Pajaro Valley Unified School District trustees on Wednesday will consider final approval of a three-year contract with the district’s teachers union that includes ongoing salary increases while the district continues to grapple with substantial deficit spending.
The Pajaro Valley Federation of Teachers has already ratified the tentative agreement, which covers the 2025-26 through 2027-28 school years. Board approval would finalize the agreement and resolve negotiations between the district and union.
The agreement gives PVFT members a 2% ongoing salary increase retroactive to July 1, 2025, followed by 1% increases in 2026-27 and 2027-28. Because these increases compound, salaries will be about 4.05% higher by 2027-28.
Because PVUSD already closed its books for 2025-26, the retroactive 2% increase will be paid during 2026-27. Combined with the current-year increase, that produces a 5.02% disbursement impact in 2026-27.
The AB 1200 financial disclosure estimates the compensation increase for roughly 1,051 represented employees at about $2.51 million for 2025-26, $2 million in 2026-27 and $2.81 million in 2027-28.
The agreement also restores a $250 classroom-supply reimbursement beginning in 2026-27, increases instructional aide support for general-education kindergarten classrooms and makes numerous changes to workload, hours, leaves, evaluations, transfers and other working conditions.
Beginning in 2027-28, Aptos High School will move from seven periods to six and eliminate its additional collaboration period. PVUSD projects the change will reduce staffing by eight full-time-equivalent teachers and could affect the number and types of courses offered.
The agreement would also resolve two pending unfair labor practice cases, which the district and union have agreed to withdraw with prejudice after final approval.
The settlement comes as PVUSD continues to face significant financial challenges.
The district says the agreement will create deficit spending in the current year and increase deficit spending in subsequent years. The ongoing costs will be funded primarily through the district’s unrestricted fund balance and reductions in some operating expenses.
For the combined general fund, the settlement adds about $6.64 million in expenditures to the 2026-27 budget. After other budget revisions, PVUSD projects its fund balance will decline by about $14.18 million this year, $24.65 million in 2027-28 and $17.58 million in 2028-29. The combined general-fund ending balance is projected to fall from about $86.6 million this year to $44.3 million in 2028-29.
Those projections assume PVUSD will implement $20 million in additional funding or ongoing expenditure reductions by 2027-28. That budget-balancing target existed before the settlement and has not increased as a result of the agreement.
Despite the projected deficits, PVUSD says it can afford the agreement. The district projects reserves of 3.04% in 2026-27, 3.12% in 2027-28 and 3.01% in 2028-29, remaining just above California’s 3% minimum reserve requirement.
The Board of Trustees will meet on Wednesday at 6pm in the PVUSD Boardroom at 294 Green Valley Road in Watsonville. For information, visit bit.ly/4rJdK3C
