Board releases Plante Moran review, adopts budget amendment and 2024–25 budget

The Ann Arbor Public Schools Board of Education voted on June 26 to release a third‑party review by Plante Moran and approved a set of budget changes to stabilize the district's fund balance.

Plante Moran's consultants told trustees the district's budgeting process is reasonable but that the principal drivers of the roughly $12 million shortfall were increases in payroll costs approved in March–April 2023, declining enrollment and higher operating costs. Michelle McHale of Plante Moran said, “It is not an accounting error, nor does it impact the fund balance at issue,” and added that the widely discussed $14 million MPSERS entry was not the cause of the current deficit.

Trustees debated how the original FY23–24 budget showed nearly flat expenditures despite negotiated wage increases that added roughly $12.3 million in recurring payroll costs. Jennifer Chambers, lead engagement partner from Plante Moran, told the board the audit work focused on process and reasonableness; she reiterated that earlier warning signs — including enrollment declines and rising costs — should have triggered earlier corrective action.

On motions from the dais, the board first approved a motion to present the Plante Moran report at the meeting and post it on the district website. The board then adopted a FY23–24 general fund budget amendment (vote: 5–2) intended to reconcile the district's year‑end position and reduce ongoing risk. Later the board voted to adopt the proposed 2024–25 general fund budget and tax rates (vote: 6–1). Trustees and staff noted the budget will likely be amended in November once state aid and enrollment data are finalized.

Several trustees said the Plante Moran findings illustrate the need for clearer reporting and stronger trustee training in financial oversight. Trustee Gainer urged better access to line‑level data when budgets are presented and called for revised reporting to make key drivers obvious.

The board did not finalize the recently negotiated superintendent contract at this meeting. Trustees who wanted more time to review the finalized contract asked for a follow‑up closed session; the board scheduled a special meeting with a closed session for Friday to continue negotiations and consider approval.

Plante Moran said it will send the full report to the district for posting the next day; trustees and members of the public called for publication with minimal redactions so the community can see the supporting schedules and the firm's recommendations.