2025-26 Budget Process
Each year, MPS moves through a budget process to determine how available resources will be allocated the following year.
Due to the historic budget gap last year, we created a budget webpage to enhance transparency and keep our community informed. We have decided to continue this practice as we move through the 2025-26 budget process. This page will be updated with information about our budget process, allocations, frequently asked questions and more.
Learn More
Find information related to the budget process on our Budget Documents page.
With questions about the budget process, email mps.finance@mpls.k12.mn.us.
MPS, like many school districts, is facing the reality that our expenses are well beyond our revenue. We will be having conversations in the coming months and making some difficult choices, but we remain committed to keeping students and their needs centered throughout the process. Last year, MPS implemented a multi-tiered approach to addressing our fiscal challenges which included making expense reductions and finding operational efficiencies, transforming how we educate and serve students, adding the funding from the November 2024 tech levy ballot question, increasing student enrollment and continued advocacy with the state and federal governments. We are grateful to the voters who approved the tech levy, the additional investments from the state and that our enrollment for the first time in many years is starting to stabilize.
Addressing the Budget Gap
In June 2024, we utilized $55 million from our assigned fund balance to address the budget gap. Passing the tech levy was one important step in addressing our budget shortfall, but additional measures will be needed. We are also facing increasing costs in areas including utilities, salaries, benefits and transportation and the impact of a statewide projected decline in compensatory education funding. Our anticipated budget shortfall at this time is approximately $75 million.
We will be utilizing a priority-based budgeting process to determine school and department allocations with the goal of minimizing and limiting the impact on students. We encourage caregivers to share their feedback about their priorities by completing the Caregiver Priorities Survey at the district level and engaging with their school’s site council at the school level.
Reviewing Current Priorities
- Strategic Plan Alignment: Emphasis on academic achievement, student well-being, effective staff, and building a positive school climate.
- Budget Approach Principles: Prioritizing restricted funding, legal requirements, and equity.
The School Board and district leadership have begun the work for next year's budget, including: Identifying collective values, prioritizing areas of investment, and determining non-negotiables given financial constraints.
Watch the Dec. 17 Committee of the Whole meeting Access the meeting presentation
What is a Pro Forma?
A pro forma is a financial statement that projects the future finances of an organization. It includes estimated revenues, expenses and other financial metrics based on previous budget allocations and other assumptions.
For MPS, the pro forma gives an estimate of what our finances will look like if we maintain all current expenditures. This helps us make changes and allocate resources differently to ensure we maintain financial stability.
The pro forma is NOT a budget or a budget proposal.
Past pro forma projections confirm MPS has already started making necessary changes to reach financial stability. For example, in 2018 the pro forma projected a negative fund balance of -$156.2 million for the 2024-25 school year. The projected fund balance for the 2024-25 school year in this year’s pro forma is $69.4 million.
Frequently Asked Questions
Budget Timeline
Note: Timeline is subject to change and the budget will continue to be revised as we move through the budget process. Finance Committee meetings are held monthly. Access the meeting schedule, agenda and minutes on the school board website.
Oct. 15, 2024 | School Board Finance Committee meeting |
Nov. 5, 2024 | Election Day, which includes the MPS technology levy ballot question |
Dec. 10, 2024 | Truth in Taxation hearing and final School Board approval of the property tax levy |
January - February 2025 |
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February 2025 | Reconcile equity considerations with financial plan |
Feb. 18, 2025 | Allocation memos sent to schools |
Feb. 18, 2025 | School budget tie-out (BTO) opens - BTO is the process for schools to review and finalize their budgets for the next school year |
March 2025 | Interview and select begins |
March 7, 2025 |
BTO system closes - schools finalize their budgets for the next school year |
April 2025 |
Draft report presented to Board Finance Committee and School Board |
May 13, 2025 | Budget first reading |
June 10, 2025 | Approval of the budget by the School Board |