activities. We will continue to keep you updated on the progress of the negotiations to shift our school year schedule.  

Again, please make a note that the start date for the upcoming 2020-2021 school year will be Thursday, September 3, 2020 and the last day of school will be June 17, 2021. 

Budget Update #55

January 23, 2020

Dear Community Member,

Last month, the . The audit report considered the District鈥檚 short-term and long-term financial challenges and made recommendations to address the District鈥檚 multi-million structural budget deficit.

The California State Auditor will present an overview of its audit report at the upcoming 麻豆果冻传媒 Board Meeting on February 6, 2020. A tentative time has been set for 7:00 p.m. A reminder will go out next week with the exact time of the presentation. You can also check here for the latest updates to the Board agenda.   
  
The District invites interested members of the community to attend the February 6 Board meeting. Members of the community are also invited to submit any questions they have concerning the audit and its recommendations in advance of the meeting. If you would like to submit a question concerning the audit report, please click here to submit your questions by Wednesday, January 29, 2020.

We will continue to keep you posted on the latest news and information regarding our District budget and finances.

For more information, please visit our budget updates page. Thank you. 

Budget Update #54

December 16, 2019

Dear Community Member,

On Thursday, December 19th, District staff will be presenting the Board of Education with the First Interim Financial Report and a Fiscal Crisis & Management Assistance Team (FCMAT) update. The First Interim Report will provide a snapshot of the District鈥檚 current cash flow projections. Click here to review the board packet materials.

The Board of Education meets at 6 p.m. at the Serna Center (5735 47th Avenue) and these items are scheduled for presentation at approximately 8:39 p.m. Please note that for parents needing child care, there will be free child care available in the room next to the Board meeting. To view the full Board meeting agenda, visit our Board of Education meeting page.

We will continue to keep you posted on the latest news and information regarding our budget and finances. For more, please visit our budget updates page. Thank you. 

Budget Update #53

November 25, 2019

Dear Community Member,

This message is to update you on the status of issuing retroactive payments to certificated employees who are entitled to salary increases for the 2018-19 fiscal year.
 
In August, the District reported that it was working to calculate the amounts of these retroactive payments. Today the District issued the final batch of these payments, which are for individual base salary adjustments for eligible certificated employees. In total, the District has now issued all retroactive payments totaling over $8.3 million. Both the June adopted budget for 2019-20 and the revised 2019-20 budget approved at the October 3, 2019 Board meeting included this expenditure.
 
We will continue to keep you updated on the latest news related to our budget. For more information, please visit our budget updates page. Thank you. 

Budget Update #52

October 16, 2019

Dear Community Member,

We want to share that Sacramento County Office of Education Superintendent Dave Gordon, who provides fiscal oversight of the district, has analyzed and responded to the district鈥檚 re-adopted budget for the 2019-20 fiscal year. In his analysis, Superintendent Gordon states:
 
鈥淏ased on our review, it appears that the district鈥檚 unrestricted General Fund balance will decrease by approximately $9.5 million in 2019-2020, approximately $28.1 million in 2020-2021, and approximately $30.9 million in 2021-2022. It appears that the district will meet its minimum reserve requirement in the current and subsequent fiscal year, but will fall short in 2021-2022, leaving a negative unrestricted ending fund balance of approximately $7.4 million. Therefore, the district鈥檚 Re-Adopted Budget is disapproved.鈥�
 
Click here to read Superintendent Gordon鈥檚 full letter to the District.
 
We will continue to keep you informed of the latest developments and updates regarding our budget. For more information, please visit our budget updates page. Thank you. 

Budget Update #51

October 10, 2019

Dear Community Member,

This message is to update you on the status of issuing retroactive payments to certificated employees who are entitled to salary increases for the 2018-19 fiscal year.
 
In August, the District reported that it was working to calculate the amounts of these retroactive payments. Today, the District issued the first batch of these payments, which total $584,910. Both the June adopted budget for 2019-20 and the revised 2019-20 budget approved at the October 3, 2019 Board meeting included this expenditure.
 
The District is now in the process of calculating individual base salary adjustment payments for eligible certificated employees. We are manually reviewing every individual employee鈥檚 appropriate 2018-19 placement on the new salary schedule as well as other individual factors to ensure accurate payment. Base salary adjustment retro payments to eligible certificated employees will be issued in November 2019.
 
We will continue to keep you updated on the latest news related to our budget. For more information, please visit our budget updates page. Thank you.

Budget Update #50

October 4, 2019

Dear Community Member,
 
Yesterday, the Board of Education adopted a revised budget in response to the County Superintendent鈥檚 disapproval of the originally adopted 2019-20 budget. Click here to view the PowerPoint presentation. Click here to view full details of the revised adopted budget.
 
We will continue to keep you updated on the latest budget news and developments. For more information, please visit our budget updates page. Thank you. 

Budget Update #49

September 30, 2019

Dear Community Member,

The District is working on a revised budget for 2019-20 after Sacramento County Superintendent Dave Gordon disapproved the District鈥檚 Adopted Budget on September 11, 2019. to read Superintendent Gordon鈥檚 analysis and recommendations for the District鈥檚 budget.

The Board of Education will hold a public hearing to adopt a revised budget at its October 3, 2019 meeting. The budget presentation is item 9.1 on the agenda. Click here to review the budget item materials in the Board Packet. A hard-copy of the budget itself can also be reviewed upon request at the front desk of the Serna Center, located at 5735 47th Avenue, Sacramento, CA 95824.

We will continue to keep you updated on the latest news and developments related to our budget situation. For more information, please visit our budget updates page. Thank you. 

Budget Update #48

September 13, 2019

Dear Community Member,

We want to share that Sacramento County Office of Education Superintendent Dave Gordon, who provides fiscal oversight of the district, has analyzed and responded to the district鈥檚 adopted budget for the 2019-20 fiscal year. At the time the budget was adopted, the district projected a $25.5 million structural budget deficit for 2021-22. In his analysis, Superintendent Gordon states that the district has made 鈥渃onsiderable progress towards stabilizing the budget.鈥� Nevertheless, the 2019-2020 adopted budget was disapproved by Superintendent Gordon because the district will fall short of meeting its minimum reserve requirement by approximately $27 million in 2021-22. Click here to read Superintendent Gordon鈥檚 full letter to the district.

In his letter, Superintendent Gordon states the following about the district鈥檚 fiscal situation:

• 鈥淪ince the district鈥檚 2018-19 Adopted Budget was submitted one year ago, the district has made considerable progress toward stabilizing its budget. However, the cuts thus far are not enough to remove the structural deficit, and although the date the district projects it will become cash insolvent has been delayed, the risk has not been eliminated.鈥� 
• 鈥淏ecause the district is holding weekly Cabinet discussions on district spending, and is more consistently using properly documented procedures, we note great improvement in the district鈥檚 hiring and purchasing processes.鈥� 
• 鈥淲e again encourage the district and its bargaining units to immediately accelerate the negotiations process so that all possible savings to the budget can be realized.鈥� 
• 鈥淭he District has forged a positive, collaborative relationship with all of its bargaining units except its teachers鈥� association. With the expiration of the teachers鈥� contract, the district has initiated proposals for a new agreement. The teachers鈥� association has not yet agreed to collaborate or come to the bargaining table to discuss the district鈥檚 proposals.鈥�  

As next steps, Superintendent Gordon states that on or before October 8, 2019, the Sacramento City Unified Board of Education must revise the adopted budget to include any response to his recommendations, adopt the revised budget, and file the revised budget with his office. Further, Superintendent Gordon also recommends that the district make cuts immediately as any delay in resolving the structural deficit compromises the future options available to the district to maintain fiscal solvency. The District plans to schedule a budget presentation to the Board of Education at its regularly scheduled October 3, 2019 meeting.

We recognize this news will understandably generate more concerns about the financial sustainability of the district and its ability to serve students. As Superintendent Gordon has pointed out, the district has been making steady progress on improving its finances. The district is confident that with collaboration from all labor partners, we can and will achieve the savings needed to resolve our financial challenges and meet the needs of our students. 

For more information about our fiscal situation, visit our budget updates page. To receive the latest updates on the status of labor negotiations, sign up for negotiations updates. Thank you.

Budget Update #47

September 2, 2019

Dear Community Member,

The District has posted to its website the unaudited actuals for the 2018-19 school year. You may be interested in this information because unaudited actuals represent the actual revenues, expenditures and ending fund balance for all the district鈥檚 funds for the fiscal year that ended June 30, 2019. Click here to view the unaudited actuals. 

The District projected an unrestricted general fund ending balance of $54.1 million for the 2018-19 fiscal year. The unaudited actuals show the District with an unrestricted general fund ending balance of $61.1 million for the 2018-19 fiscal year. This difference of $7 million is attributed to a number of factors, including increases in revenue of $3 million mainly due to interest earnings, and district reimbursements and expense savings of $4 million mainly in non-personnel areas. It is common for a school district the size of Sacramento City Unified to have a gap between projections and year end actuals because of changes in actual funding and budget spending controls resulting in year-end savings. 

This change represents a positive development for the District鈥檚 budget situation because it increases the District鈥檚 reserves to assist with unforeseen economic downturn or unplanned expenses. However, the current year savings does not eliminate the District鈥檚 structural deficit of $26 million. The District remains committed to eliminating the structural deficit and will evaluate whether any of the 2018/19 savings have potential for ongoing budget adjustments. The District will also continue working through the negotiations process to achieve ongoing employee health insurance savings鈥攁n area where the District is spending significantly more than other school districts. 

We will continue to keep you updated on the latest news and information related to our budget situation. For more, visit our budget updates page. Thank you.

Budget Update #46

August 2, 2019

Dear Community Member,

We want to provide you the latest news with important budget implications. Earlier today, the District proposed a new teacher contract and requested round the clock negotiations with leaders of the Sacramento City Teachers Association. The District seeks to reach an agreement before school starts that will resolve the ongoing labor dispute with SCTA leaders and helps reduce the budget deficit so that students and families are not impacted or distracted by negotiations during the school year.

