The new budget approved, this week by the school board, climbs about 1% to 1.85 billion dollars.

Executive Director of Budget Services Michael Perrone says the increase has been in the general fund but the operating portion of the budget has fallen.

He says the decrease has forced them to make recent staffing cuts and to initiate a spending freeze at the end of last year to help cover expenses this year.

"We were able to absorb some of the cost or the revenue short fall by rolling forward more dollars," Perrone said.

He blames the decrease on falling state and local revenue streams.

"Roughly 25-million less then what we received the year before in revenue," he said.

He says they are even more concerned about next year with the possibility of another property tax cut and even less money for the 2009-2010 school year.

"We're concerned with 9-10 as being even worse," he said.

He says they might have to consider shutting down schools and making major scheduling changes to make the budget work.

He says the biggest budget increase has been in energy. He pointed to the rising cost of fuel and energy making the largest increase in the budget.

"There's no difference with an individual family or the school system. We are all feeling the pain," Perrone said.

The school board will vote on a final budget in early September.