Sonoma Valley school board passes 2023-24 budget after heated discussion

After a lively exchange about whether or not only balanced budgets should be approved, the Sonoma Valley Unified School District Board of Trustees voted 3-2 on Thursday to approve the 2023-24 budget, which again predicts a loss for the district.

The budget projects $69,870,634 in revenues and $72,120,393 in expenses, a $2,249,759 deficit, in the 2023-24 academic year. Board President Anne Ching and Trustees Troy Knox and Catarina Landry approved the budget, while trustees John Kelly and Celeste Winders voted against it.

In 2022-23, the district’s projected revenue was $65,579,899 and the actual revenue was $74,162,286, a 12% increase. It’s a common theme, as the district’s revenue has exceeded projections by 12.1% to 19% each year from 2016 to 2022 (see sidebar).

“We have inaccuracies every single year, and if we accept inaccuracies, we are coming back to the first point I made about our basic duty of communication,” Kelly said before the vote at the board meeting on Thursday. “We are the democratic interface between the voters and this government agency, and to that extent that we are failing to communicate accurately; we have only ourselves to blame. We won’t get a balanced budget until we demand a balanced budget, and we are never going to see a change until we vote ‘no.’”

Kelly said that this discrepancy between actual and projected revenue can lead to distrust, false assumptions and uniformed decisions.

Winders added that during the district’s contract negotiation process with the Valley of the Moon Teachers Association last year, the district’s true amount of revenue was a source of contention.

“Our union partners were getting up at the podium, saying, ‘You have more money than what is being reported,’” she said. “And so, this does concern me when clearly the numbers in front of me show exactly what our union president was saying. This is the beginning of our school year, and I think it is important that we have a budget that accurately reflects what we actually have and that we not continue this pattern.”

Josh Braff, the district’s associate superintendent of business services responded, “Trustee Kelly is very, very right. When we look back at these numbers, we’re seeing some huge variances, but there are also some pretty significant things that happened throughout these times that are not being taken into account, like the LCFF (Local Control Funding Formula) was created within that timeline.

“We had big fires that held back all our tax money, and then we got it the next year, which basically doubled the amount. We had $14 million in one-time funding in the last three years that was not there at the time of budget development. We had another $6 million at the beginning of this year that wasn’t there during the budget development.”

Braff said that last year, the State of California notified the district that it would be given a generous amount of one-time money, without specifying how much. The state budget was passed in June, but the amount of money that each district would receive was not settled until August.

“So, I could not put money in the budget because I didn’t know if it would be $10,000 or $10 million,” Braff said. “The difference this year is that the state has clearly said that there is no new money at all. That is why I am confident there will not be 5% more total revenue than there was this year, outside of a whole new state budget being passed.”

He said that the board is deficit spending this year for two main reasons: It is spending down one-time money and paying for the significant raises approved by the board last year.

Ching voiced concern about deficit spending, but encouraged approval of the 2023-24 budget.

“I don’t see what we get by not approving the budget,” she said. “It seems like the board can give direction to present a balanced budget when it comes back in August.”

Kelly encouraged the board to create guidelines for district staff members to follow during the budget process, and Braff agreed.

“The board needs to be clear about what their asks and assumption are through board policy and administration regulations,” Braff said on Friday. “If they want an ending fund balance of 10%, let staff know. If there want no unrestricted deficit spending unless we are over that 10% minimum reserve, that’s also great.

“That needs to be done early in the year so that staff has time to just their operations and assumptions, and present a budget next year that takes those types of things into consideration.”

Braff said that he thinks it would be advisable for the district to create a budget committee.

“I wish we could have got if off the ground while I was here,” said Braff, who is leaving the district at the end of July. “It is important for transparency and could resolve a lot of the misunderstandings about the budget, its purpose and the assumptions that go into making it.”

Reach the reporter, Dan Johnson, at daniel.johnson@sonomanews.com.