It’s back to the starting line for Chagrin Falls district financial objectives after school leaders last week decided to cancel plans for a 7.9 mill levy on the fall ballot due to the ongoing coronavirus outbreak.
Members of the Chagrin Falls Exempted Village Board of Education said it would be irresponsible to burden residents with a new levy because many people may be out of work due to state-mandated business closures and Gov. Mike DeWine’s stay-at-home order.
Instead, the board is considering a “no additional tax” levy of 3.85 mills for the November ballot to replace the current 3.85 mills that will expire in December.
“We are certainly in a different environment than we were a month ago when we were having conversations” about putting a levy on the ballot, district Treasurer Ashley Brudno said. “I don’t think anybody would disagree that it’s probably not the most responsible thing to go ask our taxpayers for 7.9 mills right now.”
The board had not yet made any official motions or resolutions to put the 7.9-mill levy on the November ballot, but conversations in recent meetings favored the millage, and a November ballot’s higher voter turnout – due to the presidential election – often yields levy passage, as board member Kathryn Garvey and Mrs. Brudno had noted in previous meetings.
Mrs. Brudno said while the need for 7.9 mills is still the same, the district will have to reevaluate how many mills would be appropriate to ask voters to approve this November and what cost savings the schools would have to implement to avoid deficit spending by 2024 and to maintain a favorable levy cycle.
Due to the COVID-19 school closures that began on March 16, Mrs. Brudno said the district has already saved about $200,000 this year, including savings of about $25,000 in fuel, $4,000 in trash and recycling and $20,000 in contracted services, among others.
Gov. DeWine announced Monday that school buildings would remain closed statewide for this academic year and distance learning would continue. What will happen in the fall likely depends on how well the virus is being contained.
Mrs. Brudno noted the district had already identified about $300,000 in savings and cost avoidance throughout the year. She said the district will work to reduce aide positions with about $23,000 in savings, reduce full-time positions with up to $95,000 in savings – both from changing some positions to part-time or by not replacing vacant positions – and hold the budget flat with about $100,000 in savings, among other internal changes. “These are things we’re already working on implementing,” she said.
She added that the board has also been looking at other potential areas to save, including switching to a self-insured model for staff health insurance, which she said would save the district $125,000 in fees alone with the potential to save the district up to $1 million.
These changes may not be enough, however, to get the district where it needs to be, Mrs. Brudno said, noting that deeper cuts may be needed with the uncertainty of the virus outbreak and the economy.
“In addition to all of the savings and cost avoidance items that we’ve been putting together all year, over the last couple of weeks, we’ve kind of started looking at additional items and looking for areas where we can still get to where we need through a different manner,” Mrs. Brudno said. “These are items that are going to affect the programming. They’re going to affect the product that we offer our students. There’s just no way around it.”
“I think we’re looking at a down economy,” Mrs. Garvey said in support of Mrs. Brudno. “We don’t know how long that is going to last. It’s our job to prepare for the worst and hope for the best.”
Mrs. Brudno said with the approximate $500,000 of combined savings from the school closures and implementations already underway and passage of a 3.85-mill levy this fall, the district could be looking at two years before going to the taxpayers with another levy with a potential for three years.
“To get to three, we would have to move to an additional level of reductions,” Superintendent Robert Hunt said.
Mrs. Brudno said she doesn’t believe “painful” cuts would be necessary to get the district to a three-year levy cycle, but without knowing what will happen with future revenue, “I don’t want to promise that.
“Just because we’re levying a certain amount of taxes, [that] doesn’t mean we get that,” she said. “As the economy goes down, people can’t pay their taxes and then there are more delinquencies and we collect less.”
“I think we would be too aggressive to assume that our revenues just hold steady because people are putting off their mortgages for six months,” Board President Phil Rankin agreed. “It’s going to affect taxes.”
Dr. Hunt said failure of 3.85 mills this fall could mean 7.9 mills next spring. He added that if 7.9 mills failed next spring, 7.9 mills could then be pushed to November of 2021. “If that fails, you’re talking about catastrophic cuts,” he said.
Board member Mary Kay O’Toole noted that the district’s budget is primarily salary and benefits and that the “catastrophic cuts” would mean people.