No contentious cuts are needed in the San Lorenzo school district, where the rainy day fund will be sufficient to keep the district solvent into next year without any additional reductions in teachers or programs.

But board President Norman Fobert said that while trustees "recognized that this rainy day is going to be around a long time" when they slashed the budget in 2009, next year might be a different story, and the forecast is anything but clear.

"It does give us time to plan appropriate cuts, instead of making emergency decisions," he said.

District financial chief Lowell Shira said that with about $12 million in reserves, the district is in a position where it can "wait for the other shoe to drop" -- in particular the results of a state tax measure to benefit schools that is being advanced for the November ballot.

Shira said that a worst-case scenario would put the district in the red to the tune of about $4 million, which would have to be addressed next year, and in any case trustees will likely have to make some amount of cuts at that time.

"But we're in a position now that it's not mandatory to make any additional layoffs," he said. "We don't have to put the staff through that."

San Lorenzo had a $7 million shortfall in 2009 and eliminated 77 full-time positions. While some of those pink slips were later rescinded, the board meetings at the time were emotional and contentious, with an overcapacity crowd jeering and booing the board's decision.

Fobert said that earlier this year the district issued pink slips to temporary employees to keep budgetary flexibility, but he added that almost all will be rehired.


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Fobert said that since 2009, the board has "held on to our reserves quite jealously."

He said San Lorenzo has historically been a fiscally conservative district but acknowledged that there's a timing element involved in this year's good fortune.

"Castro Valley has also been conservative, but they're just running out of their reserves and need to make cuts," he said. "It's just a matter of when the cuts have to be made."

San Lorenzo Unified has a $91 million general fund and serves about 11,000 students.

Contact Eric Kurhi at 510-293-2473. Follow him at Twitter.com/erickurhi. Read his blog at IBAbuzz.com/hayword.