Spokane Public Schools is dealing with plenty of variables as it attempts to write operating budgets for next year and beyond, with “some adjustments” anticipated as federal COVID-19 funds start to dry up.
During a special meeting Wednesday night, school board members got their first in-depth look at next year’s budget. That was complicated enough, owing to uncertain enrollment projections and the upcoming addition of two new middle schools. However, the budgeting process will become more difficult as federal COVID-19 funds – better known as Elementary and Secondary School Emergency Relief, or ESSER – run out.
“We do know that we are going to have to make some adjustments,” said Cindy Coleman, the district’s chief financial officer.
According to federal regulations, districts must spend those COVID funds by Sept. 30, 2024. Superintendent Adam Swinyard told board members of “national conversations” around extending that deadline , but for now the district must plan on the current deadline.
Out of an original ESSER award of $124.2 million, the district still has $77.4 million. Of that, it currently plans to spend $38.7 million next year, $31.5 million in 2023-24 and $7.1 million thereafter.
Partly for that reason, early projections call for growing budget deficits in upcoming years: $15.9 million in the 2023-24 fiscal year, $27.1 million a year later and $38 million in 2025-26.
Swinyard said he expects a savings through attrition, especially as higher-paid teachers and other employees retire, though other details of the budget reconciliation have yet to be nailed down.
As in most districts, SPS expends most of its revenue on personnel expenses – salaries, benefits and pensions.
The preliminary budget for next year calls for total revenue of $541.9 million. Of that, almost exactly half, or $270.2 million, is state funding based on enrollment.
Other revenue includes $93.4 million in state special-purpose funding, $78.8 million from the local levy and some state funds, $47.6 million from federal grants, and $38.8 million in COVID funds and $13.3 million from other sources.
Expenditures are estimated at $546.2 million, of which $34.4 million will come from ESSER funds. The leaves a shortfall of $5.2 million. The district expects to make up for the loss in the current year’s budget.
Last summer, expenses were expected to exceed revenue by $7.6 million; instead, the district now projects to underspend by about $800,000.
According to district documents, the budget will emphasize the following: basic needs for educating the whole child, equitable distribution of resources, closing the opportunity gap, and maintenance of essential support services.
“We are investing in the same concepts as we are this year,” Coleman said.
The budget for 2022-23 must be submitted to the state by late August. In the meantime, the district will hold a public open house or forum on June 8, followed by the compilation of a draft budget that will be available to the public on July 10.
The budget is expected receive final approval from the board of directors on Aug. 10 or Aug. 24.
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