In recent weeks, San Luis Coastal Unified School District approved more than a $5 million budget cut that will impact staffing, counseling, and programs, such as music, librarians, and athletics. This decision was met with strong opposition from parents, teachers, and students. The district said that its income COVID funding ended and funding from Diablo Canyon Power Plant has reduced. While many questions can be asked as to why our district wasn’t prepared for the eminent shutting down of the power plant, which has been known for over a decade, or why it didn’t realize that the temporary COVID funding was not meant to be a permanent stopgap, one thing is for sure, the district has expressed its desperate need for more funds.
Needing more revenue brings focus to the current situation of the Morro Bay Elementary school property’s hopeful sale by the district to the city of Morro Bay. Currently, the district is negotiating with the city, and though numbers cannot be disclosed while there is an active negotiation, the city has stated that it made a meaningful offer.
Currently, tenants do lease the Morro Elementary property, with the primary lease holder being a tuition free Montessori school. Even after maintenance, reports show that the school makes revenue. The city has expressed interest in the lease holders continuing to remain as negotiations proceed.
However, the district’s board of trustees seems to have no intention of renewing the leases. Why? Accepting a good faith offer from the city would remediate some of the district’s shortfall in funding, and the city would be able to generate revenue.
D’Arcy Castro
Friends of Morro Elementary
This article appears in Jan 22-29, 2026.
Selling off assets is a poor solution to overspending. Eventually, you run out of assets to sell off, yet you still have the budget deficit. It was foolish to assume that temporary funding could support permanent spending increases, although I am sure that the extra spending was popular at the time. Now is the time to bring spending back in line with revenues.
If the current setup in rent is net positive in revenue, how will selling the property help the budget? Because once it’s sold, there will be no revenue.