District weighs its options
Since the defeat of Issue 81, the South-Western City Schools Board of Education is left to weigh its options.
At the Nov. 24 special meeting, board members discussed the next step in dealing with building and operating funds.
If voters had passed the 9.69-mill combined tax levy and bond issue, the district could have collected operating funds in 2009. Those funds would have held the district through 2012. Now, even if voters were to approve another try in the spring, collections would not begin until 2010.
“Losing that year puts us in a deficit earlier than expected,” said Treasurer Hugh Garside.
The district faces a $5.4 million deficit in fiscal year 2010. The amount jumps to $33 million the following year.
Garside said the district had two options to consider. One option would be to go back to the voters, but with an increased millage rate. He explained that a 9-mill tax levy would put the district in the same boat at the end of 2011 as the passage of Issue 81 would have.
The other option; reduce expenditures.
Garside said the district spends approximately $4,600 less on per pupil expenditures than the highest ranked district in Franklin County.
“If you look at the numbers and the data, we are spending wisely,” said Garside.
The district receives about $80 million to $90 million annually from the state of Ohio. If the state cuts its budget, millions are scrapped from the district.
Garside said district officials plan to arrange community meetings to find out why residents turned the issue down. The board should decide what millage rate to pursue for a May levy this February.
The bond issue portion of Issue 81 would have allowed the district to construct 13 new elementary schools to replace 15 buildings. It would also have funded the building of four new middle schools and a new high school.
The Ohio School Facilities Commission (OSFC) offered to fund 47 percent of the facilities project. That averages out to approximately $206 million. The state secured the funds through a billion dollar tobacco settlement.
Rick Savors, chief of communications with the OSFC, said those tobacco funds are available for the next three years.
“After that, I’m not sure what will happen as far as allocating money for school districts,” said Savors.
Superintendent Dr. Bill Wise explained that the district has OSFC funds until August of 2009.
Savors said the community has to pass its local share before the state will give out the money.
“We have already asked you to the prom and you said no. Now you have to ask us,” said Savors.
If the district cannot pass a bond issue in its allotted time, it becomes a lapsed district. Savors explained that if the district gets its local share, district leaders can reapply for funding and they would become a priority for the next funding cycle. For example, if the district were to pass a bond issue in the fall of 2009, it would be on the top of the list to receive state money in the funding cycle beginning in July 2010.
“We still have about $2 billion left in tobacco funds,” said Savors. “I cannot guarantee the money will be there, but I would be very surprised if it was not available.”
One option the board discussed was segmenting the building projects.
Savors said this allows districts to “chop the project into parts” which makes it easier on taxpayers. For example, segment one could include the construction of seven new schools. Funds would only be collected for that building project. When the district was ready for segment two, they would come back to the voters at that time.
Segmentation is a new program offered by the OSFC. In order to move forward, the local share of the segment must equal or exceed 4 percent of the district’s valuation. Other criteria must be met as well.
Some board members expressed concern that state dollars would not be available at later segments. Savors said that is something the board would have to consider, along with inflation costs.
“The board will have wide latitude on determining segments,” he said.
If district leaders wanted to pursue splitting the facilities project into segments, they would have to make a decision in January. They would also have to amend their master plan.
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