As the Board President of Morgan Hill Unified School District (MHUSD), I am writing to clarify our District’s financial position for the school year 2024-25. Now that we have closed our financial books, I am pleased to report that through diligent efforts and strategic planning, our district has strengthened our fiscal outlook.
In our Adopted Budget in June 2023, MHUSD had anticipated a $6.7 million operating budget deficit to end the 2023-24 school year. Today, I am proud to announce that we have achieved a positive turnaround for this school year’s budget. We ended the fiscal year with a surplus of slightly over $1 million in the District’s Unrestricted General Fund.
Thanks to our dedicated board and district staff, revenue upsides and prudent cost controls have set us on a brighter path.
Our district’s financial position is now healthier than anticipated. Today, our Unrestricted General Fund reserves have grown to an impressive $41 million, excluding approximately $4 million in the Special Reserves Fund. This financial foundation provides more stability and equips our board with the flexibility to implement deficit spending reductions.
Moving forward, my fellow board members and I recognize there are still broad fiscal demands that require us (and all public school leaders) to be forward thinking, including the expiration of one-time COVID-19 funds, the downturn of the state’s economy resulting in lower education revenues and significant increases in areas related to special education general fund contribution, utilities and operations.
However, we are committed to continuing to navigate any challenges thoughtfully and transparently to provide the best opportunities and outcomes for our students.
Along with a healthier reserve position, we have expanded our budget advisory member composition in our budget advisory committee, consisting of staff, parents as well as local taxpayers. Our district is committed to continuing to be transparent in its decision-making and value our community’s engagement in financial management.
As the MHUSD Board President, I want to assure our community that the district is committed to maintaining a solid financial footing. We are well-prepared to continue delivering high-quality education to all our public school students.
Adam Escoto
MHUSD Board President
The letter to the editor written by Board President Adam Escoto on September 26, 2024, is naive at best, at worst another effort to manipulate the public. He claims, “We ended the fiscal year with a surplus of slightly over $1 million in the District’s Unrestricted General Fund,” but he fails to address the district’s ongoing deficit spending, which will result in a gap of $16 million over the next three years. While he asserts that the Board is being proactive and transparent about this financial crisis, it’s worth noting that neighboring districts, which managed their one-time COVID funds responsibly, DO NOT face these issues.
Under this Superintendent and Board, MHUSD has used one-time funds to add programs and personnel —a fundamental financial misstep. Basic finance rule: one-time funds should NEVER be used for recurring expenses. Now, the district is being held accountable by the Santa Clara County Office of Education, which oversees local district budgets. MHUSD has until December to develop an ongoing spending reduction plan – in other words, cuts are coming. Not because COVID funds are gone, but because MHUSD used their COVID funds irresponsibly.
Local elections matter, and it’s crucial to support leaders who understand fiscal responsibility. Unfortunately, this Board president—and the candidates he endorses—do not.