Newburgh board details budget shortfall, says $16M in settlements funded from reserves; no tax cap override planned

Budget presenters told the Newburgh City School District board on Feb. 25 that a structural shortfall and the end of pandemic relief left the district facing a budget gap for 2024–25 while also covering large legal settlements.

"The board approved a forensic audit at its meeting on March 5 that cost taxpayers almost a $180,000," budget presenter Miss Roaring said as she explained recent audit work. She said the state comptroller’s audit (OSC) covered July 2019 through June 2024 and that current leadership managed district finances for the 2023–24 year.

Roaring said surplus funds at the end of the 2022–24 period were used "to largely offset legal liability settlements totaling more than $16,000,000" previously approved by the board and to fund the capital reserve; she added reserve levels were never exceeded.

Officials told the board the 2024–25 budget faces a structural gap of just over $1,000,000, driven largely by staffing costs and the expiration of federal COVID relief that previously supported instruction and operations. Roaring emphasized that surplus balances resulted mainly from unfilled, budgeted positions and higher‑than‑expected state aid receipts.

On the tax levy, the presenter walked the board through the tax‑cap calculation and exclusions. The current levy is $113,600,000; after calculating eligible exclusions and the capital‑levy allowance, the district expects to maintain the levy flat next year rather than override the cap.

Board members asked whether the district planned to override the tax cap; Miss Roaring answered no and said the district would complete a staffing analysis before projecting the total year‑over‑year budget change. The board scheduled a March 10 update focused on staffing and needs related to the new CTE center.

Next steps: staff will finish the staffing analysis and return with further detail at the board’s March budget update.