SFUSD presents first interim report, recommends positive fiscal certification amid continued deficit‑spending concerns

San Francisco Unified School District staff presented the first interim financial report Dec. 13 and recommended the board adopt a positive fiscal certification for the district and county based on improved beginning balances and updated revenue forecasts.

Anne Marie Gordon, interim head financial officer, said the district's beginning fund balance was about $9 million stronger than anticipated and that revenues increased by roughly $40 million compared with prior estimates. That revenue increase coincided with higher planned expenditures — including negotiated salary increases and consultant and temporary staffing costs related to the Empower SF payroll rollout — leaving an ongoing pattern of deficit spending that draws down reserves.

Gordon noted that payroll posting issues tied to Empower SF limit the district’s ability to report some expenditures; the California Department of Education allowed reporting the first interim without all payroll data posted. The district plans to prioritize posting payroll expenditures for the second interim.

Public commenters and several commissioners pushed for clearer accounting of restricted funds, urged transparency about the district's $10 million consultant/contractor spending for payroll-related services, and urged long‑term plans to reduce structural deficits and align staffing with enrollment. Commissioner Alexander asked for clearer multi‑year projections that separately present unrestricted and total general‑fund figures.

CDE and fiscal advisors commended staff for the report while cautioning that deficit spending and weak controls remain risks to fiscal health. The board voted to adopt a positive certification via roll call.

The board scheduled a February budget workshop for deeper review of assumptions, restricted‑fund use and strategies to bring ongoing operations in line with recurring revenues.