https://edsource.org/updates/contra-costa-county-to-intervene-in-west-contra-costa-unifieds-finances

The Contra Costa County Office of Education will take authority over West Contra Costa Unified’s financial planning because the district is “no longer a going concern” after running a projected deficit and after the school board on March 9 rejected a proposal to cut about 200 teacher and school staff positions.

A letter sent to the district on March 15 was titled “Going Concern Determination.” It said, “This means the West Contra Costa Unified School District is no longer fiscally healthy and is unable to meet its financial obligations.”

The letter outlines the actions the county will take under the state education code, since it has determined that the district isn’t expected to meet its financial obligations over the next two years. Interim Associate Superintendent of Business Services Robert McEntire predicts that under Gov. Gavin Newsom’s January budget proposal, the district will be forced to overspend about $21 million in 2022-23 and $41 million in 2023-24, running out of cash in October 2023, at which time it will automatically go into state receivership.

The County Office of Education intends to take four actions described in the letter: staying or rescinding any school board action that could put the district further away from fiscal solvency; assisting the board with a multiyear financial recovery plan; assisting with the development of next year’s budget; and appointing a fiscal adviser to the district.

The school board could have sought an appeal to the county’s determination but chose not to at Wednesday’s school board meeting.

Though the county superintendent has the power to rescind board actions, the statutory deadline for districts to notify employees who could be out of work next year was Tuesday. Since the board voted March 9 not to send out most of those notices, those employees can’t be laid off.

West Contra Costa Unified’s financial outlook could significantly change between now and the May/June period when it adopts its budget for next year. The governor will revise his budget proposal in May based on changes in projected revenue, and the Legislature will vote on the state budget in June. The latest forecasts project state revenues will be as much as $20 billion higher than Newsom’s forecast.

Newsom, in January, proposed giving districts the option of being funded on a three-year average of daily attendance rates, which would significantly decrease West Contra Costa Unified’s deficit, McEntire said. The district blames much of its projected shortfall on sharp declines in enrollment and attendance. State Superintendent of Public Instruction Tony Thurmond has also co-sponsored legislation that would take attendance out of the school funding equation, which would also soften the blow.