Los Angeles Unified Planning for Difficult Budget Realities (06-17-25)

FOR IMMEDIATE RELEASE

June 17, 2025

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Los Angeles Unified Planning for Difficult Budget Realities

Los Angeles, CA (June 17, 2025) – Los Angeles Unified held a public hearing today on the current state of the District’s budget, underscoring the serious financial challenges brought on by the expiration of one-time pandemic-era funding as well as the uncertainty of federal funding moving forward which, based on indications from the federal administration, may be reduced. While the District remains committed to student achievement, school safety, and high-quality instruction, the expiration of federal COVID-19 relief dollars is expected to significantly impact budget realities moving forward.

The District is currently engaged in deficit spending, meaning expenditures are outpacing revenues. Like many large urban districts across the country, Los Angeles Unified used temporary state and federal funds over the past several years to stabilize school communities, invest in academic recovery, expand mental health and wellness services, and support students disproportionately impacted by the pandemic.

However, due to strategic fiscal planning and careful use of reserves, Los Angeles Unified has been able to delay major programmatic and staffing impacts that other districts are already facing. While the expiration of one-time funding is now creating difficult decisions ahead, our prudent approach has significantly extended our runway – allowing us more time to plan responsibly and prioritize what matters most: the needs of our students.

“Those dollars allowed us to invest in students in ways that were urgently needed,” Superintendent Alberto M. Carvalho said. “But they were always intended to be temporary. We are now entering a new fiscal reality – one where our ongoing costs are higher than our ongoing revenues. That is not sustainable.”

The District is entering a period of tough but necessary budget discussions to ensure long-term fiscal stability. District leadership has initiated a comprehensive process to review programs, align resources with student needs, and adjust the budget in ways that protect the classroom to the greatest extent possible. To the extent reductions are required at any level, the District is committed to implementing adjustments through a lens of equity.

At today’s hearing, Superintendent Carvalho presented some highlights from the fiscal year 2026 budget:

Adds supplemental equity investment of $25 million for BSAP which when combined with prior investments totals $175 million
Adds $26 million for accelerated arts investment
Maintains $700 million commitment to Student Equity Need Index (SENI)
Increases funding for Student and Family Centers funding to $4 million
Places a moratorium on Cabinet-level salary increases and on certain benefits for senior staff
Preserves staffing levels (no furloughs)

He also noted some of the efficiencies and reductions in upcoming fiscal year budgets to meet obligations:

Modifies the initial reduction of $200 million in targeted school funds to $75 million in order to reduce impacts to equity-based funding allocations in FY27
Cuts non-school-based operations for a savings of $200 million in FY27 and $125 million in FY28, primarily from LAUSD Central Office

“We are committed to transparency and responsibility,” Superintendent Carvalho said. “We owe it to our students, employees, and communities to face these challenges head-on. That means acknowledging that the current path is not financially viable without meaningful adjustments.”

Key facts:

State and federal pandemic relief funding (such as ESSER) has expired.
Los Angeles Unified is currently spending more than it is bringing in.
The District anticipates the need to restructure some programs to align the District’s expenditures with its revenues
Strategic cuts and reallocations will be required to balance the budget moving forward.

Superintendent Carvalho emphasized that while the road ahead includes difficult tradeoffs, the District’s core mission remains unchanged. “This is a moment for shared responsibility and courageous leadership,” he said. “We will engage our labor partners, school leaders, and communities with honesty and respect. The hard truth is that hard decisions are coming – but we will make these decisions with students at the center.”

The District will share more information in the coming weeks as the budget is finalized.

Additional resources and information can be found here.

We have also created an informational video that you can watch here.

For the most up-to-date information, please follow Los Angeles Unified on Twitter/X at @laschools and @lausdsup, Instagram at @laschools and @lausdsup, Facebook at @laschools and @AlbertoMCarvalho1, and Bluesky at @laschools.bsky.social and @lausdsup.bsky.social.

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