The Pettisville School Board is considering putting a tax increase on the ballot for the March 2012 primary election after reviewing the five-year projection prepared by Chris Lee, district treasurer.

During its Monday, Oct. 10 meeting, the board reviewed and approved the five-year plan that shows the district spending more money than it receives by the end of the current fiscal year, which ends in June.

Since the district has a cash balance of nearly one million dollars, and since the predicted deficit at the end of the current fiscal year is only slightly over one thousand dollars, the district will still have money on hand.

But if Lee’s projection is accurate, the district will gradually eat into the cash balance.

The projection shows the district running out of money by the end of fiscal year 2015.

Tax Options

Steve Switzer, district superintendent, said in a Tuesday interview that no decision or recommendations have been made about what type of tax– income or property– or the amount.

Switzer said between now and the next Pettisville School Board meeting, Monday, Nov. 7 7 pm, in the school conference room, district officials will look at tax options to generate additional revenue.

Conservative

During the meeting, Lee told board members the fiveyear projection is conservative when it projects revenue coming into the district.

The projection predicts an overall decrease in state and federal aid, and no increase from the district income tax.

Lee said the school district income tax collection in July was up from the previous year, though. It was the highest July collection the district had seen from the 1% tax.

On the expense side of the projection, the major increases were from a projected 10% annual increase in the cost of health insurance and a 15% increase in the cost of utilities projected to take place next year.

Board members questioned the utility figure. Lee said while it was difficult to predict utility costs for the new building, he included a high figure for electricity, nearly double of last year’s amount.

He based the higher cost on the fact that the new building would primarily use electricity for climate control, and he assumed part of the cost of paying off the wind turbine would be included in the line item for electricity.

Lee also predicted higher costs for bus repairs, since the Pettisville fleet is aging, and continued increases in fuel expenses for the busses.

The expenses did not include any negotiated increases in salaries, although some provision was made for step increases.

The district currently pays just under $3 million for teacher salaries and just over $370,000 for administrative salaries. The classifi ed staff, which includes office workers, cafeteria workers, and maintenance workers, add another $442,000 in expenses.

Overall, the district is projected to have revenue this fiscal year of $4,726,611, against projected expenses of $4,727,691, yielding the shortfall of $1,080.

State Support

In the Tuesday interview, Switzer said another part of the problem is anticipating how much support the State of Ohio will earmark for schools.

Normally, he said by now the district would have a good idea of how much money it will receive from the state.

But state officials are currently revising state support of education.

State support has been flat, or even slightly increased, but Switzer said school districts are losing revenue from the elimination of the state personal property tax, and $425,000 in federal stimulus funds has dried up.

“We knew that (loss of federal revenue) was coming, so we didn’t use that for any new spending. Basically it prolonged the situation, allowing us to go a bit longer,” he said.

Now, Switzer said, the school district’s emphasis is threefold:

Look at district expenditures to find ways to reduce spending;

Develop more accurate projections as more information becomes available; and

Determine what additional revenues are necessary, and what type and amount of tax is needed to generate that amount.