The Orange County Department of Education (OCDE) is expected to meet its financial obligations for the current and next two fiscal years. This information was shared in a recent budget presentation to the Orange County Board of Education. Associate Superintendent David Giordano presented the First Interim Budget Report, which covers finances through October 31, 2025, and projects through the 2027-28 fiscal year. The board gave a positive certification, which is the highest rating under state guidelines. This confirms OCDE’s current financial stability.
Giordano noted that there are economic challenges at the state level that could affect long-term planning. California has faced an economic slowdown for about three years. This period has seen slow job growth, cautious consumer spending, and higher borrowing costs. Income tax revenues have increased, partly due to stock market gains related to artificial intelligence. However, sales tax collections have been lower, and new tariffs have increased business costs. The Legislative Analyst’s Office has warned that the recent increase in income tax revenue may not last.
These factors have made the state budget outlook more difficult. State revenues for 2024-25 and 2025-26 are about $11.7 billion higher than earlier estimates. Despite this, the state projects an $18 billion deficit in 2026-27 and annual shortfalls of about $35 billion starting in 2027-28. For schools, Proposition 98 funding is expected to cover only cost-of-living adjustments next year. There will be limited funding for new programs. The end of COVID-19 relief funds and rising pension and health costs are also increasing expenses…