Hampton Bays officials warn of tight 2025–26 budget as enrollment projections and state aid shift

Hampton Bays Union Free School District officials told the Board of Education on March 12 that the district faces a tight 2025–26 budget after a small drop in state aid and enrollment projections showing a gradual decline.

In a presentation on enrollment and the preliminary budget outlook, Lars, a district staff member, said the district had 2,002 students at the time of the meeting and presented unadjusted enrollment projections that show a gradual decline in coming years. He told the board that kindergarten enrollment stood at 107 students while 12th grade had 187, and that adjusted projections — which account for midyear new enrollments and withdrawals — could change the trajectory but still pointed to a net decrease over the longer term.

The district’s revenue outlook is being driven by state aid changes and local property valuation formulas, according to the staff presentation. Lars said the governor’s proposed budget included more statewide school funding overall but that the district’s specific aid lines changed: a roughly $253,000 (about 2%) increase in expense-driven and categorical aid, a $350,000 (about 5%) decrease in building aid, and a net drop of about $207,000 (1.4%) in total aid compared with the previous year. He described the starting point for the 2025–26 budget as “tight,” and said preliminary planning assumes a 2.1% overall budget increase while the district’s allowable tax levy limit is about 3.2 percent.

Larry, a district staff member who answered questions about property valuation, added that recent rises in local property valuations (the district’s community valuation rose from about $3.8 billion to more than $5 billion) drive the state formula and can reduce aid even where local need remains high. "On paper, we look rich," Larry said, explaining that the state’s equalization process compares districts using valuation ratios and student counts.

Staff identified key cost drivers for 2025–26: a reported 5% increase in special transportation costs; an 8% increase in special-education costs; and higher expenses for replacing first-generation Chromebooks and other instructional-technology items that had been funded initially with federal COVID grant dollars. Lars said the district has not proposed layoffs and is factoring in salary savings from recent retirements as the budget is built.

Prekindergarten funding and space also remain a constraint. Lars said the district was eligible for up to $418,000 for full-day universal pre-K but received $97,000 under current arrangements because local provider per-pupil rates exceed the state per-student reimbursement rate. He said the district is advocating for greater flexibility so it can mix full- and half-day offerings to fit local supply and demand.

Lars and other staff noted the budget calendar is active: department-level budgets and staffing proposals are being finalized and specific program choices will follow. He said the district would present a plan in the coming weeks and that a more detailed budget presentation on state-aid finalization and program priorities would follow as Albany completed the state budget process.

The board did not take a formal budget vote at the March 12 meeting. Lars said he would present the student-representative-to-the-board item in April to implement a recent state law requiring a nonvoting student representative on school boards.