Click here to read the District鈥檚 full release.

The SCTA鈥檚 contract expired on June 30, 2019. Since November 2018, the District has requested SCTA leaders begin negotiations on a new agreement and is now proposing the following:

• Ground rules for productive and professional negotiations that are rooted in best practices and similar to the ones that have already been established with other labor partners. 
• Bringing the District in line with neighboring school districts and public agencies in California by placing a reasonable cap on the District鈥檚 contribution to health insurance premiums. 
• Increasing academic, enrichment and workforce opportunities for students by changing the start date of the academic calendar to align with surrounding districts. 

To receive updates on the status of negotiations, please click here to sign up for bargaining updates and visit our negotiations updates web page. Thank you.

Budget Update #45

June 20, 2019

Dear Community Member,
 
This evening the Sacramento City Unified Board of Education adopted the 2019-20 budget. Click here to view details and the full budget presentation.
 
The 2019-20 budget spends $12.35 million of the District鈥檚 reserves to cover expenditures. While spending reserves is not sustainable, this temporary approach will buy the district some time to achieve ongoing savings through labor negotiations. This afternoon the District invited leaders of the Sacramento City Teachers Association to commence negotiations on a successor contract. Click here to get the latest bargaining updates, including communications from the District to partners.
 
Thank you for following our budget process this year. We will continue to keep you updated over the summer on any developments that may impact our budget situation. For more, please visit our budget updates page.

Budget Update #44

June 17, 2019

Dear Community Member,

This is a reminder that the Sacramento City Unified Board of Education will be adopting a final budget at the Thursday, June 20th Board meeting. The meeting will be at Serna Center (5735 47th Avenue) and starts at 6:30 p.m. The budget is item 9.4 on the agenda.
 
Click here to download the full meeting agenda and start time for each item. To view the executive summary and proposed adopted budget for all funds, please click here.  
 
Thank you for staying updated on our budget situation. For more information, please visit our budget updates page.

Budget Update #43

June 6, 2019

Dear Community Member,
 
This evening the District presented its Proposed Budget and Local Control Accountability Plan (LCAP) for the 2019-20 fiscal year. The $547.5 million proposed general fund spending plan continues deficit spending into next year, relying on $12.35 million of the District鈥檚 reserves in 2019-20, to buy the District some time to achieve long-term cost savings through labor negotiations. The Proposed Budget focuses on making investments to address the needs of students and maintain program quality including: 

• Increasing grade level readiness rates
• Increasing graduation rates
• Increasing college & career readiness rates
• Providing students with safe, emotionally healthy, and engaging environments
• Advancing equity for our underserved students

Click here to view this evening鈥檚 presentation of our Proposed LCAP.
 
Click here to view this evening鈥檚 presentation of our Proposed 2019-20 Budget.
 
As is our traditional process, both the LCAP and Proposed Budget items will come back to the Board of Education for a final vote and adoption on June 20th. Members of the public who wish to submit additional comments or input on the Proposed Budget and LCAP can contact the Board of Education and/or contact the Superintendent. We have also collected feedback from the four community budget workshops that were held between May 20th and May 30th.
 
The 2019-20 LCAP and Proposed Budget are the culmination of a process that started over 6 months ago and includes input from many stakeholders including our staff, Board of Education, labor partners and community members. We appreciate the participation from our community during this process and invite the public to participate in the budget adoption meeting on June 20th. The meeting will be held at Serna Center (5735 47th Avenue) starting at 6:30 p.m. 
 
Thank you for staying updated on our budget situation. For more information please visit our budget updates page.
 

Budget Update #42

June 5, 2019

Dear Community Member,

The County Superintendent has completed his analysis regarding the fiscal status of the District for the 2018-19 fiscal year. This report is required pursuant to Education Code section 1240[e], for any district with a qualified or negative interim report.

Click here to read County Superintendent Dave Gordon鈥檚 letter to the District.

We will continue to keep you updated on the latest news regarding our budget situation. For more information, please visit our budget updates page. Thank you.

Budget Update #41

June 4, 2019

Dear Community Member,

This is a friendly reminder that the District鈥檚 2019-20 proposed budget and Local Control Accountability Plan (LCAP) items will be presented to the Board of Education this Thursday, June 6th. 

The meeting will be at the Serna Center (5735 47th Avenue) and starts at 6:30 p.m. The LCAP presentation is scheduled to begin at approximately 7 p.m. The proposed budget presentation is scheduled to begin at approximately 7:25 p.m. Click here to view the meeting agenda and corresponding materials for each item. Thursday鈥檚 LCAP and proposed budget items are for public hearing only. The Board vote to adopt a final LCAP and budget will be on Thursday, June 20th at 6:30 p.m. 

We appreciate you following our District鈥檚 budget and LCAP process. For more information, please visit our budget updates page. Thank you.
 

Budget Update #40

June 3, 2019

Dear Families and Community Members,

Our 2019-20 Proposed Budget continues investing in the goals we have established in our Local Control Accountability Plan (LCAP) with a strong focus on maintaining and improving the quality of education for our students. Improving the alignment of our Proposed Budget to our LCAP was one of the recommendations by the State鈥檚 Fiscal Crisis & Management Assistance Team (FCMAT) in its December 2018 Fiscal Health Risk Analysis of the District.

Click here to view the 2019-20 Proposed Budget.

These LCAP-aligned investments are necessary for retaining and attracting students to our schools, particularly at a time when our District, like others, continues to see declining enrollment. These investments are also necessary to restore confidence in our schools鈥� continued ability to provide a quality education, particularly in response to the concerns that many students, families and staff have been feeling in recent months as they learned about the possibility of a state takeover. Keeping students and families satisfied with the quality of our programs and enrolled in our schools is an important and critical component to improving our fiscal situation.

While we are still facing a structural budget deficit, a clear path to a solution is within reach. The solution rests in reducing our labor costs which currently stand at 91% of every dollar鈥�6% higher than the average for unified school districts in California. The 2018 FCMAT Fiscal Health Risk Analysis also identified this spending outlier as a source of our financial challenges. In 2019-20, the District will continue to strive for working with our five labor partners to implement solutions that are fair to our employees, but also achieve the long-term cost savings necessary to have a structurally sound and sustainable budget in place so that we can continue to provide quality programs to our students.

The 2019-20 Proposed Budget totals $547.5M. In alignment with our LCAP, it includes key areas of investment to address the needs of students and maintain program quality including:

鈥� Increasing Grade Level Readiness Rates 

鈥� Increasing Graduation Rates 

鈥� Increasing College & Career Readiness Rates 

鈥� Providing Students with Safe, Emotionally Healthy, and Engaging Environments 

鈥� Advancing Equity for our Underserved Students 

We believe in our students and the ability of our schools to provide them with the quality educational experience they deserve. The proposed 2019-20 budget will put us on track to continue prioritizing the needs of our students while buying us time to work with all labor partners to achieve cost savings in a manner that is fair and equitable to all of our employees.

Sincerely, 

Jorge A. Aguilar

Superintendent        

Budget Update #39

May 18, 2019

Dear Community Member,

Starting on Monday, May 20th, the District and Board of Education will be hosting a series of community budget workshops. The purpose of the workshops is to share the District鈥檚 plan for balancing the budget long-term and to gather feedback from parents and community members. to download the flyer.

The workshops are scheduled on the following dates:

Monday, May 20th @ 6 p.m.
Hiram Johnson High School (6879 鈥� 14th Avenue)

Tuesday, May 21st @ 6 p.m. 
California Middle School (1600 Vallejo Way)

Thursday, May 23rd @ 6 p.m.
Luther Burbank High School (3500 Florin Rd.)

Thursday, May 30th @ 6 p.m.
Einstein Middle School (9325 Mirandy Drive)

For the current status of the District鈥檚 budget situation, please download the Third Interim Report PowerPoint presented to the Board of Education on May 16th. You can view the full Third Interim Report by . We have also created a document with answers to frequently asked questions about the Third Interim Report.

We will continue to keep you posted on the latest information and updates regarding our budget situation. For more, please visit our budget updates page.

Budget Update #38

May 15, 2019

Dear Community Member,

In preparation for the Thursday, May 16th budget update to the Board of Education, the District has posted the latest materials on its website. the updated board packet and information related to the Third Interim Budget Report, which is item 9.3 on the agenda.
 
Below are some key takeaways from the items that will be presented to the Board and public in greater detail on Thursday:

Despite deep cuts and identifying cost savings, the District will continue deficit spending in 2019-20.

$19.67 million of District reserves will be needed to cover next year鈥檚 expenditures, leaving only $25 million in reserves at the start of the 2020-21 fiscal year.

The over $28 million in cuts and cost savings adopted by the Board so far this year has helped extend the date that a state takeover would occur, buying the District some time to achieve long-term cost savings through labor negotiations.

While the meeting starts at 6:30 p.m., item 9.3 is expected to begin at approximately 8:25 p.m. The meeting will be held at the Serna Center (5735 47th Avenue, Sacramento, CA 95824). You can also watch the meeting online.
 
We will continue to keep you updated on the latest budget news, including answers to frequently asked questions. Please visit our budget updates page for more information. Thank you.

Budget Update #37

May 10, 2019

Dear Community Member,

Earlier today, Superintendent Jorge Aguilar issued the following statement in response to leaders of the Sacramento City Teachers Association requesting that the State Superintendent of Public Instruction form a budget solutions committee to help the district prevent a state takeover. 
 
Superintendent Aguilar鈥檚 Full Statement:
 
鈥淲e are committed to reaching a solution with all labor partners that will bring a permanent solution to our structural budget deficit and save our schools from a state takeover. The district will also seek engagement in this process from additional stakeholders including parents and community partners because maintaining the quality of education for our students should be the North Star that guides our decision-making.鈥�
 
We will keep you updated on the status of our budget, including answers to frequently asked questions. As a reminder, on Thursday, May 16th, the District will present an important budget update to the Board of Education as part of the 3rd Interim Report. This presentation will provide the community with the most recent budget projections, status of cash flow and other important information related to the district鈥檚 fiscal status. Click here on Monday evening to access and download the updated board packet with materials for the 3rd Interim Report.

