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Board warned of structural imbalance; district projects just over $8 million deficit for 2026–27
Summary
Director Chris Blackburn told the board the revised 2025–26 budget closed with a roughly $1.5 million deficit and staff currently project a just‑over $8 million shortfall for 2026–27, prompting the start of a budget adjustment process and review of fund‑balance policy.
Chris Blackburn presented the district’s recent budget picture and highlighted a structural imbalance driven by enrollment declines and rising personnel costs. He said the revised 2025–26 budget closed with a board‑approved deficit "just shy of $1,500,000" and that staff are now projecting "just over $8,000,000" in deficit for 2026–27.
Blackburn explained that personnel costs make up roughly 78% of expenditures and that the basic state formula—which increased about 2.69% this year—applies only to the portion of revenue represented by the basic formula (about 43% of general fund revenue). He warned that modest formula increases do not fully offset compensation pressures.
On reserve policy, Blackburn said the district’s unassigned fund balance policy target is 16.6% and current projections indicate the district may drop below that threshold in 2026–27; the policy prescribes actions when projected fund balance falls below the target, and the board will consider budget adjustment proposals in November. He also reviewed the audit and levy timeline: auditors will be on site in late October/early November, levy work begins in September and the board will approve levies in December.
