By admin 
Sacramento County Office of Education-appointed fiscal adviser has temporarily suspended Sacramento City Unified’s approval of a new teachers union agreement, saying the district did not comply with state law in the process.
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The development follows the school board’s approval Thursday of an agreement that would extend the use of the district’s retiree health fund for one additional year to cover an estimated $23 million in retiree health costs during the 2028-29 school year.
In a Friday letter to the district board reviewed by The Sacramento Bee, fiscal adviser Luz Cázares said the district failed to complete required fiscal reviews and public disclosures before the board approved the agreement.
“Again, we note that the Board needs the best information to make the best decisions. This requires the district Superintendent to provide the Board with sufficient time to review and consider agenda items,” Cázares wrote.
The district shared the agreement with county and state officials on the night of Sept. 9, less than 24 hours before the special board meeting the following day, when the board unanimously voted to approve the MOU. The agenda packet, including the MOU, was made public shortly before the meeting began.
Cázares referred to Government Code sections 3547.5 and 3540.2, which require districts to publicly explain a labor agreement’s key terms and anticipated costs, while districts with negative budget certifications must allow the county Office of Education 10 working days to review the deal before seeking board approval.
As a result, Cázares said she was staying, or temporarily suspending, the board’s action approving the agreement until the district completed those requirements.
“We look forward to receiving the complete and signed disclosure documents. Once those materials are received, the required review can begin,” Cázares wrote.
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Two agreements, continued uncertainty
The suspension adds another unresolved issue to the dispute: Sacramento City Unified is still awaiting the county office’s response to its request to withdraw the rescission of the earlier MOU.
The rescinded MOU became a catalyst for an escalating dispute between the district and county office over how SCUSD should address its estimated $222 million structural deficit.
The agreement was designed to provide the district about $97.6 million in relief over three years while extending the teachers’ collective bargaining agreement through June 30, 2030, and protecting educators from compensation reductions. The arrangement would allow SCUSD to use about $68 million in reimbursements from its retiree health trust to offset costs initially paid from the district’s general fund during fiscal years 2025-26 through 2027-28.
The central dispute over the MOU is that the district views it as a short-term bridge that would provide immediate cash until it finds long-term solutions, while the county office sees it as an arrangement that would limit the district’s options for cutting costs.
On Sept. 9, the district asked the county office to withdraw its rescission of the earlier MOU by Sept. 17.
SCUSD did not immediately respond to The Bee’s request to comment.
This story was originally published September 16, 2026 at 12:12 PM with the headline “County fiscal adviser suspends new Sacramento City Unified agreement with teachers.”
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