Little Falls board approves revised FY2026 budget with modest surplus, backs staffing and capital needs

The Little Falls School District Board of Education approved a revised fiscal year 2026 budget on April 20, projecting about $35.6 million in revenue and $35.2 million in expenditures, leaving an approximate $430,000 surplus.

Heidi Hagen, the district business manager, told the board the revision reflects a decrease in enrollment of about 31 students — from an originally budgeted 2,200 to roughly 2,176 — which reduces general education per-pupil aid by about $245,000 but increases special education aid by about $200,000. Hagen said the revised budget also recognizes $150,000 in tax-increment financing revenue from the city that was not included in the original plan.

Hagen outlined significant line-item changes: a projected $470,000 decrease in salaries tied to settled contracts and anticipated at-will employee assumptions; benefits rising about $90,000 because of unemployment between terms and Minnesota paid family leave; supply reductions near $200,000; and a roughly $500,000 increase in capital spending for deferred maintenance and projects at Lindbergh and Lincoln (playground, flooring and ceiling updates). She said, “based on my review … we’re looking at just over 35.6 million in revenue and about 35.2 million in expense for revenues exceeding expense by about $430,000.”

Board members asked about specific items, including how paid family leave affects substitute staffing costs and contracts with Kelly Services for subs; Hagen said district practice is to monitor and report additional details to the board as negotiations and usage trends develop.

The board unanimously approved the revised budget by voice vote. Board chair called the motion, and Mark moved with Sharon seconding.

Implementation and linked staffing

Superintendent Johnson and Hagen confirmed that several staffing changes approved later in the meeting — including two secondary interventionist positions and a student support paraprofessional at Lindbergh Elementary — were budgeted into the revision. Hagen said she factored those positions into the revised figures and recommended maintaining an unassigned fund balance around the board policy target (10–12%), with a suggested assignment of roughly $400,000 for future one-time facilities, grounds, and technology needs.

What happens next

Hagen said the revised budget documents and detailed fund schedules are in the board packet and available for review. The district will continue to monitor food-service fund balances, which Hagen projected will end the year with a deficit near $300,000 driven in part by a high school kitchen update paid from that fund. She recommended ongoing review of federal and state reimbursement impacts for meal programs as legislative changes evolve.

The board did not amend the budget further at the meeting; next steps include continued financial monitoring and reporting to the board during the remainder of the fiscal year.