Preliminary budget: Kirkwood projects $98.3M in operating revenue after state formula increase

Kirkwood R-VII district finance staff presented the preliminary operating and debt‑service budgets May 19 and described how a late change at the state level would increase district revenue projections for fiscal 2025–26.

Finance staff said the Missouri Department of Elementary and Secondary Education (DESE) calculation known as the state adequacy target (SAT) was changed for next year from $6,760 to $7,145 per student. That change increases the district's revenue projection by about $2.3 million and raises the preliminary operating revenue total to $98.3 million, according to the presentation.

Chief finance presenter (identified in the transcript as Mr. Romay) explained that the district initially budgeted with the lower SAT and set expenditures conservatively; the SAT revision added revenue on the top line but administrators did not add corresponding expenditures to the preliminary budget. The presentation said projected operating expenditures are about $93.6 million, and that most of the increase is tied to salary and benefit package cost changes.

Key budget details presented to the board included:

- Projected operating revenue: $98.3 million (an increase of roughly $2.3 million tied to the SAT change). - Projected operating expenditures: $93.6 million; roughly 80 percent of expenditures are salaries and benefits. - A budget line for KHS roof and exterior lighting and an unallocated $1.2 million intended to give the new superintendent and the board flexibility. - Restoration of a teaching contingency in the preliminary budget to allow for late staffing needs; administrators said the district also expects attrition that could offset some staffing costs in later years. - Fund balance projections showing a healthy ratio over a 10‑year forecast under the presentation's assumptions, with the caveat that DESE funding or reassessments could affect long‑term numbers.

Board members questioned the timing and assumptions behind several items. Caffey and others asked whether the administration plans for the SAT to be fully funded and how a proration (partial funding) would affect projections; administrators replied they believe the SAT increase will be funded but acknowledged the state could prorate if revenues fall short. Hepburn and Neiman urged detailed scenarios that show a low‑end outcome if the state does not fund the full SAT increase.

Trustees also debated how the $1.2 million unallocated contingency created after the September rollback (the tax‑rate adjustment adopted last year) should be handled and whether contingency teachers in the budget should be funded from that rollback money or from the operating budget. Board members asked administration to produce alternate projection runs that keep the $1.5 million in contingency uncommitted while showing the effect of including the contingency teachers.

Administrators committed to running the requested projections and to coordinating any budget changes with the incoming superintendent. The board set a schedule to revisit the preliminary budget and associated scenarios at the June 2 work session and to adopt a final budget on June 23 if no further changes are required.

Ending: No budget adoption occurred at the May 19 meeting; the presentation clarified assumptions and produced board direction to run alternate scenarios and report back at the June work session.