Bellevue School District projects 2025–26 budget shortfall; foundation and donors pledge targeted funding

The Bellevue School District presented a proposed 2025–26 budget showing a negative beginning fund balance and an operating plan that relies on spending reductions, anticipated levy increases and a planned one‑time property sale to restore reserves.

Superintendent Dr. Michael Aramaki told the board that “as of July 10, we have entered binding conditions with OSPI,” meaning the Washington Office of the Superintendent of Public Instruction will provide oversight, technical support and permit certain interfund loans while the district executes an accelerated recovery plan.

The budget presentation laid out the district—s fiscal position: operating costs have exceeded revenue for several years, reserves were drawn down and the district expects to end 2024–25 with a negative fund balance unless corrective actions hold. The proposal for 2025–26 shows revenue greater than expenditures for the year but still a projected negative ending fund balance (about $3.0 million in the presentation). The board was told additional structural spending cuts will be required in future years unless state funding or local levy support increases materially.

Why it matters: the general fund supports day‑to‑day instruction, staff compensation and operations. District leaders said roughly two‑thirds of the district—s general fund revenues come from the state, while local levies account for about 16% of general fund revenue (about a quarter of total district funding when capital levy transfers are considered). Superintendent Aramaki noted that recent state legislation (identified in the presentation as Senate Bill 5412 and House Bill 2049) increases some district flexibility and levy capacity but does not fully close the district—s structural funding gap.

Staff and enrollment: district staff described process changes intended to improve fiscal control, including new position‑control procedures between HR and budget, monthly financial study sessions with the board, a newly formed audit and finance advisory council, and enhanced special‑education reimbursement tracking. Chief Operating Officer Heather Sanchez said resident enrollment is increasing slowly and nonresident enrollment has more than doubled since 2020; the budget was built on a conservative FTE assumption (the presentation listed 19,105 FTE for 2025–26 versus a demographer estimate of 19,336).

Planned reductions and risks: the district said it reduced planned staffing by about 80.6 FTE compared with the prior budget and by roughly 112.5 FTE compared with staffing levels that had been hired during the prior year. Presenters and board members cautioned that the budget still carries risks: special‑education costs that exceed projections, enrollment that falls short of budgeted FTE (which reduces state revenue), the end of the transportation safety net (reducing revenues in the transportation program), and the need to avoid adding unbudgeted commitments without offsets.

One‑time sale and capital work: district leaders described a planned surplus‑property sale (Somerset) with an expected sale price of about $30 million to a homebuilder (identified in the presentation as Tri Pointe Homes). The presentation said proceeds would be used as a one‑time source to rebuild fund balance and repay any interfund loans; the sale was described as expected to close between December 2026 and June 2027.

Private donations and mental‑health support: Bellevue Schools Foundation executive director Juliette Booter told the board the foundation will provide $1,100,000 in support for the 2025–26 year; the foundation said most of that funding will support transitional kindergarten seats, elementary computer science curricula, mental‑health counselors and screenings, teacher certification, and targeted investments in Title I schools. Booter said the foundation—s gift also enabled an additional $150,000 specifically to restore an elementary impact counselor position within the district—s Mental Health Assistance Team (MHAP). Elementary impact counselor Jared Taylor, who will return to the role with the new funding, said MHAP has served more than 2,500 students over seven years and described the counseling and coaching work the role will provide.

Special education reimbursement: Executive Director of Special Education Scott Powers said the district improved its Safety Net tracking and expects a significant increase in special‑education reimbursement compared with prior years (the presentation compared a prior claim of about $6.5 million to an expected reimbursement of up to about $10.5 million this year). Powers described changes to leadership structure, staffing models and compliance reporting intended to strengthen special‑education budgeting.

Next steps and board action: staff presented the proposed budget and said the board will hold a public hearing and is scheduled to vote on budget adoption at the Aug. 21 board meeting. After questions, directors thanked staff for the work and signaled a continued focus on restoring financial health while protecting classroom priorities.

Votes at a glance: the meeting included procedural votes approving the meeting agenda and the consent agenda. Both motions carried; specific roll‑call tallies were not provided in the transcript excerpt.

Quotes used in this article come from the board meeting transcript and are attributed to named participants in the meeting.