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Business office presents long-range financial plan showing pressure on appropriated fund balance and potential 2028'29 deficit
Summary
District staff presented a multi-year financial projection that recommends reducing the use of appropriated fund balance, stabilizing the tax levy and funding reserves in line with the district's reserve plan. The projection shows a potential minor deficit in 2028'29 if current revenue and expenditure trends persist.
A long-range financial plan presented to the Batavia City School District Board of Education emphasized limiting the district's use of appropriated fund balance, stabilizing tax-levy increases, and funding reserves according to the district's reserve plan.
The presenter described the plan as a multi-year road map based on prior-year financial statements, strategic goals, and known assumptions such as projected state aid and tax-levy increases. The presentation recommended keeping appropriated fund balance closer to 4% of the subsequent year's budget and smoothing debt-service peaks to avoid sharp changes in future tax-cap calculations.
The plan assumes a conservative 2% annual increase in state aid and a 2% tax-levy increase in the projection, while projecting expenditures to increase roughly 4% annually. Under those assumptions, the presenter showed the revenue and expenditure lines approaching and crossing in the 2028'29 projection, producing a minor projected deficit in that year if trends hold.
Board members asked clarifying questions about the assumptions and the options to address a future shortfall. The presenter confirmed two basic options in any budget year: increase revenue (for example, via the tax levy) or reduce expenses; the projection also includes a planned contribution from appropriated fund balance ($2.5 million in the presented projection) and a prior-year anomaly tied to a $6.6 million transfer from the general fund to the capital fund related to voter-authorized capital work in 2023'4.
The plan recommends continual annual updates to the projection and close monitoring of the Rockefeller Institute's foundation-aid study, whose recommendations could increase or reduce foundation aid to the district depending on what the state ultimately adopts. Presenters said they would attend webinars with the state association of school business officials and report back to the board as details emerge.
