Prior Lake-Savage leaders warn of looming shortfall; propose class-size increases, program cuts and pool closure

Prior Lake-Savage Area Schools leaders told residents at a budget town hall that the district faces a structural shortfall and proposed roughly $4 million in annual reductions for the 2025–26 budget year.

Tammy Frederickson, the district's executive director of business services, said the district’s revenue comes from three main sources — state aid (general fund formula and categorical aids), local taxes and federal dollars — and that “for next year, it’s set in statute. It will be $7,465 per pupil.” She said the district currently receives $7,281 per pupil and that if the formula had increased with past statutory changes the district would be receiving $8,645 per pupil, a gap of $1,364 per student that Frederickson estimated would amount to about $11,000,000 in foregone revenue.

Frederickson gave a 2025–26 revenue projection of about $120.4 million (state aid, the levy and other revenues) and said projected expenses are about $122.8 million, noting the district spends roughly $13,000 per pupil in general-fund expenses compared with a statewide average of $15,731. She warned the district’s referendum expires in 2027–28 and that the loss of that revenue could reduce property-tax receipts by about $6 million in later years.

To address an estimated $4 million shortfall beginning in 2025–26, staff proposed a package of reductions that Frederickson said the board has been reviewing. Major items listed included increasing elementary class-size targets, adjusting middle- and high-school class caps and elective offerings, proposed reductions to para-educator positions in special education, eliminating the district’s online program and the third-grade SAGE program, cutting some elementary iPad allocations and an EduCLIMBER contract, reducing two Q Comp peer coaches, eliminating fitness committee expenses, reducing three administrative assistant positions, and closing the Twin Oaks pool to save approximately $75,000. Frederickson also said the district plans to reassign MCAPS students locally after Farmington ended its partnership, which will reduce transportation costs but may result in one fewer assistant principal at the high school.

The presentation emphasized that many expenditures are fixed or contract-driven: about 83–85% of general-fund spending goes to staff salaries and benefits, and collective bargaining agreements already include salary steps the district must fund. Frederickson said the district’s fund-balance policy requires maintaining at least an 8% unassigned minimum and that, without changes, the five-year forecast shows continued pressure on that balance.

Superintendent (role stated as superintendent in the town hall) framed the shortfall in broader context, pointing to declining enrollment projections and demographic trends. The superintendent urged community advocacy at the state level to address the funding formula and said the district will bring a near-final preliminary budget to the school board in May and must adopt a final budget by June 30.

The presenters stressed these are proposals and forecasts, not final board actions. Frederickson said staff will continue to refine options and bring recommendations to the board; the town hall then opened for public questions.