District unveils FY26 proposed budget; anticipates reserve drawdown and staffing adjustments

Saint Paul Public Schools administrators presented the district’s proposed fiscal year 2026 budget Tuesday, describing a multi-step strategy that relies on reserve drawdown, targeted reductions and revenue adjustments to close a projected $51.1 million gap.

Chief Financial Officer Tom Sager and other district leaders told the board the district plans to use $34.9 million of its fund balance for FY26 and to close the remaining gap through a combination of central-office reductions, school allocations, federal reimbursements and other revenues. The presentation was informational; the board will vote on an adopted budget at its June 10 meeting.

Key numbers and steps: The administration cited a $51,100,000 shortfall driven largely by rising personnel, benefits and non‑personnel costs while state funding has not kept pace with inflation. To reduce the shortfall the district identified $6.4 million in reductions in Schools & Learning, $3.8 million in Administration & Operations, and $1.3 million across finance, human resources, equity and strategy. Additional revenue adjustments cited included pupil aid (for example, voluntary pre-K Medicaid reimbursements) and interest earnings. Administrators described an anticipated net drawdown of reserves that would leave the district with an unassigned general fund balance equal to roughly 19 days of operating expenses (about 5.43% of the general fund) at the end of FY26.

Staffing and human resources: District leaders said the number of affected FTEs is far smaller than the large reductions of the prior year. The presentation cited a comparison showing a net allocation of about 116.5 additional FTEs at schools compared to the previous year (driven by enrollment shifts and special-education and middle-school needs), but also outlined 143 FTEs that were identified as reduced in this process (these are role-based counts and do not necessarily equal individual layoffs). Human-resources staff said they currently anticipate approximately 18 layoffs may be necessary after transfers, recalls and other staffing movements are completed; administrators said final layoff notices and bumping processes would be finalized in June and that employees who have completed probation retain recall rights to future vacancies.

Board members asked for continued transparency. Director Michelle Wall (public commentator earlier) had urged more granular budget transparency during public comment; board members asked administration to show how board parameters and community feedback were reflected in the adopted budget that will be presented on June 10.

Next steps and timeline: Administration will finalize staffing notifications in June, bring an adopted budget to the board for a June 10 vote, and continue to post detailed budget and program allocation documents on the district’s FY26 budget web page.

Note: No budget action was taken Tuesday; the presentation was informational and the board did not vote on the FY26 budget at the meeting.