This article looks at the financial hurdles San Rafael City Schools faces as it tries to close a projected $5.5 million budget gap over the next three years.
Enrollment is dropping, pandemic-era funding has ended, and operational costs keep climbing. District leaders are proposing strategic cuts, hoping to avoid layoffs and keep classroom learning steady for families across Marin County.
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San Rafael City Schools Faces Multi-Year Budget Shortfall
School districts all over Marin County — from Novato to Mill Valley and Corte Madera — are feeling the squeeze after the pandemic. In San Rafael, district officials recently confirmed that San Rafael City Schools must reduce spending by approximately $5.5 million over three years to balance its budgets.
Superintendent Carmen Diaz Ghysels said the district’s main goal is to prevent layoffs by relying on attrition and careful planning. The school board plans to vote on the proposed reductions at its Jan. 27 meeting, a date that’s got families in neighborhoods from Gerstle Park to Terra Linda paying close attention.
Where the Budget Cuts Are Coming From
For the 2025–26 school year, the district needs to cut about $1.42 million. That breaks down to:
- $830,000 from the elementary school district
- $590,000 from the high school district
More reductions are on the horizon for the following years. The plan calls for $2.8 million in elementary cuts and $1.3 million in high school cuts across 2026–27 and 2027–28.
These are big shifts for a community where public schools really anchor neighborhoods in places like San Anselmo, Larkspur, and Fairfax.
Why San Rafael Schools Are Running Structural Deficits
District officials point to three main reasons behind the financial strain. First, the expiration of large, one-time COVID-era state grants that kept budgets afloat during the pandemic.
Second, operating costs like utilities, services, and staffing keep rising faster than revenues. Third, San Rafael — like a lot of Marin County districts — is seeing declining enrollment.
Understanding Reserves and State Requirements
The district’s board policy sets a 17% reserve, combining the state-mandated 3% minimum and an extra 14% for long-term stability. Reserves will dip below that board goal, but officials say they’ll stay above the state minimum.
The elementary district’s $68 million budget is projected to have reserves of:
- 12.4% this year
- 9.7% in 2026–27
- 7.1% in 2027–28
Enrollment Trends and Funding Formulas
Funding for San Rafael’s elementary schools uses the Local Control Funding Formula (LCFF), which ties revenue to average daily attendance (ADA). The district serves about 4,140 ADA, funded at $14,496 per student, including a 2.3% cost-of-living adjustment for 2025–26 and transitional kindergarten subsidies.
The high school district, running on a $42 million budget, recently shifted to basic aid status after ADA dropped from 2,557 to about 2,405. Even with the decline, reserves there are projected to slowly recover over the next three years.
Labor Negotiations Add Another Layer
Ongoing contract negotiations with the San Rafael Federation of Teachers are adding to the mix. The main sticking point is a “fair share” formula for distributing new revenue — something union leaders and district administrators don’t quite agree on.
How these talks wrap up could have real ripple effects for educators and families across San Rafael, Ross, and nearby Marin communities.
What This Means for Marin County Families
San Rafael City Schools serves about 6,545 average daily attendees. Nearly 6,900 students are enrolled in TK–12 programs across elementary, middle, and high school campuses, plus an early learning center.
If you’re a parent in Marin County, the next few months might feel especially tense. The district faces a tough balancing act between keeping the budget in check and making sure kids get a good education.
As budget talks move forward, families from downtown San Rafael to Lucas Valley will keep a close eye on things. Everyone’s hoping their schools stay financially healthy and actually feel ready for whatever comes next.
Here is the source article for this story: San Rafael school district plans $5.5M in budget cuts
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