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    March 10, 2025

     

     

    Dear Parents, Students, Faculty, Staff, and Community Members,

     

    March is upon us.  Many students find March to be a particularly long month as it contains most of  the longest period of the year, 5 straight weeks without a day off.  For me, March is one of my favorite months because it is loaded with school plays, concerts, and culminating sports events.  March is also budget season, often one of the most challenging parts of the year.  At the board meeting on Wednesday, we presented a proposed budget plan for 2025-2026 to the school board.  With all of this going on, it seems like a good time for a community update.

     

    The Proposed 2025-2026 Budget

     

    The last two budget cycles have been very challenging.  In both years the projected expenses greatly exceeded the anticipated revenue.  The school board had many difficult decisions to make which resulted in the elimination of over 25 staff positions and the use of a significant amount of savings to balance the budget.

     

    The situation for 2025-2026 looks better than it did the previous two years, but it is certain that we will still have to use a significant amount of fund balance and some positions will need to be eliminated to create a balanced budget.

     

    As we consider our revenue and expenses, some factors tend to be the most significant.

     

    Revenue

     

    From a revenue perspective, our most significant income comes directly from the taxpayers.  Each year, we use the 2% tax cap formula to calculate the amount by which we can increase our tax levy.  This number is almost never 2%. Click on this link to see a good video that explains what a tax levy is and how a 2% tax cap is not really a 2% tax cap.

     

    What you need to know is that each year the school receives two major sources of revenue.  The amount the taxpayers pay is by far the largest portion of our revenue.

     

     

    While the amount we get from the state usually does not go up much from year to year, the tax levy does go up based on the tax cap calculation.  For 2025-2026, the tax cap calculation indicates that

     

    the 2025-2026 tax levy will go up by 4.35%

     

    This does not necessarily mean that your taxes will go up by exactly 4.35%.  The amount your taxes will go up will be based on the assessed value of your property compared to the assessed value of the other properties in our district.  However, the total amount of money we will propose to take from the taxpayers of our district will go up by 4.35 %.

     

    So let’s take a look at all of the revenue we can expect to receive next year.

     

    We recognize that a 4.35% increase, on top of the $17,000,000 capital project the voters approved in January, puts a significant tax burden on the community.  Unfortunately, as you can see, our state financial aid is not going up any significant amount and it falls mostly to the taxpayers to support the district.  We greatly appreciate the $51,490,831 that we anticipate receiving from the community and we appreciate the approval of our very important capital project.

     

    Expenses

     

    Not surprisingly, in these difficult financial times, the cost of educating our students is going up by a lot more than the 0.5% increase we anticipate getting in state aid.  Here is a look at how our budget has increased over the years.

     

    Each year we work hard to minimize the increase in expenses by looking at all line items in the budget to see where reductions can be made.  However, each year the cost of everything goes up including staff salaries, health care benefits for employees, special education services, food, gas, electricity, etc.

     

    Expenses fall into three main categories that make up 100% of our budget:

     

     

     

    Here are the expenses that we are proposing for 2025-2026 compared to 2024-2025:

     

     

     

     

     

    This leads us to total anticipated expenses of

     

    The budget we are proposing to the school board includes several items:

     

     

    It also includes a $5,000 stipend for a coordinator for the new Community Continuing Education Program that is currently being run by volunteers, $16,000 to pay for itinerant athletic trainers to cover most of our extracurricular athletic contests (if AT’s are available), and four new school buses at a cost of $480,000.

     

    Items of significance that are not included in the budget proposed to the school board include:a full time athletic trainer at an estimated cost of $112,000 and the summer school enrichment program that is estimated to cost $73,000.

     

    Revenue vs. Expenses

     

    As you have probably noticed, our proposed expenses are quite a bit greater than our anticipated revenue:

     

     

    We must use fund balance (savings) and reduce expenses to close the gap and create a balanced budget.

    Fund Balance

     

    Each year our school uses a significant amount of fund balance (savings) to help pay for our expenses.

     

     

    We do have some savings that will help us balance the budget this year.  As of June 30, 2024 we had $8,590,523 in restricted and unrestricted fund balance.  However, we do not have a huge amount of savings that is not already allocated for a purpose.