Thank you.

Budget Update #36

May 7, 2019

Dear Community Member,

As the District prepares for next week鈥檚 budget report, we are updating you on a recent development with budget implications.

Earlier today, an administrative law judge (ALJ) issued a decision upholding the certificated staffing reductions made by the district at the February 21st and March 7th board meetings. While decisions like this which impact our employees are difficult, the reductions are necessary. Specific fiscal impacts of the staff reductions and today鈥檚 ALJ decision will be presented as part of the May 16th third interim budget report.

Following today鈥檚 decision, Superintendent Aguilar issued the following statement:

鈥淒ecisions that result in our district losing dedicated staff members are not easy. Unfortunately, we do not have the resources to maintain our current staffing levels due to our fiscal crisis and declining enrollment. We are committed to helping our staff during this challenging transition.鈥�

Board President Jessie Ryan issued the following statement:

鈥淓ach cut to our dedicated certificated, classified and administrative staff looms heavy on our hearts but is unfortunately necessary given our grave fiscal challenges. We remain committed to doing the difficult work necessary to avoid a state takeover but recognize how deeply these actions impact our school communities.鈥�

A special board of education meeting is scheduled for this Thursday, May 9th at 7 p.m. to take action on the resolution authorizing staff to issue final layoff notices. Click on this link in advance of the meeting to view the agenda and accompanying materials.

We will continue to keep you updated on the latest budget developments. For more information, including answers to frequently asked questions, please visit our budget updates page. Thank you.

 

Budget Update #35

May 3, 2019

Dear Community Member,

At last night鈥檚 Board of Education meeting, the District presented information on the development of the 2019-20 fiscal year budget and provided an update on the 2018-19 budget. Click here to view the presentation.

As a reminder, the next key upcoming dates in the budget development process are:
 
May 16, 2019
Board of Education Meeting鈥揟hird Interim
Click here for the agenda
 
June 6, 2019
Board of Education Meeting鈥揚ublic Hearing for LCAP, EPA, and 2019/20 Proposed Budget
Click here for the agenda
 
June 20, 2019
Board of Education Meeting鈥揂dopt LCAP, EPA and 2019/20 Proposed Budget
Click here for the agenda
 
June 27, 2019
Deadline to Submit to SCOE Adopted Budget & LCAP
 
Please note that open session for upcoming Board meetings will start at 6:30 p.m. We will continue to keep you updated on the latest budget news and information. For more, please visit our budget updates page. Thank you.

Budget Update #34

May 2, 2019

Dear Community Member, 

This afternoon an arbitrator issued a decision on the salary schedule adjustment disagreement between the District and the Sacramento City Teachers Association. Click here to view the arbitrator鈥檚 full decision.

In response to the arbitrator鈥檚 decision, the District has issued the following statement:

鈥淭he District is disappointed in the outcome but will respect the decision of the arbitrator. The arbitrator鈥檚 decision will cost the District more than the 3.5% maximum increase we had agreed to and planned for in our budget. It will have negative implications on our budget situation and we are now carefully reviewing the details of his decision to assess how much our financial obligation will increase by and the impact of this decision on our current financial challenges.鈥�

We will continue to keep you updated on the latest budget news and information. For more, please visit our budget updates page. Thank you. 

Budget Update #33

April 23, 2019

Dear Community Member,

We have updated our budget updates page with information about the following key upcoming meeting dates:

May 2, 2019 
Board of Education Meeting鈥揇raft LCAP
Click here for the agenda

May 16, 2019 
Board of Education Meeting鈥揟hird Interim
Click here for the agenda

June 6, 2019 
Board of Education Meeting鈥揚ublic Hearing for LCAP, EPA, and 2019/20 Proposed Budget
Click here for the agenda

June 20, 2019 
Board of Education Meeting鈥揂dopt LCAP, EPA and 2019/20 Proposed Budget
Click here for the agenda

June 27, 2019 
Deadline to Submit to SCOE Adopted Budget & LCAP

Please mark your calendar and check regularly our webpage with upcoming meeting dates for new events and meetings. Thank you

Budget Update #32

April 3, 2019

Dear Community Member,

At tomorrow鈥檚 April 4, 2019 Board of Education meeting, there will be a presentation on the District鈥檚 cash flow report. Click here to view the meeting agenda and packet. 

The meeting will start at 6 p.m. and is at the Serna Center (5735 47th Avenue, Sacramento, CA 95824). The cash flow report item is scheduled to start at approximately 7:30 p.m. You can watch a livestream of the meeting at this link. 

We will continue to keep you updated on our budget situation and upcoming meetings. For more information, please visit our budget updates page or read answers to our most frequently asked questions.

Thank you.

Budget Update #31

April 03, 2019

Dear Community Member

One of the biggest potential barriers to solving our budget challenges is the impact that a teacher strike would have on the District鈥檚 finances. Tonight, leaders of the Sacramento City Teachers Association announced that they plan to lead a teachers strike in our district schools next Thursday, April 11th. The District will continue reaching out to SCTA leaders to avoid a strike that would have very negative implications on our budget and we have issued the following statement in response to the strike date announcement:

This strike is unnecessary and will only hurt students, families and employees by putting the district on the fast track to a state takeover. A state takeover will result in less money for our students and do serious harm to the city鈥檚 public schools for many years to come. Our students do not deserve to be put through the hardships that will be caused by this strike. We will continue encouraging SCTA leaders to work with us in the coming days to focus on saving our schools from a state takeover and finding more collaborative ways to resolve their disagreements with the District. 
 
Also, earlier this afternoon Superintendent Jorge Aguilar sent this letter to SCTA leadership to be shared with the SCTA council prior to their vote to set a strike date. For updates on this developing situation, please visit our website. To sign up for future budget alerts, please visit our budget updates page.

Budget Update #30

March 8, 2019

Dear Community Member,

We understand that our budget situation demands transparency and fiscal accountability. That is why moving forward we want to make sure members of our community have access to as much information as possible about how we are spending taxpayer dollars.
 
Today, we launched an important new tool that will improve budget transparency by providing the general public with direct access to real-time information about the District鈥檚 budget and its expenditures. This 鈥淪ac City Unified Budget Dashboard鈥� tool allows any member of the community to now view and access the same financial information that our budget department staff is able to access through our financial system. 
 
Transparency will be critical to solving our budget challenges and our community must be able to see how spending cuts impact our total budget. For example, despite the Board of Education taking action last night to cut 33 administrator positions, put a cap on administrative spending, reduce unused vacation accruals and other cost savings measures, the District still needs to make additional cuts to eliminate our structural budget deficit and save our schools from a takeover. This new tool will help the public see firsthand how we are spending our money and the impact that cuts will have on our budget.
 
We are interested in getting your feedback on this new tool. If you have questions, comments or suggestions about the new Sac City Unified Budget Dashboard, please submit them here.
 
Thank you for your interest and requests to better understand how we work through our budget challenges. For more information about our budget situation and to review previous Budget Alerts and updates, please visit our webpage or see answers to our budget Frequently Asked Questions.

Budget Update #29

March 7, 2019

Dear Community Member,

The Sacramento City Unified Board of Education tonight made additional reductions to central office administration and other administrative spending. The cuts add to the $1 million of previously made cuts to the central office administration.

These actions reduce the District鈥檚 total expenditures on central office administration to an estimated 4% of the total general fund鈥攕ignificantly lower than the average for school districts in Sacramento County.
 
In addition to making the additional central office and other spending cuts, the Board also passed a resolution on the fiscal solvency plan to save our schools. . The resolution includes:

• Placing a cap on spending on general administration
• Controlling administrator costs by not filling certain administrator vacancies
• Freezing salaries and adopting other cost-savings measures
• Adopting a management accountability plan to reduce the future cost of 鈥渧acation cash outs鈥� by having employees provide plans to use their vacation time and not allow it to accrue over time
• Working with labor partners and unrepresented employees to rebalance employee benefit contributions with a goal toward returning to District contributions that are in parity to comparable school districts while providing high quality benefit plans to our employees 

The Board will continue to seek working with labor partners to achieve health cost and other savings to save our schools from a takeover. For more information visit our budget  or .

Budget Update #28

March 6, 2019

Dear Community Member,

On February 14, 2019, Sacramento County Superintendent Dave Gordon completed an analysis of several cost savings ideas submitted by leaders of the Sacramento City Teachers Association. For example, since September 2018, SCTA leaders have stated that the District could save $16 million by 鈥渞educing central office administrators鈥�. However, according to Superintendent Gordon鈥檚 analysis, if the District made a 20 percent reduction to its unrestricted central office administration, that would only generate $1.6 million in savings, not the $16 million stated by SCTA leaders.
 

 
Superintendent Gordon also wrote that within the central support functions of the district, total unrestricted administrator (certificated and classified) salary and benefit costs are less than $8 million. The District has already made $1 million in cuts to central office administration and continues seeking more cuts in this area.

In summary, the District cannot rely on central office administrative cuts to eliminate the structural budget deficit. As we continue looking for additional savings and efficiencies, the most viable solution to the District鈥檚 budget challenges remains calling on all labor partners to work collaboratively with the District to rebalance employee health benefits contributions while still continuing to provide high quality benefit plans to employees. Four of five District labor union partners have commenced contract negotiations with a goal of rebalancing employee health benefits. The District is awaiting commencement of contract negotiations with SCTA leadership.
 
For more information on our budget situation, please visit our  or read responses to . Thank you.

Budget Update #27

March 5, 2019

Dear Community Member,

This email is to notify you that the Sacramento City Unified Board of Education will be presented with the Second Interim Financial Report and fiscal recovery plan this Thursday, March 7, 2019. The meeting starts at 6 p.m. and will take place at the Serna Center (5735 47th Avenue, Sacramento, CA 95824).

