Board approves FY25 midyear budget update and sets FY26 assumptions as state and federal funding uncertainties loom

The Saint Louis Park School Board voted unanimously on March 25 to approve a midyear budget update for fiscal year 2025 and to adopt budget assumptions to guide preparation of the fiscal 2026 budget.

The board approved a midyear general-fund revenue estimate of about $82.8 million and reported expenditures running near $84 million after adjustments, driven primarily by salaries and benefits and special-education costs. Director Magnuson summarized the midyear adjustments as incorporating “the impact of our enrollment increase this fall, special education revenue increases, actual staffing costs, and revised projections in other areas like utilities and transportation.”

Why it matters: the board acknowledged a projected $2 million budget shortfall first announced in October 2024 and chose to preserve an unreserved fund balance of roughly $5.6 million, about 8% of the budget, as contingency against further cuts. Administrators recommended a longer-term target fund balance of 12%–16% but did not build that growth into the FY26 assumptions.

Key board actions and outcomes

- Midyear fiscal 2025 budget adjustment: approved (vote 7–0). The district said the midyear update reflects higher revenue largely from state special-education aid but also higher staffing costs; the update leaves the unreserved fund balance at about $5.6 million (≈8.2%).

- Fiscal 2026 budget assumptions: approved (vote 7–0). The board approved assumptions that will guide building next year’s budget; those assumptions do not incorporate potential losses in federal or state funding but preserve an 8% fund balance. Superintendent Carla Hines told the board the district will not “try to predict either” possible state or federal funding losses as it builds next year’s budget.

Board discussion cited several risks. Magnuson warned transportation, utilities and insurance are major cost drivers. Board members and staff also noted the governor’s proposed cuts — including a proposed 5% cut to special-education transportation reimbursement — and the potential for federal funding reductions. During discussion a board member said federal funds account for approximately $2,000,000 of district revenue (roughly 3% of the general fund).

On fees and revenue: the board agreed to add a modest technology damage/loss fee (described in discussion as intended to cover less than $20,000 of losses) and to consider differentiated rental fees for premium spaces. The district is encouraging creation of a district-wide booster club to support extracurriculars. State law will raise the basic per-pupil funding factor by 2.74% under current law, the district said; the legislature had not adjourned and final numbers could change.

Votes at a glance

- Approval of meeting agenda (vote 7–0). Motion moved by Taylor; seconded by Sarah.

- Consent agenda (payroll, accounts payable, minutes, personnel): approved (vote 7–0).

- Policy 5.15 (Protection and privacy of people’s records), second reading and adoption: approved (vote 7–0).

- FY25 midyear budget adjustment: approved (vote 7–0).

- FY26 budget assumptions: approved (vote 7–0).

What the board said: Director Magnuson said the district is recommending holding the fund balance steady rather than spending reserves now, and described an ongoing effort to control cost drivers. Superintendent Hines said changes were made to address both academic achievement and the district’s $2 million projected shortfall and reiterated that principals and teachers will participate in schedule and implementation decisions. Board members urged continued advocacy at the state level and noted the difficulty of additional local revenue because the district is at the referendum cap for operating levies.

Ending: Board members framed the approvals as preparatory steps in a multi-step budget process. The board plans to present final proposed budgets in June and adopt budgets at the last June meeting as required by state law.