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An Update on Our District Budget and Planning for the 2026-27 School Year

Hello Tahoma community,

This is a long, but important, message and I encourage you to read it all the way through. Please note as we continue to get new information, many of the numbers included below are estimates and are subject to change. We will keep you posted if there are significant changes to the information below. 

We are grateful to you for your grace and flexibility as we’ve worked on developing a balanced budget for the 2026-27 school year. For the past two months, the Tahoma school board members and district leadership team have been focused on quantifying sudden, significant shifts in legislation, decreased funding, and rapidly increasing operating costs. This has required us to make quick, difficult, atypical decisions with minimal time for input, which is not how we prefer to operate. We know this has created some feelings of uncertainty, particularly since we have had to make adjustments that are out of the ordinary for Tahoma. 

This feels different because for the last 30 years, our district has seen steadily growing enrollment and an expanding budget. Next school year will be the first time our district has seen back-to-back years of declining student enrollment. We recognize this spring has been hard, and we’re thankful for the questions, open-mindedness, and grace shared by so many of you as we’ve navigated a challenging budgetary situation this spring. Please know, even though it may not always seem like it, that our students and staff members have been in the center of all decisions, and we have done our absolute best to minimize the impact when it comes to these difficult choices.

Below is some important information about Tahoma’s budget for the 2026-27 school year. We have done our best to consolidate a considerable amount of financial information into a brief summary so you can have a better understanding of why we’ve needed to make some quick but important adjustments to our expenditures for next school year.

The Financial Landscape
Please note that this dollar figure changes frequently due to new information we receive almost daily related to rising costs and projected revenue.

Like most, if not all districts across Washington, Tahoma is navigating a highly constrained financial environment. Looking ahead to next school year, a combination of rising, uncontrollable costs and reduced revenues leave us facing a shortfall of $13.57 million when comparing 2025-26 to 2026-27. There are four key factors that have created this shortfall we are projecting for next school year (2026-27): 

Amounts as of May 21, 2026 (future numbers may change)

Rising Operational Costs

Approx. $8.75M

Declining Enrollment

Approx. $2.79M

State & Federal Funding Reductions Approx. $1.15M

Reduced Levy Collections Approx. $875K

50% increase in insurance premiums (+$1.31M)

 

Inflationary increases for some salaries, wages and benefits ($4.98M)

 

Uncontrollable cost increases for food, gas, utilities and services/supplies (at least $648K) 

 

Increase in Special Education services ($1.82M)

Projected drop of 240–255 in our projected student enrollment, due to  lower numbers of enrolling kindergartners and an increase of 11th & 12th graders participating in Running Start next year

 

Enrollment declines are happening across the state due primarily to recent low birth rates.

Predicting a $750K loss in state Local Effort Assistance (LEA) funding

 

$240K loss in funding for Running Start

 

$158K loss in Learning Assistance Program (LAP) funding

$1,000 loss from federal forests

$4,508 loss in Title 1 funding

Note: We are awaiting information on additional federal grants we receive and we anticipate a loss in those as well.

Based on the difference between our typical 99% collection rate and a projected 97% collection rate for 2026-27.

 

Due to unpaid property taxes, our full levy collection is delayed. It is uncertain if we will see those dollars in the future. Our most recent levy collection in late April was lower than expected and we have had to make reductions to levy-funded activities this spring, including Kindergarten Camp, to absorb the loss of revenue. 

Our annual budget is approximately $200M and our total projected shortfall for 2026-27 school year is approx. $13.57M.

To respond to the increases in costs and loss in funding, most of which we learned about recently, we have had to make some difficult but necessary adjustments to our spending for the upcoming school year. We know this has been hard for many of you, and recognize the disappointment and challenges this has created. 

Staffing Reductions 

When 83% of our operating costs are tied to staff salaries and benefits, it is necessary to reduce costs in these areas. To do this, we are focusing heavily on attrition (not filling positions opened by retirements or resignations) and reassignment in alignment with our labor agreements. 

Adjustments for the 2026-27 school year include reduced positions, reduced extra hours, and lower than inflationary increases for non union represented employees, which reduces our operating costs by $9.47M.

School and Department Budget Reductions:

An approximately $4.1M reduction across central administration budgets and building/department budgets to absorb the inflation in insurance, utilities, and fuel. We will be operating with less next year, but our department and building leaders have budgeted carefully and will ensure the most critical needs are met.

What to expect next: 

I know this isn’t easy, but we will get through this. I have seen firsthand the strength and creativity of Tahoma both within our schools and our incredible families and community members. Together, we will find great solutions to manage the complexities associated with a flawed state funding model for education, rising inflationary costs, and the expensive, unfunded laws and policies that continue to challenge our public schools. We are deeply grateful for your dedication to Tahoma's students and to each other as we work through these challenges. We look forward to a strong partnership with you next year as we manage these adjustments and plan ahead for upcoming school years. 

We'll share updates with staff and families as new information becomes available. These updates will be published on our website and shared in our weekly staff and family newsletters to ensure ongoing access and transparency.

Thank you for everything you do for our community, and for being exceptional people during a unique time. We sincerely appreciate you.

Warmly,

Dr. Ginger Callison
Superintendent
Tahoma School District