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District projects FY27 shortfall; special education, insurance and fuel drive risk
Summary
Executive Director Zunich told the board the district faces multi‑year budget pressure: FY25 overspent by roughly $7M, FY26 projects a minimum $4.2M overspend, and FY27 reductions of about $4M are planned; special education cost volatility, rising insurance and fuel, and summer unemployment reimbursements create fiscal risk.
Executive Director Zunich presented the preliminary FY27 budget outlook and a financial-risk assessment to the Committee of the Whole.
Zunich said the district built the FY27 scenario using an average daily membership (ADM) baseline of roughly 8,125–8,175 pupils and a 2.69% basic formula increase. Key assumptions include a 2.5% personnel roll but significantly increased lane‑change and Read Act allocations (READ Act: $650,000 for FY26; proposed $1.2 million for FY27). Health insurance costs were modeled at 15% and an $85,000 upward adjustment to fuel costs was noted.
Zunich reported recent history of overspending: an approximate $7 million general‑fund overspend in FY25 and a current FY26 projection of at least $4.2 million in over‑expenditure, with FY27 reductions planned at roughly $4 million. Special education costs drive volatility: staff anticipate the state’s cross‑subsidy adjustments may raise reimbursed special‑education revenue from a current baseline figure (reported to the board as approximately $27.5 million in early projections) to nearer $31–32 million after state adjustments, but district expenditures may reach $36 million, leaving a gap during timing mismatches.
Other budget levers and efficiency notes included use of Kelly Education for substitute placement (district analysis shows in‑house substitute handling would be about 33% more expensive), site staffing for the new First Street facility (about six FTEs proposed for custodial and clerical coverage), and a projected liability and health insurance premium increase.
Board discussion emphasized advocacy with the state for steady special education funding and the operational consequences of multi‑year reductions. No final fiscal decisions were made; Zunich said the district will return with updated revenue calculators and revised figures after the close of the legislative session.
