The San Diego Unified School District faces an estimated $219 million budget shortfall over the next two years.
A large chunk of that deficit is attributable directly to a deal the school board made with unions in 2010. In that deal, unions agreed to take five unpaid days off for the first two years, in exchange for a series of pay raises in the third. The district gambled that it would be receiving more money by the third year of the contract so it would be able to pay for the raises.
But those raises are now coming due, and, despite saving about $20 million for each of the last two years from the unpaid days off, the district doesn’t have the money to pay for the salary boosts. So, it’s facing the prospect of having to lay off hundreds of people so it can afford to make good on its promise.
In the coming school year, the raises and the expiration of five unpaid furlough days account for about $45 million of the total deficit. But in the 2013-2014 school year, that amount swells to about $72 million as all the pay raises kick in.
The key takeaway here: The district is in a lot of trouble, and most of that trouble is self-inflicted. The 2010 deal saddled the district with a deficit that it is now trying to solve by laying off staff.
The financial team at the district is currently struggling to put together a comprehensive plan for how to deal with 2013-2014’s deficit. Phil Stover, the district’s top business guy, said that challenge is “keeping me awake at night.”
Without concessions from unions over the planned pay increases, or increased revenues from the state, the district won’t have much of an option that year other than to again lay off hundreds, if not thousands more employees.
Keegan Kyle and Will Carless are news reporters for Voice of San Diego. Please contact them directly at firstname.lastname@example.org and email@example.com. Follow them on Twitter @keegankyle and @willcarless.
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