Minneapolis Public Schools plans to spend $31 million more on its operations next year than originally proposed in March. Details on what precisely makes up the $31 million were not shared at the meeting but the revised 2024-25 budget proposal does incorporate the cost of the recently approved teacher and education support professional union contracts and restores funding for the fifth grade instrumental music program.

The proposed budget also now assumes an $18 million revenue increase compared to the March budget proposal and unspecified reductions in expenses. Details on where the increase in revenue comes from were not shared at the meeting. The district also didn’t share a revision to the $110 million budget gap announced in March.

Senior Officer of Finance and Operations Ibrahima Diop promised the board more details on the budget at next week’s committee of the whole meeting.

Despite these lack of details, the finance committee voted unanimously to forward the budget resolution to the board to approve at its June 11 board meeting. The school board’s finance committee includes Board Chair Collin Beachy, Board Vice Chair Kim Ellison, Treasurer Abdul Abdi and Directors Joyner Emerick and Ira Jourdain. Jourdain was absent from the May 21 meeting.

The proposed budget has a gap between revenue and expenses of $85.4 million, compared to $72 million in the budget proposed in March.

To close the budget gap, the district will rely on a combination of one-time funding sources, including $55 million from its assigned general fund balance. The district will also use $6.6 million in special education aid the district received this year but did not spend, plus $3 million from the community service fund balance.

To close the remainder of the budget gap, the district has revised upwards its projected “vacancy savings” from $12.5 million in the March proposal to $21.0 million in this proposal. Vacancy savings is the term the district uses to denote budgeted expenses it won’t incur because positions in schools and the central office go unfilled.

During negotiations with the Minneapolis Federation of Teachers, the union had asked the district to increase its projected “vacancy savings” in order to raise teacher pay. The district is now predicting a 4.2% vacancy rate next year instead of the 2.5% vacancy rate it predicted in March.

The district’s school-based vacancies are concentrated in schools serving predominantly lower-income students and students of color, and in positions serving special education students.

Diop told the board that the use of $55 million from the assigned fund balance will not impair the district’s credit rating in the near-term. He said that the Fitch rating agency recently upgraded the district’s credit rating from A+ to AA-. However, Diop cautioned that if the district continues to rely on one-time funds to balance its budget instead of reducing its costs there is a risk that the credit rating could be downgraded.