ROARING SPRING — The Spring Cove School District is facing a deficit of nearly $2.4 million based on the proposed preliminary 2025-26 budget presented during its annual finance and legal committee meeting Wednesday evening.

Business manager Steven Foor told board members “the one word that definitely describes this budget is uncertainty.”

“It particularly pertains to state and federal funding,” Foor said. “Everybody reads the news … this is my 18th budget. I’ve never seen anything like this.”

The district’s Act 1 index, which is used to determine the maximum tax increases for each tax the school district levies, is 5.4% for the 2025-26 school year, down from a high of 7.2% for the 2024-25 school year. Local taxes will account for 45%, or about $13,652,094, of the district’s total revenue, while state and federal funding will account for 53%, or $16,006,915, and 2%, or $572,950, respectively, for total projected revenues of about $30,321,959. This is an overall increase of 3.2% over last year’s total revenues.

The district’s projected expenditures total about $35,321,541, including the already-approved $2.7 million for a new roof at the Central High School. That is an overall increase of about 2.98% over last year’s total expenditures.

Not including the cost of the new roof, the district will face a deficit of about $2,366,594. By adding about $600,000 from its budgetary reserve, the deficit will be brought down to about $1,766,594.

Foor said the deficit will come from the district’s fund balance, which has about $2.4 million in unassigned funds.

Foor did not make a tax increase recommendation during the presentation, as there are too many unknowns in regards to potential state and federal funding.

“We have to keep our options open on this one,” Foor said, adding that a recommendation will likely come in May.

The main challenges facing the district in relation to the budget include health care, retirement, transportation and cyber charter school costs, limits of the Act 1 index and shifting of state taxes, Foor said.

In regards to cyber charter tuition, Foor said there were about 54 students enrolled in outside schools, costing the district about $999,769 during the 2024-25 school year. According to his presentation, cyber charter costs have increased about 143% over the last five years. This has made it the fifth costliest line item in the budget, accounting for about 3.10% in expenditures.

“Our reimbursement for cyber charter school this year was $78,000,” Foor said. “It’s down to zero (for next year).”

Board president and committee member Troy Wright said “it’s absolutely ridiculous” that the district’s taxpayers “get to pay for a student to go to whatever school they choose.”

“Go to (Bishop Guilfoyle) and you can pay your tuition,” Wright said. “But if you go into a cyber school, then that’s on the taxpayers. Personally, I think our state reps really need to help us.”

Another issue is the district’s technology costs, as it rotates out old technology on a five-year basis. Foor said he can’t get quotes for new technology to add to the budget until the federal government’s proposed tariffs are put in place.

“We have no idea,” Foor said about the potential costs. “I’m trying to put this together as far as cost, and we really can’t nail down the cost from anybody else. So, we did our best with estimates.”

The biggest “cost drivers” for the district are wages and benefits for the staff, making up about 36.1% and 26% of the budget’s expenditures, respectively.

Foor said health care costs are projected to increase about 12% to $3,182,225 and that rates will be determined on April 15. The budget’s retirement line item is about $3,886,000.

“We budget as tight as we can,” Foor said. “Obviously, we cannot overspend our budget.”

Superintendent Betsy Baker echoed this, saying cuts have already been made to get the budget “to this point,” including $450,000 in curriculum cuts.

“If everybody got everything they asked for, it would not be affordable,” Baker said. “To get it to a place where it’s even possible to move forward, there’s been a lot of ‘nos’ to people.”

The budget will be presented again during the board’s May 12 meeting. The board will vote on adopting the proposed final budget during its May 19 meeting, which is the required 30 days before the board votes on final budget adoption on June 23. The deadline for public notice of intent to adopt the 2025-26 final budget is June 13, the required 10 days prior to the June 23 final adoption vote.