The Chagrin Falls school board Finance Committee must, once again, head back to the drawing board as members look to putting a levy on the November ballot.
After Gov. Mike DeWine slashed the state’s budget by $700 million due to decreasing revenue from the COVID-19 outbreak, $300 million of which is to be taken from public K-12 schools, board members were rendered momentarily speechless after Treasurer Ashley Brudno laid out the numbers during the May 6 meeting.
“Last time we talked about this, we talked about [passing] 3.85 mills” for the November ballot to replace millage that will expire in December, Mrs. Brudno told the board. “The last numbers that I provided to you looked like if we did that, we would be able to get three years without any additional cuts beyond the $350,00 that we’ve already implemented for next school year. That is no longer the case.”
On top of the $350,000 in cost savings already being put in place by the district by reducing aides, full-time positions and other internal changes, as well as about $200,000 in savings from the building closures due to reduced utilities and contract services, the district must now look to slice out up to another $650,000 from their budget starting next year if they want a 3.85-mill levy to extend through a three-year levy cycle, Mrs. Brudno said.
Due to the state budget cuts, the Chagrin Falls Exempted Village School District will lose almost $534,000 in state foundation funding, about 32 percent of its state funding, for this fiscal year, which ends June 30, Mrs. Brudno said, adding that the district has been told by financial experts to expect cuts again for the next fiscal year at an average of 20 percent of their state funding.
“Given this news from the state, we’re going to have to go a lot deeper into our lists of potential cuts,” Mrs. Brudno said.
“I think we all recognize that we need to take some action pretty quickly to get our spending down,” board member Kathryn Garvey said. “Then we also need to reevaluate the millage and the timing of the levy and how long we want this next levy to last.” She said with the possibility of more cuts coming their way, the district may have to consider a levy north of the 3.85 mills in the fall or possibly coming to voters the following spring with 7.9 mills.
Mrs. Brudno said that after discussions with Cuyahoga and Geauga counties, the district could expect reduced tax revenue collections. Looking to the last recession from 2008, she said the district might expect between 95 percent and 96-percent collection.
With a total of about $900,000 in cuts with about $200,000 in savings from the COVID-19 closures, Mrs. Brudno said the district may be able to stretch their levy cycle to 2023 with 95-percent collection, but this assumes the district does not move forward with its $2 million bus garage project next summer.
She said if the district were to move forward with the bus garage, they would need to cut an additional $1.25 million to extend the levy cycle three years.
“I think the board needs to maybe have another conversation about bringing 7.9 [mills] back on the table,” board member Sharon Broz said. “I mean, we now need more money than we knew we needed two days ago.” She said the board would need to discuss further how the scenarios for this would look or what the timeline would be on presenting this millage to voters.
“This is a little bit of a chicken and egg scenario,” Mrs. Garvey said. “It’s hard for us to nail down a millage and how long it would last without us also looking at what costs or what cuts are reasonable.”
Board President Phil Rankin and Superintendent Robert Hunt both agreed that pushing back capital expenditures may be necessary under the current economy.
Mrs. Garvey noted that the board would need to be weary that pushing back capital expenditures from their permanent improvement fund would only yield one-time savings.
The board also discussed possibly increasing the levy this fall. Board Vice President Greg Kanzinger noted that if the district decided to do this, they should only do it by 1 mill.
Mrs. Brudno said 1 mill is about $545,000 with current collection rates for the school district.
To minimize cutting salaries and impacting programming offered to students, Mr. Kanzinger said the district would have to “lean heavy” on permanent improvement cuts.
In addition to cuts, the board also discussed ways to gain additional revenue aside from millage, especially if a levy were to fail in the fall.
Dr. Hunt said while he is not recommending it at this point, the district could consider open enrollment.
“I think it opens up a lot of community dynamic issues,” he said. “But again, I just think if we’re going to talk about everything, we should put it on the table; either rule it out or rule it in and move on.”
He added that pay-to-play options for sports and other extracurriculars, but said he felt it would not be appropriate “to hold the community accountable for the actions of our government.”
In terms of open-enrollment, the board agreed that it is not the route they would prefer to go, but if levies are failing, it is something about which they would need to spend time talking to the community.
Board member Mary Kay O’Toole noted that with pay-to-play, the district would need to be careful with what programs they would include and should first consider cutting expenses like new uniforms.
The next regular Chagrin Falls BOE meeting is scheduled for May 20 at 6 p.m.