District finance officer says special‑education state aid could drop to zero as fund balance grows

Mister Sasse, a district finance presenter, told the Rapid City Area School Board that the special‑education (SPED) fund has accumulated cash because revenue rose faster than the district has been able to spend it, largely because many budgeted positions remain unfilled. "My state aid projection for fiscal year '26 is essentially gonna be $0," he said during a presentation that the board requested ahead of contract negotiations.

Why it matters: Special‑education state aid is calculated from categorical disability counts, per‑student allocations and adjustments for local effort and excess fund balance. If a district—s SPED fund balance exceeds the Department of Education—s limit, the state reduces next year—s aid by the excess. Sasse said the accumulation in Rapid City—s SPED fund — driven by increased local property tax revenue and lower budget utilization — could eliminate the state portion of SPED aid in 2026.

Sasse walked the board through the main drivers. Local property tax effort for SPED has increased substantially; he said local effort rose about 58.73% since pay 20. SPED disability…