MARSHALL — The Marshall Public School District has approved a preliminary budget for the next school year that includes a general fund deficit of $798,317.

At Monday’s school board meeting, the board voted to approve a budget that included about $31.87 million in general fund revenue and $32.66 million in expenditures.

There wasn’t a lot of discussion of the budget projection at Monday’s meeting, but on June 7 the school board heard a more in-depth presentation on the budget process from Business Services Director Dion Caron. Caron said factors ranging from the effects of the COVID-19 pandemic to uncertainties about state education funding made the 2021-22 budget process more complex.

Besides enrollment, factors like the number of students receiving free and reduced-price lunches have an impact on the school district’s revenue. Caron said MPS enrollment had leveled off slightly over the past two years, possibly because of the pandemic. And because breakfasts and lunches were provided free this past school year through federal funding, fewer families had applied for free and reduced-price meals. Fewer applications meant the district would receive less compensatory revenue from the state.

Caron said MPS is projected to receive around $536,000 less in compensatory revenue funding for 2021-22.

The preliminary budget presented to the school board earlier this month also allowed for a 1% general education funding increase from the Minnesota Legislature. However, Caron said a 1% increase would also result in about $165,000 less revenue for the school district.

MPS will have about $1.54 million in federal relief funds in the budget in the 2021-22 school year. However, Caron said those funds don’t offset the challenge of having reduced revenue from other sources. He said relief funds will help with costs that were part of the district’s COVID-19 response, like supplies, technology and additional staff positions like a custodian and a nurse’s aide.