How does our district establish a budget?

Districts establish their budgets by estimating revenue and expenses based on projected student enrollment, state funding, which is determined through the legislative session, federal funding, and local taxes. Unfortunately, revenue increases have not kept up with inflationary increases or service costs. This imbalance of funding determines whether a school district needs to reduce expenditures to balance the budget.

 

Like most districts across the state, our enrollment has seen a steady trend of declining enrollment. While we typically see more students open-enrolling into the district, fewer students enter kindergarten compared to the number of students graduating. Over the past five years, our enrollment has decreased by about one hundred students. Budget-wise, that is a yearly decrease of about $80,000 from state funds.

 

Our district is fortunate to have the lowest school tax base in the area. Property taxes per $100,000 home value for residents in the NRHEG School District are $269. The average property tax for the same $100,000 home value in our region is $497, the state average is $472. Roughly 75% of school districts in the state of Minnesota have a voter-approved operating levy collecting funds on top of the property taxes being collected. NRHEG is one of the few districts in the state that does not receive funds through a local operating levy.

 

The budget process usually starts months in advance and involves gathering input from school administrators, teachers, and school board members to prioritize needs. Districts then review expenses like staffing, curriculum, technology, transportation, and facilities to align spending with goals. As the final step, the school board approves the budget, ensuring that resources are allocated to best support student learning and district priorities.