Exeter Region Cooperative School District officials presented a needs-based FY26 operating budget and urged voters to compare it with the default budget at the upcoming deliberative session.

"It is a very lean budget," Molly O'Keefe, the district's director of finance, told the public, saying the district ended the prior year with "only 1.445 percent of the appropriation unexpended." She said the proposed budget was built with building-level and central-office input and reflected minimal cushion.

The proposal focuses on the operating budget — the portion that affects local taxes — while the district's fed funds and food-service programs remain self-sustaining, O'Keefe said. The total cooperative figure discussed in public comments was described as about $71,000,000, a roughly 4 percent increase from the prior year, though town-level tax impacts are calculated separately.

Why it matters: District leaders said that most of the cooperative budget is driven by contractual or mandatory costs — salaries, benefits, special-education programming, transportation and debt service — leaving little discretionary spending. At the same time, administrators described sustained increases in student need and higher costs for some specialized placements that they say are straining the budget.

Special education and out-of-district placements were the central focus of public questions and staff explanations. Dr. Esther Asbell, superintendent, and building special-education directors described a steady increase in students with Individualized Education Programs (IEPs): in the middle and high schools the share rose from about 12 percent in 2016 to over 20 percent projected for 2025–26, and at the high school staff reported growth from about 13 percent in 2020 to roughly 17 percent this year.

"Under IDEA, school districts must ensure that students with disabilities have access to a free and appropriate public education," Molly O'Keefe said while explaining why some students require specialized out-of-district placements. Staff warned those placements can be expensive: administrators said a residential out-of-district placement can run about $300,000 per student when room, board and transportation are included.

District finance staff and special-education directors said the cost pressures include both more students with complex needs and higher tuition and transportation costs driven by inflation and by program availability. Sonia Roche, special-education director at the middle school, said early-intervention work and a multi-tiered system of supports (MTSS) aim to reduce the number of students who ultimately require an IEP but that those interventions themselves require staffing and resources.

Another change affecting budgets statewide, staff said, is a shift in reimbursement for catastrophic special-education aid. "In the past . . . we would get reimbursed 100% of that difference from the state. Then it went down to 87%. The commissioner sent a letter . . . that now we're only going to get reimbursed 67%," said Dr. Asbell, summarizing the district's outreach to state leaders for emergency relief. Participants mentioned that district advocates are pressing the state to restore higher reimbursement levels.

Other drivers explained to the public included negotiated salary and benefit changes. The district reported health insurance plan adjustments (the district HMO plan was described as increasing about 5.2 percent; dental about 5 percent) and noted employer retirement contribution rates under the New Hampshire Retirement System declined slightly (teacher rate cited moving from 19.64% to 19.23%; other employees from 13.53% to 12.75%).

The board and administrators also described grant reductions that shifted some previously grant-funded positions or services into the operating budget. For example, a position in adult education that had been funded by grants was proposed to be folded into the operating budget to preserve the program's offerings.

Public comment ranged from requests for clearer town-by-town tax impacts to appeals for more transparency and outreach to town residents who may not follow school-board work. Tricia Cox, representing the Budget Advisory Committee, said the BAC unanimously recommended the proposed budget and emphasized the committee's careful line-by-line review: "It was not a rubber stamp process," she said.

Votes at the meeting included board approval to accept an Arts in Action donation and a vote to move the FY26 budget and associated warrant articles to the deliberative session. A motion to move the FY26 budget and warrant articles to deliberative session was made by board member Amy Ransom and seconded by Kim Shute; the motion passed. The board also voted to accept a $6,000 donation from the Arts in Action Project for Exeter High School and approved minutes and routine items during the meeting.

What happens next: Voters will decide between the proposed operating budget and the default budget at the district deliberative session. Board members and administrators repeatedly urged residents to attend the deliberative session and to participate in state-level advocacy because, they said, many major budget drivers are set by state law and state funding decisions.

Administrators and board members encouraged residents to review the full line-by-line budget packet and posted presentations on the SAU website and to contact district staff with questions. "We invite you also to look back at our past meetings," O'Keefe said, noting packet materials and slide decks are posted online.

Ending note: Board members said the district is working to control costs where it can but called for broader state action to address funding shortfalls, particularly in special education and adequacy aid. "We have so many fixed costs. Ninety-five percent of our budget is fixed costs," Dr. Asbell said in response to public concerns about affordability.