CFO previews 2025 levy assumptions and budget outlook; warns salaries and health costs outpacing levy increase

Morton CUSD 709 Chief Financial Officer Lisa Kowalski presented the board with a preliminary timeline and assumptions for the 2025 levy and an early projection of fiscal 2027 budget balances at the Oct. 15 meeting.

Kowalski said the district will present a tentative levy in November and the final levy in December, and that the district posts truth‑in‑taxation notices as a transparency step even when it does not exceed the 5% threshold that mandates notice. “Whenever I'm doing the computations, I'm looking at last year's levy, using our CPI, adding in the new property, and then that kinda gives us the amount,” she said.

Key assumptions and figures presented (preliminary): • Expected evidence‑based funding level: about $2,900,000 for FY‑26 (assumption). • Salary increases modeled at about 5% for the projection period. • Health‑care budgeted increase used in projections: 15%. • Current‑year property‑value new growth used in projection: 0.735% (county assessment numbers reported). • Projected operating tax rate presented as 4.7185 (including bond levy assumptions in the model).

Kowalski warned the board that the modeled salary and benefit increases outpace the projected levy growth in the baseline scenario. “One for one, when you look at the levy increase versus the salaries, obviously, we're not in the direction we want to be,” she said, noting that while the district can carry reserves for one year, continuing draws would be unsustainable.

She provided a preliminary, combined‑fund picture showing projected fund balances and “days in reserve” estimates: under the present projection the general fund would end FY‑27 with about 217 days of reserves, above the 180‑day benchmark the district monitors. Kowalski said she expects to request a resolution to transfer working‑cash funds to the capital projects fund later in the fall to help pay for ongoing construction projects.

Why it matters: The levy and budget projections set the financial framework for negotiations, staffing and capital projects. Kowalski emphasized that final numbers depend on county assessment rolls, evidence‑based funding allocations, health‑care renewal and other variables that can change before the December levy adoption deadline.

Next steps: Kowalski will present a tentative levy for board approval in November, publish the truth‑in‑taxation notice as a transparency measure, and seek final levy approval at the December board meeting. She told the board staff will continue to refine projections and present the formal levy and budget documents at the scheduled hearing.

Ending: Board members thanked Kowalski for the overview and asked staff to continue to monitor EAV and health‑care cost trends as levy season progresses.