With an estimated $9.2 million budget shortfall for next fiscal year, Higley Unified School District officials outlined a plan for spending reductions, careful financial planning and the potential use of budget balance carryforward funds.
However, as the district prepares for further budget cuts in future years, concerns remain over the sustainability of these measures.
District officials presented their plans to the governing board during a second review of the maintenance and operations budget at the Feb. 4 board meeting.
At the previous review, the district discussed a $5.1 million cut for fiscal year 2025-26 realized through position reductions, which officials hoped could be done mostly through attrition.
The proposed FY 2025-26 budget takes into account a projected loss of 300 students, a phased reduction of the district’s M&O override, and a mandatory transfer of $3.5 million from the M&O budget to capital funds for middle school lease payments.
To help balance the budget, the district has identified approximately $550,000 in reductions across department and school budgets. This includes significant cuts to maintenance and operations as well as special education, though officials emphasized that the district would continue to meet its obligations for student services.
“We have had difficult conversations in terms of reducing our department and school budgets across the board,” Chief Financial Officer Tyler Moore said. “Our largest contributors are from the maintenance operations department. We made some large reductions in their M&O budget in addition to Shauna (Miller, executive director of special education) and the SPED department.”
The district is also bracing for rising costs, including a projected $200,000 increase in utility expenses due to expected rate hikes from Salt River Project. Additionally, the district awaits final insurance rate renewals, which are anticipated to rise due to inflationary pressures in the reinsurance market.
The district plans to use budget balance carryforward funds to absorb the remaining $3.6 million deficit.
“This is not a long-term solution,” Moore said. “But we do have that carryforward, and we can utilize it for this purpose.”
The most pressing financial challenge facing the district is the phased reduction of its M&O override, which was not renewed by voters in November. For FY 2025-26, the override phase-down will reduce district funding by approximately $5.1 million. Another $5 million cut is expected in FY 2027, followed by a final $4 million reduction in FY 2028, when the override will be fully eliminated.
“As it stands, we do not have authorization for an override continuation,” Moore said. “We would like to engage our community and a lot of our stakeholders into this process as we have about a year to formalize some of those reductions if no resolution is called for the continuation of the override.”
In preparation for additional reductions, the district is launching a community engagement process to gather input from stakeholders on how to proceed.
“We want to be able to collect input from all stakeholder groups,” Superintendent Sherry Richards said. “That includes all employees, our parents, community leadership, meet and confer. And I would like for our students on the Superintendent Advisory Council to participate as well.”
A survey will be sent out to community members on Feb. 10, with a two-week response period. Results will be compiled and presented to the board at the March 4 meeting, alongside the district’s third and final budget review. A community meeting is also scheduled for Feb. 19.
“I think what we are trying to do is be really thoughtful because anytime you reduce people, programs, it’s tough,” Richards said. “So I’m interested to get the feedback from our parents, employees and the community.”
Board members and community members expressed concerns about the impact of budget reductions on student enrollment and district competitiveness.
“Our main concern should be to do what it takes to ensure that we’re attracting families,” Board Member Anna Van Hoek said. “When we have upset parents because there’s a lack of transparency and parents aren’t being heard or things that are happening in classrooms that are upsetting parents, that’s causing them to pull their children. That is the direct impact where students are leaving our district, which means we’re losing the funding.”
Others pointed to broader statewide funding challenges, including the state’s decision to divert public funds to private education through the expansion of Empowerment Scholarship Accounts.
“Our state legislature has decided to give public money to private schools, and that’s why we’re all struggling with our funding,” Board Member Scott Glover said.
However, Van Hoek pushed back on blaming ESAs for enrollment declines.
“Everybody’s blaming ESAs,” she said. “It’s not ESAs’ fault. Parents wouldn’t utilize ESAs if they were happy with the school. Obviously, if a parent is choosing to pull their child to use the ESA dollars, there’s a reason for that.”
The district will finalize its proposed FY 2026 budget next month with formal adoption coming in June. The board plans to conduct further discussions on budget priorities, and the district will issue teacher contracts March 15.
Officials stressed that while the district is making every effort to balance the budget with minimal impact on students, difficult decisions lie ahead if funding does not improve.
“I am always appreciative of creative ways to try to look forward, and I am always appreciative of looking to prepare rather than being responsive to some of these problems,” President Amanda Wade said. “And I think that’s the best that we can do.”
Meet Tom Tom Blodgett joined Independent Newsmedia, Inc., USA, in 2022, when the company acquired Community Impact Newspaper's Phoenix-area properties. Raised in Arizona, he has spent more than 35 years in journalism in the state.
Community: He has served as an instructional professional in the Walter Cronkite School of Journalism and Mass Communication since 2005, and is editorial adviser to The State Press, the university's independent student media outlet. He also is director of operations for an 18U girls fastpitch softball team from Gilbert.
Education: Arizona State University with a BS in Journalism.
Random Fact: He lived in Belgium during his freshman year of high school.
Hobbies: Tweeting enthusiastically about ASU softball (season-ticket holder) and grumpily about other local sports (pessimistic fan).
Higley Unified School District Governing Board,
Higley USD maintenance and operations budget,
Tyler Moore,
Sherry Richards,
Anna Van Hoek,
Scott Glover,
Amanda Wade
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