WCCUSD avoids deep cuts in new budget, but insolvency looms

With its newly passed budget, the West Contra Costa Unified School District barely averted financial catastrophe for another year. But cuts and layoffs are likely coming.

Money troubles — due in part to the slowing economy, declining enrollment, expiring funds, and increasing costs — have long plagued the district. The new $521.5 million budget, which the school board approved on June 14, includes a plan to cut $24.3 million in the next two years. If not, the district could face financial insolvency and state takeover by the 2025-2026 school year. 

“These are the numbers we need to make in order to sustain our own destiny,” said Associate Superintendent of Business Services Robert McEntire. 

The 2023-24 school year would kick off with a fund balance of $109 million and end with a hefty $70 million remaining. But if spending and labor costs are not reduced and projected revenues can’t cover those costs, the district’s reserves will dip below the state-mandated minimum by the end of the 2025-26 school year, triggering receivership. Under receivership, a state adviser would assume control of the district, and the school board would lose decision-making power. In addition, the district would be forced to borrow money from the state, which would add debt and further limit its ability to cover costs. 

McEntire urged the board to adhere to the financial solvency plan, which includes a recommended $15.1 million reduction in staff salaries in the coming school year, and another $8.4 million in labor cuts in 2024-25. 

“They haven’t necessarily given us anything as to what their plan is,” said John Zabala, United Teachers of Richmond president. The union this year worked with the district to cut around $1 million from ongoing contracts. But the district may be asking for more. 

“If there are hard decisions, an actual process to engage the community has to be public so that members can understand why it needs to happen and where it needs to happen,” Zabala said. 

The new budget, up 7% over the current year’s, buys the district time, said Mister Phillips, who, for two consecutive years, cast the sole vote against the budget. He said he is skeptical of the board’s willingness to make tough decisions, given that last year’s budget also included a financial solvency plan that the board did not completely follow.

As in past years, the budget relies on one-time funds — in this case, federal COVID-19 money that is ending next year. 

“The COVID money really has been life support for the district,” Phillips said. 

He couldn’t support the new budget, Phillips said, because it wasn’t balanced, and it enables the district to delay getting its house in order. He said he’s ready to take on the financial solvency plan and rework one of the district’s largest expenses — personnel. 

“The district is consistently deficit spending and not making cuts, including staffing cuts, because that’s a huge part of it, to be honest,” Phillips said. 

“Teachers, staff members in general, I think that they work hard, and I think that they deserve to be able to take care of themselves and their families and to live well. But you can’t do that on credit,” he added.

Liz Sanders, WCCUSD spokesperson, wouldn’t comment on whether the administration is considering staffing cuts. She said “high quality staff is key to retaining families,” but she also acknowledged that significant action will be needed for the district to achieve fiscal health without disrupting education.

“We will not find our way out of this challenge purely by just making cuts,” Sanders said. “We really have to make sure that we are moving our district forward and providing quality experiences at our school sites in order to retain the families that we have and bring our families back.”

Since the pandemic, the number of students in WCCUSD has been declining, to about 26,000. And when student enrollment goes down, the district gets less state funding. The trend is seen statewide. In the 2019-20 school year, enrollment in California public schools was about 6.16 million. By the 2022-23 school year, the number of students had dropped to 5.85 million. 

“It’s a trend that we are rapidly working to understand at a deep level locally so that we can reverse it,” Sanders said.