Key Updates on OUSD 9/23 Agenda

OUSD Budget Updates

Update on OUSD Budget

This week marks an escalation in the budget. Up until now, ACOE (the county office overseeing OUSD's finances) has been raising warnings and concerns. This time, ACOE declined to approve OUSD's budget as it issued only a "conditional approval" instead.

ACOE's core complaint: OUSD has made real improvements to how it manages its finances but hasn't actually fixed the underlying problem of a "structural deficit."
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What is a structural deficit?

It means OUSD spends more money every single year than it brings in. This is not because of a one-time emergency, but because its basic ongoing costs (staffing, programs, contracts) exceed its ongoing revenue (state funding, local taxes). You can't fix a structural deficit with one-time band-aids. You need to permanently either cut spending or increase recurring revenue.

ACOE's blunt assessment: The "easy" fixes are done. What's left are the hard choices. Specifically, around staffing costs and how the district organizes its schools (i.e., how many schools it runs, where, and how big they are).
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OUSD's Response Plan

In reaction, OUSD has committed to:

• $30 million in "budget balancing solutions" this year (FY 2026-27)
• $10 million in additional cuts identified for future years

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How the $30 Million Will Happen This Year (No Layoffs, yet)

Because California law doesn't allow mid-year layoffs, this year's cuts come from less disruptive sources:

• Not filling currently vacant positions
• Not renewing contracts
• Tighter purchasing rules and spending controls
• "Reconfiguring" co-located schools and alternative education sites

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What's Coming Next Year (FY 2027-28)

Position changes/layoffs are now on the table. OUSD says affected employees will be notified by March 15, 2027 of possible layoffs.

Discussions will begin about "site funding" (how money is distributed per school) and the district's overall "school footprint" (how many schools OUSD can afford to keep operating as-is).
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Why "Reconfiguring" and "School Footprint" Matter to Families

• Co-location = two schools sharing one building/campus
• Shared staffing = fewer dedicated staff per school, more roles split across sites
• Phased downsizing = schools gradually shrinking, potentially toward consolidation or closure
• School footprint changes = the number and size of schools OUSD operates could shrink

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The Questions Advocates Are Asking

When and how will OUSD obtain family input on key budget-related changes:

• The new site funding formula
• Proposed school site “configuration” changes, such as co-location, shared staffing, and phased downsizing
• Changes to Special Education program that affects placement and services to students

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Bottom Line for Parents

This week, the county has essentially told OUSD "your plan isn't good enough," and OUSD's response opens the door to real changes to which schools exist and how they're staffed. Not just budget line items. The March 2027 layoff notification date and the vague "school footprint" language are the two details worth watching most closely in the coming months, especially if your child attends a co-located school or one that could be considered for "reconfiguration."

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Thank you for taking the time to review these updates. We can't wait to see you show up for our students and make sure our voices are being heard!