Pasco School Board votes to lower fund balance requirement to address budget deficit

In a recent board meeting held on May 27, 2025, the Pasco School District addressed significant financial challenges, including a projected budget deficit of approximately $6.9 million for the current fiscal year. The primary focus of the meeting was a proposal from district staff to reduce the board-mandated fund balance requirement from 5% to 2.5%. This adjustment aims to help bridge the budget gap while maintaining essential programs and staffing levels.

The board discussed the implications of this proposed reduction, emphasizing the need for a strategic approach to navigate the district's financial reality. The staff outlined a plan that involves gradually reducing the mandated reserve over three budget cycles while also implementing staffing cost reductions through natural attrition. This strategy is designed to preserve jobs and minimize disruption to educational services.

During the meeting, board members expressed their support for the proposed changes, recognizing the necessity of adapting to current economic conditions. They highlighted the importance of maintaining a safety net for future financial stability, with a commitment to eventually restoring the fund balance to its original level. The board also acknowledged the broader context of financial difficulties faced by school districts across the state and nation, reinforcing the need for responsible fiscal management.

To proceed with the fund balance reduction, the district will initiate a budget extension process, which requires public hearings and approval from the Educational Service District (ESD) and the Office of Superintendent of Public Instruction (OSPI). The board plans to hold a public hearing on June 24, 2025, to discuss the budget changes and gather community input.

In conclusion, the Pasco School District is taking proactive steps to address its budget deficit while prioritizing the well-being of its staff and students. The board's decision to reduce the fund balance requirement reflects a careful consideration of the district's financial landscape and a commitment to maintaining educational quality amidst challenging circumstances. The upcoming public hearing will provide an opportunity for community engagement as the district moves forward with its budgetary adjustments.