As Upper Arlington school leaders go through the process of putting a 4-mill continuing operating levy on the fall ballot, the state's new biennial budget is shifting a larger burden to local taxpayers.
The Upper Arlington Board of Education approved a resolution of necessity for the levy request July 15.
If approved by voters, the 4-mill levy would generate about $6.3 million per year for the district and would cost homeowners an additional $140 per year for every $100,000 of home value, district Treasurer Andy Geistfeld said.
That's more than residents would have paid before Ohio's new budget was signed into law.
Geistfeld said the cost to residents would be less had state leaders not made a last-minute move to remove a subsidy for local school levies when House Bill 59 -- the biennial budget -- was signed into law June 30.
He said the state had picked up 12.5 percent of the cost of new or replacement levies since the 1970s. That is no longer the case.
"The new bill is now shifting the entire cost of the levy onto the resident, versus the state paying the 12.5 percent," Geistfeld said. "The district will not bring in more or less money from each levy than in the past, but taxpayers will now pay more."
He said the subsidy reduction "caught us all off guard."
"There was no prior discussion about this in the House or Senate. It came up last minute in a conference committee, so it was not something that was thoroughly discussed," he said.
The challenge in explaining the change is that the rollback subsidy will still be in place for levies that passed before November.
"What we see is that it is a part of the bigger picture from the state," Geistfeld said. "Part one was to phase out the tangible personal property taxes on businesses and to eliminate the reimbursement of that tax money to districts. We lost $2.6 million per year due to that phase-out.
"No one has expected this rollback subsidy to disappear so quickly, so it worries most of us that the guarantees for school funding will also disappear more quickly than expected," he said.
Upper Arlington Board of Education members will meet at 8 a.m. Aug. 5 at the Central Office, 1050 North Mallway Drive, to consider the last step in the levy process, a "resolution to proceed" to put the 4-mill levy on the November ballot.
"Should school board members approve that resolution, then the levy resolution will be filed with the Franklin County Board of Elections and the levy will be officially on the fall ballot," Geistfeld said.
Upper Arlington voters turned down a 5.8-mill continuing levy request in November 2012.
After that, the district made $13.4 million in budget reductions, eliminating more than 40 staff positions to reduce personnel costs.
Geistfeld said the district will save an additional $3.3 million in medical insurance premiums by requiring employees to pay a larger share of their health insurance costs. He said another $3 million was cut from future operating budget projections.
Superintendent Paul Imhoff said July 15 that if district residents commit to supporting the schools by approving the levy, school leaders will also commit to making the money it generates last at least four years and will begin a new "efficiency project" to involve the community, staff and city leaders in a plan to find and target areas for future budget reductions.
Geistfeld said the district is currently in deficit spending; he said fund balances could dwindle to a general budget deficit of $3.7 million by 2017 without new revenue.
In order to maintain the district's top bond rating and to mitigate financial risks, district leaders want to maintain an unreserved fund balance of at least three months' worth of operating expenses or about $24 million, he said.