Shakopee School District grapples with $7M deficit in upcoming budget

The Shakopee Public Schools Board meeting held on May 12, 2025, focused on critical financial discussions regarding the district's food service fund and overall budget projections for the upcoming year.

A significant topic was the cap on the food service fund, with board members noting that while there is no formal cap from the Minnesota Department of Education (MDE), a common practice among districts is to maintain a fund balance equivalent to about six months of expenses. The discussion highlighted the impact of the COVID-19 pandemic, which allowed for free lunches for all students, significantly boosting the food service fund balance. However, concerns were raised about the restrictions on spending these funds, which could limit their utility for other programs.

The board also reviewed the district's budget, which shows projected revenues of $167 million against expenditures of $174 million for the next fiscal year. This indicates a planned drawdown of nearly $7 million from reserves, primarily from the general fund and restricted fund balances. The financial outlook suggests that the district will continue to spend more than it brings in unless adjustments are made.

Additionally, the board discussed the implications of student enrollment projections on the budget, emphasizing the need for careful financial planning to address potential deficits. The conversation underscored the importance of strategic budgeting to ensure the sustainability of programs and services for students.

Overall, the meeting highlighted the district's financial challenges and the need for proactive measures to manage its resources effectively in the coming year.