Peninsula board adopts $178.8 million 2025–26 budget after finance briefing

The Peninsula School District Board of Directors voted to adopt the 2025–26 budget, approving Resolution 25-08 and authorizing $178,769,283 in total spending for the coming school year. The motion to approve the resolution was moved by David and seconded by Laurie; the board president, Natalie Wimberly, was absent.

District Chief Finance Officer Ashley Murphy gave a recap of last week’s extended presentation and summarized key budget drivers, including projected enrollment, revenue sources and fund balances. Murphy said the district is budgeting a subtotal of 8,208 FTE (full-time-equivalent) students driving most state funding and an anticipated total K–12 enrollment of 8,669, including 101 ALE students. “The actual dollar values have remained the same,” Murphy said, describing the session as a recap for those who had seen the two-hour presentation posted on the district’s YouTube channel.

The nut of the budget is that projected revenues, including a planned $5,000,000 transfer from the capital projects fund to the general fund, come to just over $173 million, while the district is requesting authority to spend $178,769,283. Murphy told the board that almost 75% of district funding is expected to come from the state, local levy dollars account for roughly 20% of the budget, and federal funds make up about 3.2%.

Murphy outlined several items that drive expenditures: a recently ratified agreement with the Peninsula Education Association (PEA) that raises compensation by 3% for 2025–26 (and another 3% for 2026–27), classified staffing increases tied to a reorganization of support roles, and added grounds positions to maintain buildings constructed or modified during bond projects. She noted material, supplies and operating costs (MSOC) budgeted at just over $23,000,000 while the state MSOC allocation is projected at about $12,800,000, leaving a local-levy-funded gap of roughly $10,400,000.

On staffing costs, the district is budgeting salaries and benefits at about 79.74% of general fund expenditures, slightly under the commonly cited 80/20 split between salaries/benefits and MSOCs. The proposed ending general fund balance meets the board’s stated goal range of 4%–6%, though Murphy said the cabinet will seek ways to reduce expenditures and increase revenues to move closer to the 6% target in future years.

Murphy also reviewed other funds: a capital projects fund (including the Safety, Security & Technology levy) expected to end 2025–26 with just under $500,000; a debt service fund with an estimated beginning balance of $8.7 million, expected levy receipts near $12.2 million and debt payments around $11.5 million, leaving an estimated ending balance around $9.3 million; an ASB fund with a projected starting balance of about $1.75 million and anticipated revenues near $2 million (with expenditures budgeted near $2.8 million); and a Transportation Vehicle Fund used only for purchasing yellow school buses, with an estimated beginning balance of $2.7 million, depreciation revenue of about $1.2 million and planned vehicle expenditures near $3.8 million, leaving a low interim balance that will be replenished when the next depreciation payment arrives.

Murphy emphasized the district’s dependence on the October student-count date for state funding. “The first school day of October is our true count,” she said, adding that much state funding and some poverty-based allocations are driven by that date. She also noted local enrollment patterns: the district median home price (June 2025) is about $935,000 and some outlying neighborhoods, such as the Evergreen attendance area, are showing faster growth — Evergreen’s incoming kindergarten class was reported as 12 students over budget.

Before the vote, several board members urged prudence. One director said it was “very concerning” that the state had delayed payments in recent months and urged increasing the ending fund balance over time to buffer similar situations. After brief discussion, David moved approval of Resolution 25-08, Laurie seconded, and the motion carried.

Discussion versus decision: the presentation and board questions were recorded as discussion (enrollment trends, MSOC shortfall, staffing changes, fund balances); the formal board action was the adoption of Resolution 25-08 authorizing spending up to $178,769,283. No additional policy changes or spending allocations beyond the resolution were adopted at the meeting.

The board was reminded of upcoming meetings: a study session and community open-house forum on Sept. 9 and the next business meeting on Sept. 23.