Lexington Public Schools imposes spending freeze, predicts nearly $2M shortfall

Lexington Public Schools implemented a spending freeze on Dec. 4 after hiring 25 new staff this year to accommodate an unanticipated influx of students with extra needs. 

Those new hires support students who have contractual requirements such as Individualized Education Programs (IEPs), or 504 Plans, both of which outline what specialized services a student with a disability needs to succeed in school.  

“We are so happy to have all of the students we have in our system, and we’re working hard to support them and we believe they deserve an excellent education,” Julie Hackett, superintendent of LPS, said. “But we have budgetary challenges at the same time that we have to manage.”

Hackett said the district predicts there will be a budget shortfall of between $1.5 million and $2 million due to the growth of the special education program. 

David Coelho, assistant superintendent for finance and operations at LPS, sent a memo to principals and department leaders, alerting them of the spending freeze on Dec. 4. Hackett alerted the School Committee on Dec. 13 through a memo of her own. 

In her letter, Hackett states that since 2021, there has been an increase in special needs among existing students as well as an increase in students with IEPs moving to town.

Coelho said he believes the reason for that influx is because Lexington is “a drawing card for people to come to because we have such high level services.”

LPS has a budget of about $141 million for fiscal year 2025, approximately 86 percent of which goes toward salaries and 14 percent to expenses. LPS is working to protect programs from being eliminated and staff from being laid off, Hackett said in her memo. Teachers’ salaries are “fairly fixed,” she told LexObserver, but LPS is considering reducing costs through attrition. 

To save money, LPS will prioritize hiring candidates with less seniority if and when new staff must be hired. 

“If two candidates with similar skills are being considered for a position, and one has five years of experience and a Master’s, and the other has 12 years of experience and a doctorate, we will select the candidate with less seniority, which will put less pressure on the budget,” Hackett’s memo states. 

As a result of attrition and slowing hiring, class sizes will likely increase across all grades, Hackett’s memo states. In the elementary schools, there will be fewer classes, each with more students and an aide to help the teacher. Team sizes will increase in the middle schools, and in the already overcrowded high school, classes will accommodate 27 or more students. 

“We’ve tried to keep [class sizes] smaller post-pandemic because of the learning challenges for some students, but we think that we’re at a point now where we’ve provided a lot of additional support and we need to be more conservative with those numbers so that we can be able to satisfy all the needs that we have in the system through our budget,” Hackett told LexObserver. 

LPS will also conduct a “cost-effectiveness study” on its special education program to see if it’s as practical as it was once believed to be. Many years ago, LPS created the staff-intensive special education program to entice residents with disabled children to enroll them in LPS schools instead of sending them to other districts for specialized education. It was thought that reducing the number of students who attended schools outside of Lexington would save the town money, Coelho said, because the district is responsible for the costs associated with students attending outside programs.

“It can cost $200,000 plus per year per student to place them in other schools, plus transportation,” Coelho said. 

By essentially auditing this program, LPS can obtain data and learn whether or not its in-house special education program is cost-saving, and if not, where changes can be made, Hackett told LexObserver. 

The study will cost approximately $30,000, which Hackett states will be paid for with “existing resources” in her memo. 

LPS will also cut down on professional development expenditures to mitigate the predicted shortfall. That includes ordering catering from Whitsons, the school lunch provider, rather than outside restaurants for professional development days, and sending department heads to local professional development conferences rather than out-of-state. 

Hackett told LexObserver the ways in which LPS is planning to cut down on costs is not unorthodox. 

“The strategies I listed out in the memo are strategies that are always in place, we are always combing through the budget and looking for ways to save money,” Hackett said. “We have processes and procedures in place so that we are very careful with the town’s resources.”

The influx of students with extra needs is only one piece of LPS’s larger budget puzzle — the uncertainty regarding the future of students living in emergency housing in Lexington could greatly affect LPS’s future budget. 

Right now, there are 118 homeless students enrolled at LPS, according to Hackett’s memo, including many refugees living in local shelters. The state pays LPS $104.89 a day to provide homeless children with everything they need to succeed in school, including transportation, lunch, and more. But the state’s program for homeless families is evolving. 

Over the summer, Gov. Maura Healey imposed a new limit on families’ stays in temporary respite centers, like the Lexington Armory. She also capped the number of families who could stay at 7,500 and their time in longer-term shelters to nine months.

If students living in shelters are relocated to different municipalities due to Healey’s refinements, they can elect to stay in the LPS system under the McKinney-Vento Homeless Assistance Act. The law gives guardians of homeless children the right to choose where their child attends school, whether that’s their school of origin, or the school in the district they’re residing in. 

It’s best for students who are already enrolled in LPS to continue attending school in Lexington because children “have more success when they have continuity,” Hackett said. 

“We want to be able to do that because we want kids to have stability and support and not to have things disrupted in their lives constantly,” she said.

In that case, however, “transportation then becomes…more costly,” Hackett said. While the state will continue to pay LPS $104.89 a day to educate a sheltered student who moved to a different municipality, it will not cover the additional cost of transporting them to and from school. 

Nonetheless, Hackett advocates for them to stay. 

“I believe that children belong here and should be in our school system and should receive the support that they need to be successful in life,” Hackett said.

Many school districts across the state are similarly experiencing budget issues, Hackett notes in her memo. 

“Nearly 100 municipalities have sought school-related operational overrides in the last three years with varying degrees of success,” she states, linking to data on operational overrides from the Massachusetts Department of Revenue’s Division of Local Services. 

Hackett blames state-wide budget swelling on rising educator salaries and post-pandemic costs for goods and services such as special education tuition and transportation.

“There are social costs when you’re looking at these programs, not just budgetary costs, and this is kind of the balance I’m trying to strike with messaging about the budget,” she said. “We obviously want to have programs that our students need, and we want to do it and manage them in a fiscally responsible way.”