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Understanding Lake Stevens School District’s anticipated 2023-24 budget

Loss of ESSER funding and rising costs equal budgeting challenges

Lake Stevens School District (LSSD) is carefully reviewing its budget projections for the 2023-24 school year, and making necessary adjustments based on federal funding reductions, and the anticipated state budget. However, because of our proactive and conservative budgeting process, and strong community support for passing school levies, the district will not need major budgetary adjustments. 

Overall, the district projects approximately $3.5 million in budget reductions for the coming school year. Some of these reductions will happen through attrition when staff resign or retire, and their positions are not replaced. Others will happen with strategic cuts and other planned cost saving measures. We are committed to working together to ensure we remain fiscally responsible, keeping our primary focus on student learning.

A myriad of factors led to these budget reductions, including: depleted federal aid; inadequate state funding; and rising costs of goods and services.

Understanding enrollment
Student enrollment is one of the key factors in school district budgeting because schools in Washington receive funding based on the number of students.

In Snohomish County, enrollment is down approximately 3,500 students from 2019-2020 and 2021-22, according to state data.

However, in LSSD, enrollment continues to hold steady, and is back to pre-pandemic levels. Enrollment is even projected to slightly increase in coming school years. While this is good news for our budget, it also affects other areas such as potential class size increases and school overcrowding. Solutions to these challenges are being considered in the district’s long-range budget and facilities planning, and will likely be addressed in the next school construction bond.

Federal aid during the COVID-19 pandemic
In response to the COVID-19 pandemic, LSSD received approximately $8.4 million in federal Elementary and Secondary School Emergency Relief (ESSER) funding. This equated to 4.8 percent of the district’s annual budget.

The funds were received in four installments (see chart below). Funds must be spent by September 2024, and then ESSER funding ends. Any staffing, programs, services or activities that were funded with ESSER dollars will also end unless other funding sources are identified. We are in the process of determining other potential funding sources.

Elementary and Secondary School Emergency Relief funding

  • Staff unemployment costs
  • Student resources
    • Lap desks
    • Wifi hot spots
    • Student learning kits
  • Health and safety materials
    • Temperature scanners
    • Thermometers
    • Personal protective equipment
    • Hand sanitizer
    • Signage and other supplies
  • Chromebook deployment
  • Additional hiring of certificated elementary employees for continuity of services for students
  • Certificated substitute teachers for elementary schools
  • Health and safety supplies to protect staff and students
  • Curriculum
  • Elementary Deans of Students for student support
  • Additional counselors for student support
  • Additional hiring of certificated secondary employees for continuity of services for students
  • Distance Learning Academy staffing for Elementary
  • Secondary Alternative Learning staffing
  • Supervision staff for late buses while we had labor shortages
  • Health and safety supplies to protect staff and students
  • Summer enrichment programs for student achievement
  • Extended day academic interventions for students
  • Special Education recovery services to proactively address the lack of appropriate progress on IEP goals
  • Professional learning and instructional supports for our staff
  • English language arts and math curriculum
  • Strengthening school day interventions to support students

Inadequate State Funding and Rising Costs
In 2018, in response to the McCleary ruling to “fully fund” public education, the state changed its funding formula to rely more on state funding and less on local funding. That means that the state only funds basic education, programs and salaries.

The state limited how much districts could collect locally—through levies that are voted on by taxpayers—and has slowly reduced the state regionalization funding received to help offset the higher cost of living in our area. LSSD’s regionalization funding has decreased two percent each year since 19/20, starting at 24 percent above the base allocation for salaries, and decreasing to the current 18 percent. However, the cost of living has not decreased. Inflation has significantly increased living costs, and the costs of goods and services.

The district also covers the gap in what the state funds for Special Education versus the actual costs. The district typically pays about $1.5 million above what the state funds in a school year. These services are legally required, but not fully funded by the state.

2022 Levy Renewal
In 2022, Lake Stevens voters renewed the district’s Educational Programs and Technology Levies. That money replaces funding that expired in December 2022. While local levy funds make up about 12% of the district’s budget, they do not consider the inflation on goods and services and cost of living variables.

Employee Salaries
Over the past several years, increases in employee pay have not been covered by the state. The state funds education based on a "Prototypical School Funding Model," which means the state only funds certain positions and at a basic pay rate. Every group of employees has a different rate of underfunding or non-state funded positions. The district pays 100 percent of the salary for any employee who falls outside of this model. In order to maintain the robust educational services that our community deserves and has come to expect, the district fills the gap between what the state provides and our expenses with local and other federal funds.

Next Steps
Districts won’t know the exact dollar amount to expect in state funding until lawmakers approve a budget. That’s expected to happen in April. In the meantime, district administrators and the Board of Directors are proactively reviewing the budget, identifying our priorities and determining where cost savings can be made.

Budgeting decisions are presented to the Board of Directors during open public meetings. The board welcomes and encourages community involvement in all matters regarding our schools and district. You can attend these meetings in person, or listen in via Zoom.

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