Riverview Gardens School District faces $23M budget deficit crisis

The Riverview Gardens School District (RGSD) Board of Education held a special meeting on February 12, 2025, to address significant financial challenges facing the district. The primary focus was on the operating fund, which combines the general fund and the teachers fund, and the alarming projected deficit that could impact the district's ability to function effectively.

During the meeting, it was revealed that the district's operating fund balance is expected to drop dramatically from over $31 million to approximately $16 million by the end of the fiscal year, representing a decline from about 40% to just over 18%. This decline is attributed to a combination of increased expenditures and a significant reduction in federal funding, particularly from the Elementary and Secondary School Emergency Relief (ESSER) funds, which have been a crucial financial resource in recent years.

The board discussed the implications of this financial situation, noting that if current spending patterns continue without intervention, the district could face an annual deficit of $23 million. This figure represents the amount by which expenditures would exceed revenues, leading to a potential financial crisis within a year. The board emphasized the urgency of addressing this issue to avoid being designated as financially distressed, which would occur if the fund balance falls below 3%.

Key factors contributing to the financial strain include the addition of approximately 200 staff positions over the past three years, which increased salary and benefit costs by $20 million. Additionally, errors in the budget, such as overestimating state revenue and underestimating salary costs, have compounded the problem.

The board acknowledged the need for immediate action to reduce expenditures or enhance revenue to stabilize the district's finances. They discussed the importance of long-range budget planning to prevent similar issues in the future and ensure the district can meet its operational needs while maintaining a healthy fund balance.

In conclusion, the RGSD Board of Education is facing a critical financial juncture, with the potential for severe budget shortfalls if corrective measures are not implemented promptly. The discussions highlighted the need for strategic planning and fiscal responsibility to secure the district's future and continue providing quality education to its students.