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Sacramento City Unified School District’s fiscal turmoil intensified as the district board voted 5-0 at a special meeting on Tuesday to appeal a recent Sacramento County Office of Education decision to the state superintendent.
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The decision follows a move by the Sacramento County Office of Education’s appointed fiscal adviser to rescind the district’s recent approval of a new labor agreement with the teacher’s association.
“We are Team Sac City and we’re going to move forward with this together,” SCUSD board president Tara Jeane said shortly before calling for a vote. “The resolution we’re about to vote on empowers our superintendent to write a letter that documents exactly where we are at in all of this and I anticipate that that will be released tonight as well.”
The vote was unanimous, with members Michael Benjamin and April Ybarra absent.
Resolution calls for appeal of SCOE decision
In the resolution, the district argues that SCOE’s fiscal assumptions are “flawed, rely on faulty logic, and prohibit the District from achieving fiscal solvency,” and that the county office wrongly determined the labor agreement would undermine its ability to meet its financial obligations.
Tuesday’s approval authorized the district superintendent and legal counsel to “take all further actions reasonably necessary to prosecute an appeal and request for review to the State Superintendent of Public Instruction,” the resolution states.
The resolution also asks the state superintendent to temporarily freeze SCOE’s rescission while the dispute is under review.
Not everyone at the sparsely attended meeting agreed with the district going after SCOE or county Superintendent Dave Gordon.
“Dave Gordon and SCOE have been trying for a long time to get this district to make sound financial decisions,” Steve Bruno said during public comment.
Another commenter, Karla Faucett of SEIU 1021, praised the district’s labor agreement with the teacher’s union.
“We appreciate the work that has gone into developing a plan that addresses the district’s financial obligation while keeping students at the center of every decision,” Faucett said. “For far too long, our employees, students and families have lived under constant uncertainty.”
The legality of the appeal and what might follow
The California Department of Education issued conflicting messages Tuesday to The Bee, initially suggesting that the district lacked the ability to appeal the county’s decision before stating that they perhaps could.
Spokesperson Scott Roark told The Bee prior to Tuesday’s meeting that the county office acted under Education Code Section 42127.6(e), which does not provide for an appeal to the state superintendent.
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“Under California law, this authority rests with the county office, and there is no appeal to the State Superintendent of Public Instruction,” Roark said.
Several hours later, CDE told The Bee via email that “this situation may be subject to an appeal process” under Education Code 42127.9.
The board met for about an hour in closed session prior to the vote on Tuesday, with the meeting agenda noting that the session would include a legal conference about “initiation of litigation.”
The board didn’t report after the closed session that it had taken any action, such as voting to file a lawsuit, but Jeane indicated after the meeting that a lawsuit was possible.
“We are exploring every option available to us, including legal,” Jeane said.
What led to Tuesday’s vote
The months-long effort to address the budget crisis has progressed into an increasingly contentious phase, with the district and the county Office of Education locked in a power struggle over how the district can avoid insolvency. The fiscal adviser’s decision to rescind the labor agreement marked the strongest intervention yet.
The rescinded agreement would have drawn about $68 million from the retiree health benefits trust to cover costs otherwise paid from the general fund. It was part of an agreement that would provide about $97.6 million in financial relief over three years, but the county office and fiscal adviser questioned its long-term effect.
“The agreement would only temporarily delay SCUSD’s impending insolvency by a few weeks while also making it more difficult for the district to make a sustainable long-term fiscal recovery,” said David Gordon, Sacramento County Superintendent of Schools, in a statement Friday.
Gordon pointed to the extension of the district’s current labor contract with its teachers as an example of how the agreement would limit the district’s future flexibility.
In May, Fiscal Crisis and Management Assistance Team CEO Michael Fine delivered a grim report projecting that the district could run out of cash as early as January or February. Although the district reported substantial cuts in its third interim budget report, many of the improvements came from one-time savings, and the district was still projected to remain in the red.
The $170.5 million deficit reported for 2025-26 was projected to grow to nearly $284 million a year later and nearly $510 million within three years, by 2028-29.
With growing fiscal concerns, SCOE and Sacramento County officials have taken more aggressive steps in recent weeks, requiring the district to submit planned payments for review two business days in advance.
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This story was originally published August 4, 2026 at 9:00 PM.