Kirkwood R‑VII CFO outlines 2025–26 budget increases, recommends early bond payoff option

Chief Financial Officer Mike Grama presented the Kirkwood School District's proposed 2025–26 budget at a Board of Education meeting, describing revenue and expenditure projections for the operating fund and a range of nonoperating funds and asking the board to approve the revenue budget at an upcoming meeting.

Grama said operating revenues for the coming year are $98,300,000, an increase of $4,100,000 (about 4%). Projected operating expenditures are about $93.9 million, an increase of roughly $2.6 million (2.8 percent). Grama said the presentation includes additions tied to the district's strategic plan, including two additional custodians, $100,000 for math coaching, $70,000 for strategic plan consulting, $100,000 for band instruments, a $175,000 natatorium timing system and paid parental leave-related substitute coverage (about $294,000 for teacher substitutes and $75,000 for support/administrative substitutes).

Grama noted a single change since the board last met: an added $255,000 on one operating line. He summarized that the line now includes $1,000,000 for Kirkwood High School roofing and exterior lighting plus $1,500,000 that is unallocated to give flexibility to the incoming administration. "Please just ask any questions that you have, with the budget," he told board members during the presentation.

Why it matters: Grama said the district maintains a multi-year view of fund balances so staffing, services and programs are not surprised by revenue changes. The presentation reiterated board policy guidance to keep at least a 25 percent operating fund reserve of the following year's expenditure budget. In long-range projections shown to the board, the operating fund balance in the final year displayed was projected at 40.6 percent (previously 43.1 percent), reflecting the new additions.

Nonoperating funds: Grama reviewed several dedicated funds. The maintenance fund, supported by a dedicated levy, generates about $3 million annually; the board approved about $3.8 million in maintenance fund projects for the coming year (an increase of about $500,000). The technology fund also generates roughly $3 million; anticipated additional revenue for next year includes a projected $287,000 from E-rate for district-wide network switches and access-point replacements and approximately $488,000 expected from the planned sale of iPads and laptops. The technology fund's projected revenue increase was about $896,000 compared with the current year, with most added expenditures tied to the E-rate project.

Debt service and Prop R: Grama discussed the debt service fund, noting preliminary March assessed-value data the district received and a current debt service levy of 27 cents. He described a projected increase in debt service revenues of $1.2 million based on those preliminary assessments and warned the numbers will change when assessments are finalized in July and again in September. When the district's debt-service reserves grow to about $6,000,000, the district will have to choose between paying off debt early or reducing the debt-service levy; Grama said he would recommend paying off debt early to save interest costs. "I would recommend that we, pay off debt early as opposed to reducing the tax levy," he said. Grama explained districts commonly "defease" bonds by placing reserves with an escrow agent to pay bonds when they are callable.

Other funds and items: Grama said construction funds established to track Prop R expenses are nearly spent; the remaining construction funds are primarily funding a district-wide cellular antenna system, which the district expects to complete this summer but may not be fully spent by the June 30 fiscal-year end. Activity accounts track about 300 school and program accounts and together hold roughly $2 million. The Kirkwood Early Childhood Center (KCC) fund is a largely tuition-supported enterprise fund with projected revenue near $5.2 million (reflecting a 3 percent tuition increase approved in January) and expenditures just under $5.3 million; the ending KCC fund balance was shown at about $3.4 million. Grama said KCC growth is driving additional staffing in the Adventure Club before- and after-school program.

Next steps and board action requested: Grama asked the board to approve the revenue budget in a few weeks; combined all-funds revenue in the presentation was just over $120 million with all-funds expenditures just over $115 million and a projected combined ending fund balance of about $61.9 million (an increase of about $5.1 million year over year). He reiterated many of the revenue figures are preliminary and a number of amounts will be finalized this summer when assessments and federal program awards are confirmed.

Questions from board members touched on DESE memoranda and assumptions about state funding formulas, transportation cost increases (Grama cited added buses, normal annual increases and rising homeless-transportation obligations), the mechanics of paying off bonds early and prior instances when the district defeased debt, and the source of KCC staffing increases. Board members thanked Grama and staff for the work preparing the budget and noted the decision points for the new administration and board in the next two years.

Ending: No formal budget vote was recorded in the transcript; the revenue budget was presented for board approval at a future meeting and several long-range choices (including whether to pay down debt early) remain to be decided by the board and administration.