Mehlville presents preliminary FY26 budget; district aims for operating breakeven amid revenue uncertainty

Marshall Crutcher, Mehlville R-IX director of finance, presented the district’s preliminary fiscal-year-2026 budget to the board on April 20, outlining assumptions, risks and near-term capital-fund decisions.

Crutcher said the district is targeting an operating fund breakeven for FY26 while maintaining cash reserves above 30 percent. He noted the nonoperating (capital) fund shows a large year-to-year drawdown—about $12.8 million—because the district is spending previously collected capital levy proceeds on authorized projects, including HVAC and other Prop S work.

Key points from the presentation: - Overall revenue growth shown in the draft is about $299,000 (0.2 percent), effectively flat year over year. The local-tax picture is uncertain because of recent policy changes affecting collections; the district estimated collections between last year’s 96.26 percent and a traditional 97.13 percent, which creates a swing of roughly $500,000 either direction. - State funding and the basic-formula attendance estimate remain uncertain. Crutcher explained that attendance-based funding true-ups could create a multi-million-dollar variance that would affect FY26 and FY27 numbers. - Expenses: salaries budgeted up ~3.1 percent; benefits up ~7.7 percent largely due to health insurance; service and supplies up ~3.4 percent; significant expected increases in water and sewer costs (noted roughly 34 percent) and continued pressure on insurance costs. - Capital transfers: to achieve an operating breakeven, the preliminary plan reduces tax-levy transfers to the capital fund in FY26 by about $6.9 million compared with FY25. Crutcher cautioned that continuing that practice year after year is unsustainable if revenue declines continue.

Board members thanked Crutcher for the clear dashboard indicators comparing Mehlville to other district benchmarks (tax rate rank, operating expense per student, debt per student). Crutcher said final budget approval will come at either the May or June board meeting depending on evolving revenue figures and state decisions.

Crutcher recommended against publishing a long-range forecast at this time because of high uncertainty in state-level and local revenue assumptions.