The Santa Monica-Malibu Unified School District Board of Education has unanimously approved a $282 million budget for the 2025-26 school year, despite continued enrollment decline and projected deficit spending. The adopted budget includes $217.6 million in revenues from local sources, with 61% attributed to the Local Control Funding Formula.
Personnel costs dominate the budget, accounting for 81% of total expenditures, with a focus on teacher salaries and benefits. The district faces increased pressure in special education, requiring an additional $35.6 million local contribution. Assistant Superintendent Gerardo Cruz expressed concerns about the financial impact of expanding transitional kindergarten programs, citing skyrocketing TK numbers.
Despite challenges, the district maintains healthy reserves, exceeding state minimum requirements. However, projections indicate deficit spending in future years, with $3.9 million and $3.5 million shortfalls projected for 2026-27 and 2027-28. The district may need to borrow up to $5 million between funds during October through December 2025.
The budget includes several transfers between funds to maintain solvency and reflects negotiated salary increases for all employee groups, with a focus on teacher pay. The district will continue monitoring property tax revenues and prepare budget revisions if necessary. A major budget milestone is the First Interim report in December 2025.
Source: https://smdp.com/news/education/santa-monica-malibu-school-district-adopts-dollar282-million-budget-amid-enrollment-decline