By NEIL ZOLOT

NORTH READING — The initial estimate for the Fiscal Year 2025 School Department budget ask is $40,679,524, a nine percent increase of $3,359,929 from Fiscal Year 2024’s $37,319,595.

“We try to watch our costs, but things don’t get cheaper,” Assistant Superintendent for Finance and Operations Michael Connelly reported at the School Committee meeting March 11. “People ask why can’t you move things around, but so much of the budget is fixed. Only three percent is discretionary.”

“This isn’t a surprise,” member Rich McGowan reacted. “We’ve been talking about this for a while and know about contractual increases and increases in fixed costs.”

With aid and receipts factored in the increase is only 7.5 percent, rising $3,031,608 from $40,836,908 to $43,868,516, although the grant and revolving account total is dropping $328,321 from $3,517,313 to $3,188,992.

Other funds not included in the budget are estimated to be $250,000 in donations and $75,000 in gifts from Parent/Teacher Organizations.

“We’ve been funding a level services budget with modest increase, but the increases for next year are bigger,” Connelly said, a reference to the smaller increases in previous years. There was a 5.8 percent increase from FY23 to FY24 of $2,058,874 ($35,709,330 to $37,768,204). The increase from FY22 to FY23 was 4.2 percent totaling $1,432,665.

“It’s typical for us to start off the budget process with a modified level services budget, but if we never put in a request for more, we’d never get anything,” McGowan added.

Salaries represent $33,733,805 of the new budget and are 7.5% higher than FY24, or $2,799,217.

Operations and Maintenance total $2,173,975, rising $55,750 (0.15%).

Tuition is rising $322,425 (0.86%) from $2,277,814 to $2,600,239;

Instructional Expenses is rising $41,642 (0.11%) from $1,516,633 to $1,558,275;

Transportation is rising $140,895 (0.38%) from $472,335 to $613,230.

Offsets in the form of user fees total $1,040,000 which is 30% of the cost of programs like athletics, bus transportation, performing arts and kindergarten and pre-kindergarten programs, although there has been a long term goal to provide free full day kindergarten classes.

Echoing comments from last year’s initial presentation of the FY24 budget, Connelly discussed a structural deficit in the process, pointing out that while costs have risen 6 percent revenue has only risen 3 percent.

Last year costs also rose by 6 percent, but revenues has risen by 4 percent, in part due to the availability of Elementary and Secondary School Emergency Relief (ESSER) funds allocated due to the pandemic going offline. Between FY21 and FY24, a total of $231,300 in ESSER funds were used to fund four positions. Connelly’s budget breakdown page in his report states $337,321 in Changes in Revenue Offsets, including ESSER funds.

The proposed FY25 budget includes 5.6 new positions at a cost of $476,889 to fulfill elements of the school district’s strategic plan, “NRPS 2025: A Strategy for the Future,” which includes concepts such as Diversity, Equity, Inclusion, and Belonging (DEIB) and Social and Emotional Learning. That reflects a 1.3% increase over FY24.

The new positions will help maintain small class sizes despite increased enrollment at the elementary level. On a page in Connelly’s report titled “Fiscal 2025 Budget Breakdown,” a sum of $199,986 is designated for “Enrollment Driven Staffing Needs at Elementary Schools.” This is an increase of one half of one percent over the current year’s budget. “We’re seeing higher class sizes in the early grades, but want to maintain class size to deliver the same level of service seen today,” Connelly explained.

The rest of the proposed $3,359,929 increase from FY24 is a 4.6% increase in Contractual Salary Obligations; a $138,287 increase (0.37%) in Fixed Costs Contractual Increase, including busing, utilities and materials; a $398,104 increase (1.1%) in tuition for Special Education Out-of-District placements and a $100,000 increase (0.3%) in Special Education Transportation and Contracted Services.

Connelly will host a budget webinar for the public on Monday, March 25 at noon. Go to https://www.north-reading.k12.ma.us/ to attend the virtual event.

Subsequently, the School Committee will hold a budget workshop on Monday, April 8 at 5 p.m. followed by a public hearing at 7 p.m.

If necessary, the School Committee will hold another budget workshop on Monday, April 22 at 5 p.m. and is scheduled to potentially vote on the budget during the regular meeting that same evening and subequently present the final budget to the Finance Committee in preparation for the annual Town Meeting on Monday, June 10.

“This is going to be a long and tough process,” School Committee chairman Scott Buckley knows. “The key point is this is not a school issue, but a town issue given both the school and municipal budgets are facing huge pressure. We’ll be talking about it at every meeting and I’ve talked about it at Select Board meetings too.”

Given the possibility of a budget override that would cover various budgets, including the School Department’s, McGowan thinks “this year the process could be a little different,” menacing two budgets could be on the Town Meeting warrant. One would include money derived from an override, the other wouldn’t.

Having Town Meeting so close to the beginning of the Fiscal 2025 has its pros and cons. Towns with May Town Meetings are further along in finalizing their budgets, but are doping so while less certain of the amount of their state aid. “We’re further along in the state budget process to include potential revenue in our budgets,” McGowan said. “We want to make sure we’re maximizing our revenue.”