SFUSD Faces State Deadline on Fiscal Stabilization Plan as $44M Deficit Looms

The San Francisco Unified School District board held a marathon budget study session Wednesday to confront the math behind its persistent structural deficit — and the state's demand that it adopt a fiscal stabilization plan at next week's second interim vote. Staff presented three tiers of cuts totaling more than $40 million, revealed that the district's chronically low attendance rate is costing more revenue than its declining enrollment, and fielded pointed questions about equity, transparency and whether SFUSD's budgeting practices have finally caught up with reality.

• State requires SFUSD to adopt a fiscal stabilization plan at next week's second interim; board must choose scope of cuts

• District's 91% attendance rate costs more revenue than its 500-student annual enrollment decline

• Three tiers of cuts presented: $32M already underway, an additional $8M, and a deeper $18.6M package that could restore positive certification by December 2026

• Board members push for explicit equity strategy in staffing model, rejecting appeals-based approach as insufficient

• First-ever position reconciliation completed, eliminating ghost positions; $6M in double-budgeted special ed contracts targeted for savings

• QTEA parcel tax carryforward will cover new healthcare agreement for 18 months; renewal with a higher rate needed by 2028

The basics: SFUSD's unrestricted general fund carries a structural deficit — meaning ongoing spending exceeds ongoing revenue — that staff projects will persist through at least 2028-29 even with tentative labor agreements factored in. The restricted fund will exhaust its balance by year four, shifting those costs onto the already strained unrestricted side.