Reed district warned to rein in deficit spending

The Marin County Office of Education has warned the Reed Union School District about its “unsustainable” deficit spending, noting that unless the district cuts about $1.75 million from its budget in the next two years, it will fall short of its reserve goals by fiscal 2027-2028.

The warning was issued in a Sept. 15 letter approving the district’s current-year $33.2-million budget and its accompanying projections two years out; the county Office of Education is required to review the budget annually under the state education code to ensure it meets state standards for fiscal solvency and aligns with the district’s Local Control Accountability Plan.

Though the county has vouched for the district’s ability to meet its financial obligations in the next three years, the letter notes the district’s planned deficit spending will shrink its ending fund balance by 35% in that time as it pulls from its reserves to close the gap. That projection, it notes, is inclusive of a planned $300,000 in salary reductions beginning in the 2026-2027 school year.

If the district continues to deficit spend at the projected rates, the county letter says, its unrestricted general fund balance will fall to about 21.5% of expenditures, or about $7.6 million, by fiscal year 2027-2028 — short of the district policy that requires a minimum reserve of 27% of expenditures.

Read the complete story in our e-edition, or SUBSCRIBE NOW for home delivery and access to the digital replica.

Comment on this article on Nextdoor.