Laurel School District board approves FY2026 budget amid failed referendum; officials warn of rising costs

The Laurel School District Board of Education on Tuesday approved the FY 2026 final budget after acknowledging a Feb. 9 current-expense referendum did not pass.

Dr. Leroy, the superintendent, told the board the district accepts the referendum result and thanked staff and community members who participated. “Respectful dialogue still matters,” he said, adding that the district would continue to “lead responsibly, listen carefully, and move forward together.”

Laura Horsing, the district’s chief financial officer, presented the financial highlights that accompanied the budget. Horsing said the mid‑year unit count showed 2,497 students, a net loss of two, and that the proposed FY26 budget carries a projected deficit of $875,000. “I have a projected deficit of $875,000,” she said, attributing the shortfall to having fewer vacancies than in prior years and to higher tuition costs for students placed in special schools.

Horsing described tuition for outplacement placements as substantial: certain placements are billed at about $25,000 per student per year, while others can be roughly $50,000. She told board members the district had not yet received final bills for all placements but flagged those per‑student costs as a driver of the deficit.

Horsing also reviewed proposed state budget changes officials said could shift costs to local districts if enacted: the governor’s draft would raise the state teacher base salary (the public education compensation committee’s recommendation would set the base to $39,370); it would modestly change OEC rates to 33.72% and eliminate several appropriations the district has received in recent years, including an athletic‑trainer block grant and a substitute‑reimbursement fund used when teachers take paid parental leave. “It looks like that will be going away,” she said of the block grant, warning the district might need to find local funding alternatives.

Board members asked for additional detail on reserves and payroll requirements; Horsing said the district must maintain the equivalent of the first three months of payroll locally and at least one month of local salary availability at all times because county revenue timing fluctuates. She referred trustees to the detailed final budget packet for line‑by‑line amounts.

The board also noted the auditor’s report for FY2023 had no findings and Horsing said she received the draft FY2024 report the same week, which likewise showed no findings. The board approved the budget on a roll‑call vote and will convene next on March 18, 2026.

What to watch next: with the referendum defeated, the board signaled it will continue outreach and follow up on resident questions about reserve balances and specific spending lines in the final budget packet.