Mercer Island School Board approves 2025–26 budget after debate over nurses, librarians and state apportionment shortfall

The Mercer Island School District Board of Directors approved Resolution 744 to adopt the district’s 2025–26 budget following a split vote and extended discussion about staffing cuts and state funding shortfalls.

Board members said the budget is balanced under current revenue estimates but disagreed sharply over staffing decisions. One board member said, “I do not support a budget that contemplates and has, in fact, resulted in cuts to nurses and librarians,” while others said the budget "follows the board's priorities" and represents responsible decisions given state revenue constraints.

The board heard a May financial dashboard showing the district is roughly three-quarters of the way through the fiscal year and that expenditures through May were at 74.9 percent of budget while year-to-date revenues were about 17.4 percent. The district reported a drop in state apportionment from 9 percent in April to 5 percent in May and said the state shorted the district “about a quarter of a million dollars” in June because of state-level budget constraints; staff said the district expects to recover the shortfall across July and August.

Officials pointed to a year-over-year increase in monthly fund balance and cash on hand of about $827,000 and described a large insurance payment of nearly $600,000 made in April that affected month-to-month comparisons. The district also noted an expected “safety net” payment of about $1,500,000 to be remitted in August tied to special services claims, and that future timing for those payments will change under new legislation.

Board discussion included repeated requests for clarity on how the general fund reserve is calculated. One director asked whether the denominator for reserve calculation should be forward-looking (next 12 months) rather than based on the prior year’s actual expenditures; staff replied that the district uses year-end actual expenditures (August 31) as the denominator, which they described as industry standard. Several directors said they have been discussing reserves and budgeting across multiple meetings.

After public hearing procedures (no members of the public signed up to speak), a motion to approve Resolution 744 was called. The board clerk reported the motion passed by a tally reported as 4 yes, 2 no, 1 abstain. The board did not identify individual votes on the record during the public roll call portion of the meeting.

The board also received a brief update that certificated full-time equivalent (FTE) staffing showed no certificated increase since the last report and only a small classified increase (two hires since the previous meeting). Staff said this update is informational and reflects recent hires rather than year-over-year change.

Board members said they appreciate the finance and HR teams’ work preparing the budget during a constrained funding environment, with some members emphasizing the district’s efforts to rebuild its finance systems and fund balance. Dissenting members urged the board and administration to revisit staffing priorities and to pursue additional state advocacy.

The board voted to adopt the budget and moved on to other items on the agenda.