Sacramento: SPED costs "more than doubled" while enrollment declining

Sept 7, 2026, Sacramento City School District At Insolvency Tipping Point – Again – California Globe

School board trustees tried to pass a plan more than tripling their own pay in the nearly insolvent school district

By Katy Grimes

A case of annual Déjà vu: The Sacramento City Unified School District, which has teetered on the cliff of insolvency for many years, announced it would cut 60 administrative positions as the district deals with a looming financial crisis, the Globe reported November 2025:

This is the same school district which renamed several schools in 2023, including Sutter Middle School and Kit Carson International Academy, costing $550,000. Yet more than half of SCUSD students do not meet basic state English standards, and nearly three quarters fail to meet basic state math standards.

“The district was already facing fiscal woes when a September report showed that the district spent $43 million more than expected last year due to a “flood” of costs that popped up later in the year,” the Sacramento Bee reported. “Officials estimate that the district could end up $88 million in the red by the 2027-28 school year if they do not come up with a strict plan.”

The school district got into $43 million worth of trouble with “unbudgeted spending.” A September report included unauthorized contracts and spending on special education. “During the 2024-25 school year, unauthorized contracts across Sacramento City Unified totaled $62 million worth of spending. The special education department represented 98% of those purchases,” Abridged reported in October. They reported that special education department heavily uses outside contractors because of staffing shortages. But $43 million worth?

The Sacramento County Office of Education told the SCUSD that to become solvent, it needs to cut $50 million in spending for the 2026-27 school year – or risk state intervention and takeover.

That was last year. Here we are 10 months later and the same Sacramento City Unified school district is nearly insolvent once again… yet trustees tried to pass a plan more than tripling their own pay.

Sacramento City Unified School District (SCUSD) is in a severe fiscal crisis, and trustees recently floated a large increase in their own stipends before withdrawing it after public backlash, Hoodline.com reported.

The school district now faces a reported structural deficit of about $222 million – quite a jump from the $43 million in 2025. County executives say the district needs approximately $150 million in cuts and cash solutions by June 2027 or it risks running out of money and entering state receivership, which largely amounts to a state loan and loss of local board control. . . .

Declining Sacramento City Unified enrollment and special-education costs that have more than doubled, coupled with labor agreements that added spending without matching ongoing revenue, have all contributed. Successive budget updates through 2025 – 26 showed the hole widening after COVID-era one-time funds expired. Obviously adjustments were not made when the COVID funds expired. . . .

As with Governor Gavin Newsom’s state budget, Sacramento City Unified’s problem is a structural deficit – ongoing spending growing faster than ongoing revenue – that has also become a cash-flow crisis. . . .