Virginia school systems face dramatically different budget situations

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School systems across Virginia are developing their budgets for the upcoming fiscal year. Although they're still waiting on state lawmakers to finalize the state budget, local boards are already making hard decisions – some harder than others.
Roanoke city public schools are looking at a potential $14 million budget gap. Last month, the city school board approved a plan to eliminate roughly 170 positions across the school division, including 65 positions that are currently filled. Kathleen Jackson is the school system's chief financial officer. She says those cuts are coming as the school budget is squeezed from rising costs and slowing revenue growth.
"About 75% of our budget is people," Jackson says. "Salaries and benefits are the biggest driver of costs. Health insurance costs go up exorbitantly annually. That is an ongoing concern."
Roanoke city council previously had a policy of setting aside 40% of its budget for schools. A couple of years ago, that changed. Now the schools get 40% of the old 2025 budget, plus a percentage of new revenue growth – resulting in less growth in the school system's budget over time. The school system was encouraged to use its fund balance, but now that money has been spent and the school system is facing an even larger budget hole.
"So we've got sort of that $10 million that we're already behind in current year," Jackson says. "And then natural increases that happen year over year combine to bring us to where we are in terms of the deficit of about $14 million."
So city schools will cut staff, even as enrollment remains flat.
"We aren't contracting our staff because of less need because of less enrollment," says Roanoke city school board chair Franny Appel. "It's purely a revenue driver on why we'd be contracting any staff. Not need."
Other school systems are facing challenges too. Roanoke County pulled back $3 million that schools there had counted on to help cover increases in insurance rates and inflationary costs. The Roanoke County school board is handling the decrease by pausing contributions to its fleet replacement fund, not replacing some laptops, and underfunding its textbook adoption fund.
"Reduced funding is not a local problem, it's happening across the nation," says first-year Roanoke County school board member Ryan White. "It's just important for us to figure out where that money goes."
But it's a different story in other localities in Virginia. Babur Lateef chairs the Prince William County School Board. The county earmarks 57% of its general revenues for the schools. But even still, when Lateef first took office in 2018, the county ranked near the lowest in Northern Virginia for per-pupil spending. That's changed.
"What's improved over the last eight years for Prince William County is that we do, as many know, we have a lot of data centers," Lateef says. "We started taxing them significantly, dramatically. That has dramatically increased the revenue to the county and specifically the schools. This year we expect for the schools alone, on a $2.2 billion operating budget, we're going to be well over $200 million coming from data centers.
"That has dramatically increased our ability to increase teacher salaries, increase per pupil spending, invest in classrooms and for the first time in all of Virginia, we will offer universal pre-K."
For comparison, Roanoke City's school budget for fiscal 2027 is $269 million — only marginally more than what Prince William County schools will get from data centers alone. Prince William County will give teachers an average 6.7% raise. Roanoke County teachers will get a 4.5% raise. And Roanoke City teachers will get a 2% raise in the proposed budget.
School budgets are set to be finalized soon, but officials are still waiting on Virginia lawmakers to finalize their own budget. Currently, the House and Senate are hung up on whether to eliminate a lucrative tax break for data centers. They're scheduled to meet in a special session on April 23.