Leo Nyberg, Contributing Photographer

New Haven’s school district is a step closer to balancing its budget for the current fiscal year.

The New Haven Board of Alders on Monday approved an ordinance amendment that transfers $3 million in state funding to a reserve designated for “educational purposes.” The money won’t be available to the Board of Education until the end of the 2025-26 fiscal year, according to Westville Alder Adam Marchand, the chair of the board’s Finance Committee.

“Effectively, it’s saying to the Board of Ed, ‘Look, we understand that things are tight. We’re going to have your back, and this money will be available if needed,’” Marchand said. ”Next year, at this time, they would need to ask for a transfer to actually use the money. So it’s designating it for that purpose if needed, but it’s not actually allocating it in the budget.”

Still, the school district will take that potential boost into consideration as its administrators anticipates its ultimate balance, New Haven Public Schools spokesperson Justin Harmon said.

The school district remains without a finalized line-item budget. In September, Harmon told the News this was because NHPS was still working to balance what it predicted would be a $3.8 million deficit. Although the school district doesn’t get the $3 million right away, it’s a tool the district can use as part of its ongoing mitigation efforts, Harmon added.

“If the Board of Education budget comes in with a deficit at the end of this next fiscal year, that $3 million can be used to cover it as a bookkeeping matter,” he said. “Knowing that we have that $3 million enables us to come closer to a projection of ultimate balance.”

Ahead of Monday’s vote, Board of Education Vice President Matt Wilcox told the News that the $3 million would allow the district to avoid mid-year layoffs.

The school district retains roughly $800,000 in unaccounted-for projected expenditures. But Harmon said that this number is not fixed, and that unanticipated costs could change the district’s financial position by the end of the fiscal year. He mentioned energy costs — which can vary based on winter weather conditions — among the factors the district cannot predict.

The school district has been at work mitigating this fiscal year’s budget since the spring. The district initially anticipated a deficit of $23.2 million. With support from local and state funding and a number of staffing and program cuts, the district compensated for most of those costs.

“There was a lot of effort to reduce positions, some administrative, a lot of them teaching positions,” Harmon said. “In the high schools, we eliminated some electives. We combined sections where we could and stay within the cap that’s in the teacher’s contract. Those are some of the changes the community is really feeling.”

The district also closed the Brennan-Rogers School and merged Wexler-Grant and Lincoln-Bassett Schools to minimize its costs.

The Board of Alders is preparing to vote on a separate $3 million transfer to the Board of Education to address a remaining $4.9 million deficit from the 2024-25 fiscal year. Last year, the extra $3 million in reserve came out of the city’s year-end surplus, rather than from extra state funding, Mayor Justin Elicker said at a press conference Tuesday.

According to reporting by the New Haven Independent, the $3 million comprises funding from Connecticut’s Supplemental Revenue Sharing Grant and the Office of Policy and Management.

23 of the 24 alders present at Monday’s meeting voted for the transfer.

Leo Nyberg contributed reporting.