2014-08-16 / News

‘We are quickly running out of money’

By Charles Prince

Superintendent Randy Cotner explains the district’s precarious financial condition at last Thursday’s Community Meeting in the elementary school cafeteria. Beacon photo by Charles Prince. Superintendent Randy Cotner explains the district’s precarious financial condition at last Thursday’s Community Meeting in the elementary school cafeteria. Beacon photo by Charles Prince. MILLERSPORT – Nearly 100 people turned out last Thursday evening for the Walnut Township Local School District’s Community Meeting.

The subject was money. “We are quickly running out of money,” Superintendent Randy Cotner emphatically stated. “We are in dire straits. We can’t cut enough.”

The subject was familiar to many present – school board members, teachers and parents active in school activities. The district has been spending more than it takes in for the last five years. Expenditures exceeded revenue by $612,749 for the fiscal year ending June 30. That was down from $734,112 on June 30, 2013.

Increasing costs for items like diesel fuel for busses, natural gas for heating, electricity and insurance are part of the problem. The district’s $3 million of Certificate of Participation bonds issued in 2008 to replace the roofs on both schools, upgrade both HVAC systems, pave the high school parking lots and make other facility improvements have also contributed. Board members in 2008 opted not to ask taxpayers to approve a bond levy for the repairs, choosing instead to repay the bonds out of the general fund. Those payments are adding to the deficit spending.

It’s now crunch time. Public school districts in Ohio must issue five-year forecasts every six months. The district’s latest forecast projects a negative $174,032 balance at the end of the 2015 fiscal year on June 30, 2015. The projections jump to a $1.3 million negative balance by June 30, 2016, $2.7 million a year later and $4.3 million by June 30, 2018.

Public school districts in Ohio are not permitted to carry negative balances. The options are asking voters to approve more revenue, cutting expenses to match revenue or a state takeover.

Voters overwhelmingly rejected an additional 6.9 mill levy for five years by a 628-352 unofficial vote on May 6.

“There are not enough cuts to make up $4 million,” District Treasurer Kirk Grandy said Thursday night. Cotner pointed out that Walnut Township spends 71 percent of its revenue on salaries and benefits. The state average is 83-85 percent so proportionally the district is well below the state average. “We’re at bare bones here,” he added. There are only two teachers per grade level in the elementary school.

The key contributor is beyond local control. The state’s school funding formula ranks the district as the 42nd wealthiest district in the state. The state provides 20.7 percent of its budget. Walnut Township is right behind Dublin City on the wealthiest list. Yet 53 percent of the district’s students qualify for free or reduced lunches.

“It’s on you (local taxpayers) to do the bulk of the fundraising for the district,” Cotner said. The formula considers the value of taxable property in the district. Waterfront property carries high valuations. The formula also considers the number of students to calculate a valuation per student. “Our valuation per kid is high, ” Cotner explained. Waterfront properties build up the district’s valuation but contribute almost no students. Most districts don’t want more students because the local cost to educate them exceeds the additional property tax revenue from their home. Walnut Township has a severe shortage of students.

The district actively seeks open enrollment students from other districts. “Open enrollment (for the upcoming school year) has been fast and furious,” Cotner reported. Kindergarten and sixth grade classes are now closed to open enrollment.

“It’s almost like we are on our own,” he said concerning the level of state support. He previously compared Walnut Township’s ranking and amount of state aid as a percent of the district’s expenses with other area districts:

• Bloom Carroll (Fairfield County) - 97th at 32.7 percent;

• Granville (Licking County) - 102nd at 33.6 percent;

• Lakewood (Licking County) - 113th at 34.7 percent;

• Northern Local (Perry County) - 172nd at 41.5 percent;

• Southwest Licking (Licking County) - 190th at 43.2 percent;

• Berne Union (Fairfield County) - 240th at 46.2 percent;

• Lancaster City (Fairfield County) - 249th at 46.8 percent;

• Liberty Union-Thurston (Fairfield County) - 376th at 55.6 percent;

• Fairfield Union (Fairfield County) - 381st at 56.0 percent;

• Pickerington Local (Fairfield County) - 413th at 58.4 percent; and

• Amanda-Clearcreek (Fairfield County) - 512th at 67.6 percent.

Board members have placed an 8.8 mill, five year emergency levy on the November ballot. It includes an existing emergency levy that brings in $258,000 a year which is set to expire at the end of the year.

Cotner admitted that it was risky linking the small long-time emergency levy with the additional levy. “We’re trying to get off of being on the ballot all the time,” he explained. The district has another emergency levy that generates $250,000 a year that expires at the end of 2016. Both emergency levies are flat, bringing in the same $258,000 and $250,000 a year as they did when voters first approved them in the 1990’s. The objective, Cotner said, is to eventually get all three together.

Grandy said the district’s income tax generates about 1/7 of the district’s $7.3 million budget or just over $1 million a year.

“We need community members to be the lead on this (levy),” Cotner said. “You would be shocked to see how many people aren’t registered to vote.”

He noted that the district “can’t spend a dime on a levy campaign.” “It’s going to take an army of people to get this done,” he concluded.

Sign-up sheets were distributed for volunteers. Cotner expects there will be additional opportunities for voters to ask questions about the levy and district finances. “We need informed voters,” he said.

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