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Laurel School District CFO warns of potential $1 million shortfall; board urged to back referendum
Summary
The district’s CFO told the board that monthly payroll is about $540,000 and the current projected balance exceeds $4 million, but staff project a $875,000–$1,000,000 shortfall by June 30 unless steps are taken; administrators urged the community to support a referendum next year to avoid deep cuts.
Tanya Morphy, the Laurel School District chief financial officer, told the school board the district’s local payroll costs are about $540,000 a month and the district’s projected balance currently exceeds $4,000,000, but forecasts show a potential shortfall approaching $1,000,000 by June 30 if current trends continue.
"Laurel's local payroll costs right now are about $540,000 a month, and our projected balance right now exceeds 4,000,000," Morphy said during the financial-position presentation. She added that the district could face a deficit of roughly $875,000 — and possibly up to $1,000,000 — by the end of the fiscal year without adjustments.
The presentation, required by Delaware code, explained the financial position report’s role as a projection of revenues, expenditures and payroll that is submitted to the state Department of Education and, through it, to the Office of Management and Budget and the controller general’s office in Dover.
Board members and administrators discussed options to limit the gap. The district plans to rely partly on attrition (not filling some positions as employees retire or leave) and reassignments to remain within the number of staff units the district will earn. Morphy said several grant-funded positions are ending and must be absorbed into the unit count or funded locally.
Chair (speaker 1) noted the projected deficit to the board: "Now we're gonna be in a deficit of 875,000, almost 876,000…which we could be up to 1000000 or even more by June 30." The chair asked staff for recommendations on tightening funds.
Administrators urged early community engagement around a referendum. Dr. Blair Moore said the district needs a broad effort to persuade voters: "We need to spend '26, '27 going back out for referendum. It's gotta it's gotta happen…we've got two opportunities to pass one next year. We all need to get together."
The board voted to approve the May 1 financial position report as submitted. The approval was procedural — the vote records show the motion passed on roll call — but the presentation and discussion made clear a referendum will be necessary if the district is to avoid deeper cuts in 2027–28.
What happens next: staff will continue to refine revenue and expenditure projections, prioritize essential positions for retention, and prepare community outreach materials about the need for a referendum next year. The board recorded a formal approval of the financial position report before moving on to other agenda items.
