Mantua – When news of the recent reductions was made public in recent months, many in the community expressed surprise at the state of their school District’s financial situation. It’s important to note that two times each year, the District Treasurer shares the District’s Five-Year Forecast publically, at the monthly School Board meetings. As is the common practice, the information was made public at the School Board’s May meeting. It’s important to note that the numbers in this forecast are static, based on information that is available at this point in time, which is why the information is updated twice per year. As factors, including enrollment and State funding, change, the forecast will be adjusted.
According to Crestwood District Treasurer Jill Rowe, “Statutorily, we are required to update this model semi-annually. The first filing shall be on or before October 31st and the second filing shall be between April 1st and May 31st of each fiscal year.” Filing of the District’s five-year-forecast is mandated by House Bill 412, which went into effect during the 1997-1998 fiscal year. Ms. Rowe went on to explain the purpose of the forecast stating, “It provide a standardized tool for long range planning at the local level. It also provides a method for the Ohio Department of Education and the Auditor of State to identify districts headed toward financial difficulties.” Failure to file would place the District in Fiscal Caution, the first step toward the State stepping in to prevent further fiscal decline.
In the most recent version of the District’s financial forecast, Ms. Rowe included two versions for consideration. The first version assumes renewal of the Emergency Levy, which was originally passed in 2012. It’s a four-year levy that is currently in effect, and collects $1.4 million annually. Ms. Rowe explained, “Currently the Emergency Levy is 4.57 mills; for a home valued at $100,000, it costs $159.95 annually in taxes, or (100,000 times .35) multiplied by .00457.” She also noted that since this a renewal, a yes vote to renew it will not increase anyone’s taxes, but will continue what they are currently paying. The forecast assumes renewal by voters of this levy in May or November of 2019 or any election in 2020 in order to maintain funding.
It’s important to note that the current year spending shows a deficit in 2018, even with the Emergency Levy in place. “This shows the District’s current year revenues minus current year expenses. We are projected to end 2018 spending more than we took in,” Ms. Rowe explained. “With the reductions the District recently made, 2019 is not projected with a deficit, but we again start deficit spending in 2020 and beyond.”
She continued, “Without the emergency levy, which would start falling off during Fiscal Year 2021, when half of the $1.4 million would be lost, the District would be deficit spending at about $1.6 million, followed by deficit spending $3 million in Fiscal Year 2022.” She added, “ Cash balance would get us through FY 2021, but the cash balance goes negative in FY 2022 without the emergency levy.”
During the same meeting, Superintendent David Toth voiced his concerns about State funding for public schools, in light of the relationship between ‘capped’ and ‘guaranteed’ Districts. “Capped’ Districts are those with increasing enrollment, which entitles them to increased funding according to the formula the State of Ohio uses to determine how much funding to provide to each School District. The majority of Districts with increasing enrollment are located in the Greater Columbus area. Inversely, “guaranteed’ Districts are those with declining enrollment, whom the State provides additional funding over and above what its formula has determined to be necessary in order to help the District maintain services. In the past several years, the Crestwood District has been among the top three Districts for receipt of ‘guaranteed’ funds. Over time, the State has been reducing the amount of money it provides to such Districts. For forecasting purposes, Ms. Rowe has assumed a slight reduction in State funding during each Fiscal Year.
Ms. Rowe explained, “The State’s Biennial Budget debate will begin in the spring of 2019, to be passed by June 30, 2019.” She continued, “Crestwood is on a large guarantee of funding — which means that almost half of our State funding, according to the State, we should not be receiving. This large guarantee is due to enrollment losses.” Ms. Rowe further explained that during this current biennium budget process, Crestwood was only ‘guaranteed’ at 97% of the previous years funding. “We are afraid the State is going to continue cutting the guarantee,” she shared, adding that every two years, Districts have no idea of what the budget process will bring. For forecasting purposed, Crestwood assumes an estimated 5% reduction in State funding each year.
According to Mr. Toth, there is concern across the State that ‘capped’ Districts will be lobbying legislators in the coming months in order to recoup the funds that, according to the State’s own formula, they should be receiving. He added, “This is very concerning to Crestwood as the District is on a large guarantee and any reduction in funding from the State will be detrimental to the District.”
Much discussion has taken place around the community about facts surrounding consolidation of District buildings, and what financial savings would have been achieved by a building closure. Ms Rowe set the record straight, sharing, “With a consolidation, the (recent teacher) reductions would still have occurred.” She continued, “The figures (or savings) for a consolidation versus a reduction were the same relating to loss of teachers. However, additional savings would be achieved with a consolidation, through the reduction of classified staff — custodial, cafeteria, secretaries and aides. We would have seen about an additional $300,000 of savings from the classified staff if we consolidated,” she shared. Plus the cost savings in reduced maintenance and utility costs due to a building closure.
The Board meeting minutes, meeting videos, and meeting dates are available on the School Board’s page at crestwoodschools.org. More in-depth information is available by contacting the District office at (330) 357–8206. The next regularly scheduled Board meeting will be held on Tuesday, July 10th at 7 pm in the CHS library. The community is encouraged to attend to learn, firsthand, the details of their School District.
