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Brown wants five years of increased income taxes for those making more than $250,000 annually and a half-cent raise in the state sales tax.

If voters approve the increases in November, the state would continue to fund local schools at this year's level but San Diego Unified School District Chief Financial Officer Ron Little said increasing expenditures, such as utilities costs, would still result in deficit spending.

"We have ongoing costs that continue to increase year after year," Little said. "While flat funding may be good in other industries, in this one it certainly isn't. It doesn't keep up with the costs of doing business."

Brown has also proposed eliminating state funding for school transportation which could cause the district to cut bus service to about 2,700 students next year and up to 4,000 the following year, Deputy Superintendent Phil Stover said.

Little said the district stands to lose about $9 million in transportation funding.

If the tax increases are rejected or do not reach the ballot, San Diego schools would lose about $40 million mid-year, or $370 per student per day, which is the equivalent of three weeks of school, Little said.

The district could then face a budget shortfall of about $122 million next year, he said

District financial staff identified potential solutions which could cut about $124 million from the $1.057 billion operating budget, which included selling off property, raising class sizes and layoffs for more than 1,100 employees.

Funding for the visual and performing arts program could be reduced by 50 percent, and the school police force could be reduced by 15 percent.

"We're talking about a huge magnitude of cuts," Board President John Lee Evans said. "There's no way to make these cuts without doing really horrible things to our schools."

Even with next year's solutions, staff projected a budget gap of $73 million in 2013-14 which could balloon to a deficit of $151 million by the 2014-15 academic year if the tax initiative fails.