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Business administrator presents draft long-range financial plan; warns of midterm deficits and preschool shortfall
Summary
Business administrator Mr. Lang presented a draft long-range financial plan that projects modest near-term surpluses but increasing deficits beginning in 2027–28, flagged a preschool program shortfall now charged to the general fund, and reviewed reserve rules including a 4% unassigned fund-balance limit under Real Property Tax Law §1318.
Mr. Lang, the district’s business administrator, presented the draft long-range financial plan to the Batavia City School District Board of Education, describing it as a projection tool that models revenues and expenditures across several years under a set of assumptions.
Mr. Lang said the plan uses conservative assumptions for state aid (about 2% per year in the model) and a 2% annual tax-levy increase for projection purposes. He warned that later years in the projection show increasing deficits beginning around the 2027–28 school year and said the district will use budget development to consider programmatic and staffing choices to address any shortfalls.
On reserves and fund balance, Mr. Lang reviewed accounting categories (restricted, assigned, unassigned) and cited compliance guidance under Real Property Tax Law §1318. He reported that the district’s unassigned fund balance at fiscal year-end 2025 was $2,532,406, equal to 4% of a $63,310,108 budget, and recalled that the district appropriated $3.6 million of fund balance in 2024 to close a budget gap. "You can exceed 4% — although it is in violation of real property tax law — but there is no mechanism for those funds to be stripped away," Mr. Lang said, describing audit-committee reporting and reserve reallocation practices.
Mr. Lang also highlighted three drivers he built into the expenditure projections: ongoing collective-bargaining negotiations (including the teacher contract), a preschool program shortfall currently budgeted in the general fund, and anticipated increases in health-insurance claims and rates. He said the district will receive updated state-aid runs and finalized health-insurance rates later in the budget process and will adjust projections accordingly.
Board members asked clarifying questions about what happens if unassigned fund balance exceeds 4% and whether the district would consider changing or discontinuing programs (such as the preschool) if shortfalls persist; Mr. Lang said reallocating excess at year-end to restricted reserves and programmatic decisions during budget development are standard responses.
No formal budget adoption or amendment vote took place during the public session; Mr. Lang said the plan remains a draft for the budget-development process.
