School District faces $4.6M PERS cost hike impacting fiscal year 25 26 budget

The BLS School Board in Oregon is grappling with significant budget challenges as it prepares for the fiscal year 2025-2026. During the Budget Committee Meeting held on April 8, 2025, board members discussed the implications of rising costs, particularly in personnel expenditures, which are projected to account for 85% of the district's budget.

A key point of discussion was the increase in Public Employees Retirement System (PERS) rates, which have surged to 4.1%, translating to an additional $4.6 million in costs. This increase is substantially higher than the previously anticipated 2-3% rise, placing further strain on the district's financial resources. The board acknowledged that these escalating costs could lead to difficult decisions regarding personnel, potentially requiring cuts to staff positions if budgetary constraints continue.

In addition to PERS increases, the budget also reflects a 22% rise in liability insurance costs, driven by recent incidents affecting multiple districts. This trend is expected to persist, compounding the financial pressures faced by the school board.

Despite these challenges, the board noted that they have managed to maintain a close alignment with budget actuals, projecting to land near 100% for the current year. However, the discussions highlighted a critical need for strategic planning to address the ongoing financial volatility and ensure the sustainability of educational services.

As the board moves forward, they will continue to monitor market conditions and negotiate with staff regarding cost-of-living adjustments and insurance caps. The implications of these budget discussions will be felt across the district, as the board seeks to balance fiscal responsibility with the need to support its educators and students effectively.