Redlands Unified deficit projected to shrink

REDLANDS, Calif. — Redlands Unified School District officials say a $21.7 million deficit projected for the current school year is expected to shrink sharply over the next two years, according to the district’s latest financial report.

The district’s Second Interim financial report, presented Tuesday by Director of Fiscal Services Kirtan Shah, updates revenue, spending and multiyear projections required under California school finance law.

The report projects the district will end the 2025–26 fiscal year with $355.9 million in revenue and $377.6 million in expenditures, resulting in a $21.7 million deficit and reducing the district’s fund balance to about $68.8 million.

Looking ahead, the district projects the deficit will shrink to about $3.8 million in 2026–27 and roughly $500,000 in 2027–28, bringing the budget close to balance.

The improved projections follow the district’s January decision to begin a reduction-in-force process affecting certificated and classified positions, part of an effort to align staffing levels with declining enrollment, the expiration of one-time COVID relief funds and increased compliance-related costs.

Redlands Unified, like many districts across California, has seen enrollment decline in recent years. Shah told the board that the district has lost about 182 students compared with last year, reducing state funding tied to student attendance by about $2.4 million.

"Each year we have been losing students, and this year is no different," Shah said.

Despite the projected deficit this year, Shah said the district is expected to meet its financial obligations for the current year and the next two fiscal years.

School districts in California must submit financial updates three times each year — the adopted budget in June, the First Interim report in December and the Second Interim report in March — which are reviewed by county education officials to ensure fiscal stability.

The improved projections follow the district’s January decision to begin a reduction-in-force process affecting certificated and classified staff. District officials will revisit the projections later this spring after the governor releases a revised state budget in May.