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Millbrae officials present proposed 2025–26 budget, warn of state revenue uncertainty
Summary
Chief business staff and the director of business services presented the district’s proposed 2025–26 budget, highlighting a $33.2 million revenue projection, an ending fund balance of about $9.98 million, conservative planning amid state revenue uncertainty, and staffing challenges tied to Prop 28 and the 60% certificated threshold.
Mary (chief business officer) and Director of Business Services Sue Kim walked trustees through the district’s proposed 2025–26 budget, outlining revenue and expenditure assumptions, multi‑year projections and several fiscal risks tied to state revenue forecasts and staffing shortages.
Why it matters: the budget frames staffing, programs and reserves for the coming school year. Staff described conservative assumptions to protect reserves amid uncertainty in state and federal revenues.
Staff presented projected revenue of roughly $33,208,268, with the Local Control Funding Formula (LCFF) comprising roughly $24–25 million, about $748,000 in federal funds and several million in state and local revenues. Wasliff and business staff also noted that the district’s LCAP‑related expenditures total about 10 percent of the general fund (approximately $3,406,000 of a roughly $35 million general fund). The proposed combined ending fund balance was presented as $9,975,226.
Mary and Sue Kim summarized the May Revision context for the state budget and explained the assumptions used in the district’s multi‑year projection: a 2.3 percent COLA for 2025–26 and modest projected increases in later years. They flagged several fiscal risks — potential cuts to federal programs, projected declines in key state revenue sources and higher health‑care costs — and said neighboring districts had reported healthcare increases of up to about 17 percent.
Trustees asked for details on specific funds and projects. Staff explained that Fund 19 holds restricted donations (site‑specific gifts that are parked in restricted accounts) and that Prop 28 arts and music funding carries a spending requirement that makes hiring teachers difficult: the grant requires roughly 80 percent be used for teacher compensation, and districts are competing to hire art and music teachers. Mary said the district has pursued both direct hires and contracted services (for example, Music for Minors and other vendors) but that hiring certified teachers remains a challenge.
Board members also raised the district’s prior shortfall under the so‑called “60 percent” compliance measure (the required share of payroll spending on certificated staff and others who work directly with students). Staff said the district fell short by about $1.6 million in the prior year; roughly $800,000 of that gap reflected positions filled via contracted agencies rather than payroll, and the district obtained a county waiver after documenting active recruitment efforts.
On facilities and summer projects, trustees asked about classroom refreshes, carpeting and fencing. Facilities staff responded that many visible projects require requests for qualifications or proposals (RFQ/RFP) when they exceed threshold amounts, which lengthens timelines. The facilities director (Rudy) and staff planned a walkthrough with trustees to review summer work.
Next steps: adoption of the 2025–26 budget and the LCAP was scheduled for the June 17 board meeting; the state’s final budget is expected by June 30 and staff said they will revise the district budget if needed within state timelines.
Ending: trustees asked for a follow‑up that lays out summer facilities projects and a clearer plan for Prop 28 spending and site‑level hiring; staff said they will provide those details in upcoming board updates.
