FUSD announces $30 million budget deficit

Everything we know about the FUSD budget deficit

Staff Writer

During March 13th’s Board Meeting, Fremont Unified School District announced a $30 million budget deficit through the 2028-2029 academic year. However, the estimated deficit fluctuates according to various district sources; the Virtual Balanced Budget meeting claims $26-27 million, the district’s FAQ’s lists $38 million, and the Balanced Budget for Fiscal Sustainability Workshop indicates $30 million.

The district attributed the deficit to the expiration of “hold harmless” funding, the parcel tax, and increased costs following the pandemic. On October 15th’s Virtual Balanced Budget Input Session, Superintendent Erik Bermeister said, “We find ourselves at what some in the state are calling the fiscal cliff.”

The FUSD general funds budget can be broken down into restricted funds including “self-contained programs with specific purposes and defined constraints,” and unrestricted funds, “flexible dollars that are used for day-to-day operations,” according to James Arcala, the FUSD Director of Budget. Restricted funds account for 35% of the budget ($178,121,600) while unrestricted funds make up the other 65% ($337,772,431).

The structural deficit, meaning a persisting budget deficit, occurs because unrestricted expenditures exceed unrestricted revenues, so the 2024-2025 school year operates with a deficit of $23.1 million and the following year, $27.7 million.

Arcala attributes the deficit to “lower enrollment, increasing costs including salaries and benefits, negotiated raises, pension costs, utilities, and rising contributions.” He said that without budget reductions, the 2026-2027 school year would face a debt of $15 million.

Some of the cuts to the budget include a promised reduction to supplies, services, and utilities. Still, Arcala said, “It won’t be enough to balance our 27 million dollar deficit.” The district proposes attriting staff, affecting mostly counselors, campus supervisors, coaches, and library-media-technicians.

Recent negotiations with the teacher’s union address the district’s goals of reducing staff, and FUDTA has postponed their long-term goals of smaller class sizes to protect staff job security. Former FUDTA representative Mr. Elam said, “When teachers speak on issues specifically related to budget cuts, we focus on ‘retaining current people’ because smaller class sizes, while a priority, is not feasible if you are having budget cuts because that’s expensive. An overall union goal is smaller class sizes, but here, we don’t want to let go of any counselors, psychologists, medical personnel, or teachers because job security is important.”

The FUDTA bargaining team did not provide comment for this story, citing ongoing negotiations.

The decisions surrounding the district’s budget will be finalized January 8, 2025, but until then, influence from the Fremont voter base, community Balanced Budget Input portal, and further FUDTA negotiations will affect how the deficit is addressed. As the budget is to be finalized in December, the community voice is crucial in influencing how the deficit will operate.

Caption: Board meetings such as this one on April 17, 2024 play an important role in the future of FUSD’s budget allocation process (Photo Credit: Grimmer Elementary School on X (Twitter)).