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District projects continued enrollment decline and a multi‑million‑dollar fund‑balance gap
Summary
Finance staff updated the board on enrollment and budget pressures: a $6.2M fund‑balance decline in 2024–25, an estimated $8.9M decline for 2025–26, and projected enrollment declines (559 students year‑over‑year; roughly 515 projected for 2026–27). Staff outlined multiyear planning and cost‑containment steps.
Issaquah School District finance leaders told the board March 11 the district faces ongoing fiscal pressure driven primarily by declining enrollment and rising costs.
Mariah Banasic, sector director of finance, said the district recorded a $6.2 million decline in fund balance for 2024–25 and currently estimates a roughly $8.9 million decline for 2025–26. She said enrollment has fallen by 559 students between 2024–25 and the current school year and that the demographer projects a decline of about 515 students (roughly 3% of enrollment) for 2026–27 under current assumptions.
Banasic and Chief of Finance Operations Martin explained the drivers: a statewide and local birth‑rate decline, migration patterns, and the fact that staffing and related operating costs represent roughly 83–84% of district expenditures. They warned that cost per pupil rises as enrollment falls and noted the district is developing multiyear forecasts, contingency plans, and cost‑containment measures including attrition‑based staffing adjustments.
Board members asked about nonresident enrollment (staff and nonresident students) and whether that program could mitigate declines; finance staff said about 90 current nonresident students were enrolled in addition to roughly 220 staff‑related enrollments, and that interest may grow as public awareness increases. Staff also noted the district is under state audit that is increasingly focused on financial condition and monitoring reports.
The presentation framed next steps: continued scenario work pending legislative outcomes, labor conversations, and regular updates to the board as projections and the state budget evolve.
