San Diego Unified faces $176M budget gap for 2025-2026 school year

SAN DIEGO (FOX 5/KUSI) -- The San Diego Unified School District is facing a projected $176 million budget gap heading into the 2025-2026 school year.

On Monday afternoon, the San Diego Unified School District Board of Education held a special budget workshop meeting to discuss the budget deficit, how they got here, how the budget compares to other school districts, and held an early discussion on solutions.

At the meeting, leaders said there are a few reasons the district is in this position, including less enrollment, less funding, more expenses, more student needs, and a deficit prior to COVID.

Cristen Owens, the district’s budget director, said students needs are increasing, including mental health needs and IEP’s (Individual Education Plans).

SDUSD is the state’s second largest school district and the largest in San Diego County. According to Matt Philips with School Services of California, hired to perform a budget review and offer solutions, the statewide enrollment is declining overall, and it’s a similar story in San Diego.

The cost of a student absence is about $90 per day. The less students in seats means less funding.

According to Monday’s meeting, SDUSD has seen a 12.11 percent decline in average daily attendance from the 2018-19 school year to the 2022-23 school year. The decline is behind Los Angeles USD which has seen a 15.01 percent decline, while Oceanside has seen a 14.73 percent decline and Vista USD has seen a similar decline at 12.76 percent.

Phillips also discussed the personnel salary and benefits compared to other districts. He said the money SDUSD is spending on personnel is “unsustainable.” He said the district is number one on spending for its teachers, but this doesn’t correlate to the district’s teacher salaries or class sizes.

His presentation also showed San Diego has a small amount of money in its reserve, and said Los Angeles Unified has more than five times the amount of money in its reserve. LA Unified is the state's largest school district, just ahead of San Diego Unified.

The meeting was informational only and no decisions or votes were held.

The district said a feedback form will be made available online for anyone in the community that wants to share feedback or ideas.

The next budget meeting is scheduled for December, where they hope to have closed the budget deficit more by then.

Last school year, in early 2024, the district faced a $94 million budget deficit, and the board had approved around 400 layoffs. By the time the layoffs happened, 48 staff members were let go.

It's too early for decisions on layoffs for the upcoming school year, but Board President Shana Hazan said they are following through with their attrition model they began last year, by not filling the vacant positions.

Looking ahead, the district anticipates a continued budget shortfall into 2026-2027 by up to $230 million.

"This is the earliest Board Budget Workshop we have hosted in preparation for the upcoming budget season, that typically begins in December for central office departments and January for school sites," the district said. "The intent of engaging earlier is to have more collaborative dialogue with both Board and community members around potential solutions and strategies to address the projected shortfall."

To share feedback or learn more, visit 2025-26 Budget Information - San Diego Unified School District.