With the clock ticking on a possible takeover of the Pasadena Unified School District, a Los Angeles County Office of Education (LACOE) fiscal expert delivered some bad news to the local Board of Education last week.

LACOE will not consider $7 million the district could gain from a potential sales tax increase against a $6 million shortfall for the 2021 school year that must be reconciled by Nov. 15.

“We cannot account for any revenue that you do not have direct control over,” said Pearl Izuka. “In this case, we are talking about the tax money.”

The city has promised the PUSD $7 million annually if voters approve a three-quarter cent sales tax increase on the Nov. 6 ballot, and approve advisory companion measure, Measure J, which asks if a third of the $21 million a year expected by passage of Measure I should go to the district.

Some voters are skittish about raising taxes to help the cash-strapped district.

The board has two weeks to make the necessary cuts from its budget and meet its state-mandated obligation to maintain a 3 percent budget reserve, or LACOE could elevate Izuka from a fiscal expert to a fiscal advisor with full stay and rescind authority over financial decisions in the district.

“Because you have the best interest for Pasadena’s students, we would like for you to be the ones to make these decisions,” Izuka said. “You don’t want to be like some other districts in our county that have lost the ability to make those decisions, and have someone else who doesn’t know your community be able to do that.”

If the district does not cut the additional $6 million, Izuka would be promoted to fiscal advisor.

“I really want to believe all of you are well-intentioned,” PUSD parent Tina Fredericks told Board of Education members at their meeting last week. “You’ve joined this board with the best intentions, but this is a failure. It’s a failure of leadership.”

On Thursday, the school board approved $3.1 million in cuts by increasing the lease on facilities used by charter schools by $134,000, which will result in more than $600,000 annually. The new rate will also apply to incoming charter schools.

That could result in resistance from local charter schools, which oppose the increases.

The increases will only impact charter schools with leases that are up for reconsideration.

Cuts to school district warehouses and maintenance yards will save the district about $290,000.

The district will save an additional $392,564 by eliminating instructional coaches and a bilingual coordinator. The district will also restructure the athletics department for about $480,000 in savings.

The board took a proposal to eliminate the CIF athletic program at Blair High School off the table.

“We’re starving these programs, but we’re not canceling them,” Board of Education member Kim Kenne said. “We expect them to continue, but we are taking away their support. This is going to make a lot of people unhappy.”

The board also opted to reduce the international baccalaureate coordinator position to 10 months a year, and to implement an administration ratio for assistant principals.

“Every decision you make is going to be tough and increase the workload of others,” said Eva Lueck, interim PUSD chief business officer, after board members speculated the cuts could increase the workload on remaining district employees.

The district has been in a state of declining enrollment due to rising housing prices and apartment rent increases in Pasadena that have left many young and lower income families unable to live in Pasadena, Altadena and Sierra Madre.

Earlier this year, the board supported a rent control initiative that would have capped rent hikes, but organizers failed to gather the number of signatures needed to get the initiative on the November ballot.

Organizers of Proposition 10, which would repeal a state law to clear the way for cities to enact rent control laws, are being badly outspent and the proposition appears to be headed for defeat Tuesday.

To make matters worse, the state has mandated increases in district retirement contributions. Health benefits are likely to increase over the next three years beyond the district’s projections, due to the dismantling of the Affordable Care Act.

The contribution taken from PUSD’s general unrestricted budget for needed special education services over the last five years was $147 million. The district’s contribution is likely to go up without an increase in funding from the federal government.

Those factors have left the district financially compromised and dangerously close to takeover by LACOE.

LACOE took over the Inglewood Unified School District in 2002. According to an article in the Los Angeles Times, six years later enrollment is still declining and the district remains in poor fiscal condition. LACOE warned the Los Angeles Unified School District in August that, like PUSD, the district is in danger of not meeting its fiscal obligations.

LACOE is calling for cuts to special education, an increase in the district’s insurance fund workers’ compensation program, and close monitoring of enrollment trends. School funding by the state is predicated on student daily average attendance, with funding cuts corresponding to steep and ongoing reductions in the district’s student population.

Earlier this year, the Board of Education voted to eliminate 139 full-time employees — 87 of those positions held by teachers — to close a $6.9 million gap via current year reductions and revenue increases. The board made another $14.2 million in reductions for the 2018-19 school year, beginning in September.

Earlier this month, the United Teachers Association gave Superintendent Brian McDonald a vote of no-confidence, and parents are looking for leadership as the crisis grows.

Last year, 500 students left the district and on Thursday, McDonald announced enrollment was expected to continue to drop. He anticipates 100 more students will leave the district this year.

“When I went back [and looked at the record] we only had one or two years where we only lost 100 students,” said Kenne. “I think that’s an optimistic number.”

The board voted Tuesday to shutter Cleveland Elementary School. Votes to shutter Franklin Elementary School and Wilson Middle School failed.Cleveland has experienced a 46 percent drop in enrollment since 2016 and now only has 99 students. Only 183 students attend Franklin Middle School, which has suffered a 25 percent enrollment drop over the past two years.

Wilson Middle School’s population has decreased 15 percent over the same time period and has 485 students.

McDonald said school closures are “needed” now.

“With declining enrollment, flat state and federal funding and rapidly increasing mandatory costs, we are at a point where tough decisions must be made to right size our district and cut costs,” he said.

Board members said they needed more information before they would agree to close schools.

McDonald said that any rejected proposals that the district opted not to vote on could come back at a later date.