In addition to items in the financial report and fiscal recovery plan, the Board will be considering a resolution to help save our schools by further reducing spending in the following ways:

• Capping spending on unrepresented administrator and management positions
• Further exploring health cost savings options
• Reducing unused vacation time accruals

The fiscal recovery plan that will be presented continues to prioritize making cuts away from services and programs that serve our students. To view the Board meeting agenda and packet, please click here. 

Budget Update #26

February 28, 2019

Dear Community Member,

In recent weeks, we have received many questions regarding the District鈥檚 plan for balancing the budget, the status of achieving health cost savings, implementation of a salary schedule adjustment for teachers, and other items.

This email is to notify you that we have updated the FAQ section of our website with answers to some of the most frequently asked questions. Below are the items that have been added to our FAQ鈥檚.

New FAQ鈥檚

What is the District鈥檚 plan to save our schools from a takeover?

To avoid a , the District needs to close a $35 million structural budget deficit. A critical component of the District鈥檚 plan to balance the budget and sustain itself long-term is to achieve employee health insurance cost savings.  Currently, labor partners representing our custodians, bus drivers, cafeteria and maintenance workers, and principals have initiated contract negotiations with a commitment toward making shared sacrifices to prioritize the needs of students and save our schools from a takeover. We will continue to invite leaders from the Sacramento City Teachers Association to begin contract negotiations before we run out of time.
 
Working with labor partners and employees to reduce spending is the District鈥檚 preferred plan. According to a D (FCMAT) the District is spending 91 cents of every unrestricted dollar on benefits and salaries. This amount exceeds the state average for unified school districts and is unsustainable. According to the FCMAT report: 鈥淭he statewide average for unified school districts as of 2016-17 (the latest data available) is 84.63%. At 2018-19 first interim, the district is exceeding the statewide average by 6.37%.鈥�  and scroll to page 17 for the reference about Sac City Unified鈥檚 high average for benefits and salary combined.
 
If the District and its bargaining partners cannot achieve the savings necessary to balance the budget, then the District will have to find other alternatives which would include cuts to programs and services that our students and families depend on.
 
If the District can save a lot of money on health costs, why has the District not implemented a health savings agreement with the Sacramento City Teachers Association (SCTA)?
 
Achieving health savings has been a high priority for the District for many years. Health savings cannot be achieved until the District and SCTA reach agreement. We will continue to invite leaders from the Sacramento City Teachers Association to begin contract negotiations.
 
What is the disagreement over the 3.5% salary schedule adjustment all about and how is it related to the budget?
 
Per the 2017 framework agreement between the District and SCTA, both parties were to agree upon a salary schedule adjustment 鈥渘ot to exceed a total expenditure of 3.5 percent鈥�. The District has been committed to honoring the 3.5 percent toward a salary schedule adjustment. However, after the agreement was ratified, the SCTA submitted to the District an implementation proposal that the District estimated would cost 7.1 percent annually, or a total of $14.2M in ongoing expenditures. This amount is significantly higher than the amount the District believed was agreed to by the parties, and which was actually approved by our Board of Education, reported to and approved by the Sacramento County Office of Education, and planned for in our budget.
 
In terms of dollars, the difference between the agreed upon 3.5 percent and the proposal SCTA submitted after the agreement was ratified, is approximately $7 million per year of ongoing expenditures.  on whether there was agreement between the parties on the 3.5 percent given the differences in what we and SCTA believed we had agreed to. The Court determined that SCTA and the District should resolve this matter in arbitration. The parties are scheduled for arbitration on March 7, 2019.
 
Did the District file a motion in Superior Court seeking to overturn its collective bargaining agreement with SCTA due to budget constraints?
 
No. There has been some misunderstanding about the previously referenced court case. The court case involved the District seeking to obtain a decision on whether there was, in fact, an agreement between the parties on the single issue of the salary schedule adjustment. The District currently has the salary schedule adjustment budgeted at a 3.5% cost increase to the District. The District was not trying to overturn the entire 2017 agreement with SCTA. In fact, the District has already implemented most of the 2017 agreement including:

• Paying out 2.5 percent retroactive salary raises for teachers in 2016-17
• Paying out 2.5 percent salary raises for teachers in 2017-18
• Paying out 2.5 percent salary raises for teachers in 2018-19
• Crediting unlimited years of qualified experience to new hires and current teachers for placement on the salary schedule
• Hiring two additional psychologists
• Increasing the stipends of Athletic Directors from $3,895 to $4,490

Why does the District not communicate directly to employees about its cost savings plans, and other questions related to employee health benefits?
 
Labor laws require the District to communicate with the union representatives of our employees and prevent District administrators and management from communicating or 鈥渄irect dealing鈥� with represented employees on issues related to wages, working conditions and other issues. Labor unions representing various employee groups do not have these same restrictions on communications with employees and can communicate freely about these matters to employees in their bargaining unit.

More Information

The District will continue to keep the community updated on the latest news and actions related to our budget situation. For more information, please visit our . Thank you.

Budget Update #25

February 21, 2019

Dear Community Member,

As we , tonight the Board of Education took up important cost saving measures to help save our schools from a takeover and prioritize funding for students. The Board voted to start the process of reducing our staffing levels to match student needs based on the district鈥檚 actual and projected enrollment. These actions will result in an estimated cost savings of $5 million.

Specifically, this means staffing levels will be reduced to match the district鈥檚 class size requirements.

The Board鈥檚 action maintains District class size ratios while ensuring that certificated staffing levels do not exceed the ratios specified in the District and Sacramento City Teachers Association (SCTA) collective bargaining agreement and, keep within California Department of Education class size requirements. Per the District and SCTA collective bargaining agreement, class size ratios are:

• 24 to 1 for grade K-3 classes
• 33 to 1 for grade 4-6 classes
• 31 to 1 for grade 7-8 classes
• 32 to 1 for grade 9-12 classes (maximum in English, Social Studies, Math and Science shall be 35:1, shall be limited to 170 pupil contacts per day)
• 15 to 1 for elementary segment special education mild to moderate classes
• 16 to 1 for secondary segment special education mild to moderate classes
• 13 to 1 for elementary and secondary segment special education moderate to severe classes
• 28 to 1 for the resource specialist program (RSP)

Moreover, early childhood programming will be reduced to save costs and focus on kinder readiness and our core mission of providing K-12 services. The funding the District receives from the state and federal government to run the program is not at a sufficient level to fully operate our early childhood programs. This has resulted in losses to the District鈥檚 unrestricted general fund. The District will be reducing its Pre-K programs next year to reduce these costs. Families that are impacted by these changes will be connected to other entities that provide these services to ensure continuity of care.
 
The actions taken tonight to cut staffing levels to match the District鈥檚 actual service needs are an important step in multiple actions the Board will be taking in the coming weeks to save our schools from a takeover. Please follow our budget updates page to learn more. Thank you.

Budget Update #24

February 15, 2019

Dear Community Member,

At next Thursday鈥檚 Board of Education meeting, the District will be taking additional steps on implementing cost savings measures that are necessary to balance our budget and save our schools from a takeover. Download the meeting agenda by clicking here.
 
As we reported last month, the Governor鈥檚 proposed budget will not fix our budget challenges. We will need to continue to work with bargaining partners to achieve health care and other cost savings. These necessary steps may result in hardships for some of our employees. However, we must begin taking steps now to remain fiscally solvent and be able to continue addressing the needs of our students. We appreciate SEIU 1021, United Professional Educators, Teamsters Classified Supervisors and Teamsters Local 150, for beginning the negotiations process with the District in January.
 
Superintendent Aguilar has reached out to SCTA leaders since November asking them to offer dates to begin bargaining. Given the longstanding strained relationship with our teachers鈥� union, and because we cannot afford to lose any more time, Superintendent Aguilar again today asked SCTA leaders to agree to begin negotiations, and to agree to a neutral facilitator, to help both sides reach agreement on what are the necessary steps we must take to help save our schools. .
 
We will continue keeping you posted on actions we are taking to save our schools from a takeover. For more information, please visit our website. Thank you.

Budget Update #23

February 13, 2019

Dear Community Member,

As has been widely reported, Sacramento City Unified Schools are projected to run out of cash in November. Unless significant spending cuts are made by June to balance the budget and meet state required reserve levels, the district will be taken over.

Although the District is working on solutions to save our schools from a takeover*, this situation has understandably prompted many questions and concerns from our community about what would happen if a takeover occurs. To help you get the facts about what insolvency and takeover would mean for our schools, please click here to download a fact sheet or see the facts below.

FACTS ABOUT 鈥淪TATE TAKEOVER*鈥� OF OUR SCHOOLS

There would be less money to spend on students.

When an insolvent school district gets taken over, a state loan is obtained to pay its bills. State loans charge an interest rate on the borrowed money. Therefore, in addition to making cuts to pay its bills, the District would need to make even more cuts to pay back the state loan with interest. This will result in less money available for our students.

An Administrator takes over. Local control is lost.

An Administrator would be appointed and the local school board would lose its decision-making authority. Part of the Administrator鈥檚 responsibilities is to identify cuts to balance the budget and repay the state loan with interest. Valuable student programs, services and schools could be cut out of the budget.

Recovery could take 10 or more years.

According to experts from the State鈥檚 Fiscal Crisis Management Assistance Team (FCMAT), school districts in California that have experienced a takeover take about 10 or more years to recover. It could be many years before parents and local community members in Sacramento would regain local control of our schools.

Experts agree a takeover would be bad for our students.

Experts from FCMAT presented to the Sacramento City Unified Board of Education on December 13, 2018 and warned District leaders that a takeover would not be in the best interest of our students. FCMAT has encouraged the District and its labor partners to work together to identify the cost savings necessary to avoid a takeover.

Click here to download a printable version of this fact sheet. To receive updates on this issue, including upcoming district proposals that would save our schools, click here to sign up for budget updates. For more information, visit our budget updates page. 

Thank you for taking time to review this information. The District will be communicating with you again about our proposed solutions for avoiding a takeover. If you have any questions, please submit them here. 

