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Show Low Unified previews FY26 budget amid grant cuts and carryforward estimates
Summary
District staff presented a proposed FY2026 budget that anticipates flat enrollment, a $5 million estimated carryforward and reduced federal and state grant funding; the board approved the proposed budget for adoption in July.
Jamie Davis, a district finance staff member, told the Show Low Unified School District Board of Education at its June regular meeting that the proposed fiscal year 2026 budget assumes flat enrollment (2,302 students) and an estimated $5,000,000 carryforward. She said the Arizona Department of Education has changed budget forms so the new-year lines show only FY26 resources and carryforward now appears on a separate line, which makes year-over-year comparisons appear skewed.
Davis said several revenue and grant items are uncertain. The district is assuming no automatic 2% per-pupil increase in the base for the budget she presented; she described the presented budget as a “good budget without the 2%.” She said the Teacher Experience Index (TEI) value decreased (from 1.0163 to 1.0042), which reduces formula funding tied to staff experience. The Classroom Site Fund rose from $7.92 to $8.42 per pupil, which helped fund teacher pay increases this year.
Davis and Dr. Shane Farnsworth, the district superintendent, summarized anticipated reductions in grant funding that together total about $473,000 in their current estimates. Davis told the board the district expects to lose particular grant streams entirely or be reduced substantially, including a rural/low‑income grant (about $76,000 last year) and a comprehensive support and improvement grant (about $40,000 last year). She said Title I and IDEA will carry small balances into FY26 but that the district is planning to supplement services from maintenance-and-operations where necessary.
Davis described the capital budget as $3,100,000 (a decrease of about $1.4 million from FY25) and said she plans to move $1,000,000 from capital into maintenance and operations this year to help cover operating needs; she noted last year the district moved $1,000,000 the other direction. She also listed planned new expenditures: classified salary increases driven by a salary study (an average classified increase of roughly 14%, about $569,000), a projected 9% increase in health‑insurance premiums (about $357,000), a $2,000 per‑FTE classroom base increase estimated at about $366,000, and a 4% administrative pay increase (about $115,000). Davis said the lowest paid district staff now start at about $16.50 per hour after the salary study, meaning the January minimum‑wage rise will mostly affect event workers.
Board members asked about state timing and payment risk. Davis said the legislature is expected to pass a base education budget by June 30 but other bills will likely continue into the fall and that some state payments have historically been delayed; she said the district has sufficient cash to cover short timing delays. Dr. Farnsworth and Davis also discussed statewide political uncertainty tied to Proposition 123 and a separate proposal to enshrine vouchers in the state constitution; Davis said ADE consultants indicated some matters may go to voters in October.
Davis asked the board to approve the proposed FY26 budget so the board could adopt it at the July meeting. Board President (Joe) moved to adopt the proposed FY26 budget as presented; the motion carried.
The superintendent and finance staff said the proposed budget will be returned in July as the adopted budget. They noted a revised budget can be filed in September if legislation changes state aid figures.
Ending: The board approved the proposed FY26 budget and will take the formal adoption at the July meeting; staff will monitor state actions and return with revised figures if necessary.
