Tempe Elementary School District finance staff presented budget projections and a menu of savings at the Dec. 17 board meeting, warning that under conservative assumptions the district could face a multi‑million dollar shortfall for the 2026–27 school year.

Mister Thompson and district staff outlined modeling that assumes 2% annual enrollment decline, approximately 2% state funding, an expected ~6% insurance cost increase and a modest 2% cost‑of‑living raise for employees. Under those inputs, the district would overspend if no reductions were made; the presentation estimated an approximate $7.6 million shortfall absent cuts or other offsets.

HR reported historic staffing declines of roughly 10% district‑wide over recent years (from about 1,735 to 1,565 FTE) and district‑level positions fell from 320 to 286 FTE (~10.6%). Staff solicited input from principals, district leaders and a TEEA survey and categorized recommended savings: reduce district‑level administration, reimagine or eliminate large events (for example the back‑to‑school rally), protect compensation and insurance, trim non‑essential curriculum purchases and subscriptions, consider facility consolidations and pursue operational efficiency and energy conservation.

District staff said they priced a menu of potential savings that collectively could approach $35 million across multiple categories, and they will present recommended options that target the immediate $7–8 million gap while preserving a $5–6 million carryforward to buffer midyear enrollment volatility. The superintendent told the board that he will not initially recommend school closures as part of the first round of actions.

Board members debated tradeoffs. Several members cautioned against a four‑day instructional week as a primary savings strategy, noting it effectively represents a ~20% reduction in salary if instructional days are reduced and could depress enrollment. Members prioritized protecting classroom services — including certified classroom teachers, librarians, nurses and arts/music programs — while asking staff to return specific proposals and dollar amounts for each recommended option.

Staff will return in January with line‑by‑line recommendations and cost estimates timed to staffing decisions for the next school year.