Understanding School Finance

School finance can often feel like a complex puzzle. To shed light on how MRH funds its operations, let's break down the key revenue sources and how those funds are allocated.

Where Does the Money Come From?

MRH primarily relies on four main sources of funding:

Local Revenue (79%):

• Property Taxes: The lion's share of our funding comes from property taxes paid by local residents and businesses.
• Sales Tax: A portion of local sales tax revenue also contributes to our budget.
• Program Fees: Fees from programs like preschool and after-school care, as well as food sales, provide additional income.

State Revenue (13%):

• Basic Formula Funding: The state provides a base amount of funding per student.
• Classroom Trust Fund: A portion of gaming revenue is allocated to schools.
• Transportation Reimbursements: The state reimburses districts for certain transportation costs.

Federal Revenue (2.5%):

• Title Grants: Federal grants for specific programs, such as Title I for disadvantaged students.
• Child Nutrition Reimbursements: Reimbursements for school meal programs.

Other Revenue (4.5%):

• Transportation Reimbursements: Reimbursements from other districts for joint transportation services.
• Property Sales: Proceeds from the sale of district-owned property.

The District’s budget directive establishes priorities and goals that guide the development of the annual budget, ensuring alignment with all District plans and the five-year Strategic Plan. The budget directive is built on a proactive awareness of financial conditions at the federal, state, county, and local levels, anticipating the decline in supplemental funding for 2026-2027. This approach ensures that budgeting decisions are made with caution and foresight, enabling the District to allocate resources sustainably while addressing the complex needs of the District.

Read the FY27 Budget Directive

Aligning Spending with the Strategic Plan

MRH's Strategic Plan outlines the District's long-term goals and priorities. The budget process ensures that spending decisions align with these goals. For example, if a strategic priority is to improve student achievement in STEM subjects, the District may allocate additional funds for science and math teachers, curriculum, and technology. Similarly, if a goal is to enhance mental health support, the district may invest in additional counselors and social workers.

How is the Money Spent?

Once the District receives funding, it's carefully allocated to various areas to support student learning and well-being. The primary expenditure categories include:

• Instruction: Teacher salaries, curriculum development, and instructional materials.
• Support Services: Student services (counseling, special education), administrative costs, and operational expenses.
• Capital Outlay: Building maintenance, renovations, and new construction.
• Debt Service: A portion of the district's revenue is specifically allocated to a debt service fund. This fund is used to pay off the principal and interest on bonds issued to finance major capital projects, such as building new schools or renovating existing facilities. By dedicating funds for debt service, the district ensures that it can meet its financial obligations and maintain its infrastructure.

Forecasting the Future

Predicting future revenue is a challenging task, but the district uses a variety of methods to make informed estimates:

• Historical Data: Analyzing past trends in property values, enrollment, and state and federal funding.
• Economic Forecasts: Monitoring local, state, and national economic indicators.
• Legislative Updates: Staying informed about changes in state and federal education funding policies.
• Enrollment Projections: Estimating future student enrollment.

By carefully considering these factors, the District can develop a realistic budget that supports our students' education.

Understanding the diverse sources of funding for our schools is crucial. It empowers us to advocate for policies that support public education and ensures that our students have the resources they need to succeed.