The Abridged version:
- The Sacramento City Unified School District is on the brink of insolvency. A state-funded organization that advises ailing districts has released a new report highlighting a litany of longstanding issues that contributed to the multimillion-dollar crisis.
- The same organization assessed Sacramento City Unified in 2018 and found many of the same problems.
- Among the oversights and systemic failures identified was an agreement with the teachers union that raised salaries but did not sufficiently plan for how to afford the additional costs.
- The Sacramento City school board will discuss the report Thursday.
A statewide team that reviews California school districts in fiscal crisis has issued a scathing report about Sacramento City Unified — one that repeats many criticisms it leveled seven years ago.
The report from the Fiscal Crisis and Management Assistance Team, a state-funded organization summoned by county or state school officials to review school districts in financial distress, found a range of system weaknesses at Sacramento City.
- The district agreed to raise teacher salaries this year but did not clearly plan for how to afford the payments.
- District board members for years received insufficient training and, as of late, there is no chief business officer on staff.
- An underbudgeted special education department now regularly relies on spending without proper approval.
Existing challenges come back to haunt
Most of the problems are not new.
Seven years ago, almost to the day, the organization published an analysis outlining Sacramento City Unified’s then-troubling fiscal position. According to the report from Dec. 10, 2018, “The fiscal risk is real, imminent, and serious. Without action, state intervention is certain.”
This year, amid the district’s latest multimillion-dollar plight, the organization was called in by Sacramento County Superintendent of Schools Dave Gordon. It studied Sacramento City Unified from October to November, interviewing staff members and reviewing accounting documents to create a fiscal health risk analysis report, dated Dec. 10.
“The areas of concern today are not remarkably different than they were seven years ago,” the report concluded.
The district was able to survive after the 2018 critical report, according to the financial crisis team, because an infusion of one-time COVID-19 funds “masked” the instability and deeper-rooted problems.
In 2018, the agency rated Sacramento City Unified’s insolvency risk level at 44.8%.
This year, that risk score increased to 50.7%.
New salary agreement tips Sac City’s scales
Board members voted unanimously in September to approve a new three-year contract between the district and the Sacramento City Teachers Association.
Included was a 2% salary increase for all represented employees. The overall agreement was estimated to cost the district about $10.6 million this school year.
Superintendent Lisa Allen signed on, the recent report charged, without clearly identifying “any expenditure reductions to ensure the district remained fiscally solvent.”
The agreement also includes added compensation for eight extra days of school. For the last two years, the district has extended the instructional calendar by a little over a week to make up for time lost during a 2021 teacher strike.
The Sacramento City Unified calendar will return to normal length starting next year. The settlement with the teachers union runs through 2027-28.
Sacramento City Unified spends about 94% of its unrestricted dollars on salaries and benefits, according to the state’s financial crisis team. Across California, the average is 86%.
The district has yet to finalize contracts with any other labor group.
Special education gets consistently shorted
Sacramento City Unified has consistently underestimated the amount of money needed by the special education department, the recent analysis found.
Spending by the department doubled over the course of two years, from $69.2 million in 2022-23 to $138.6 million in 2024-25.
Yet the district allotted just over $124 million to special education for this school year.
The department has regularly turned to unauthorized contracts — or spending without full advanced approval.
The state-funded fiscal crisis team identified these unapproved contracts as “a significant loss of budgetary control” for the district.
Issues identified at the leadership tier
Board members also have received “no cohesive training on the budget and governance” in at least the past two years, the crisis team found.
A similar deficiency was reported in 2018.
The position of chief business officer — the staff member responsible for steering the district through financial recovery — has been vacant at Sacramento City Unified since Janea Marking left in November.
School board members are scheduled to discuss the report Thursday.
The district approved a fiscal solvency plan at the end of November, after the independent agency had concluded its field work. The district’s proposed remedies, estimated to save $70.7 million this school year, include cuts to administration staffing, supply budgets and before- and after-school programs.
Savannah Kuchar is a reporter covering education. She came to Sacramento to be a part of the Abridged team and contribute to a crucial local news source.