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School board adopts FY27 budget amid operating deficit and overall surplus
Summary
The Bird Island–Olivia–Lake Lillian school board approved the district's FY27 budget on June 22, 2026, while discussing an increased operating deficit and an overall surplus that partly relies on restricted funds and accounting changes. The board also approved insurance proposals and authorized activity-contract signings.
The Bird Island–Olivia–Lake Lillian Public School District board voted June 22 to adopt the fiscal year 2027 budgets after hearing a superintendent's presentation on the district's financial position.
Superintendent Tim told the board the district's operating deficit widened from $288,000 in FY26 to a projected $384,000 in FY27 but emphasized that the district's complete budget includes restricted funds and shows roughly a 7.4% overall surplus. He said the reduction in the operating deficit this year was largely driven by work from business manager Nicole White to reallocate funds where state rules permitted.
"One of the reasons we were able to bring our operating deficit down so much this year was because we have a business manager in Nicole White who was able to find ways to move a bunch of our restricted funds into our general fund and/or figured out ways to be able to use that money," Tim said.
Board members pressed for clarity about which restricted funds can legally be used in the general fund and were told some restrictions have loosened at the state education department level, allowing more flexibility in spending for operating needs. The board also cited state and federal cuts to special education and ongoing contract uncertainty as pressures that informed the FY27 proposal.
Following discussion, the board held a roll-call style vote with members present voting in favor; the motion to approve the FY27 budgets carried with one member absent.
In the same meeting, the board approved insurance proposals for 2026'27 from Northwest Partners, covering property and casualty through Liberty Insurance and workers compensation through Trust. The board noted the premium increase was modest (about $550) and that a change in the dental carrier—to MetLife—was required to comply with Minnesota paid-leave implementation choices.
The board also authorized the business manager and superintendent to sign activity-account contracts and approved a blanket coverage authorization for 2026'27. Members discussed student activity fees separately and approved the published schedule, noting a family maximum out-of-pocket cap of $400 for extracurricular activities.
The board said it will continue monitoring state-level funding developments, including pending policy and budget changes that could affect the district's operating picture.
The board adjourned at 8:41 p.m.
