Ann Arbor Public schools must cut $25M from 2024-25 budget



(The Center Square) – Ann Arbor Public Schools Interim Superintendent Jazz Parks says the district must cut $25 million in the 2024-2025 budget because of increasing costs and fewer students.

Parks said the “multi-year” budget challenges are “significant” and require immediate action for the district serving about 17,000 students.

During the last 10 years, the student foundation allowance increased by $1,509 per student but the district’s fund balance decreased by $10.5 million.

Marios Demetriou, assistant superintendent for finance and operations, said over the last 10 years, revenues increased by $105 million but expenditures increased by $119 million – leaving a $14.5 million deficit.

“There’s some big variances and I know some money came in from the federal government for COVID and so forth,” Demetriou said. “But also, our expenditures actually increased much more than the money that was coming in.”

The school added 4.44 students and 480 employees during the last 10 years. In the prior five years, the district added 52 employees and lost 1,100 students.

The school’s new projected ending fund balance is projected to be 2% of revenues or 1.96% of expenditures, which would trigger state programs that require a fund balance of 5% of revenue – or $15.7 million.

Also, the BOE policy requires 6% to 15% of expenditures fund balance which is between $19.3 million and $48.2 million.

Staffing additions, increased staffing costs, recent pay increases for employees, and enrollment loss have caused significant financial challenges for the district.

The school will review staffing, which comprises 80% of recurring operating costs.

If the district cuts recurring operating costs, it should be able to increase its fund balance to 6% or 7% – in compliance with state law and board of education policy.

The district continues to spend more than it reaps in revenue. Those expenses include adjusted salary and benefits in collective bargaining agreements ($3.7 million), maintenance and operations ($2.8 million).

Read the Black Chronicle Black History Edition for Free! Click Below

Read the Black Chronicle Black History Edition for Free! Click Below



Share post:


More like this

Lawsuit Alleges Racial Discrimination by American Airlines After Black Passengers Removed from Flight

According to CNN, a lawsuit filed Wednesday on behalf...

Spokane approves raises for elected officials despite potential reductions

(The Center Square) – Despite a request to prepare...

Report: 1 in 6 Texans live or work in known flood hazard areas

(The Center Square) – Roughly one in six Texans,...

Tennessee severe risk domestic violence GPS tracking law starts July 1

(The Center Square) – A new Tennessee law will...