--- ## title: Permanent School Fund Detail --- ## SCHOOL DISTRICT 197 · School Board ## Referendum Review With a closer look at the Permanent School Fund amendment Peter Olson-Skog, Superintendent | August 24, 2026 The district provides information. Voters make the decision. ## TONIGHT Three parts The detail we committed to sharing on the Permanent School Fund in the larger context of the local referendum. 01 Where we are The gap, what we have already cut, and what is left. A short review — most of this the board has seen. 02 ## The Permanent School Fund What the fund is, what the amendment would actually change, and what it would mean here. 03 Two questions, one ballot How they differ, why residents are conflating them, and how we answer that accurately. ## PART ONE Where we are A short review of the budget picture and reductions to date. ## THE PROBLEM Costs climb faster than revenue. Every year. State funding has not kept pace with inflation for two decades. Had the general education formula simply tracked inflation, District 197 would have received about $7.7 million more last year alone. ~3% ## ANNUAL COST GROWTH What it costs to run our schools, year over year. ~1% ## ANNUAL REVENUE GROWTH What the state formula and local sources typically deliver. ## $2M ## THE GAP, EVERY YEAR And it accumulates. Skip a year of reductions and the hole is $4 million. The gap is structural, not a one-year event. That is why one-time tools do not close it. ## WHAT IS DRIVING IT Health insurance is the clearest example ~44% More than we paid four years ago Four straight renewals of 8%, 8%, 14% and 8%. Compounded, our cost today is about 44% higher than it was four years ago. Not ours to control Health insurance, special education, transportation and utilities are obligations, not preferences. Our employees pay it too The employee share rose by the same percentages. Staff are absorbing these increases alongside everyone else. Familiar to every household This is the one line in our budget that residents experience directly in their own lives. ## BEFORE ASKING We started with our own budget $3.2 million reduced over two years before bringing any question to voters. Nearly all of it permanent structural change rather than one-time patches. ## $3.2M ## CUT OVER TWO YEARS Reductions made before any levy question went to the ballot. ## $2.55M ## FOR 2026–27 ALONE $1.73M from positions; $825,000 from everything else. One-third less ## THAN STATE AVERAGE SPENT ON ADMIN Per MDE’s FY25 report as a percentage of budget The MDE report predates nearly all of these reductions — the next one should show us further below average, not closer to it. ## WHAT IS LEFT Everything left will be felt in classrooms The reductions we could make away from the classroom are largely behind us. If the levy does not pass, another $2 to $4 million comes out for the following year — and that is just to hold the fund balance where it is. Rebuilding to the board’s target would requir…