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The Falls Church City School Board unanimously approved a $71.6 million operating budget for fiscal 2026-27 after rising costs and lower revenue projections forced more than $620,000 in adjustments.
The $71,591,629 advertised budget, approved Tuesday night, now advances to the City of Falls Church for consideration in the broader municipal budget process. It represents a 3.1 percent increase from the current fiscal year and calls for a $57,680,284 transfer from the city government.
The board also approved a $1,789,008 Food Services Budget and a $3,058,845 Community Services Budget.
The spending plan emerged after months of work involving Superintendent Terry Dade, Chief Operating Officer Alicia Prince, the School Board and city officials. Since the formal budget process began in December, the school division has faced a $500,000 reduction in projected city revenue and an additional $120,000 in health insurance expenses.
Insurance rates increased by 13 percent, compared with the 10 percent rise budgeted by the division. Officials offset the new pressures through employee attrition and limited reductions to operational and contractual expenses, leaving compensation and benefits intact.
Dade said the reductions were difficult because the district is seeking to preserve and expand the programs behind its strong statewide standing.
“We are not an okay district. We’re a district of excellence,” Dade said, adding that continued programming and improvements are needed to keep Falls Church ranked as the top district in Virginia.
The budget provides a city transfer 4.1 percent above last year’s amount. That remains below the 5.02 percent increase the division initially identified as the minimum necessary to maintain existing services.
Several priorities remain unfunded, including expanded assistance for students struggling with reading and mathematics, improvements to district operations and additional investments in early learners. Those proposals could be reconsidered as the city completes its budget work.
School Board Chair Kathleen Tysse described the approved plan as both responsible and extremely lean. She warned that the division remains about $600,000 short of its maintenance-of-effort target.
“I am proud of the work we have done and the integrity that this budget represents,” Tysse said. “But I want to be really clear — we are very far from our maintenance of effort.”
Tysse also stressed the importance of the school division’s revenue-sharing agreement with the city, which determines how local tax receipts are divided between municipal operations and the schools. The board does not set tax rates or approve city funding transfers, she said, making predictable and transparent revenue projections essential to school budgeting.
Updated projections presented at the meeting indicate the division could receive as much as $182,450 in additional funding if tax revenue reaches the anticipated $7 million. That money was not included in the approved budget but could later support maintenance-of-effort expenses or other high-priority needs.
Tysse and city leaders are scheduled to present the advertised budget jointly to the Falls Church City Council on March 23.
Falls Church City Public Schools enrolls about 2,700 students at five schools. It is one of nine districts nationwide offering the complete International Baccalaureate continuum from prekindergarten through 12th grade.