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District presents FY26 draft budget projecting $2M deficit, fewer teachers and lower grants amid enrollment decline
Summary
Steamboat Springs School District staff presented the fiscal year 2026 draft budget May 19 showing use of more than $2 million from reserves to balance rising costs and declining revenues, proposed staffing reductions tied to lower enrollment and several expiring grants, and a food service deficit tied to a planned reusable-dish pilot.
District finance staff presented a draft fiscal year 2026 budget to the Steamboat Springs School Board on May 19 that uses accumulated fund balance and proposes staffing and program adjustments in response to declining enrollment and the end of several grant awards.
The presentation, led by Stephanie (district finance staff), said the proposed general fund budget includes more than $2 million in use of fund balance to cover the gap between rising expenses and declining revenues. The district is budgeting a projected ending general fund balance of roughly $11.15 million by June 30, 2026, equivalent to about 22% of expenditures under the current draft.
Why it matters: The draft budget sets the spending framework for the district and underpins the compensation package approved by the board the same evening. Board members emphasized the tradeoffs between maintaining reserves for cash flow and paying higher salaries.
Topline numbers and revenue changes: The district estimates a funded pupil count of 2,493 and a per‑pupil funded amount just over $12,000 under the state finance formula. State per‑pupil funding rose under the finance formula changes, but that increase was partly offset by the nonrenewal of several state grants totaling approximately $584,000 (largest single loss cited: $242,000 for early literacy professional development). Federal grant revenues are also uncertain.
Staffing and program adjustments: To align staffing with projected enrollment, the draft reduces total full‑time equivalent positions by about 10 FTE compared with the current year. Specific proposed reductions noted in the presentation include: - Two fewer classroom teachers at each of Soda Creek and Strawberry Park elementary schools to match lower elementary enrollment. - One fewer specials teacher and one fewer special education teacher at Sleeping Giant School. - A net reduction of nine special education paraprofessionals districtwide through a new allocation process. The draft does include restoring 1.5 counselor positions and, if preschool enrollment supports it, 2.5 preschool staff positions.
Food service and single‑use plastics: The district’s food service fund is projecting a budgeted deficit of roughly $169,000 in FY26. Food service staff described an effort to pilot reusable dining wares after a student presentation and subsequent working group meeting that included five students. District staff have tested multiple product classes (stainless steel, melamine, glass/ceramic) and highlighted tradeoffs: stainless steel and insulated camp‑style products can remain hot under serving lamps, and melamine is no longer recommended because high‑heat dishwashing can release plastic into food; glass and ceramics pose breakage risk for younger students. The district purchased insulated stainless steel camp bowls for testing and said a permanent shift would likely require an additional hired dishwasher position and reliable staffing to avoid overtime.
Other funds and capital: The bond redemption fund includes a planned $8.145 million in debt service payments next year; property tax revenue for bonds is budgeted at about $8 million. The capital projects fund, supported by a 1.146 mill levy override, proposes about $1.15 million of projects including masonry repair at the district office, HVAC and roofing work at Soda Creek, synthetic turf for an athletic seating area, track resurfacing, and gym equipment upgrades. The district also reported a $1.7 million CDPHE grant to cover five electric vehicles and three charging stations, which are included in the capital revenues and expenditures.
Grants and volatility: The presentation highlighted that some grants that supported FY25 expenses will not be renewed in FY26, including an early literacy grant and several health and tutoring grants. District finance staff warned that reductions in local revenue (for example, Education Fund Board sales tax receipts) or changes to state averaging formulas could materially affect FY27 and beyond.
Next steps: The draft will return for a public hearing on June 2 and final adoption on June 16. Board members asked staff to continue monitoring cash flow and to report mid‑year; staff said they will present additional details at the June meetings.
The district reiterated that use of fund balance is a one‑time measure and cannot be sustained indefinitely; board members and staff encouraged continued state‑level advocacy for more stable school funding.
