If SFUSD Teachers Get Their Way, District Suggests More Cuts Could Be on the Table

With the San Francisco teachers strike in its fourth day, a look across the bay to Contra Costa County could offer a glimpse at the future for the financially struggling district.

Educators want the San Francisco Unified School District to step up its wage offer and fully fund family health care. And if the city’s last teachers strike in 1979 is any indication, the longer negotiations drag on, the more likely it is that the district will have to make significant concessions on the union’s demands to reach a deal and reopen schools.

But SFUSD said it’s facing dire fiscal constraints, and with budget planning for next year looming, Superintendent Maria Su has indicated that spending more on the teachers union contract could force the district to make deeper cuts than it already planned to this spring.

“Every single time we increase on one side, we have to decrease on the other side,” she told reporters on Wednesday.

That’s already playing out in Contra Costa County, where educators were granted similar contract demands — including 8% raises over two years and a plan to fully fund health care benefits by 2028 — after a four-day strike in December.

In community meetings last month, the West Contra Costa County Unified School District laid out bleak plans to slash 10% of its workforce and consider merging schools, blaming in part the cost of the new contract agreements: an estimated $106 million more than planned over the next three years.

“The community has lifted up and said, ‘We support our teachers. We want them to have everything that they want,’” Superintendent Cheryl Cotton said at a district committee meeting last month, the Richmondside reported. “This is what this looks like.”

Associate Superintendent of Business Services Jeff Carter said the district planned to empty a “rainy day fund” — which includes reserve money beyond the state’s mandated amount — of about $28 million and borrow an additional $13 million a year from a pool of money it invests to pay for retiree health care benefits.

After that, Carter said the district would still need to come up with about $60 million in reductions over three years through staffing and program reductions, including “rethinking” its kindergarten through eighth-grade school model, considering merging middle schools with fewer than 400 students, and realigning staffing to minimum required levels by closing vacant positions, not re-filling positions left empty through retirement, and potentially laying off workers.

Carter said West Contra Costa Unified is also considering cutting 10% of educators, school support roles, administrators and district central office staff.

“There are choices that we have to make in order to meet the obligations that we are stepping into and agreeing to,” Cotton said. “My job is to come up with solutions to this deficit. The board is what makes the decisions.”

San Francisco Unified has previously warned that it needs to cut more than $100 million from its ongoing expenditures for the second year in a row this spring.

Last year’s reductions included hundreds of early retirement buyouts, a strict staffing model and administrative cuts.

In November, the district took steps to reopen a conversation around possible school closures, more than a year after it shelved its botched plan to shutter or merge more than a dozen campuses.

All of those reductions were based on the district’s budget predictions without accounting for additional raises and benefit costs.

A report from a neutral panel earlier this month found that the union’s proposal to fully fund health care for families with two dependents would cost the district $14 million a year. Transitioning from a caseload to a workload model for special education staff would cost $11 million annually.

The report also suggested that fully funded health care could be covered for the next three years through existing parcel tax funding, though that tax expires after three years.

When asked on Wednesday if San Francisco could end up in a position similar to West Contra Costa with added contract costs, Su said, “That’s the reality of where we are at.”

Still, United Educators of San Francisco said the district can afford to cover the union’s demands without making additional cuts. It pointed to a large “fund balance,” which is made up of money that the district has left over at the end of a budget year — usually because it brought in more revenue than expected. At the end of the 2024-2025 school year, that balance was almost $430 million.

In December, the district set aside a financial reserve of about $110 million as a rainy-day fund, money that could — and, it argues, should — be spent now. California requires districts to maintain a reserve equivalent to 2% of their general fund, which for SFUSD would equal about $28 million.

The district said both the reserve and any existing fund balance should not be used for ongoing expenses like salaries and health care costs, since they represent one-time funding, but the union has argued that funding available today should be used for today’s students.

“This is a tale as old as time,” Curiel said, when asked about the possibility of cuts after a new contract deal is reached.

She said that districts often project a budget deficit and end up with a surplus by the end of the budget year.

“And then suddenly they’ve got $400 million in reserve,” Curiel said. “Today’s dollars are in that account, and they need to be spent.”