School forecasts lack of funds
- Published: October 25, 2012
The latest five-year budget forecast Yellow Springs School Treasurer Dawn Weller presented at the school board meeting Thursday, Oct. 4, continued to show that the district is still facing financial woes. With the recent drop in state revenue still reverberating, and expenses trending up, the only glimmer of a bright spot was this year’s 1.9 percent increase in income tax revenue for the district.
“A 1.9 percent increase is sad,” Weller told the board. “That’s a very small increase for us.”
And though Weller has forecasted a 3 percent annual income tax increase for each of the next four years, that increase (approximately $60,000 per year) doesn’t come close to making up for the nearly $400,000 in annual state property tax reductions and the approximately $100,000 annual increase in salary and benefit costs the district is currently trying to manage. And though the district exacted about $700,000 in mostly personnel and benefit cuts over the past two years, those cuts only extend the district’s solvency an extra year before it is projected to slide into a negative cash balance in 2015.
According to the forecast, this year’s expenditures will exceed revenues by about $322,000, and next year the difference will climb to $640,000, trending up to nearly $1 million in deficit spending by 2016. Meanwhile, to make up the difference, the district’s cash balance, currently at $1,685,000, is expected to drop to $724,000 by the start of the 2013–14 school year and completely dissolve in the beginning of the 2015 school year.
Currently, the district is considered by the state to be in “fiscal caution,” the first of three levels of fiscal concern. According to the forecast, if the district continues in the current vein, by the 2014–15 school year it will decline into, “fiscal watch,” the second level of fiscal concern that could provoke the state to impose it’s own oversight of the local district’s budget.
The balanced forecast does not include any revenues that are not currently guaranteed. But in order to close the gap, the board voted last spring to put an emergency levy on the November ballot. The district is asking voters to pass a 7.4-mill property tax levy to bring in an additional $915,000 a year for the schools. If the levy passes, the contingency forecast shows the district will be able to raise revenue higher than expenses and slowly grow its cash balance to about $1.9 million by 2016. But according to Weller, costs are expected to continue growing at a level that even with the additional revenue from the levy, the schools could begin deficit spending again after 2017.
In other school board business:
• Local resident and parent Trish Gustavson requested that the district reconsider its intention to replace in two phases the Mills Lawn playground equipment that was damaged in a storm last spring. The school’s playground committee had decided to use the $70,000 insurance reimbursement to immediately replace the big play set, and then fundraise for a future installation of additional multi-sensory, handicapped-accessible equipment. But Gustavson, who helped to establish a handicapped-accessible playground in Beavercreek, recommended that the district would increase the affordability of the whole project by using the current replacement fund to seed the fundraising effort for a holistically designed playground. The project could then be installed in one bid sometime next year.
• The next school board meeting has been changed to Thursday, Nov. 1, at 7 p.m. in the John Graham conference room at Mills Lawn.