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Business administrator outlines FY26 pressures: WPU up 4% but health insurance, retiree costs and substitutes push district to Truth in Taxation hearing
Summary
Devin Daley told the board that a 4% increase in the WPU did not cover major cost drivers for FY26 — notably a 30% rise in health insurance and growing substitute and SOEP costs — and that a modest local tax rate change would yield roughly $4 million to fund teacher/administrator pay adjustments and other pressures.
Business administrator Devin Daley presented the district’s Truth in Taxation overview to the board, explaining why the district scheduled a public tax‑rate hearing and the key drivers in the FY26 budget. Nut graf: Daley said a 4% increase in the state WPU (weighted pupil unit) did not cover major local cost growth — most notably a roughly 30% increase in health insurance costs and higher substitute and online education program (SOEP) expenses — and that the proposed local tax rate would raise about $4 million to close part of the gap. Daley told the board the district received a 4% increase in the WPU but that health insurance costs rose about 30%, representing roughly $4.5 million in additional expense; the WPU increase alone represented about $2.5 million. Substitute‑teacher costs rose from about $500,000 to $1.5 million in recent years, and the district paid roughly $1.2 million related to online credits through the state SOEP program. He said retiree medical liabilities are large and that the district has set aside roughly $14 million of fund balance for long‑term retiree benefit obligations; retiree health insurance costs increased about 25% this year. Daley described actions the district has taken to reduce pressure: instituting fees for some SOEP course enrollments, eliminating or not filling select district positions, transferring interest revenue into insurance reserves, and modest increases to teacher base pay and longevity already approved. He explained how property valuations and tax rates interact with revenue: valuations in Provo rose substantially (Daley cited about $1.2 billion in increased valuation for this year) which can lower the required tax rate even while individual tax bills rise for some homeowners whose valuations grew faster than average. Daley said the proposed combined board rate (local and capital levies) would generate about $4,000,034 and that the district’s proposed rate is lower than last year’s rate in terms of the mill levy number because assessed valuations rose; he described how basic and voted levies interact with state funding and noted the district has run Truth in Taxation hearings multiple times over recent years. Board members asked why some taxpayers still see higher bills even when the district rate decreased; Daley explained differences in individual property valuation changes and in other levies outside the district’s control. Ending: Daley said he would present the same overview at the public hearing later that night and that staff would provide materials and an FAQ to the community.
