Board narrows FY26 ADM projection to 50 students as staff warns overestimates drove FY25 shortfall

District finance staff told the board that a principal cause of the FY25 budget gap was optimism in student-count projections. Ken Hicks explained that the district's base support calculations and the revenue limit are driven largely by average daily membership (ADM). He said the administration built draft FY26 numbers on an ADM of roughly 4,370 and noted recent official ADM counts for the current year had fallen to about 4,267.

"Any time the board is approving a budget, revising a budget, really needs to know what the average daily membership is that's supporting this budget," Hicks told trustees, and he warned that overestimating ADM inflates budgeted revenues and can create midyear shortfalls.

Board members debated the appropriate conservative estimate for growth. Several trustees said they preferred a more cautious projection than the staff's earlier discussion figure of 100 new students. After discussion the board expressed consensus to use a 50-student growth assumption for FY26 planning, with the understanding that the projection can be revised at the next available budget revision if actual ADM differs.

Hicks and Dr. Monroe also warned that budget limits are not spending authorizations and that the district should plan to spend below the budget limit in order to maintain a carryforward. Administration estimated that the combination of transfers, journal entries and PO reductions could leave the district with roughly $400,000—00,000 in carryforward for FY25; the AFR and final ADM adjustments will set the official amount.

Why it matters

About 85% of the district's funding flows from the per-student formulas that are multiplied by ADM or weighted student counts. A small change in students therefore can change revenues by several hundred thousand dollars. Trustees said they wanted a conservative ADM estimate that would reduce the chance of repeating a midyear funding shortfall.