Loudoun County Public Schools expects to see a $7 million drop in state funding during fiscal year 2022 because of decreased enrollment and community factors, but Chief Financial Officer Susan Willoughby said that funds are still “healthy.”
While it is still only the first quarter, and economic recovery as the county emerges from the pandemic-impacted balance sheets with uncertainty, Willoughby said that this year’s $1.5 billion budget is in a much better position than it was in at the same time last year, speaking during a first quarter review with the Finance and Operations Committee on Tuesday, Oct. 19.
This year’s enrollment of 81,318 students at the start of the school year represents a 7% drop from the original projected enrollment for the year, meaning less money will be coming in from Richmond. The district, which is the third largest in the state, would have received about $440 million from the state this year had it met its projected enrollment. Losses from state revenue this fiscal year are offset by “hold harmless” funding, which limits the extent to which the state may reduce funding to a school district based on an enrollment drop. The bulk of school funding—about $1billion—comes from the county.
The operational budget review also indicates a loss of about $150,000 in revenue from community sources, such as parking fees and athletics fees.
The district is eyeing sales tax and lottery proceeds—which so far this year have exceeded state projections—to help offset the losses.
Willoughby said that the district will be watching closely in December when Gov. Ralph Northam releases his budget proposal to see if the state will offer any additional relief funds for school districts.
As of this quarter, the budget still appears tight, as the leftover funds total just $1.2 million, representing 0.08% of the budget. Willoughby said that margin is likely the smallest the district has ever experienced. In years prior, the district has aimed for greater surplus, usually about $10 million. Willoughby said that given how the budget can fluctuate in scenarios such as a pandemic, it makes more sense to consider the excess margin as a percentage of the budget.
The quarterly review will be presented to the full board during its meeting on Oct. 28.