District finance chief outlines 2025–26 budget drivers: fiscal‑stress score, low reserves and a roughly $1 million gap

The Middle Country Central School District presented preliminary details for the 2025–26 budget, focusing on the Comptroller’s fiscal stress indicators, reserve balances, major expenditure drivers and projected state aid. The district reported a fiscal stress score of 21.7 points under the Comptroller’s monitoring system and described use of reserves in recent years; staff presented a working budget gap of just under $1 million that the board will continue to close before adoption.

"So we're gonna talk about the 2526 budget," said Dr. Rella, the district presenter for the budget briefing. The presentation reviewed the Comptroller’s fiscal stress monitoring system, which assigns points for items such as operating deficits, fund balance as a percentage of gross expenditures, cash position and reliance on short‑term borrowing. Middle Country’s 21.7 points placed the district off the Comptroller’s formal designation list this year, but staff said the score indicates continuing financial work is required.

Key financial figures and drivers - Fiscal stress score: 21.7 points (Comptroller score components included a small operating deficit, low unassigned fund balance and a cash position the Comptroller considers below peers). - Fund balance: Unassigned fund balance reported at 3.2% of gross expenditures; total fund balance at about 9.2%. Staff compared the district to Long Island averages (Long Island averages cited roughly 6.3% unassigned fund balance and substantially higher cash ratios). - Historical reserve use: The district used reserves to smooth prior years; staff noted a roughly $300,000 decline in fund balance this year (an improvement from prior years when larger amounts were drawn down). - Expenditure drivers: Contractual obligations, healthcare costs, five additional special‑education preschool classes, special‑education excess costs, transportation, retirement costs, utilities (partially mitigated by district solar projects), paraprofessionals/teacher aides and BOCES occupational education costs. - Revenue side: State aid is a major revenue component. The governor’s proposed state aid (as presented) showed an increase larger than recent averages (a roughly $9 million increase in the presentation, larger than the district’s five‑year average). Staff cautioned the district cannot immediately access the full pre‑K grant allocation due to grant constraints; that limitation reduced usable revenue by about $400,000 in the district’s analysis. - Tax levy cap: Using district‑specific calculations, the district’s estimated allowable tax levy cap for 2025–26 was presented at 2.21%; staff said the proposed levy in the working budget remains within that cap.

Working gap and next steps Staff presented a working gap: proposed expenditures increasing by $11,830,402 vs. proposed revenues increasing by $10,839,838, leaving a gap of roughly $990,564 (approximately $1 million). Next steps outlined by staff include finalizing staffing and enrollment projections, completing retirement replacements, filing the tax levy cap by March 1, incorporating adopted state aid (due April 1) and continuing budget revisions to close the gap without relying on reserves.

Why it matters The presentation emphasized district dependence on state aid (said to represent about 42% of projected revenue) and the sensitivity of the budget to aid changes. Staff urged continued attention to reserve rebuilding and to financial advocacy (including requests to state legislators to modify pre‑K grant restrictions and to increase aid for students with disabilities). Board members expressed support for the administration’s work to address the fiscal position.

What the transcript does not include The presentation provided estimates and models; the transcript excerpt does not show final adopted state aid figures, employee retirements finalized for replacement calculations, or the board’s final adopted budget. The figures presented were subject to change as staff refine enrollments and revenue assumptions.