'A fluid process': Johnson City Schools approves 2027 budget

Johnson City Schools approved its proposed fiscal year 2027 budget Monday, advancing a spending plan that includes employee raises, increased benefit costs and targeted school requests while delaying some technology purchases. The Johnson City Board of Education approved the budget during its Monday finance meeting. The proposal has already been submitted to the Johnson City Commission, which is scheduled to consider the first of three required readings Thursday before final adoption. Director of Schools Erin Slater said personnel costs continue to make up the largest share of the district's spending plan. "The board considered and approved a 2% salary increase and step movement," Slater said following the meeting. "The step movement means that employees move one year down for their experience, so they get a 2% raise and step. When you have about 84% of your budget going to salaries and benefits, that's the majority of your budget that you review and look at each year." Slater said the district's budget development process begins months before approval and includes requests from individual schools across the system. "We go out and meet with each principal individually, and they talk about their budget, they talk about how they've spent their dollars and they talk about any wants, needs or requests that they have for the following school year," Slater said. "We take all that information from all of the buildings, bring it back to the central office and then work through those requests with supervisors and our finance team." She said those requests are prioritized into tiers based on available funding. "Based on our budget and our revenue, we were able to do the Tier 1 one-time requests and the Tier 1 recurring requests," Slater said. "Once we got more detailed information on revenues and expenditures, we took some of those Tier 1 requests and created a subset called 1A that we can revisit if additional funding becomes available through carryover and rollover dollars." Meeting documents showed the district is continuing to face higher operating costs, including increases in insurance, utilities and retirement expenses. Administrators also discussed the loss of several three-year grant-funded programs like the Stronger Connections and Innovative School Model grants and uncertainty surrounding future state funding estimates under Tennessee's funding formula. To offset some of those pressures, the district delayed planned technology purchases and reviewed staffing needs. "We're on a refresh cycle for our Chromebooks, and so we delayed the latest refresh cycle for a year to reduce expenditures," Slater said. "We looked at retirement positions of people who are retiring. We also looked at staffing opportunities, and we did reduce some hiring of positions based on vacancies that we had." While Tennessee lawmakers have required school districts to raise minimum teacher salaries, Slater said Johnson City Schools already exceeded the state's threshold before the legislation took effect. She also said enrollment trends remain another factor influencing the district's finances. School funding under Tennessee's TISA formula is tied to student enrollment, meaning districts with fewer students can expect lower revenue. "If you look across the state of Tennessee, many districts are experiencing declining enrollment," Slater said. "When you have a funding formula that's based on the number of students that you have, you're going to get less revenue based on a reduced number of students." During Monday's meeting, finance officials noted that state funding estimates continue to fluctuate and will not be finalized until later this summer. Administrators said they do not currently anticipate major budget amendments but acknowledged changes remain possible as revenue figures become final. "The budget is a fluid document and a fluid process," Slater said. "We look at the budget, if not on a daily basis, on a weekly basis. There are always fluctuations because a lot of the budget revenues are based on estimates that we have at the time. When actual numbers are realized, we have to go in and make some adjustments." Slater added that district leaders will continue monitoring revenues and expenditures throughout the year and return to the board if significant changes become necessary. "If there's something significant with revenue or expenditures that we need to review, you'll see us come back with a budget amendment," Slater said. The proposed budget now moves to the Johnson City Commission, where it must receive three readings before final approval.