Norwalk finance committee approves two transfers as special-education costs, health insurance increases widen FY26 gap

The Norwalk Board of Education Finance Committee on April 9 approved two budget transfers and received an update showing higher-than-expected special-education outsourcing costs and an operating-budget shortfall for fiscal 2026.

“We're at 70.9%,” Linda Azmani, chief financial officer for the Norwalk School District, said of year-to-date general-fund spending through March, adding that the district is about 75% of the way through the fiscal year. The committee approved two transfers to reallocate funds between school budgets; the motion to move the transfers was made by Ms. Fahey and seconded by Board Chair Diana Carpio and was recorded as passed.

The committee’s discussion centered on three budget areas: the general fund, grants, and food services. Azmani said salaries remain the district’s largest expense and noted a timing effect for summer pay; she reported the general fund was 70.9% spent for the year to date, while salaries were at about 68% spent. Azmani also flagged “other student services” — where the district pays out-of-district tuition — as a pressure point: the line is about 85.7% spent at roughly the three-quarter mark and is running about 8.3% higher than the same point last year because of higher per-student outsourcing costs rather than a large change in student counts.

Azmani told the committee the state recently approved a $40 million pool for excess special-education costs; Norwalk expects “just under $900,000” of that funding, which staff plan to use to pay some personnel costs currently charged to the local budget. She said that if the expected excess-cost reimbursement does not materialize, the district has already notified the city it may seek a possible special appropriation.

On grants, Azmani said Connecticut’s recall of some ARPA ESSER funds totaled about $6 million statewide; the district’s portion was “about $60,000.” She said some planned ESSER purchases remain under purchase order and that the district is watching state and federal guidance before finalizing those expenditures.

Azmani reported the food services fund is roughly flat year over year at about $4.5 million and said the USDA-run school-lunch reimbursement process generally leaves the district exposed to timing risk when reimbursements arrive late.

The committee also heard an update on FY26 budget development. Azmani said the Board of Education’s original FY26 operating request was larger than the mayor and common council’s cap; the council approved a capital allocation of $6.9 million (the board had sought $7.4 million for capital). On the operating side, Azmani walked the committee through adjustments: the district’s current-year budget base figures cited in the presentation totaled about $233.3 million; after earlier reductions and other adjustments the district’s adjusted budget figures were discussed in the range of the mid-$240 millions. Azmani said recent health-insurance increases — including an 11% state-plan increase and a 15% increase on a larger teacher plan — added roughly $2.1 million to projections, and lower-than-expected turnover added roughly another $0.5 million to projected expenses.

Taken together, those revisions put the district’s working FY26 need at about $249 million, leaving a gap of approximately $6.5 million relative to the city’s 4% target discussed in earlier budget materials. Azmani said district staff are continuing conversations with the mayor’s office and tracking state budget activity; she said the district hopes for clearer numbers after spring break and expects to present a final reconciliation at the board’s May workshop and seek final budget approval at the June business meeting.

Committee members pressed staff on implementation and personnel impacts. Azmani said the district has begun conversations with unions and is reviewing seniority lists, retirements and current vacancies; she said one approach will be to hold vacant positions open and allow internal bumping before recruiting externally. The committee discussed program reductions such as consolidating some elective offerings and reducing the number of class sections at some schools where enrollment has fallen.

The meeting concluded after housekeeping motions including approval of the March minutes and a motion to adjourn. No formal vote tallies other than the recorded motions were specified in the meeting record.