     

    We keep money in four reserves:

     

     

    Out of the $8,590,523 total savings dollars that we have, most of it is contained in reserves or it is already allocated to be spent for future purposes and/or to balance the 2024-2025 budget.

     

    Our unassigned fund balance is relatively low:

     

     

    Having an unassigned fund balance lower than the 4% allowable limit is not something we are particularly comfortable with, but we do have a plan to replenish our fund while still using savings to help balance the 2025-2026 budget.

     

    Declining Enrollment

     

    It is difficult to consider a future budget, the spending of savings, and the reduction of expenses without considering our declining student enrollment.  Our loss of students is significant.

     

     

    While our enrollment has been declining, our level of staffing has not declined in a similar fashion:

     

     

    Each year we consider all possible ways to reduce expenses.  While we have greatly tightened our financial belt over the last couple of years, in order to balance the budget we have had to use fund balance and reduce staffing positions.  The same will be true for 2025-2026, but we are grateful that the number of positions that will need to be reduced will be less than that over the last two years.

     

    The recommendation given to the school board to create the 2025-2026 School Budget

     

    It is the job of the Superintendent, after a full analysis of the financial situation and after conversations with the financial and administrative team, to make a recommendation to the school board.  The school board has the responsibility of analyzing the recommendations, listening to constituent groups, asking questions, and finally adopting a budget that they feel is in the best interest of the district.  The taxpayers then have the responsibility of voting for or against the proposed budget on May 20, 2025.

     

    Here is the proposal to close the $3,167,551 budget gap that was given to the school board on Wednesday night

     

     

    We can use $300,000 out of the retirement reserve fund to pay for part of our annual contribution to the Employee and Teacher retirement systems.  That is the reason the money was reserved in the first place.  

     

    We can afford to use $1,900,000 of unrestricted fund balance because our investments this year, with the high interest rates banks are paying now, have paid off.  We have also sought out extra revenue wherever we can.  As a result, we feel that we can use a significant amount of savings to balance the budget and still push our unrestricted fund balance up to the much more comfortable level of 4% of our total budget.

     

     

     

    Using $2,354,000 of fund balance still leaves us with over $800,000 to cut from our expenses for 2025-2026.  Here are reductions that can accomplish this goal.

     

     

     

    These unfortunate reductions represent the laying off of three valued employees who currently work for the school district.

     

     

    These are positions filled by substitute teachers and not full time employees.  The two special education positions would be at the elementary level.

     

     

    These reductions equate to a total of 4.4 positions eliminated and a savings of $813,551.  Three current employees would be laid off.

     

    The next graphic summarizes the entire proposal:

     

    What Happens Next?

     

    The next school board meeting on March 19 will start with a community forum where the public is encouraged to attend and express their opinions about the budget proposal and to ask questions.  This community forum will start at 6:30 pm and it will be held in the MS auditorium.

     

    The school board is interested in hearing what the community has to say.  The community forum will be followed by the regularly scheduled school board meeting.  During this school board meeting the board will have an opportunity to deliberate on the budget proposal and to discuss the comments provided by the community.  Their goal will be to reach agreement on what the final adopted budget should look like.

     

    Once a budget is adopted by the school board, it will not be changed before the budget vote on May 20th.  However, several presentations and outreach efforts will be made before May 20th so that everyone in the community knows exactly what they are voting for.

     

    School Board Elections

     

    On May 20th, voters will also be asked to vote for people to fill two open school board seats.  If you are interested in filling a three year school board term, you can learn more about being a board member by clicking on this link.

     

    There is a lot of information in this update.  I hope it answers any questions you might have.  If you want to watch the full budget presentation given at the school board meeting you can click on this link.  The actual budget presentation starts at the 14:30 mark of the video.  The presentation is followed by some public comments and some preliminary discussion by the school board on the budget presentation.

     

    It is important to us that you get the most accurate information possible.  If you have questions, please don’t hesitate to reach out to me either by telephone or email.  Please consider attending the budget forum on March 19 in the Middle School Auditorium and sharing your thoughts.

     

    Best Wishes,

    Stephen Gratto - Superintendent

     

    Ps.  Don’t miss the All District Choral Concert onTuesday March 11 at 6:30 pm in the HS auditorium or the All District Band Concert on Thursday March 13 at 6:30 pm in the HS auditorium.  Together, these events will involve almost 400 students and their families!