Rochester, MN (KROC-AM News) - Despite the $20 million per year operating levy that was approved by Rochester School District voters in November, a new financial projection prepared for the Rochester School Board predicts significant budget shortfalls in coming years.

The School Board meets Tuesday in a study session to review the updated projections.

Fun 104 logo
Get our free mobile app

The report shows a modest budget surplus of around $137,000 is predicted for the next school year, but that is followed by a nearly $8.7 million deficit the following year. The projection forecasts the deficit will grow to $15.5 million in fiscal year 2028, about $21.4 million in fiscal year 2029, and to more than $27.6 million in fiscal year 2030.

The same analysis shows the school district's unassigned general fund balance, or reserve, is predicted to be large enough to cover the budget shortfalls for at least several years before running dry. Without any adjustments, it projects a reserve fund of 17.4% for the current budget, which would shrink to 15.3% next year, 14.2% the following year, and down to around 11% in fiscal year 2027.

Rochester School District
Rochester School District
loading...

That fund balance is then projected to shrink to only 5.5% in fiscal year 2028 before going negative in 2029.

Rochester School District (YouTube)
Rochester School District (YouTube)
loading...

The report states that "this projected decline highlights potential financial challenges that the District may face in the future." Superintendent Kent Pekel is recommending the School Board include development of a long-term strategy to address the projected deficits in future years as it begins working on the framework for the school district's budget for the next school year.

More Minnesota News:

Highest-paying jobs in Minnesota that don't require a college degree

Stacker ranked the 50 highest-paying jobs in Minnesota that don't require a college degree, using annual compensation data from the Bureau of Labor Statistics.

Gallery Credit: Stacker