Taos schools finance director flags $1.1M operational shortfall; board schedules budget workshop

Taos Municipal Schools’ finance director, Dr. Reineer Martins, told the board on March 4 that the district’s January financial report shows operational expenses plus encumbrances exceeding the district’s expected State Equalization Guarantee (SEG) funding by roughly $1.1 million.

Martins said the gap is driven by several factors, including historical enrollment declines (the district lost approximately 70 students year‑over‑year in his estimate) while staffing levels remained. He also warned of an unfunded legislative change that requires districts to pay 80 percent of employee health‑insurance premiums — a change he projected could raise district costs by an additional $600,000 to $800,000 per year.

"If you run payroll and there's no dollar in the bank, then the payroll is running but nothing is flowing," Dr. Martins said, urging the board to identify options to reduce recurring expenditures and align staffing with enrollment and revenues.

Board members expressed support for a rapid, transparent budget review. Superintendent Leighton and the finance director recommended a site‑level analysis that maps each school’s revenue (SEG generation) against its staffing and spending. The board agreed to a full finance and budget workshop on Saturday, March 28 (start 9:00 a.m.), to review site‑level budgets, identify possible reductions or reallocation, and examine options to shore up reserves.

Martins said he has already taken steps in his department (hiring freezes and attrition) and that some one‑time capital funds cannot be used for recurring payroll. Board members asked staff to prepare clear breakdowns of where the over‑expenditures occurred and to present options that prioritize classroom staffing and student supports.

The board voted to accept the January 2026 financial reports as presented and directed staff to prepare detailed materials for the March budget workshop.