The district's 6.7-mill emergency levy failed by a vote of 3,734 to 3,647, according to unofficial results from the Delaware County Board of Elections.

"Obviously, we're disappointed in the outcome," said superintendent Steve Mazzi. "I don't think it's a reflection of the Big Walnut schools or the job our staff does. I think it's more of a reflection of the local and national economy."

Mazzi said he will sit down with the new school board and review options.

"The problem is, there are only two options. The way schools are funded in the state, we either need additional tax revenue or the school will have to make deeper cuts to balance the budget, which is a state law," he said.

"It doesn't get any better from here," he added.

Cuts for the 2010-2011 school year likely will mean no sports teams or extracurricular activities, except for those that can be self-supporting or paid for by parents, no librarians or art, music or physical education teachers at the elementary schools, and 11 fewer teachers and larger classes at the high school.

The district spent $297,000 out of the general fund during the 2008-2009 school year on supplemental contracts for athletic staffing at the middle and high schools, said assistant superintendent Gary Barber.

About 1,000 students participated in athletics at that time, he said.

Potential cuts in the athletic department might mean families will pay the cost.

"If you do that math, that's about $300 a participant," Barber said. "If a student decided to play football, basketball and baseball, it would cost the student $900 a year.

"That's just the reality of where we would be for us to maintain our current level of athletics and not impact our general fund," he added.

If a new levy for the district passes in the spring before the end of the current school year, cuts won't be necessary, Barber said.

No decisions on a new levy have been made at this time, he said. The board of education will begin to make decisions at its Nov. 9 board meeting.

"We just really have to roll our sleeves up and work hard to get our message out and take the high road and stay positive and (hopefully) sometime this spring we'll be successful in convincing enough folks to see the need and our students won't miss out on any opportunities," he said.

The current recession has reduced property and income taxes, two large sources of revenue for the district, district treasurer Ben Streby has said.

The district received about $1.3-million less for the 2008-2009 school year than originally projected in November 2008.

That number includes $535,663 less than initially estimated in real estate property taxes, $363,506 less in income taxes, $196,189 less in personal property taxes, $116,430 less in state aid and $45,578 less in property tax allocation.

"We need to wake up tomorrow and educate kids," Mazzi said on Nov. 3.