*NOTE: While this process has traditionally been referred to as a 鈥渟tate takeover鈥�,  made several changes to the state鈥檚 system for intervening in fiscally distressed school districts. Among the changes, takeover responsibilities shifted from the state to the county level.

Budget Update #22

February 7, 2019

Dear Community Member,

On November 16, 2018, we notified you of a requesting a declaration from the court on a salary schedule adjustment disagreement between the District and the Sacramento City Teachers Association (SCTA).
 
A judge has now rendered a decision directing the parties to arbitrate their disagreement over the salary schedule adjustment. The outcome of the arbitration could have significant budget implications for the District.
 
When the agreement with SCTA was reached, we understood that the terms included a mutually agreeable adjustment to the salary schedule in 2018-19 that should 鈥渘ot exceed a total district expenditure of 3.5%鈥�, which the district has been and remains committed to honoring. 
 
SCTA has claimed that the District agreed to an expenditure that has been estimated at 7.1% for 2018-19 and thereafter. This amount is significantly higher than the amount we understood was agreed to by the parties, and which was actually approved by our Board of Education, reported to and approved by the Sacramento County Office of Education, and planned for in our budget.
 
We respect the Court鈥檚 decision and look forward to presenting our facts in arbitration. We are committed to planning a budget that is focused on protecting core academic programs and enrichment opportunities for students, while protecting and maintaining the fiscal solvency of the District.

For more budget alerts and information, please visit our website. 

Budget Update #21

January 30, 2019

Dear Community Member,

The Sacramento City Unified School District鈥檚 general obligation bonds have been downgraded by the Standard and Poor鈥檚 rating agency. The new rating (BBB) represents the lowest investment grade bond rating indicating more risk than higher rated bonds. 

We are hopeful that all of our labor organizations will work together with the District to craft a solution to our fiscal problems. Until then, the lower bond rating means the District鈥檚 interest payments will be higher for bonds issued under this downgrade. Increased interest rates and bond costs will create an increased burden for the taxpayers who voted to support bond initiatives for capital improvement projects. The District must prioritize projects and consider whether bonds to pay for those projects should be issued in the near future given the financial risk involved. 

Four of five district labor organizations鈥揝EIU 1021, United Professional Educators, Teamsters Local 150 and Teamsters Classified Supervisors鈥揾ave commenced negotiations with the District to address its fiscal problems. The District remains hopeful that all labor partners will work in partnership with the District to reach consensus on decisions that will improve the District鈥檚 fiscal condition, without disrupting the classroom or programs that benefit students. 

Our District鈥檚 financial future is in jeopardy unless all employee partners come together immediately to collaborate with the District and make significant budget cuts. 

Budget Update #20

January 22, 2019

Dear Community Member,

On January 10th, Governor Gavin Newsom introduced his budget proposal for the 2019-20 fiscal year. As is our practice, the District has updated its budget projections in response to the Governor鈥檚 proposed budget. This email is to update the community on where our budget projections currently stand.

It is important to note that budget projections are fluid. At the time of our 1st Interim Report last December, the District reported needing to make a minimum of $16 million in cuts for 2019-20 and another $36 million for 20-21. However, under the Governor鈥檚 proposed budget, and an updated forecast projecting continued declining enrollment in our schools, the District needs to cut $35 million for both years to completely eliminate the structural budget deficit, meet its financial obligations, and meet the 2 percent minimum reserve for each year as required by law.

We appreciate the Governor鈥檚 increased investment in education. However, the biggest takeaway for our families is that our District鈥檚 fiscal challenges remain and we have to significantly reduce spending immediately to avoid running out of cash this year and being taken over by the state. The chart below shows that despite our updated projections, the District鈥檚 fund balance will still be almost completely gone in 2019-20.

The District will continue working with our labor partners to achieve the costs savings necessary to prioritize student needs and avoid a state takeover. As was reported two weeks ago in Budget Update #19 below, contract negotiations with a focus on making shared sacrifices to eliminate our structural budget deficit, have started with SEIU 1021, United Professional Educators (UPE), Teamsters Local 150 and Teamsters Classified Supervisors. The District will continue inviting and making efforts to have all of our labor partners agree to contract negotiations and work with us on addressing our budget challenges. The bottom line is that despite a 3.5 percent increase to education in the Governor鈥檚 proposed budget, our District still must significantly reduce overall spending to achieve the cost savings targets needed to avoid state takeover.  

District leaders understand this somber news, and County Superintendent Dave Gordon鈥檚 letter last week agreeing with the District鈥檚 self-certification of 鈥渘egative鈥� status, will continue to raise serious concerns about our ability to protect funding for core academic and student programs. To date we have been able to keep cuts away from students. However, continuing to keep cuts away from students will require shared sacrifice and all labor partners working collaboratively with the District to achieve additional cost savings.

To help the community better understand our current situation, below is a basic breakdown of the key factors that led to these latest budget projections.

Declining Enrollment

Student enrollment plays a significant role in how much funding the District receives from the state. The District has had a continuous trend of declining enrollment over the past 17 years, and has continued to lose students this year. The District is projecting an enrollment loss of 384 students in the 2019-20 school year, translating to a projected $3.5 million loss in revenue in 2020-21. Click here to view year by year enrollment projections.

Health Benefit Costs

One of the biggest cost drivers in the District is employee health insurance. In fact,  to current employees and retirees. Until the Sacramento City Teachers Association agrees to switch health plans to less expensive health plans with comparable benefits, the District projects its health costs will continue to increase in 2019-20. In addition, the District is being mandated by the state to continue contributing more toward the CalSTRS and CalPERS pension systems to ensure those retiree systems remain solvent (see next section for more details).

Governor鈥檚 Proposed Budget

The  does not include any one-time funds, but does seek to increase state funding to school districts by approximately 3.5 percent. The District appreciates Governor Newsom鈥檚 increased investment in education and other proposals focused on reducing costs. However, in Sac City Unified, our costs continue to significantly outpace the 3.5 percent proposed increase in our revenues. Our structural budget deficit will remain unless District spending is reduced.

The Governor鈥檚 proposed budget also seeks to reduce the CalSTRS employer contribution rate by approximately 1.0 percent in 2019-20 and 2020-21, as well as to reduce our out-year contribution rate by 0.5 percent. Assistance from the Governor in bringing down this cost is certainly welcome. However, it will not generate enough savings to prevent our District from running out of cash this year, or to balance our budget in future years. The chart below shows that over a 10-year period, our projected STRS costs, even with the Governor鈥檚 proposed STRS contribution decrease, will still be almost three times more than in 2013-14.

Next Steps 

Again, we appreciate the Governor鈥檚 increased investment in education but understand that despite a 3.5 percent increase to education in the Governor鈥檚 proposed budget, our District still must significantly reduce overall spending to achieve the cost savings targets needed to avoid state takeover. Our Board of Education is committed to preventing this from happening.     

Thank you.

Budget Update #19

January 9, 2019

Dear Community Member,

This email is to update you on the progress we are making in starting critical discussions with labor partners so that we can achieve the cost savings necessary to avoid state takeover. We are pleased to share that today we met and had productive discussions with our labor partners, United Professional Educators (UPE) and SEIU 1021. We also have meetings scheduled this Friday with Teamsters and Teamsters Classified Supervisors (TCS). The Sacramento City Teachers Association (SCTA) has not agreed to dates to begin negotiations.

Nevertheless, the District had a previously scheduled meeting from 4:00 p.m. to 5:00 p.m. this afternoon with leaders from the SCTA to discuss their cost savings ideas. Superintendent Aguilar waited until 4:20 p.m. in anticipation of listening and discussing SCTA鈥檚 cost savings ideas. Unfortunately, SCTA leaders showed up late to the designated meeting location. After several minutes of District staff being interrupted and talked over, our staff left the room as it was clear that such an environment would not allow for a productive discussion.

The looming possibility of the state taking over the District requires that each of us engage in productive discussions focused on the goal of avoiding state takeover. Our District鈥檚 Civility Policy calls for all of us to demonstrate mutual respect, civility, and orderly conduct and model such behavior for the children we serve. We must all keep this policy in mind, especially at this critical juncture where we must have difficult conversations focused on continuing to have local control as opposed to state takeover of our District.

Although a productive discussion with SCTA did not take place today, Superintendent Aguilar and District representatives remain committed to meeting and look forward to sharing the following with SCTA concerning its cost savings ideas:

• Validation of Cost Savings Estimates 鈥� SCTA proposes that their ideas would generate $60 million in savings. The District had planned to ask about whether these estimates had been validated by independent school finance experts.
• Retiree Health Insurance 鈥淥verpayment鈥� 鈥� SCTA proposes that the District can save $12 million by 鈥渞edirecting鈥� retiree health insurance 鈥渙verpayments鈥�. The District has a fiduciary obligation to make these payments, which are to cover the cost of providing lifetime health benefits. After discussing this SCTA proposal with the Sacramento County Office of Education (SCOE), it is premature to estimate a $12 million savings. The District had planned to ask questions to better understand SCTA鈥檚 position given that SCTA members are beneficiaries of lifetime medical benefits.
• Administrative Cuts 鈥� SCTA proposes that the District can save $16 million by eliminating administrative positions. The District had planned on seeking specifics regarding which administrative positions SCTA would eliminate. It is worth noting that almost half of the positions listed in SCTA鈥檚 cost savings ideas are either principals or other school site administrators, not central office administrators.Please click here to read the District鈥檚 full response to SCTA鈥檚 claim that the District can cut $16 million from its administration.
• 鈥淰acation Buyout鈥� Savings 鈥� SCTA proposes that the District can save $6 million per year by ending 鈥渧acation buyouts鈥�. The District has analyzed this idea and determined that there is not $6 million worth of savings in this area in future years. However, the District is committed to saving money by enforcing vacation time policies and has already taken a number of steps to reduce this cost in future years鈥� budgets. You can read a full summary here of the steps already taken by the District to reduce this cost.

The District remains optimistic that all five labor partners will continue to work collaboratively to solve our budget challenges and avoid the damaging effects that a state takeover would have on our students. In a future update, we will send detailed information about the negative consequences a state takeover would have on our students and families. 

