Mahtomedi board approves 2025–26 budget reductions and use of fund balance after hours of debate

The Mahtomedi Public School District Board on Feb. 24 approved a set of budget reductions and adjustments intended to address an estimated $2,000,000 shortfall in the 2025–26 general fund, combining expense reductions, modest revenue measures and a $792,000 one‑time use of fund balance.

The package, moved by Director Donner and seconded by Director Whitson, cleared by voice vote after nearly three hours of discussion about class sizes, program cuts and the long‑term risks of drawing down reserves. Board members removed two measures from the list before voting: a proposed 20% increase in activity registration fees (estimated at about $56,000) and a proposed reduction of certain high‑school low‑participation activities (about $4,500); administration will return with more information on those items.

District leadership told the board the $2,000,000 estimated gap is the result of several factors including the expiration of one‑time federal relief (ESSER) funds, inflation on operating costs and state policy changes that affect district funding. "We're looking at an estimated budget reduction of about 2,000,000," Superintendent Barb said as she introduced the proposal and asked the board to approve items that could be acted on now and continue work on the rest at the March meeting.

Key elements of the approved package: - One‑time use of fund balance: $792,000 to reduce the immediate shortfall; administration said that would leave an estimated unassigned fund balance of about 8.28% (roughly 29 days of cash) under board policy. - Revenue adjustments (some retained for later review): returning elementary class sizes toward pre‑pandemic levels and modest enrollment‑driven revenue from resident and open enrollment; community education cost sharing. Administration initially proposed a 20% activity fee increase (roughly $56,000) but the board removed that from this vote to seek more information. - Expense reductions: eliminating a small number of elementary sections based on current enrollment (second and fifth grades were cited as at‑risk reductions if enrollment does not change), reductions in some middle and high school sections driven by student course selections (administration used a 20‑student threshold as a starting point for estimating which classes might be combined or not offered), restructuring technology support (reducing one district‑level tech integrationist role in favor of building‑level lead stipends), reductions in substitute and contracted services, utility and insurance adjustments, reductions to supplies and certain curriculum subscriptions and planned reductions in facilities and grounds staffing hours.

Board members pressed administration for specifics about impacts and alternatives. Director Regan and others sought clearer numbers on which sections and how many staff would be affected; the administration said decisions would depend on final spring enrollment and course selections but that the high‑school principal had used a 20‑student threshold to estimate potential reductions this year. Director Peterson asked whether open enrollment and resident enrollment could restore a section; administration confirmed that additional resident enrollments would allow the district to add a section back.

Several trustees cautioned against cutting programs that provide unique learning opportunities. "I struggle with reducing the offerings for low enrollment because of the … showcase," Director Whitson said, referencing student projects and extracurriculars highlighted in the district—s Zephyr learning presentations. The board majority nevertheless voted to approve the administrator recommendations as amended (with the two items removed for further review), citing the need to act now to give administration time to implement staffing and operational changes before fall.

Administration also presented a three‑year projection showing continued structural deficits if no further action is taken. That projection — which did not include the reductions approved at the meeting — showed a recurring shortfall of roughly $2.3 million in 2025–26 under current law assumptions, reinforcing the district—s earlier discussion about the possibility of an operating referendum if revenues do not improve.

Motion and vote record: the motion to approve the 2025–26 budget reductions and adjustments, as presented (with the two items removed for additional study), was moved by Director Donner and seconded by Director Whitson and passed by voice vote. The board did not record a roll‑call tally in the meeting transcript; the clerk recorded the result as "motion carries." The board separately approved donations and grants totaling $4,482.19 earlier in the meeting (moved by Director Regan, seconded by Director Donna) by voice vote.

Administrators acknowledged the austerity of some choices and said they would return to the board with additional detail on any items trustees asked to reconsider, including the activity fee proposal and the proposal to reduce certain low‑participation high‑school activities. They emphasized that the use of fund balance is a one‑time measure and that ongoing structural reductions or new revenue (including the potential for a referendum) will be necessary to close projected future deficits.

What happens next: administration will implement the approved reductions that are operationally required now, continue work on the remaining proposals, update the board as state budget and aid figures are finalized, and return in March with revised numbers and options where trustees requested further information.

Sources and attributions in this article are drawn verbatim from board meeting discussion and motions recorded in the Feb. 24, 2025 Mahtomedi Public School District board meeting transcript. Direct quotes are attributed to the speakers as recorded in the transcript.