Fresno Unified School District will move into the coming school year after having overcome a $77 million budget deficit with classroom cuts, early retirements, and a late boost in state funding.

But the district isn’t out of the woods yet, as it faces inflation, steadily falling student enrollment, and upcoming contract negotiations with the Fresno Teachers Association.

The School Board agenda for the June 17 meeting is expected to include votes on the 2026-27 budget and Local Control Accountability Plan.

To stay afloat, Fresno Unified has scaled down reserve levels, authorized an early retirement incentive, and eliminated hundreds of positions. This includes an overall decrease of 172 teaching positions due to elimination or retirement.

Gov. Gavin Newsom offered a reprieve from the onslaught of bad budget news in May, granting an additional $33 million in ongoing unrestricted funding and roughly $19.5 million in one-time funds to Fresno Unified, according to district spokesperson AJ Kato.

Jensen: We Can’t Fund All of FTA’s Asks

Meanwhile, district leaders are heading into what is expected to be tough bargaining with FTA. In October 2023, the district avoided a threatened teachers strike at the last minute after weeks of contentious public comments by both sides.

“There’s going to be asks for additional salary. There’s going to be asks for additional benefits. And there’s going to be an ask to preserve jobs,” Fresno Unified CFO Patrick Jensen said. “Unfortunately, with the revenue stream we currently have, we cannot full fund all three of those.”

FTA President Manuel Bonilla did not respond to GV Wire’s request for comment.

In 2023, the union emphasized four major issues: Tying teacher pay to inflation, maintaining the district’s current contribution to the healthcare fund, reducing class sizes, and reducing special education caseloads.

The last time Fresno teachers went on strike was in 1978.

Fresno Unified Makes Tough Cuts Amidst Declining Enrollment

Fresno Unified is eliminating 450 positions across the district to “right size” the district amidst the enrollment decline.

“Right now, we’re trying to right size our district. In 2002, we had 80,000 students and 7,000 employees. And right now, we are 67,000 students and 10,000 employees,” Superintendent Misty Her previously told GV Wire. “And we don’t have the funding that we used to have.”

The district estimates a loss of 1,200 to 1,700 students annually over the next seven years. The district loses about $17 million annually per drop of 1,000 students.

In response, Fresno Unified trustees approved an early retirement incentive for 573 employees — planning to leave many positions unfilled.

Additionally, the district delivered final layoff notices to 84 certified employees and 196 classified employees who are undergoing a seniority-based “bumping” process.

District trustees have emphasized that affected employees who wish to remain with the district will have the opportunity to do so. However, they may have to switch schools or move into different positions.

These moves saved the district $60 million on paper but only $39.8 million in actual reductions. The remainder will be directed to initiatives supporting the district’s goals such as better support of students and improving test scores.

“We’ve understood for a number of years that low attendance and low enrollment are trends that are here to stay in our district,” Jensen told the board Wednesday. “I just wanted to call out that two years ago, we started making Central Office reductions in order to try to keep cuts as long as possible away from our school sites.”

Over the last two years, the district has eliminated about 96 central office positions. This year, 141 central office positions will cut, the district says.

Fresno Unified’s Budget Deficits Past and Future

The ending of one-time pandemic era grants coupled with falling average daily attendance has led to a string of budget shortfalls for Fresno Unified.

In the previous two budget cycles, district was forced to cut $26 million and $34.9 million, respectively.

However, the challenges ahead don’t appear quite as daunting. Fresno Unified predicts $23.29 million in reductions next year and $5.78 million the year after.

Still, producing a balanced budget will require tapping district reserves — dipping below 5% during the 2028-29 school year.

California requires school districts to maintain a minimum of 2% reserve level in the General Fund. Comparatively, Clovis Unified, which is gaining students, has a 15.44% reserve.