We will continue keeping you updated with the latest information on our budget. Thank you.

Budget Update #18

December 17, 2018

Dear Community Member, 

I want to provide an important update on some critical next steps our school district is taking to address the structural budget deficit and keep budget cuts away from our students.

Last Thursday, the state鈥檚 Fiscal Crisis & Management Assistance Team (FCMAT) presented the district with a Fiscal Health Risk Analysis which you can view here. FCMAT鈥檚 primary mission is to assist school districts in identifying, preventing and resolving financial, human resources and data management challenges. FCMAT concluded that, unless changes are made, the district is at high risk of insolvency and focused on identifying district systems and processes where improvements can be made. As a result of FCMAT鈥檚 findings, and in addition to , the district is now taking steps to implement business process changes in the following areas:

• Aligning the district鈥檚 budget and Local Control and Accountability Plan (LCAP) processes
• Improving communication between the business services department and other departments
• Better management of position control (i.e. process of filling vacant positions)

Adopting FCMAT鈥檚 recommendations will help fix a number of improper business practices that have become norms in the district for many years. The Board of Education and I are committed to changing the organizational culture that has led to these improper business practices and will implement business process changes immediately, holding all employees accountable to adopting these new practices.

While implementing new practices and accountability measures is important, to avoid running out of cash we must work collaboratively with all labor partners to immediately achieve health cost savings. 

As has been reported in the news, the ongoing cost driver for Sac City Unified is its long history of paying significantly more for employee health benefits than all other surrounding school districts. For example, Sac City Unified pays almost twice as much as neighboring districts to provide similar health benefits to employees. I remain committed to getting all labor partners to work with the district as soon as possible to switch employees over to more affordable health insurance plans with comparable benefits. The longer it takes to switch health plans and save money, the more likely the district will run out of cash and be taken over by the state.

On December 6th, four out of five district labor union partners鈥擲EIU 1021, United Professional Educators, Teamsters Local 150 and Teamsters Classified Supervisors鈥攃ommitted to switching health insurance plans to save the district an estimated $11 million to $16 million per year. On Friday, December 14th, district representatives met with the Sacramento City Teachers Association leadership team and other representatives, to discuss what it would take for SCTA to agree to make a switch in health plans. SCTA leadership indicated that they would switch SCTA members to a more affordable health plan, but only if the cost savings were used to, among other things, hire an additional 220 certificated staff. Clearly, using health savings to pay for new positions is not going to save the district any money.

While an agreement with SCTA leadership was not reached on Friday, I remain optimistic that they will soon understand the value of switching SCTA members to a more affordable health plan and applying the savings achieved toward covering the cost of teacher salaries and benefits. I will continue to keep you updated on the latest developments on our budget situation. Thank you for your patience as we work to resolve this challenge.

Sincerely,

Jorge A. Aguilar
Superintendent

Budget Update #17

December 14, 2018

Dear Community Member,

We want to inform you that this evening we concluded a meeting on health savings with our labor partner, the Sacramento City Teachers Association. The two parties had a focused discussion on how we can work together to switch to a more affordable health plan with comparable benefits. Both the district and SCTA have agreed to continue discussions on new health plan options as early as next week. We look forward to continuing the process and taking steps necessary to reign in the significantly high cost of providing health insurance to district employees so that we can redirect more of those funds toward our students.

Budget Update #16

December 14, 2018

Dear Community Member,

The district looks forward to meeting with Sacramento City Teachers Association leaders at 4pm this afternoon to discuss the specific next steps necessary to achieve health insurance cost savings so we can balance our budget next year, avoid running out of cash and protect and expand programs for our students. We will continue to keep the community updated on the status of these discussions. We know our students and families are depending on us to work together to implement health care cost savings so we can prevent running out of cash next year and avoid state takeover. 

Budget Update #15

December 12, 2018

Dear Community Member,

Today, we regret to inform our community that under the current circumstances we are facing, the Sacramento City Unified School District is projected to run out of cash next November.

This is our reality despite the fact that we have identified over. Without further actions, this means the District would be unable to fulfill its financial obligations and would not have enough cash to cover employee payroll, payments to vendors and others. To prevent the District from running out of cash, we must immediately identify additional cost savings to balance next year鈥檚 budget.  

While it is painful to share this news with our community, we remain committed to working as hard as possible to address our budget challenges. In recent months the District has taken various steps to achieve as many cost savings as possible in areas where negotiations are not required. However, the greatest cost savings by far would result from all of the District鈥檚 labor union partners agreeing to switch over to more affordable health plans. Reports provided by school districts to the County Office of Education show that Sac City Unified spends significantly more to provide health benefits than all other Sacramento area school districts. Therefore, the largest savings would be achieved if labor partners agree to switch over to more affordable health plans. This action requires agreement from the District鈥檚 five labor partners.  An independent analysis provided to the District by the non-profit California Education Coalition for Health Care Reform (CECHCR), a nonprofit group that works with school districts to reduce health care costs, showed the District could save between $11 million and $16 million annually if labor partners agree to make the switch in health plans. 

Last week, four of the District鈥檚 five labor union partners took an important step to help actualize these health cost savings. In a joint announcement with District leaders, SEIU 1021, United Professional Educators, Teamsters Local 150, and Teamsters Classified Supervisors, all signed an agreement to switch to more affordable health plans with comparable benefits. If you have not already seen it, please watch and read news coverage of this announcement or watch a video replay. The District has made the same proposal to SCTA and hopes to reach agreement soon. The District recently offered SCTA three dates this month to meet again on this important issue. The District remains optimistic that we will soon have agreement with all labor partners to switch over to more affordable health plans by selecting benefit plans similar to those currently offered, but that cost significantly less. To be clear, paying less for health plans would not mean losing benefits.

Meanwhile, the District is implementing other cost savings strategies that do not require negotiations to save what it can. For example, the District continues its trend of reducing how much of its general fund is spent on administrators. The District now spends 4.39 percent of its general fund dollars on general administration, the lowest in the Sacramento region. By comparison, surrounding school districts spend an average of 5.71 percent of their general fund dollars on general administration. Click here to see California Department of Education data showing how much less of its general fund Sac City Unified spends on administration than surrounding school districts. 

While operating a lean administration helps the District achieve some short-term savings, under-staffing has long-term financial consequences. Under-staffing results in employees being unable to utilize vacation time鈥攁 benefit the District is required by law to allow employees to accumulate and use, or cash out if unused. Since Sac City Unified has traditionally been understaffed with many employees unable to utilize their vacation time, the District has had to take action in recent months to reduce this financial liability and prevent it from growing. Implementing a 鈥渦se it or cash it out鈥� policy this year for vacation time has saved the District approximately $4 million in future liabilities. To view cashed out vacation time for unrepresented staff, click here.  

While these actions have resulted in some savings, they will not yield the ongoing large savings needed to keep the District financially solvent in the long-term. The key to long-term cost savings is to work collaboratively with our labor partners to switch over to more affordable health plans and lower the cost of providing employee health benefits, which four out of five labor union partners are committed to doing.

The District will continue to keep you updated on the status of our budget situation and important developments as they occur. Thank you for your patience as we continue to work through this challenge.

Budget Update #14

December 8, 2018

Dear Community Member,

This week four of the district鈥檚 five labor partners鈥擲EIU 1021, UPE, Teamsters Local 150 and Teamsters Classified Supervisors, signed an agreement to implement health cost savings with the help of the California Education Coalition for Health Care Reform (CECHCR), a nonprofit group that works with school districts to reduce health care costs.

We are optimistic that all of our labor partners will agree to implement these cost savings, which requires selecting a specific health plan that will replace an existing plan, and then notifying CECHCR of that selection and a start date.

To better understand the importance of achieving health cost savings to help solve our budget challenges, please watch the recent news coverage on this issue or watch the replay of the announcement which is posted on our website. Thank you.

Budget Update #13

December 5, 2018

The Sacramento City Unified School District announced in a video statement on Wednesday that it has managed to find millions in cost savings, with most cuts being made away from the classroom. However, Superintendent Aguilar and Board President Jessie Ryan warned that these cuts will not be enough to entirely address the district鈥檚 structural deficit. Both leaders called on district employees to rise to the occasion and make shared sacrifices to eliminate the structural budget deficit. 

Board of Education President Jessie Ryan indicated that 鈥漌hile the Superintendent has gone as far as he can in reducing costs, we are now forced to look for other areas to save money. As Board President and mother of two children in our schools, I want to be very clear that the Board of Education will not approve a budget that hurts students. Our students did not cause this budget deficit and we will not balance the budget on their backs.鈥�

All of the savings the district has found up to this point have been attained without any collective bargaining. However, to eliminate the district鈥檚 structural budget deficit, it must now reduce total costs to provide health benefits. The district will not be able to balance its budget in future years unless all employees are willing to make some concessions in the next round of contract negotiations. These negotiations are expected to begin immediately after the Board of Education voted on November 15, 2018 to give Superintendent Aguilar authority to begin bargaining with labor partners. 

The district believes the largest potential costs savings would be achieved by shopping for more affordable health insurance plans for employees. Sac City Unified is currently, and has historically, spent significantly more on its employee health insurance costs than other school districts in the region. A cost savings estimate provided to the district by , shows Sac City Unified could achieve an estimated $11 million to $16 million per year in savings if all labor unions agree to join a health insurance pool that will provide employee benefits at a lower cost. CECHCR is an initiative of the non-profit Center for Collaborative Solutions that helps school districts and their unions work effectively together to save money and implement best practices in how they handle the complexity of health benefits issues. 

