Saint Joseph school leaders outline $8 million recovery plan, seek third‑party review

District finance officials told the St. Joseph School District Board of Education on the special meeting call that the district finished the 2024–25 fiscal year with a 10.02% reserve ratio and is projecting a roughly $2.8 million deficit for 2025–26 if no corrective steps are taken. Business officer Robert (Mark) Krell and Assistant Superintendent/Chief Financial presenter Roger Hedgecourt outlined a multi‑year recovery scenario that relies on $1 million in cuts to purchase services and supplies in 2026–27, and an assumed $6 million reduction in salary and benefit costs spread across fiscal years 2027 and 2028.

Hedgecourt said the shortfall came from three primary causes the board heard repeatedly during the meeting: delayed federal reimbursements and timing of federal funds, lower‑than‑projected state revenue tied to enrollment and assessed valuation timing, and higher‑than‑expected capital spending during the 2024–25 cycle. “I think with our work, we can get that to a positive number by the end of the year. I really do,” Hedgecourt said.

Why it matters: the district’s board policy target is a 20% reserve ratio. Trustees were shown a projection tool that models different combinations of cuts and revenue assumptions and were told the district can recover to policy levels under the scenario presented, but only with sustained savings and careful monitoring. Hedgecourt presented a scenario that reduces purchase services by $500,000 in each of two years, reduces supplies by $500,000 in each of two years, and reduces salary/benefit costs by $3 million in 2027 and $3 million in 2028 (noting that the salary number is a “ballpark” figure driven by the fact that salaries/benefits are the largest share of operating expenses).

Board and community members pressed for transparency and independent validation. Several board members and public commenters urged a third‑party review to restore public confidence. A board member asked district staff to contact Linda Quinley, director of the Missouri School Boards’ Association (MSBA), to scope a short independent review and report back at the August board meeting; the board requested a cost/procedure outline for that review. Hedgecourt and McGinnis said KPM (the district’s financial statement auditor) will perform the routine financial statement audit on completed fiscal years but that a performance‑style review (operations/processes) is a different type of engagement and could be pursued separately.

Supporting details: Hedgecourt explained that some federal funds for FY2023–24 arrived in late July and therefore will be reflected in FY2026 accounting because of fiscal‑year timing rules; that timing complicates year‑to‑year comparisons and budgeting. He also explained a reclassification of M&M (sales) surtax dollars into Fund 4 late in FY2025 to avoid a negative Fund 4 balance, which reduced Fund 1/Fund 2 reserves on paper and contributed to the lower reserve ratio. Hedgecourt said updated bond and capital tracking are posted on the district website under Business Office and will be part of the October budget amendment.

Board directions and next steps: Hedgecourt will prepare an October budget amendment with detailed line‑item changes and an updated projection tool showing where savings were achieved; staff will provide a breakdown of positions/allocations already changed through attrition or reallocation. The board asked staff to scope a focused outside review (MSBA as a suggested option) and return with cost and scope at the next regular board meeting.

Public comment and board reaction: Public commenters and multiple trustees said the district needs rapid, visible corrective action and independent confirmation of the new numbers to restore trust. Several community members supported keeping current board leadership in place while pursuing transparency steps; others requested a formal, outside audit or review. The board did not take a formal vote that night on any structural change to leadership; the board instead directed staff to return with the vendor/scope and a plan for the October budget amendment.

Ending: The board set a timetable for the finance team to return with a budget amendment and with a proposal for an independent review of the district’s finances; no formal policy change or vote on leadership occurred as part of the budget discussions.