By Rick Palsgrove
Groveport Madison Schools’ finances are currently in good shape, but the district’s existing levy will need to be renewed by voters in 2019 to maintain future fiscal stability, according to the district’s most recent five year forecast.
The district’s 6.8 mill levy was passed in May 2014 and will expire on Dec. 31, 2019.
“The district administration will be able to plan for the future needs of our students with the financial stability obtained with the current state budget and the passage of the levy,” wrote Groveport Madison Treasurer John Walsh in the five year forecast report. “But they will also need to be mindful there are many risks and uncertainties that will need to be considered in future planning as there are two new state budgets in fiscal year 2020 and fiscal year 2023.”
The forecast shows the district with positive cash balances of $16.7 million in 2018; $18.7 million in 2019; $15.9 million in 2020; and $8.1 million in 2021. However a deficit of $1.5 million is projected in 2022 depending on levy results.
“If a levy is not successful, then we will have a deficit of $1.5 million (in 2022),” said Walsh. “The levy is a must.”
Walsh suggested to the Groveport Madison Board of Education at its May 2 meeting that it should consider making the levy that expires in 2019 a permanent levy.
According to the forecast, the district’s general fund revenue for fiscal year 2018 is $83.1 million.
The district receives 53 percent of its revenue from state funding. Real estate property taxes make up 41 percent of the revenue with the remaining 6 percent coming from other local sources.
“The district is very fortunate to have received more funding for fiscal years 2018 and 2019 than had been expected from the state budget,” wrote Walsh in the forecast. “Being that 53 percent of the funding for the district is from state dollars this increase is very beneficial to the overall operations for the education of our students.”
Walsh said potential and unknown future changes in state funding would have an affect on Groveport Madison’s finances.
“The risk comes in fiscal year 2020 and beyond if the state economy worsens or if the currently adopted funding formula is changed to reduce funding to our district in a future biennium budget,” wrote Walsh.
According to the forecast, the district’s expenditures for fiscal year 2018 are $78.1 million.
Wages and benefits account for 63 percent of the district’s expenditures.
“People costs are your biggest item,” Walsh has said.
Purchased services make up 31 percent of expenses while materials are 3 percent, capital is 1 percent and miscellaneous is 2 percent.
Purchased services expenses include payments for contracted services, utilities, gas, electric, property insurance, and transportation. However, 34 percent of purchases services expenses come from Groveport Madison being required to make payments to community (charter) schools. Likewise, the Educational Choice Voucher program and open enrollment schools are also expenses. These expenses are due to students who live in the district but attend school elsewhere. In Ohio, state money follows the student so Groveport Madison loses dollars to other schools that these students choose to attend instead of Groveport Madison.