Belton ISD staff told trustees at a Nov. 17 workshop that the district is projecting roughly a $2.5 million deficit for fiscal year 2026–27, assuming no changes to staff compensation and the expiration of temporary state aid known locally as "disaster pennies." Melissa Lafferty, who led the budget timeline presentation, said the 2627 estimate is preliminary and depends on refining state funding templates and attendance data in coming months.

The workshop recapped a multi‑year fiscal turnaround: the district confronted a roughly $10 million shortfall in mid‑2024, absorbed a $1.3 million cut after a Medicaid cost‑report adjustment and added about $1 million in costs after a late legislative requirement for armed campus security. Lafferty said the district implemented roughly $13.1 million in reductions — including aligning staffing to guidelines and trimming campus and departmental budgets — and that state legislation (House Bill 2) and temporary disaster pennies allowed a balanced 2025–26 budget.

"We were at a point where that gets to work," Superintendent (Speaker 2) said, reflecting on the budget advisory process and reductions. Lafferty told the board that the district must now plan without the disaster pennies that were available in 2025–26.

Staff described current-year activity as of Nov. 6: a projected $2.5 million general‑fund deficit for 2024–25 that was partly offset by the sale of district property and tighter spending controls. "If that holds true, we'll be at 23% in fund balance, which is within policy for our district," the superintendent said, referencing the board's 20% fund‑balance policy.

The presentation enumerated recent technical risks: preliminary state appraisal values that conflicted with local certified values, a successful protest that narrowed a prior $10 million estimate to about $4 million, and timing mismatches that force the district to carry uncertainty while awaiting state and appraisal‑district actions. Lafferty urged trustees that the state aid template is still evolving and that January–April will be important months for refining revenue projections.

Trustees spent the workshop discussing priorities and tradeoffs. Multiple board members urged maintaining the district's fund balance at or above the 20% policy threshold. Several trustees said they would like to increase capital project funding to about $1.5 million annually (up from the $500,000 assumption currently modeled) while also restoring or increasing staff compensation where possible. Several board members reiterated that each additional dollar for capital or raises reduces the district's ability to maintain staff levels and a healthy fund balance.

The district identified a handful of near‑term assumptions for the 2627 model: no compensation changes built into the current $2.5 million estimate, a $100,000 placeholder for higher utilities and insurance, and a $500,000 capital projects assumption. Staff said they plan to return with formal budget assumptions in February and begin campus and departmental planning in March.

Next steps: staff will refine the state funding estimate in January, present draft assumptions for board discussion in February, and bring campus budgets and tax‑rate preparations forward as certified property values and attendance data become available.