RPS board approves balanced budget model changes, including 80/20 compensatory split and new central cost centers

The Rochester Public Schools Board on Dec. 16 approved a set of enhancements to the district's balanced budget model that change how certain funds will be allocated in 2026-27.

Superintendent (presentation) withdrew an earlier recommendation to move school counselors into the flexible funding category after further analysis and consultation with counselors. The three enhancements the board approved were: moving supplies budgets into the flexible category (with a minimum spending requirement), allocating 80% of compensatory education revenue directly to school sites and designating 20% centrally to advance equity and strengthen school-level flexibility, and organizing central office budgets around cost centers to increase efficiency and transparency.

On the 80/20 compensatory proposal, the superintendent and finance staff explained how the 20% held centrally would be used: roughly 30% of that 20% (about $765,000 in the district's estimate) would be set aside to support eight schools that generate limited compensatory revenue and do not qualify for Title I funds; the remaining 70% of the 20% (about $1.8 million) would support districtwide allowable compensatory uses such as reading coaches, reading specialists, lead counselors and other interventions, freeing up general fund dollars for site priorities.

Superintendent and staff said the shift is permitted under Minnesota law and was adopted with provisions intended to reduce unintended gaps between schools that do and do not qualify for federal Title I funding. Board members asked for clear public-facing graphics to explain the allocation mechanics; staff agreed to produce clearer materials for community and staff communication.

The board moved, seconded and approved the resolution adopting the enhancements by voice vote.