Thanks largely to a reduction in staff due to retirements and resignations, the financial picture of the Archbold Area School District has improved.
Christine Ziegler, chief fiscal officer, presented figures from the five-year financial forecast to the board at its Monday, May 20 meeting.
In a previous five-year financial forecast she prepared in October 2012, without changes in revenue or expenses the school district would end Fiscal Year 2016 on June 30, 2016, about $1 million in the red.
But now, she estimates even with the district spending more money than it takes in, the district will end FY 2017 about $840,000 in the black.
The five-year forecast is a planning document. State officials require the district to submit the forecast twice a year.
Ziegler said staff is being reduced through attrition. As teachers and other employees leave, they are not being automatically replaced.
When possible, the workload of a teacher who has retired or resigned is spread among other teachers.
By June 30, 2014, she anticipates reduced salaries alone will save the district about $64,000.
Additional savings will be seen in employee retirement and insurance costs.
Another factor she noted was savings in energy costs due to two relatively mild winters, plus cost savings realized from the installation of the wind turbine.
In all, Ziegler told board members she anticipates the total expenditures for the 2014, 2015, and 2016 fiscal years will be below FY 2013 spending.
Ziegler said there still are many unknowns on the income side of the school-funding picture.
The biggest question is that of state support.
A few months ago, John Kasich, Ohio governor, announced his school funding plans for the 2013-15 biennium. Under his original plan, Archbold was to receive a 26% increase in state funds in the first year of the twoyear budget.
Ziegler said the Ohio House of Representatives has proposed capping increases in state support at 6%.
She said there has been very little talk out of the state capital about school funding for the next biennium.
Acting out of caution, Ziegler built a 2% increase in state funding into her calculations.
The total tax valuation of the school district declined 12.6% between tax year 2010 (payable 2011) and tax year 2012 (payable 2013), but revenue from property taxes has remained steady.
That’s because Fulton and Henry county auditors have been able to increase millage rates charged against owners.
Millage rates are reduced to prevent property taxes from increasing with appreciation.
Conversely, when property values go down, millage rates can be increased to the voted amounts.
Ziegler said she projects minimal increases in total tax valuation beginning in FY 2014 due to updates and reappraisals of property values.
In spite of reduced spending in salaries and benefits, plus other factors, the district still is in a deficit spending mode.
Ziegler projected that at the end of the current fiscal year, the district will have spent a little over $1 million more than it took in.
But, she predicted the school district will still have more than $3.6 million in cash on hand.
Ziegler said the school board does not have a “cash policy.”
She said she has talked about maintaining enough cash on hand to operate the school district for 60 days.
For Archbold schools, that’s about $2 million.
Her projections call for the district to reach that level roughly at the end of the 2014-15 fiscal year.
“The bottom line is, the concern is not as imminent as it was in October,” she said.