鈥淥ur budget staff has worked very hard over the past few months with the assistance of an appointed fiscal advisor to achieve the maximum amount of cost savings that could be achieved without touching our existing labor agreements,鈥� said Superintendent Aguilar. 鈥淲e have reached the point where we cannot eliminate the structural deficit without bargaining. Protecting core academic programs and services for students will now require all of our labor partners to come to the bargaining table ready to make shared sacrifices. This is the only way we can balance the budget and avoid state takeover.鈥�

Budget Update #12

November 16, 2018

As we continue preparing a plan to address the district鈥檚 structural budget deficit to advance our vision of Equity, Access, and Social Justice, we want to share an important action we have taken to resolve claims that the district is responsible for expending more resources in salaries than that which we understood had been agreed upon last year with our labor partner, the Sacramento City Teachers Association (SCTA).

When the agreement with SCTA was reached, we understood that the terms included a mutually agreeable adjustment to the salary schedule in 2018-19 that should 鈥渘ot exceed a total district expenditure of 3.5%鈥�, which the district has been and remains committed to honoring.

The SCTA, however, has claimed that the district agreed to an expenditure that has been estimated at 7.1% for 2018-19 and thereafter. This amount is significantly higher than the amount we understood was agreed to by the parties, and which was actually approved by our Board, reported to and approved by the Sacramento County Office of Education, and planned for in our budget.  

The district seeks to resolve this matter in court so we can continue to plan a budget that is focused on protecting core academic programs and enrichment opportunities for students and maintains the fiscal solvency of the district. 

To that end, this morning we filed a complaint in Sacramento County Superior Court requesting a declaration from the court that there is not an agreement between the district and SCTA regarding the 2018-19 salary structure, let alone an agreement to pay significantly more than the terms of our contract which were ratified by our Board of Education on December 7, 2017.

We will continue to provide updates on proactive measures we are taking to reduce costs, achieve savings and protect resources for our students and families. Thank you.

Budget Update #11

November 3, 2018

Dear Community Member,

As our district continues working on a solution to our structural budget deficit, we want to inform you of an important reform that is now being implemented to reduce future spending.

You may have read news articles in recent years such as  or the .

Failing to control the cost of accrued vacation siphons away resources from our students and schools.

That is why under the leadership of Superintendent Jorge Aguilar, the Sacramento City Unified School District is now implementing a 鈥渦se it or cash it out鈥� policy that will rein in and reduce the financial burden on the district of paying out unused vacation time. This is an important step in reducing the financial burden that high leave balances have on the district. Since implementing this policy, the district has reduced its financial liability by approximately $4 million.

Here鈥檚 how it works: Vacation time is an employment benefit. When accrued vacation time is not used by an employee, the employer has an obligation to pay out the value of that benefit when the employee leaves or retires from the agency. By putting a policy in place that requires employees to use their vacation or cash it out, the district prevents situations where employees are hoarding vacation time and then receiving large lump sum payouts when they leave.

Our labor partner, the United Professional Educators, has also agreed to help the district further reduce our future costs by decreasing its members鈥� number of vacation days from 22 to 5 per year. In fact, new UPE members hired after July 1, 2017 will not accrue any vacation time. This reduction in vacation days will help the district save money. In addition, non-represented management employees are now required to either use or cash out any vacation carry over above 15 days to further reduce the district鈥檚 financial liability and lessen the cost of vacation benefits so more resources are available for our students.

 to learn more about state laws pertaining to employee vacation time and the district鈥檚 obligations to comply with these laws. We will continue to keep you updated on steps we are taking to save money. 

Budget Update #10

October 18, 2018

Dear Community Member,

Last night our Board of Education voted to continue working with our local Sacramento County Superintendent, fiscal advisor and labor partners to address the district鈥檚 budget deficit. Voting to continue working locally and waive the formation of a Budget Review Committee that would be handled at the state level, allows the district and stakeholders to continue working together at the local level to address the budget deficit and chart a course toward financial sustainability.

Click here to view the budget update presentation at yesterday鈥檚 Board meeting.

The district will now continue working collaboratively with all partners and the County Superintendent to meet a December 14, 2018 first interim report and balanced budget deadline. The district has also started working with the state鈥檚 Fiscal Crisis & Management Assistance Team (FCMAT) on a fiscal health analysis of the district that FCMAT is anticipated to complete this December.

We will continue to keep you updated on the latest news and information related to our budget situation. For more information including responses to frequently asked questions, please visit our Budget Review Process web page. Thank you for your patience as we work through this process.

Budget Update #9

October 12, 2018

Dear Community Member,

We are writing to inform you that, as anticipated, the Sacramento County Superintendent has sent a letter disapproving the school district鈥檚 revised budget that was adopted on October 4, 2018. 

Prior to submitting our revised budget, we notified the County Superintendent that while our revised budget included approximately $10 million in cuts, many to our central office and administration, we knew it did not contain sufficient reductions to completely eliminate the district鈥檚 structural deficit. In order to minimize the impact to students, we notified the County Superintendent that we needed more time to work alongside the Sacramento County Office of Education, the County Superintendent鈥檚 appointed fiscal advisor, labor partners and our community to chart a sustainable course that is thoughtful and student-centered.

The fiscal challenges facing Sac City Unified are the result of the district鈥檚 decades-long history of operating with an ongoing structural deficit that has not sufficiently prioritized meeting the needs of students. Making real, solid, and permanent reductions in expenditures to address our longstanding fiscal problems will require courage and commitment and working in collaboration with all partners and stakeholders. Quick fixes made within the 30-day period we were given, would not have served students well. That is why we decided to adopt initial cuts on October 4th that will not harm our students, while seeking more time to work on solutions that will solve our long-term structural deficit. 

Our fiscal challenges can and will be resolved; however, not with a quick fix. The way forward is working in partnership with shared ownership of the solution. There is no other way to solve this. We have to create a functional collaborative coalition between the district鈥檚 bargaining partners, the 麻豆果冻传媒 Board of Education, and the community. 

Successful models are out there, and we need to look no further than our own backyard where Elk Grove Unified School District has a working coalition of the district鈥檚 union leaders. Together, they take responsibility for the health of the district鈥檚 budget and work together to keep the organization fiscally sound. In Sac City Unified, over the past few months we have been working diligently to bring together our labor partners and we are very close to achieving this model. In fact, four of our five labor partners have formed an unprecedented labor-management consortium dedicated to coming up with sustainable solutions by coming to the table and reworking budget priorities that focus on supporting students. 

The solutions we reach in the weeks ahead must come from meaningful input from all stakeholders and reflect the values of fiscal prudence as well as our unwavering commitment to student success. Our current and future generations of students are counting on us to come together to solve this problem. We are determined not to let them down.

Sincerely,

Jorge A. Aguilar          Jessie Ryan
Superintendent           President, Board of Education

Budget Update #8

October 5, 2018

Dear Community Member,

Sacramento City Unified Board of Education and Superintendent Jorge Aguilar have released the following statement regarding action taken at yesterday鈥檚 Board meeting:

鈥淟ast night we took immediate action to cut approximately $10 million from our central office and reduce other administrative expenditures. Now we must shift our focus to having a serious conversation with all employees about how we can work collaboratively to achieve savings in areas where costs continue to increase beyond our ability to sustain. One area is in employee healthcare costs. Sacramento City Unified School District spends more on employee healthcare costs than any other surrounding school district in the region. The potential to continue to provide high quality coverage while achieving millions of dollars in health cost savings is a win-win that will solve our most prevalent budget challenges and redirect millions of dollars back into programs for students. All that is required now is the willingness of every bargaining partner to put the past behind us and come to the table ready to make this happen.鈥�

Below are PowerPoint slides presented at last night鈥檚 meeting which summarize $11.48 million in budget adjustments and cost reductions approved by the Board. 

Budget Update #7

October 3, 2018

Dear Community Member,

We would like to inform you that we have updated our frequently asked questions page with a response to a question related to the district鈥檚 administrative positions and costs. Copied below is the question we have received and our response. Please visit the district鈥檚 FAQ page for all responses to the most common questions we have received. Thank you.

Has the district鈥檚 number of full-time administrators grown from 190 employees in 2014-15 to 271 employees in 2017-18?

No. This statement is factually incorrect and the District has requested that the Sacramento City Teachers Association refrain from using the incorrect figures in their communications. Below are the accurate numbers related to the district鈥檚 reported administration costs reflected in the District鈥檚 end-of-year actual reports submitted to the Sacramento County Office of Education and the California Department of Education:

• In 2014-15, the district actually reported employing 232.2 administrative full-time employees. 
• In 2017-18 the district actually reported employing 267 administrative full-time employees. 
• Four (4) of these positions were vacated and left unfilled at the end of the fiscal year in compliance with the hiring freeze adopted by the Board of Education, leaving the district with a total of 263 administrative full-time employees to start this fiscal year.

Sac City Unified administrators, both at the site level and district office, constitute 4.66% of budget expenditures and are focused on student achievement and providing critical support services to all of our school sites. To help the community understand the roles of our 263 administrators, here is a breakdown of who these employees are and what roles they perform for our students:

• Almost half, 49% (129) of the 263 administrative positions, are held by Principals, Assistant Principals, Site Instructional Coordinators, Student Support Services Coordinators, and other positions directly serving students on school sites. Click here to view a listing of all job titles and salaries for these 129 FTEs. 
• Roughly 10% (26) of the administrative positions are not paid for with unrestricted general fund dollars because they are covered through grant funding, bonds, reimbursements or other funding sources. Eliminating these positions would not result in any cost savings since they are not paid for with general fund dollars. Examples of these positions include, among others: 
  • Our Director and Supervisor of Special Education Services, responsible for overseeing the delivery of services to students with special needs;
  • Our Coordinator for Induction Programs serving first-year teachers;
  • Our Director of Student Support and Health Services overseeing school nurses and the delivery of health-related services at school sites;
  • Our Director and Coordinators of Multilingual Literacy Services and;
  • Our Attendance Campaign Coordinators which are focused on increasing student attendance and generating more revenue for the district. 

Click here to view a listing of all job titles and salaries of these 26 FTEs not paid for using unrestricted general fund dollars.

