School district projects tight FY26 budget after drop in state EBF; municipal retirement fund shows shortfall

Wendy, a district finance presenter, told the Ball Chatham School Board on Aug. 1, 2025, that the district’s tentative FY26 budget projects roughly $53 million in revenue into the education fund — about 2% higher than last year — but flagged several areas of concern, including lower state Evidence-Based Funding after a move from tier 1 to tier 2 and a municipal retirement account that could run about $350,000 negative next year. The tentative budget presentation said about 68–69% of district revenue flows into the education fund and that 61% of expenditures across funds are salaries and benefits. Wendy said the education fund receives roughly 69% of its revenue from local sources (primarily property taxes) and 24% from state funding; she said the district’s state EBF declined when the district moved from tier 1 to tier 2. Wendy said the transportation fund receives about 54% of revenue from levies and 46% from state sources, that operations and maintenance is almost wholly levy-funded, and that capital projects face constraints: the district receives roughly $5 million per year for capital but has a backlog of projects and one-time bond proceeds of $1.6 million that flowed through last year. She also said capital projects require approvals from the regional office of education (ROE), the State Board of Education and the district architect. On specific fund balances, Wendy said the education fund is expected to finish the year with about $270,000 remaining and the operations and maintenance and transportation funds with roughly $25,000 each after planned spending. She warned that the municipal retirement and Social Security fund has been drawn down and will require changes to the levy schedule within the next one to two years to stabilize it. Board members did not take formal action to adopt the tentative budget at the meeting; the board will review the budget at a public hearing scheduled for Sept. 24, 2025, at the Ball Chatham District office, Wendy said. She also said the tentative budget materials would be posted online for review. Wendy described the capital-projects process as constrained by outside approvals and noted about $400,000 in outstanding invoices from last year that the district plans to pay from this year’s capital budget. She recommended continued monitoring of enrollment trends and the municipal retirement account to inform levy planning. The board scheduled the formal budget hearing for Sept. 24, 2025, and was told the district will notify the public again before that meeting.