Sequoia Union High School District reserves deplete

Although the district is not making “the hard decisions” yet, it is preparing to navigate a stressful fiscal landscape, said Christine Gong, assistant superintendent and chief business officer. 

For Fiscal Year 2025-26, district staff is budgeting to deficit spend approximately $1.2 million, with a total fund balance decrease of more than $10 million including transfers out. The ending balance for the fiscal year will be approximately $34,531,667, the staff report reads. 

The multi-year projection also proposed decreases to the fund balance reserve percentage. For Fiscal Year 2025-26, the reserve is proposed at 6.98%, and in the outset years at 5.42% and 5.6%. 

Trustee Rich Ginn raised concern over the reserve percentage falling under the board’s policy to maintain it at 8%, asking why the proposed budget violates the reserve policy. Superintendent Crystal Leach responded stating “some of the numbers are likely to come in better” than anticipated, thus allowing more funds to be allocated toward reserves.  

The statutory cost of living adjustment is proposed at 2.3% — which affects the calculation determining how much funding districts get for programs such as special education, universal meals and adult education. This is slightly lower than what was initially projected back in January, Gong said. 

Revenue generated from property tax increases is less than the rising cost of expenditures, said Director of Business Services Vinita Singh. Historically, property tax increases are around 5%, but the estimate for fiscal year 2025-26 is only at 4.37%.

“We have some fiscal challenges and we will be monitoring property tax growth as reports come out,” Leach said. “That will be a very telling point for how we move forward.” 

Singh also spoke to the closure of Summit Everest, a charter school, at the end of this fiscal year. The in lieu transfers to the site will be reallocated to Summit Prep, another charter in the district, assuming the children will be in large transfer to this location. Updated information on enrollment will determine how much funds the site will receive from the district, Singh said. 

The Board of Trustees will consider approaching the proposed budget at its meeting June 18, before submitting it for state approval.