OCEANSIDE — The Oceanside Unified School District board approved the 2023-24 fiscal year budget on June 27, reporting a $4.1 million surplus safe from recently proposed state cuts to grant funding.
The surplus is the result of a combined summary of restricted and unrestricted funds, leaving an overall ending balance of $50.5 million in reserves.
The board approved the budget days before Gov. Gavin Newsom and the state legislature agreed to meet in the middle regarding proposed budget cuts to address the state’s more than $30 billion deficit.
Funding for arts and music in California schools will decrease by $200 million and pandemic-era learning recovery grant funding by $1.6 billion.
According to Andrea Norman, the school district’s associate superintendent of business services, staff did not include those grant opportunities in the budget.
Despite the surplus, the district remains wary of the following two fiscal years as assistance funding from the Covid pandemic falls off the books. Staff predicts only $440,000 in surplus funds for FY 2024-25 and a $8.4 million deficit in FY 2025-26.
Another factor in the school district’s drop in revenue is declining enrollment, averaging a loss of about 410 students annually. Statewide, public school districts are suffering from fewer students, with enrollment dropping approximately 8.6% since the 2015-16 school year.
While some funds have been cut, state lawmakers also approved a historically high 8.22% cost-of-living adjustment for schools this year in response to rising costs across the board, which the governor intends to fully fund.
Todd Maddison, an Oceanside resident and regular critic of the district’s financial choices, suggested that additional money could be used to decrease class sizes.
“Why doesn’t that give us enough money to lower class sizes? For every dollar we put in we could reduce class sizes by one student,” Maddison said. “If we started that today we’d be moving in the right direction – if we did that for the next few budget cycles we’d made significant progress – but we’re not doing that.”
The district has been working to reduce class sizes over the last few years. Since Superintendent Julie Vitale assumed her role during the 2018-19 school year, class sizes have decreased by an average of about 1 student per year.
In a separate action from the budget, the school board approved borrowing no more than $40 million from the county to address a potential cash flow deficit.
School districts receive most of their funding from property taxes in bulk payments typically in December or April, which sometimes result in a cash flow deficit to manage ongoing monthly payments in between those payments. Districts are allowed to borrow money known as TRANS, which are short-term financings issued by California school and community college districts to manage cash flow deficits.
Norman said the exact amount to be borrowed, if any, hasn’t been decided. She also said the borrowed funds will not impact the district’s budget.
“It’s purely our cash flow, the money coming in and going out,” she said. “It doesn’t impact our budget overall.”