Laconia School District adapts budget amid $1.2M state funding cut

The Laconia City Council held a crucial budget meeting on May 12, 2025, where significant discussions centered around the financial challenges facing the Laconia School District. The meeting highlighted the impact of reduced state funding and the end of federal ESSER funds, which had previously supported the district's initiatives.

During the meeting, Business Administrator Diane Clary presented the district's budgetary concerns, noting a staggering $1.2 million reduction in state funding for the upcoming fiscal year. This decline is attributed to changes in the adequacy formula used by the state, which considers factors such as the number of families eligible for free and reduced lunch and the city's equalized valuation. Clary explained that while recent building projects have positively affected Laconia's overall valuation, they inadvertently hinder educational funding.

The meeting also addressed the decline in applications for free and reduced lunch, a trend that emerged post-COVID when students were accustomed to free meals. Clary emphasized the district's efforts to encourage more families to complete these applications, although she acknowledged that these measures would not alleviate funding issues for the next school year.

To manage the budget shortfall, the district is implementing cuts and adjustments while striving to minimize the impact on student services. Clary detailed the necessity of using reserve funds to cover essential supplies and meet contractual obligations, including a nearly 10% increase in health insurance costs for the second consecutive year. The total financial lift required to maintain operations is approximately $3 million.

The discussions at this meeting underscore the ongoing financial pressures faced by the Laconia School District and the broader implications for educational services in the community. As the council moves forward, the focus will be on finding sustainable solutions to support both students and staff amid these challenges. The next steps will involve continued dialogue on budget adjustments and potential strategies to enhance funding opportunities for the district.