By Rick Palsgrove
The Groveport Madison Board of Education is considering its options for placing an operating levy on the ballot because inflation is causing the district’s expenses to outpace flat revenues.
At the April 10 board of education meeting, Treasurer Felicia Drummey said “the cost of the services we are providing to our students is greater than the revenue being provided.”
She said this revenue gap will grow to $6.9 million next year and $9.6 million the following year.She said to ensure the district has the necessary resources to keep up its services to students and provide additional safety measures the district needs to close the revenue gap, which includes: spending reductions, renewing the expiring levy, and passing a new additional levy, or a combination of these actions.
“Current revenue cannot sustain the services that our parents and community expect for students” said Drummey. “The earlier we impact spending and revenue patterns, the less impactful other corrective remedies would have on students, whether its spending reductions or new levies. We have been judicious in our historical spending by fully utilizing federal grants.”
She said the board could consider $4 million to $6 million in spending reductions to balance the operating budget, depending on the board’s comfort level in reducing services.
Earlier this year Drummey noted that the state legislature has discussed various bills that could dramatically impact school funding in Ohio and that the district “does its best” to plan by anticipating the most probable outcomes of new laws when reviewing the overall financial picture.
The district hasn’t received any new money since the expiring 6.68 mill current expense levy was first approved by voters nearly 10 years ago in 2014. This “no new taxes” levy was renewed by 67.35 percent of voters in 2019.
The earliest the district’s existing five-year renewal general operating levy, which will expire in 2024, can be placed on the ballot is November 2023. If it is approved, the district would receive half the funds it generates in 2025 and the remainder in 2026.
According to information provided by the Bricker and Eckler law firm to the district, Groveport Madison has the second lowest effective millage rate out of 17 Franklin County school districts. Effective millage is the rate actually levied on a property. Once a levy is approved, a district cannot collect any additional money due to a valuation increase from reappraisals or triennial update on that levy. Residents of the district benefit from the high commercial tax base by sharing the tax burden almost equally.
As of fiscal year 2022, the district receives 46.5 percent of its revenue from property taxes, 40.7 percent from state funding, and 12.8 percent from other sources.
As a service business, salaries make up 52 percent of expenditures, benefits are 23 percent, and contracted services are 17 percent.
According to Drummey, salary expenses may increase an average of 7 percent annually. Benefits costs are also rising an average of 8.5 percent. This increase is driven by the return of previously held positions, such as teachers, nurses and counselors, to the general fund upon expiration of grant funding that sustain instructional services levels throughout the pandemic.
The board and district officials are planning to hold work sessions to consider the type of levy or levies to present to voters, financial options, and ballot timing.