Sun Prairie projects balanced budgets next three years while budgeting for falling enrollment

Matt Clark, director of business and finance for the Sun Prairie Area School District, told the school board the district’s five-year forecast shows a balanced budget for the next three years and incorporates referendum expenses, conservative enrollment estimates and cautious state-aid assumptions.

"We have a balanced budget for the next three years," Clark said, attributing the near-term stability to last year’s operating referendum and the forecast assumptions baked into the model.

The forecast uses the district’s BARED model and incorporates Applied Population Lab (APL) enrollment projections, state revenue estimates and current staffing assumptions. Clark said APL projects a decline of 235 students over the next five years and a decline of 45 students for fiscal year 2627, but the district is budgeting a larger decrease of 75 students for 2627 to be conservative after last year’s actual losses exceeded APL projections. "We are budgeting a decrease of 75 students opposed to 45," Clark said.

Clark cautioned that long-range projections are inherently uncertain, noting the forecast spans two different binding state budgets and may change with future state decisions. He emphasized the connection between enrollment and state aid: as districts lose students, state aid typically follows, and that effect is incorporated into the revenue projections.

Key revenue and cost assumptions in the model include a $325 per-pupil revenue limit increase next year (from the state budget), a conservative special-education reimbursement assumption of 39% going forward (below recent signals of 42–45%), a 3.13% salary increase budgeted for next year and a 10% health-insurance increase in the coming year with 6–8% in subsequent years. Clark said the district is projecting modest equalized property value growth at 4% in the forecast period.

Referendum-related expenses are built into the plan through 2829. Clark estimated about $200,000 in 2627 for dual-credit/double-enrollment with Madison College STEM Academy and later-year staff compensation costs on the order of $1,000,000 tied to hourly and administrative wage-study adjustments.

The five-year spreadsheet presented to the board shows historical, current and projected years and indicates the district can remain balanced in the near term while maintaining current class-size and staffing assumptions. Clark noted the projected mill rate in the current projection should remain under $11.30, as communicated to the community in the referendum materials: "our mill rate is going to be able to in this current projection remain under the $11.30."

Clark also described a planned two-year strategic transfer from the general fund (Fund 10) to a long-term capital maintenance fund (Fund 46) to build reserves for maintenance needs. He said staff will continue to update the board monthly as assumptions change so the forecast can be adjusted.

Clark closed by inviting board members and community members to contact him with questions and said district staff will keep the board and public informed as new information becomes available.