Gilroy Unified School District’s Board of Education approved nearly $3 million in cuts to the 2019-2020 budget, citing a continued trend of declining enrollment, lost revenue and increased costs.
Board President James Pace said the latest cost-saving measure, approved unanimously on Feb. 14, was not an easy decision to make.
“We didn’t want to do this. We had to do this,” Pace added.
The deepest of those cuts was $1.2 million in full-time salaries, the equivalent of approximately 12 positions.
Superintendent Deborah Flores said that the staffing cuts will not require layoffs, but will be accomplished through attrition, such as retirements and resignations.
“Our primary objectives are to preserve the good fiscal health of the district and to make cuts at the district level first, away from the classroom,” Flores said.
The veteran administrator cited $3.7 million in lost revenue due to declining enrollment, coupled with rising costs for employee pension rates, salaries and benefits as well as underfunded contributions to support students with special needs.
“These are challenging times for Gilroy Unified as well as most districts in Santa Clara County,” Flores said.
According to a staff report, 26 of the 31 schools districts in the county are experiencing declining enrollment.
“Enrollment loss is a function of a significant decline in birth rates, rising housing costs and a lower student generation rate from new residential developments,” according to staff.
In Gilroy, last year’s enrollment dropped by 250 students, and that decline resulted in a $2 million-plus decrease in state funding for the current school year. That pattern continued into the 2018-19 school year, with district staff estimating 160 fewer students this year than the 2017-18 year, resulting in another $1.5 million drop in the state’s Average Daily Attendance funds.
“Trimming the budget by $2.9 million in 2019-20 is necessary to address the erosion of revenue, and address the increase in employee’s total compensation through 2020-21,” according to the staff report. “Putting it simply, revenues are declining while expenditures are rising. Ongoing cuts are necessary to maintain fiscal stability.”
Other items among the $2,859,501 in cuts for the 2019-20 school year include:
- two new IT positions will go unfilled to save $270,856;
- fewer textbooks will be purchased to save $250,000;
- the district will employ two fewer instructional specialists/teachers on special assignment to save $246,192;
- the district will terminate contract with Graduation Alliance to save $190,987;
- a program administrator for student attendance will be eliminated to save $155,411;
- classified and paraeducator positions will go unfilled to save $100,000; and
- Some summer school services will be eliminated to save $100,000.
If the downward trend continues as projected, the district anticipates cutting an additional $1 million in the 2020-21 budget, with an unidentified elementary school closure on that list.
“Potentially if the budget went up, there are some things we’d be interested in restoring,” Pace said. “However with costs going up and revenue from the state going down, that puts us in a tough position in maintaining the fiscal health of the district.”
Total expenditures for the 2019-20 budget stand at $131,389,940, increasing to $134,321,610 in 2020-21. With revenues falling short of expenditures, the district’s unrestricted reserve is expected to be nearly $9.2 million for the 2019-20 school term.