• Roughly 7% (18) of the administrative positions are responsible for ensuring the district complies with various state and federal laws and other requirements including:
  • Education Code;
  • Local Control and Accountability Plan (LCAP) and Local Control Funding Formula (LCFF);
  • School Safety compliance;
  • Student data and online privacy and safety;
  • Employee Payroll;
  • Translation Services;
  • Bullying Prevention;
  • Student Enrollment and;
  • Disciplinary Hearings 

Click here to view a listing of job titles and salaries for these 18 positions.

• Roughly 12% (33) of the administrative positions are supporting school sites in instructional supervisorial roles, maintenance and operations, and pupil transportation. For example, these positions include our Director of Guidance and Counseling, Chief Operations Officer, Student Transportation Supervisors, and Manager for Facilities Maintenance. The district also employs a grant writer through this funding source and this individual has garnered nearly $75 million in funding for Sac City Unified since the 2014-2015 academic year. Click here to view a listing of job titles and salaries for these 33 FTEs.
• Only 21% (57) of the administrative positions in the district are administrative employees that are paid out of the general fund for a total combined salary amount of $6.7 million. Many of these employees lead the district, or parts of the district, and perform highly critical leadership functions in human resources, business services, accounting, technology, communications, operations and accountability to support school sites with the delivery of essential services that sites depend on but are unable to perform on their own. These positions include the district鈥檚 leadership team including the Superintendent, Deputy Superintendent, Instructional Area Superintendents and their administrative management and support staff. Click here to view a listing of all job titles and salaries for these 57 FTEs.

Every school district depends on administrative employees to keep school sites open and running to serve the needs of students. While the district鈥檚 total number of full-time administrators is currently 31 FTE greater than in 2014, this growth and the percentage of overall budget that is allocated for administration is on the lower end of administrative costs compared to surrounding districts in the Sacramento region (see chart below).

Budget Update #6

October 3, 2018

Dear Community Member,

Superintendent Jorge Aguilar and Sacramento City Unified Board of Education President Jessie Ryan released the following statement this afternoon after the district, working with a fiscal advisor appointed by the County Superintendent, has determined the amount of cost savings the district must achieve to eliminate its structural deficit is $28.5 million in 2019-2020 and $19.5 million for 2020-2021:
 

鈥淭he Sacramento City Unified School District鈥檚 fiscal problems are structural, complex and not new. 

The fiscal challenges are the result of the district鈥檚 decades-long history of operating with an ongoing structural deficit that has not sufficiently prioritized meeting the needs of students. Making real, solid, and permanent reductions in expenditures to address our longstanding fiscal problems requires courage and commitment and working in collaboration with all partners and stakeholders. Quick fixes made within a 30-day period will not serve students well.  

Therefore, we have notified the Sacramento County Superintendent that the revised budget we plan to submit by the state required October 8th deadline, while making approximately $10 million in cuts, does not contain sufficient reductions to completely eliminate the structural deficit. We simply need more time to work alongside the Sacramento County Office of Education, the County Superintendent鈥檚 appointed fiscal advisor, labor partners and our community to chart a sustainable course that is student-centered.

Our fiscal challenges can and will be resolved; however, not with a quick fix. The way forward is working in partnership with shared ownership of the solution. There is no other way to solve this. We have to create a functional collaborative coalition between the district鈥檚 bargaining partners, the 麻豆果冻传媒 Board of Education, and the community.  

Successful models are out there, and we need to look no further than our own backyard where Elk Grove Unified School District has a working coalition of the district鈥檚 union leaders. Together, they take responsibility for the health of the district鈥檚 budget and work together to keep the organization fiscally sound. In Sac City Unified, over the past few months we have been working diligently to bring together our labor partners and we are very close to achieving this model. In fact, four of our five labor partners have formed an unprecedented labor-management consortium dedicated to coming up with sustainable solutions by coming to the table and reworking budget priorities that focus on supporting students. 

The solutions we reach in the weeks ahead must come from meaningful input from all stakeholders and reflect the values of fiscal prudence as well as our unwavering commitment to student success. Our current and future generations of students are counting on us to come together to solve this problem. We are determined not to let them down.鈥�

Budget Update #5

October 2, 2018

Dear Community Member,

We want to share that since September 10, 2018 the district has been working closely with the fiscal advisor appointed by the Sacramento County Superintendent of Schools to review the district鈥檚 budget numbers for accuracy. 

The amount of cost savings the district needs to achieve to eliminate its structural deficit has been revised after our review. The current structural deficit amount after the review is now $28.5 million in 2019-2020 and $19.5 million for 2020-2021. The updated amount reflects changes made after checking for accuracy and reviewing cost information. See chart below for more details.
 

We will continue to update you on our progress as staff continues to work on a revised budget proposal for the Board of Education meeting this Thursday. We plan to send out another update tomorrow but want to keep you apprised of this information for now.

Budget Update #4

September 18, 2018

Dear Community Member,

Thank you again for signing up to receive budget alerts from the Sacramento City Unified School District. The district would like to inform you that our website has been updated with responses to two new frequently asked questions and their responses. Please check the bottom of this email for the two new FAQ鈥檚 and responses that have been added to our web page. You can access all of the FAQ鈥檚 here.

We are still working to schedule a public meeting date for presenting a revised budget. Once that date has been scheduled, you will be notified. Thank you for your continued patience during this process.

Newly Added FAQ鈥檚 

Was the budget disapproved because the district mismanaged its finances?

No. It was disapproved because the County Superintendent is required by law to provide fiscal oversight of the district鈥檚 finances and the district鈥檚 budget has projected deficit spending that will leave the district without any reserves before the end of the 2019/20 school year. The district鈥檚 adopted budget although having sufficient resources to pay expenses for this year, did not include sufficient reserves for outgoing years.

Does the district have a top-heavy central office and high amount of administrative overhead?

Not in comparison to other school districts. This can be determined by how much of the district鈥檚 overall budget is spent on administrative expenses allocated to the central office. The district鈥檚 records show administrative expenses allocated to central office have actually decreased from 4.5 percent of unrestricted general fund budget in 2014-15 to 4.2 percent of unrestricted general fund expenditures in 2017-18. These figures show an overall decrease in central office and administrative spending during this time period. It is worth noting that the district鈥檚 budget significantly increased during this time period. From the 2014-15 fiscal year to the 2017-18 fiscal year, the district鈥檚 budget grew from $333,320,568 million to $395,468,056 in state and local unrestricted general fund revenue sources. The larger revenues led to hiring more staff at all levels of the organization to implement programs and services dedicated to low-income, foster, and English Learners paid for with these revenues. By comparison, the number of teachers employed by the district also grew during this time period. For example, in 2014-15 there were 2,298 certificated (i.e. teaching) FTE employees in the district. In 2017-18 that number grew to 2,521 certificated FTE employees in the district鈥攁n increase of 223 teaching positions*. That increase in hiring of teachers would be equivalent to fully staffing classrooms at McClatchy High School three times. See chart below for how Sac City Unified鈥檚 administrative expenses as a percentage of its budget compare to surrounding districts. 

*Source for number of FTE certificated (teaching) positions: Sacramento City Unified School District Financial Database

Budget Update #3

September 13, 2018

Dear Community Member.

Answers to frequently asked questions that the district has received since the announcement of our budget disapproval, are now posted online on our budget review process page. Click here to view the FAQ鈥檚.

The FAQ鈥檚 will be updated frequently in the coming days leading up to the October 8, 2018 deadline to submit a revised budget to the Sacramento County Office of Education. Remember that if you have a question, our public information office will work to respond with an answer. Please submit your questions here.

Thank you and have a good evening.

Budget Update #2

September 10, 2018

Dear Community Member,

Thank you for subscribing to receive updates from the Sacramento City Unified School District regarding the recent disapproval of the 2018-19 adopted budget. In the coming days, you will be receiving more updates from the district about this topic, including answers to frequently asked questions and when a public meeting will be held. You can also visit our website for updates and information. 

We want to clarify the reason why the district鈥檚 2018-19 adopted budget was disapproved by the Sacramento County Office of Education (SCOE). It was disapproved because sufficient funding was not set aside in savings (our reserve) to meet the state鈥檚 mandated requirement to maintain a minimum 2 percent reserve in fiscal years 2019-20 and 2020-21. A minimum reserve is necessary so that we are structurally addressing our long-term fiscal challenges and able to meet the needs of our students in future years. Per Education Code 42127d, an independent fiscal advisor has now been assigned by the SCOE to work with the district to help remedy our financial sustainability challenges. The independent fiscal advisor arrived to the district today and has now begun the process of assessing our budget to help identify options to address our reserve deficiencies in 2019-20 and 2020-2021. No decisions regarding cuts will be made until the fiscal advisor has completed her assessment work.

To help raise awareness about the steps the district is now taking in response to the budget disapproval, Superintendent Jorge Aguilar and Board President Jessie Ryan were guests on Capitol Public Radio鈥檚 Insight with Beth Ruyak this morning.  or tune in to 90.9FM Capitol Public Radio this evening at 7:15 p.m.  

Finally, we want to make sure you are receiving accurate information from us about what is going on. If you have questions, please do not hesitate to submit them here. We will do our best to respond to your questions as quickly as possible. Thank you.

Budget Update #1

September 7, 2018

Dear Community Member,

At last night鈥檚 Board of Education meeting, our Chief Business Officer, Dr. John Quinto, publicly announced that the Sacramento County Office of Education (SCOE) has disapproved the district鈥檚 adopted budget for this fiscal year. The school district must now submit a revised budget by October 8, 2018 that addresses our $24 million budget deficit.
 

Understanding that this is a critical issue to our students and families, Superintendent Jorge Aguilar and Board President Jessie Ryan want to  with our community in response to this situation鈥攖he first time SCOE has disapproved our adopted budget.
 

We want to assure our community that our commitment over these next few weeks is to work tirelessly to continue making good on the promise of advancing equity, access, and social justice for all students and collectively figure out how to address our budget challenges with the least disruption to our students.
 

The district has created a webpage to update our community with the latest news on this situation, frequently asked questions and other resources. Please sign up to receive alerts and details on how you can participate in meetings on this issue by visiting: www.scusd.edu/budget-review-process.