Mill Creek CFO warns of rising mandates, low state aid and local tax gaps in 2026 budget presentation
Get AI-powered insights, summaries, and transcripts
Subscribe
Summary
CFO Aaron O'Toole told the board Feb. 10 that Mill Creek ranks low in state and federal revenue per student, relies heavily on local revenue (63.8% in 24/25), and faces growing special-education and health-care costs; he estimated $8.3 million in foregone revenue if the district had raised taxes to the Act 1 index since 2019.
Chief Financial Officer Aaron O'Toole presented the district’s fiscal picture during the Feb. 10 meeting, saying Mill Creek’s revenue and expense pressures reflect statewide trends but leave the district short of funding needed to meet mandates.
O'Toole highlighted that the district’s special education enrollment has grown to about 20.8% of total enrollment and that English-language learners are about 5.4%, driving a need for space and specialized staffing. He said that Mill Creek is more reliant on local revenue than most peers — 63.8% of total revenue in 2024–25 came from local sources — and ranks near the bottom for state revenue per student (418 of 500 districts). "We're not getting enough state revenue per student," O'Toole said during his presentation.
The presentation cited several quantitative pressure points: an autistic classroom can add roughly $210,000 in annual cost; the Basic Education Funding Commission report identified a local/state funding gap and suggested Mill Creek could be short by about $13.8 million before local effort adjustments; and, O'Toole told the board that if the district had increased millage to match the Act 1 index every year since 2019 it would have generated an estimated $8.3 million more annually.
O'Toole framed the situation as a balance between local choices and state formulas. He said many costs are mandated but not fully funded—for example, charter reimbursements and pension obligations—and that growing special education ratios and health insurance increases are recurring budget pressures. "We continue to cut staff and programs including the regular maintenance of our facilities in effort to balance budget," he said, summarizing the difficult choices districts face.
Board members asked for more detail on timelines and whether a draft budget would be published. O'Toole said a draft would be presented in March, with a proposed final due in April and a final approval in May. He also said administration will present more granular comparisons with peer districts and recommended consistent treatment of related budgets.
What comes next: Administration will circulate the budget presentation slides to the board and bring a draft budget in March; the board will consider options to close gaps, including use of fund balance, potential tax increases and grant-seeking strategies.