Centennial SD proposes roughly $83.5 million general fund budget for 2025–26, plans modest deficit and targeted reductions

Centennial School District officials on April 23 presented a proposed 2025–26 general fund budget that keeps most classroom programs intact while planning a modest planned spend-down of reserves to cover a structural gap driven by declining enrollment and state funding uncertainty.

Superintendent James Owens and Director Sotherton (Business Services) told the budget committee the proposal preserves co‑curricular activities, career and technical education and special education supports while carrying an estimated $1.9 million (about $2.0 million in some summary lines) deficit that will be covered in part by a planned draw on the district’s ending fund balance.

The district said current‑year general fund revenue is just under $79 million and next year’s forecast is roughly $81 million. Key cost drivers are personnel costs — including step increases, cost‑of‑living adjustments and a projected PERS rate increase the district estimated at roughly 2 percent (about $935,000) — plus higher costs for students with significant special‑education needs. District staff told the committee they expect a continuing enrollment decline of roughly 100 students a year, which reduces state funding by roughly $1.4 million in next year’s projection.

Why it matters: Centennial’s planned deficit follows a multi‑year effort to rebuild reserves after pandemic‑era cuts. District leaders said they will use both targeted reductions and a measured draw on reserves to avoid “cliff” cuts and preserve instructional programs while the state adjusts school funding formulas.

What the plan does and how the district will pay for it - The proposed general fund expenses are presented in the budget book at about $83.5 million (before contingency). The administration is carrying a larger‑than‑usual contingency line to allow for possible additional funding from the state (for example, improved reimbursement for high‑cost disability cases) if legislation passes. - The draft uses a mix of reductions and planned fund balance spend‑down to address the projected gap. The administration told the committee it intends to split the work roughly half through reductions and half through drawdown on reserves rather than spend reserves entirely to cover ongoing costs. - District presenters described a $750,000 estimated saving from “insourcing” several out‑of‑district special education classrooms (bringing services in‑district), which will add staff (the plan shows roughly 14 additional educational assistant positions and two licensed positions tied to that insourcing) but reduce private placement tuition and outplacement costs. - The budget preserves Centennial Virtual Academy, Measure 98 (high‑school success) and Student Investment Account (SIA) programs in their current forms and continues investments tied to Roadmap ’27 strategic goals.

Other notable budget details and changes presented - ESSER pandemic relief ended in September 2024; the district used remaining ESSER dollars earlier but cannot rely on that source going forward. - The budget reflects targeted reductions to ancillary services (some IT printing reductions, transportation insourcing that will reduce contracted special‑education transport, and modest custodial hour adjustments), shifting of some positions into grant funds where legally allowable, and a classroom improvement project for Park Lane Elementary (remodeling of four classrooms and a music room funded by the new classroom improvement fund). - The district presented sensitivity examples showing a potential $5 million deficit if no adjustments were made; the proposed package is intended to avoid such a cliff.

Process and next steps Superintendent Owens and Director Sotherton asked the budget committee and public for feedback by April 30; staff said they will post the proposed budget in the district’s business services section and return to the committee on May 28 for the committee’s consideration and potential approval. The administration said it will share committee questions and staff responses with the full committee.

Committee actions recorded at the meeting - The committee adopted its agenda and elected Jess Harden as budget committee chair (nominated by Pam Shields, seconded by Rod Boettcher) and Pam Shields as vice chair (self‑nominated/seconded by Rod Boettcher); both nominations were approved by voice vote. The committee also approved a motion to extend the meeting time.

What was asked and what remained open Committee members asked about the sustainability of insourcing and whether savings are ongoing (staff said yes), the timeline for the planned spend‑down of reserves (staff detailed a multiyear plan to reach a board policy target), and how the district will manage potential midyear funding changes from the state (staff said some contingency is held to add supports if the legislature increases funding for high‑cost disability or removes the special‑education cap). Detailed page references were provided for committee review of the draft budget book.

Taper: The district emphasized the proposed deficit is intentional and part of a multi‑year plan designed to protect programs while pursuing state funding changes; staff asked for written feedback and said they will update the proposed budget for the committee’s May 28 review.