by Dr. Rick Timbs, Executive Director of SSFC
This has been (the 2025-26 school year) one of the most fiscally stressful years in the recent line of fiscally stressful years. Let me
tell you why I have come to that conclusion. To me, based on my multitude of financial workshops this year and work with my
contracted business clients I have come to categorize school districts into three general categories within the Statewide School
Finance Consortium community.
Category 1: School districts concerned for the future
These are school districts are beginning to realize they are not as financially secure looking into the future as
they had hoped they would be.
These school districts are recognizing the slippery slope of their maintaining current and predictable future
financial practices related to items such as:
•“rightsizing the budget”
•Long-range budget analysis
•Resetting program expectations based on enrollment declines
•Resetting attempts at increased efficiencies to thwart escalating costs
•The planned and careful use of reserves
•The true meaning of an appropriated fund balance
•The management of Real Property Tax Law §1318
•Management of public perceptions particularly related to the tax cap
•Knowing how the tax cap actually works and its implications
•The importance of cash flow
•Succession planning for critical positions
•Ongoing training of board of educations about the nuances of educational finance
•The process of making difficult decisions that includes research, and evaluation related to
goals and expectations, a realistic appraisal of current and future conditions and the need for
“selective abandonment” of practices or programs that are ineffective, inefficient or no longer
practical or affordable
Category 2: School districts that know they are in financial trouble
These school districts have done research, and it clearly indicates that their financial future puts
them in jeopardy through a diminishment of educational resources and the inability of their
finances to support their mission.
These school districts requested support as they further examine ways to increase their
educational and financial survivability over the next few years. The have identified the sacrifices
that will need to be made, the outreach that will be required to their communities, and an
examination of other options including internal and regional approaches and even perhaps usually
as a last effort, mergers to secure the futures of the children under their charge.
Category 3: School districts that have not figured out how much financial trouble they’re in
as the future quickly approaches.
These school districts have not had the time, resources or inclination to examine their long-term
condition in the light of their mission, community expectations, and their relationship to the
financial underpinnings of the district.
These school districts tend to be very vulnerable to the vacillations of taxpayer support, state aid,
and the opposing influence of rapidly escalating costs that include but are not limited to:
•Collective bargaining agreement financial obligations
•Pension costs growth
•Medical insurance escalations
•The rising population of students with special needs and the increased cost associated with
these important services.
•Staffing patterns compared to enrollment changes
•Community expectations for educational and ancillary programs
My suggestions
Once the books are closed at the end of the 2025-26 fiscal year:
•Look at fund balances from the most recent budget and compare them to previous years.
•Analyze and identify portions of the expense side of the budget that are escalating faster than
revenues.
•Analyze and identify portions of the revenue side of the budget and the realistic potential for
increased revenue.
•Determine whether fund balances have been used to balance this recent budget
•Analyze and identify the reserves held by the district.
•Determine if reserves held by the District are proper reserves for the future
•Determine if any or all the reserves will be used in future budgets to balance the budget or for
their designated purpose.
•Make sure you have a five-year plan for technology, equipment, vehicle, and bus replacement
as well as capital projects.
•All projections for escalating expenses should contain something related to the realistic cost of
the items and/or inflation.
•Determine whether the district is maintaining enough cash flow so that those items that are
unanticipated in the budget will find sufficient financial resources available when they arrive.
•Re-examine debt service schedules and their impact on the tax cap.
•Make good use of your auditor... if you need a message delivered have them deliver the
message and support you.
•Use the team approach when analyzing finances, This is not a one-person job. Two heads are
better than one and three are better than two.
•Make sure that your analysis is detailed enough to come up with an accurate portrayal of your
financial condition currently and forward without wasting time in the weeds.
•Report out the findings of your studies.
•Your report should include findings, implications, caveats, considerations and
recommendations.
In Closing
Be prepared for another difficult financial year.
Board members please attend regional NYSSBA and regional School Boards Association
meetings. Superintendents please be active in NYSCOSS and regionally. And of course,
School Business Officials partake in NYASBO and the regional chapter meeting and
workshops.
Work regionally and statewide, learn to lobby and of course:
Attend Statewide School Finance Consortium (SSFC) workshops. If you need one for
your regional unit, give me a call, I’m ready!
Be well,
Rick
