The Kenston Local Board of Education members appear to be holding their breaths after approving the May five-year forecast without the slash to state funding recently announced by Ohio Gov. Mike DeWine. The cuts to public school districts are due to a drop in state revenue during the coronavirus epidemic shutdown over the past two months.

Despite taking a hit of more than $791,000 to their budget for fiscal year 2020, Kenston schools’ Treasurer Paul Pestello said he opted to present the forecast as he did prior to the cut for board approval. He explained, however, that the district will file another five-year forecast to the state in June as more information is available to the districts on how the budget cuts will play out.

“The five year forecast I asked you to approve this evening was prepared over a week ago,” Mr. Pestello said in his report to the board during the May 11 board of education meeting. He said he made adjustments when school districts heard they were to expect reductions of 3.7 percent of their foundation funding as a result of the state cuts, which would have been $130,000 for Kenston schools. Upon hearing that this number climbed to $791,000 (21.4 percent of their state funding) for Kenston as a result of being considered a wealthier school district, he chose to present the budget for approval without this cut.

Mr. Pestello explained that he attended a Zoom meeting that was cosponsored by the Buckeye Association of School Administrators, known as BASA, and the Ohio Association of School Business Officials, known as OASBO, providing a statewide update dealing with the recent reduction to education funding. He received highlights from Aaron Rausch, director of the Office of Budget and School Funding from the Ohio Department of Education, as well as insight regarding the preparation of five-year forecasts amidst the state budget cuts from Chris Moore, a former OASBO chairman.

“We are going to utilize the best information that we currently have prior to hearing [about the $791,000 in budget cuts] because this is a simulation,” Mr. Pestello said of the forecast. “The hope is that the governor will reconsider his position and take a softer approach to what he’s calling wealthier school districts.”

Mr. Pestullo said that while school districts are required to file two five-year forecasts in November and May, “nothing precludes us from filing 25 five-year forecasts if we wanted to.” He explained that districts are encouraged to file more than the required two forecasts, especially to account for dramatic expenditure or revenue fluctuations.

The five-year forecast the board approved, Mr. Pestello said, includes for fiscal years 2021 and 2022 a 15-percent reduction to state foundation funding, a 3-percent reduction to real estate tax projections, a 50-percent reduction to investment income and a 33-percent reduction to casino tax.

For fiscal years 2023 and 2024, Mr. Pestello said he brought figures back to what he believed they would be for fiscal year 2020 prior to COVID-19.

“It brought our ending cash balance in fiscal year 2022 to just about $3.9 million,” he said, noting that it does not consider the $791,000 reduction.

Mr. Pestello added that if the cuts are not remedied, the district does have the ability to withstand the $791,000 budget cut.

“For what it’s worth, our current financial situation has us at about $1.3 million ahead of plan,” he said, noting that this is where he would like the district to be under normal circumstances. “So, we can certainly withstand the $800,000 reduction. It’s just not something we would, obviously, have wished for.”

In talks of cost reductions, board member Bill Timmons asked if the district has seen any significant savings as a result of closing the school buildings.

Mr. Pestello said that with school buildings closed in mid-March, between the reduction of fuel, heat, electricity and supplies expenses, he estimated that the district has saved about $150,000.

“That obviously helps,” he said. “But, again, it’s certainly not $800,000.”

Mr. Timmons also asked if there would be any opportunity for further savings by choosing not to replace retirements, to which Superintendent Nancy Santilli said the board will evaluate the positions and current staffing, noting that with current class sizes, the district is already “pretty stable with staffing.”

Mrs. Santilli also said that standard summer maintenance and cleaning projects are already underway. She noted that while there have been some savings in getting a head start on this, those savings have been counteracted by extra measures needed to be in place due to the health crisis and possible preparations for social distancing constraints for the next school year.

Board Vice President Neysa Gaskins noted in regard to Mr. Pestello’s report that her biggest concern lies in the state’s $2.7 billion rainy day fund, anticipating more hits to the district’s state budget.

“The thing that’s most alarming and concerning to me is the fact that the state won’t tap into its rainy day fund and that they said they’re going to need that for the future,” she said. “If they’re saving that rainy day fund, that’s a bad sign.”

Sam Cottrill started reporting for the Times in February 2019 and covers Auburn, Bainbridge, Bentleyville and Chagrin, Kenston, Solon and West Geauga schools. She graduated from Kent State University in 2018 with a bachelor's degree in journalism.

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