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Board adopts preliminary budget showing deficits and possible SOD risk; community-ed and preschool shortfalls highlighted
Summary
Lake Park Audubon approved a preliminary 2026–27 budget that projects a general-fund deficit and a community-education shortfall; the business manager warned the district could fall into statutory operating debt without further cost controls or revenue increases.
The Lake Park Audubon School Board on June 30 approved a preliminary budget for fiscal 2027 that projects a significant general-fund shortfall and a community-education deficit, prompting discussion about potential cuts, transfers and the possibility of a future referendum.
Janetta, the district business manager, told the board the unassigned general-fund balance is projected at a deficit of about $463,015 for next year and the community-education fund shows a projected deficit of $343,647. She said past transfers from the general fund were missed in multiple years, which enlarged current shortfalls. "There are three years where transfers were not done," she said, noting one prior year transfer was only $35,000 and another year none was made.
Janetta also identified a school-readiness program shortfall of roughly $144,418; she said combining that line with regular community education results in a net position that required transferring $153,001.69 from the general fund to balance community ed in the current projection.
When asked whether the district faces statutory operating-debt (SOD) status, Janetta gave a rough projection that the district could land near a negative 3.45 percent on the SOD metric under current assumptions, which would put the district at risk of SOD next year if cuts or revenue changes are not made. "I'm projecting at the end of '27 we'll be at a negative 3.45 with these numbers, which means, yes, you would fall into SOD next year," she said, adding the figure is a rough estimate.
Board members pressed for action and options. One member said controlling personnel costs is the primary lever and recommended exploring increased revenues. Another urged outreach and supports for families with outstanding preschool bills; Janetta confirmed the district cannot bar preschool students if bills are outstanding because of program rules.
Superintendent Dr. Bergquist told the board he will work with Ehlers (a municipal-finance advisor) to model referendum options and said the board must decide in July if it wants to pursue an operating referendum on the November ballot. He cautioned that even with a successful referendum any new revenue would not affect the immediately approaching fiscal year-end.
After Q&A and discussion about enrollment assumptions and possible transfers, the board approved the preliminary budget by roll-call vote. Members stressed that the approved budget can be amended later and emphasized the need to control personnel costs and pursue additional revenue sources to avoid SOD.
What’s next: The superintendent will meet with Ehlers and return with referendum options and more detailed cost-control proposals; business staff will dig into enrollment, preschool billing and historical transfers to refine projections.
