The Sacramento City Unified School District has been warned for months to balance its budget and is now being ordered to do so.
The district has yet to determine programs or positions that could be cut.
The district can't pay for the 11 percent raises it negotiated last fall with teachers. And it can't cover the 150 percent increases in retirement benefits it owes teachers and staff over three years.
The Sacramento County Office of Education warned the district about this four times, including in a letter last week. The latest letter includes an order to deliver a new budget that accounts for a $24 million deficit by October 8.
County Superintendent of Schools Dave Gordon says the labor deal with teachers cut into the district's already dwindling reserve fund. "I wrote to them [in December] and said, just with what you have negotiated, you will have to make reductions of almost $16 million to meet your basic reserve requirements for next year," Gordon said.
District spokesman Alex Barrios says the district has relied on one-time money from the state. Those monies have decreased every year for the past three years.
“But you can't sustain yourself long-term like that,” Barrios said. “You have to eventually make sure that your paycheck and revenues are enough to pay your bills."
Adding to the situation, health care costs have increased an average of 6.5 percent in each of the last five years. And the district admits its health care cost forecast for the next five years is “conservative.”
The district had a $28 million deficit in June, but made $4 million in cuts, including a summer program the superintendent had just implemented.
This week, Superintendent Jorge Aguilar and school board president Jesse Ryan posted a video on Facebook and asked for ideas of how to solve the shortfall.
The county office has lent the city district a financial adviser who will report directly to Gordon on the district's progress.