Niagara Falls schools project $7.6M budget shortfall; leaders plan cuts and limited reserve use
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Summary
District leaders presented budget projections showing expenses outpacing revenues, a projected $7.6 million gap, plans to use about $3.8 million of prior reserves, and possible cash‑flow measures such as a revenue anticipation note while staff pursues expense reductions.
The Niagara Falls City School District presented a detailed budget work session that showed projected expenses rising faster than revenues and a working gap of about $7.6 million for the coming year.
Board President Mark Laurrie told the board the district expects to use roughly $3.8 million of a previously allocated $4.83 million reserve this year and listed outside pressures driving the decision, including charter-school tuition increases and settlement costs. "This year, for the first time, we're going to use approximately 3.8 of the of the 4.83," he said.
Julie, a district finance staff member who presented revenue-and-expense trends, said expenses are beginning to accelerate at a faster rate than revenues. The chart staff showed projects next-year expenditures growing near 4.95% while anticipated revenue growth was nearer to 2.26%, widening the gap. Julie also reported larger-than-expected increases in charter and special-education tuition costs: an actual rise of 9% compared with earlier estimates of 3–4%.
The board discussed several drivers of the gap: the regional cost index in the state foundation aid formula (last updated in 2007), questions about the CPI input used in state aid calculations, high out-of-district special-education tuition (the presentation cited an example of $52,000 per student for some BOCES placements) and lagging federal and state reimbursements that raise potential cash‑flow concerns.
Finance staff said the governor’s executive budget includes proposals affecting extended summer school (ESY) funding, and the district identified possible one-time savings associated with the governor’s initiative. They also flagged cash‑flow exposure in September when state aid timing may require short-term borrowing; staff said adding a revenue anticipation note (RAN) to the budget was a contingency option.
Laurrie said he does not favor immediately maximizing the tax levy to close the gap and urged staff to prioritize reductions before additional levy increases or major reserve draws. "We need to now work that down," he said, asking staff to return with tightened numbers and cost-reduction proposals at the board’s Feb. 26 meeting.
The finance presentation also highlighted that the district’s graduation rate has risen (Laurrie cited an 86% rate for Niagara Falls High School), while attendance and outcomes for homeless students remain significant challenges. The meeting included announcements of several grants and an ongoing push to grow an endowment to support partial tuition scholarships if fundraising targets are met.
The board did not vote on the budget during the work session; staff and board members will continue analysis and return with updated projections and proposed reductions.