On Thursday, March 27, the Board of Education held a budget workshop to consider proposals for the 2025-26 school year.
2024-25 budget shortfall
The district is currently facing a budget shortfall and working to close the gap. The shortfall is caused by a number of factors. According to the January state aid runs, the state aid revenue that the district was projected to receive this year is $480,000 less than anticipated. The district has reconciled its aid projections and expects to receive approximately $330,000 in additional state aid this year, leaving the shortfall around $150,000. Additionally, health insurance costs increased by nearly 17%, resulting in a $700,000 increase. Lastly, after the 2024-25 budget was adopted, the district hired additional staff to accommodate the needs of students, resulting in an increase of approximately $500,000 that was not budgeted.
Cost increases for 2025-26
In addition to the shortfalls listed above, the district is facing significant cost increases for the 2025-26 school year. Out of district placements and special education costs are projected to increase by approximately $900,000. Health insurance is again expected to rise, this time by nearly 13%, a $650,000 increase. Contractual obligations are projected to increase by $425,000.
To address the shortfall and cost increases, the Board was presented with scenario budgets for consideration.
Scenario 1
This scenario is the district’s best effort to preserve educational opportunities, as well as all clubs and extracurricular activities for students.
To close the gap, the district proposed the following options:
- The majority of retirements this year will not be filled, resulting in cost savings through attrition
- A decrease in the supplies/equipment/contractual line items
- Taking money out of the district’s fund balance to help balance the budget
- This would leave the district with less than the recommended 4% allocation in the fund balance
- Seven staff layoffs
- Decrease in benefits as a result of a decrease in staff
In this scenario, the district would realize a cost savings of approximately $1.5 million. Despite the cost savings, the district’s shortfall remains $611,398 and the proposed tax levy increase would be 6.22% to balance the budget. Because this increase is over the district’s tax cap, it would require a supermajority approval (60% or more) to pass.
Scenario 2
This scenario eliminates clubs and extracurricular activities for students, with the exception of athletics, which will provide fewer opportunities for students.
To reach the 3.18% tax cap, the district proposed the following options:
- All of the options listed in scenario 1
- In addition:
- All clubs and extracurricular activities would be cut, with the exception of athletics
- A decrease in the supplies budget
- A decrease in the contractual budget
- A decrease in benefits
- A decrease in the equipment budget
In this scenario, the district would realize a cost savings of approximately $1.8 million. With this cost savings, to balance the budget, the district would use the $312,570 (3.18%) tax cap to balance the budget. This would require a simple majority approval (50% plus one) to pass.
Scenario 3 – Contingent Budget
If the district is placed into a contingent budget, it would include all of the cuts previously mentioned in scenarios 1 and 2, plus an additional $135,793 in reductions.
Under a contingent budget, there can be no increase to the tax levy from the prior year. Last year’s tax levy increase was 1.8%. Adopting a contingent budget prohibits a district from spending any money in certain areas.
This includes, but is not limited to:
- All community organizations who utilize the school campus for any purpose would be charged based on a fee schedule
- No new bus purchases for 2025-26
- We are sending back three buses this summer that have ended their lease. This would create a shortage of school buses for transportation for the 2025-26 school year
- No purchases of any new equipment
Upcoming budget workshop
The Board is hosting another budget workshop on Wednesday, April 2 at 6:30 p.m. in the High School Library.