Battle Ground School District adopts 2025–26 budget; officials warn bigger cuts if levy fails

The Battle Ground School District Board of Directors approved Resolution J-25 adopting the 2025–26 budget at its Aug. 25 meeting, voting 4–0 to adopt the plan after a public budget hearing. The board’s vote came after district staff outlined a multi-million-dollar funding gap and the steps the district has taken to cover it.

District finance staff told the board the 2025–26 budget shows total revenues of $224,437,769 and total expenditures of $239,163,259, producing a projected shortfall of $14,875,490 that will be covered with assigned fund balance. "We are looking at expenditures exceeding revenue by $14,875,490," said Michelle Lee, staff member (finance). She presented the budget and the four‑year projections during the hearing.

Board members and staff said that shortfall stems largely from the nonrenewal of the district’s local levy, which required roughly $14 million in program and staffing reductions carried into the current budget cycle. Staff warned the district cannot sustain another levy loss without severe additional cuts: "If levy funding is not approved for 2027, the district will need to make an additional $20,000,000 in student program reductions to balance the budget," Michelle Lee said.

Why this matters: the district said state funding now provides about 83% of revenue and local levy revenue fell from about 13% in 2024–25 to roughly 6.6% in the adopted budget. District leaders described remaining reserves as low and noted the district’s projected four‑year financial health score would fall to levels that could trigger state monitoring if another levy fails.

Key fiscal details and risks - Revenues: $224,437,769 (state funding ~83%). - Expenditures: $239,163,259; 77% of spending is salaries and benefits. - Budgeted shortfall (to be covered by fund balance): $14,875,490. - Special education: staff reported a continuing shortfall of about $5,000,000 that is not covered by current state allocations. - Materials/operating costs: an estimated $4,600,000 of unfunded costs tied to inflation and rising operating expenses. - One‑time state allocation: $50 per student for 2024–25 was cited as a one‑time offset; the district received a projected 5.3% operating increase for 2025–26 (about $750,000) that largely covered insurance and utilities increases.

Board and staff discussion emphasized constraints on local authority and the long timeline to restore programs. "If funding is approved the district will not be able to restore student programs until 2027–28," Michelle Lee said. Superintendent Shelly (superintendent) said district leaders are coordinating with other superintendents and statewide associations to seek legislative changes and additional resources. "There's no two ways about it. If we don't pass the levy, it's pretty certain that we will be here very, very shortly," she said.

Program and staffing impacts District staff listed the categories affected by the levy loss and reductions: principals and assistant principals, instructional coaches, teacher‑librarians, classroom teachers, special education coordinators, district office support, custodial and operations staff, LPNs and family‑community resource personnel. Middle‑school sports stipends were eliminated (not counted as FTE). The district also noted curriculum adoptions have been deferred and custodial and maintenance hours reduced.

Fund balance and projections Staff described how the district will use assigned and other fund balance categories to cover the shortfall. Projected ending general fund balances: a projected ending balance for fiscal year 2024–25 was shown as $5,750,000, with a projected 2025–26 ending balance of $4,778,753 (about 2% of the budget). The assigned fund balance category used for curriculum and capital reserves will decline to approximately $251,757 after covering the current deficit. Without new local revenue, projections show the district would enter negative ending balances by 2026–27, which staff said could force further cuts and bring the district into state financial oversight.

Monitoring, audits and transparency The board was told the district maintains monthly budget status reports, enrollment monitoring and internal audits and undergoes the annual state audit. Finance staff said the most recent audit work billed about 340 auditor hours (roughly 42 days) and that auditors will need extra time during the Skyward data migration review.

Public comment and next steps No new public commenters signed up specifically for the budget hearing at the meeting, though staff said they had received at least one community inquiry. The board adopted the budget by Resolution J‑25 as presented and the motion passed 4–0.

Votes at a glance - Motion to excuse prearranged absences (Director Johnson; student representative Itzel Contreras Montiel): passed 4–0. - Motion to approve the agenda as presented: passed 4–0. - Motion to approve the consent agenda with a correction to minutes (clarifying that Director Terry Tate made the motion to table the high‑school SEL item until the next full board meeting): passed 4–0. - Resolution J‑25, adoption of the 2025–26 budget: passed 4–0.

The board will continue monthly budget monitoring and staff said they will present options and a detailed plan should the district need to pursue additional reductions next year. The board adjourned after noting upcoming meetings and committee events.