Mount Vernon City School District Board of Education adopts budget for 2025-2026 school year

The Mount Vernon City School District Board of Education adopted the proposed budget for the 2025-2026 school year at Tuesday’s Board meeting.  

The Board adopted the budget following a financial presentation by Assistant Superintendent for Business Jose Formoso. Click here to view a PDF of the full presentation.

“A top priority for this budget was to create a path to sustainability, where the District can survive and thrive for years to come,” said Acting Superintendent Dr. K. Veronica Smith. “This budget allows us to maintain our programs and move forward towards growing and improving them in the long term. We are increasing fiscal responsibility within the District by spending taxpayer dollars efficiently and being transparent in the ways we do it. We have needed to make difficult decisions, such as the building reconfiguration, but we believe this budget is a necessary first step towards a financially healthy school district.”  

The proposed budget includes a 3.3% increase to the tax levy, which is 34% below the state tax cap of 5%. The projected household impact for a home with a full market value of $555,555 and an assessed value of $9,500 would be about $24.15 per month. 

For the District, there would be an increase of spending in this budget by $940,298. While there is an increase to overall expenses, the District has reduced other expenses, including personnel services, BOCES services and debt service, to develop a budget that maintains student programs and services.  

This spending plan would maintain student programs, while also directly supporting the District’s ability to address outstanding union contracts. The increase to the tax levy would raise revenue by $4,486,255, which would directly support the preservation of athletics, pre-K, after-school programs, and performing and visual arts. Without an increase, the District would be required to make cuts to these programs and others for the upcoming school year.  

The District has held a designation of significant fiscal stress from the New York State Comptroller since 2022. With an increase to the tax levy, the District would be able to make significant progress in addressing financial concerns. 

With the NYS comptroller’s designation of significant fiscal stress, declining enrollment and expensive building repairs, the District approved the closure of three schools and a reconfiguration of the remaining school buildings. The reconfiguration allowed a reduction in expected expenses by $16.9 million in the proposed budget, while also allowing the District to utilize its buildings and staff more efficiently. 

During the current school year and in past years, the District has utilized its reserves to cover costs exceeding the budget, but those reserves have been depleted. Specifically, the District’s fund balance of restricted and unrestricted reserves has dropped from $33.1 million in the 2018 fiscal year to $6.9 million prior to the 2024-2025 school year. The District is developing a long-term financial plan with Capital Market Advisors, which includes replenishing reserves. Click here to read more about Capital Market Advisors’ financial advisement of the District. 

“A main goal headed into next year’s budget is to put forth a plan where we can have an operating surplus and start to build back our reserves,” said Mr. Formoso. “Not only to the level it was, but even a higher level than that. Financial advisors for school districts usually recommend about two to three months of expenses to be in your total reserves, so that would be roughly anywhere from 50 to 60 million for a district of our size.” 

Alongside the multi-year plan and a fiscal analysis that was completed in December, the District is conducting a full review of its state aid to maximize revenue. In addition, a facilities study is being conducted with BOCES to properly maximize the use of buildings. The District is also completing a transportation efficiency study and plans to use higher-capacity buses and optimized routes to reduce transportation expenses. These steps will combine to address several financial concerns, allowing the District to maintain its programs for students. 

The largest expense, personnel services at $111,887,212, is decreasing by $10,929,342 as a result of the building reconfiguration. The reconfiguration allowed the District to staff its buildings to align with the declining enrollment, resulting in a more efficient and sustainable model.  

Key expense drivers include an 8.94% increase in health insurance premiums and a 42.21%  ($5.24 million) increase in transportation costs. While budgeted transportation costs are increasing, the actual amount spent for the 2024-2025 school year was even higher. When bids went out for transportation after the budget passed last year, they were over 40% higher than the budgeted amount. With optimized routes and the upcoming transportation efficiency study, the actual cost is expected to decrease by about $2 million.  

One factor limiting revenue is that the District is reducing its assigned fund balance by $6.99 million due to reserves being depleted. Additional revenue to cover rising costs will come from a projected increase to state aid and the 3.3% increase to the tax levy.  

There will be a budget hearing at 6 p.m. on Tuesday, May 6 prior to the Board of Education meeting, and the community will vote on the budget on Tuesday, May 20. Click here to visit the 2025-2026 budget page, which will be updated with new budget information as it is released. 

Community members can register to vote to pick up an early mail or absentee ballot at the District Clerk’s Office in The Education Center, 165 North Columbus Ave., Mount Vernon, NY 10553. More information, including registration, absentee, and early mail deadlines can be found on the budget webpage.