Last month, the Worthington Schools Board of Education approved the latest financial forecast for our district.
Despite every effort to maintain a lean and conservative budget, it is clear the challenges we face are a result of three major developments: cost increases due to our significant enrollment growth; increasing staff and insurance costs; and stagnant to overall decreasing revenue.
State revenue to fund our schools continues to decline. Although most Franklin County school districts will receive slight increases in funding under the latest state budget, Worthington is one of two school districts that will see an actual loss of funding – $3.5 million dollars over the next two years. This is due to the phaseout of state-reimbursement payments for the loss of the local tangible personal-property tax. In addition to the loss of state funds, our local revenue from property taxes remains relatively flat.
Although the average increase in property value from the Franklin County Auditor Office's 2017 reappraisal was 12.5 percent, the increase in revenue for Worthington Schools is expected to be less than 1 percent of the district's operating revenue. This is a result of House Bill 920, a state law approved in the 1970s to limit inflationary growth on taxes. Unless new tax issues are approved by voters, local revenue for school districts remains relatively stagnant.
One exception to HB 920 is something called "inside millage, "which is 4.5 mills for the Worthington district. This is the only portion of the tax rate permitted to increase or decrease with valuation. (Editor's note: Inside millage refers to the property taxes for which the Ohio Constitution authorizes collection without a vote. It is limited by law to a maximum of 10 mills.)
The school district is facing these revenue challenges at the same time enrollment is increasing.
We value the quality educational programs and options available for our students; however, without additional revenue, we will experience some challenges in the near future. We have maintained a responsible fund balance but as our revenue continues to be reduced, the district's five-year forecast projects that deficit spending is projected to begin in fiscal year 2018 and increase to $10.8 million in fiscal 2020.
It is important for district leaders to think proactively and plan to maintain the resources needed to reach our goal of ensuring student success.
That means we might be looking at an operating levy in 2018 to maintain current operations. This is in addition to a possible bond issue needed to implement the community-led facilities master plan that would address the needs of our aging school buildings, accommodate increasing numbers of students and balance enrollment at our high schools.
Over the next several months, we look forward to working with residents to decide what it takes to maintain and protect excellence in both our community and schools – something we've all worked so hard to build together for many years.
Jeff McCuen is the treasurer for Worthington Schools. Contact him by email at firstname.lastname@example.org.