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WCS budget crunch

October 24, 2012

Wapakoneta School Superintendent Keith Horner

CRIDERSVILLE — Reviewing the school district’s finances, Wapakoneta City Schools top administrator told school board members they will have to make some “tough choices” in the next couple of years or the district will be in debt.

During Tuesday’s meeting at Cridersville Elementary School, Wapakoneta School Superintendent Keith Horner dissected the school district’s five-year financial forecast for Wapakoneta City Schools Board of Education members. The school district, which has been operating with annual deficits at least since the fiscal year 2010, will be in debt during the fiscal year 2014, which starts July 1 and ends June 30, 2014 if changes are not made.

“The good news is these folks (teachers) are working very hard in the classroom, the good news is preliminarily we have an excellent rating on our state report card which is thanks to the teachers working every day with the kids in the classroom, but we have a dramatic issue that we are going to have to face very, very soon,” Horner said. “We are faced with some very tough choices.”

Unlike 20 years ago, he said open enrollment makes educating youth a more competitive market and threatening cuts to programming or utilizing a “pay-to-play” philosophy to participate in extracurricular activities makes the school district less desirable to attend.

“We are in a much more competitive market than what we were 20 years ago or even 10 years ago,” Horner said. “Every school district is battling for kids, so we have got to somehow remain competitive — and that means what we do in the classroom and that means what we do outside the classroom. We have to give students a reason to be Wapakoneta Redskins each and every day.

“We are going to have to make some very tough decisions moving forward or we will need to look for additional revenue — or both,” the superintendent said. “Going into the future to remain competitive, we are going to have to make some tough decisions on how we want our district to look.”

Revenues remain relatively flat with the district having $22.99 million for the fiscal year 2010, climbing to $23.65 million during fiscal year 2011 before falling to $22.45 million in fiscal year 2013. Revenues are expected to climb slowly to $22.88 million by fiscal year 2017.

Total expenditures were $23.56 million in 2010 and $24.98 million in 2011, before falling to $23.99 million for 2012. Expenditures climb from $24 million this fiscal year to an anticipated amount of $25.58 million in 2017.

These deficits reduced a $5.2 million cash carryover in fiscal year 2010 to an anticipated $990,131 at the end of this fiscal year. With a $1.68 million deficit expected in fiscal year 2014, the cash carryover disappears and results in a $689,975 debt that year. The number climbs to $7.68 million by end of fiscal year 2017.

Personnel salaries and benefits account for approximately 75 percent of the each budget, declining from $18.45 million in 2010 to $17.76 million in 2013 before rising to $19.23 million in 2017.

Having reduced teaching staff by 40 from 335 teachers to 272 teachers, in the past few years while enrollment has remained steady at approximately 3,030 students, Horner said he does not feel the school district can cut staff anymore.

School District Treasurer Susan Rinehart said state cuts in funding are hurting the district. Prior to 2010, the district would see an annual 3 percent rise in state funding, which makes up approximately 60 percent of the school district’s funding. With the recession, they cut school funding to 2 percent or less in annual increases.

With a new state funding formula expected in the next year, school administrators forecasted revenue from the state being flat at $12.77 million.

“We can’t advise the board until we know the new funding formula,” Rinehart said. “We have to wait and see what the funding formula looks like before we will plug those numbers in.”

Rinehart also explained the district was hit hard when special education costs recently rose $1 million in one year. She noted it cost $38,000 to have one special education student graduate in 2012.

Pre-school education costs the school district must pay totaled $198,000, with the state only providing $18,000, or 10 percent, of the mandated program. Rinehart said this is just one example of state and federal mandates chipping away at local revenue.

“I want the public to know it is not the staff, it is not the school board — most of the issues the school is having as well as other schools around the state are having is because of state and federal mandates,” Rinehart said. “Money we have to spend that we simply do not have.”

Board member Eric McKinniss explained casino money “is not the savior” with the district receiving approximately $19 for each student. Horner and Rinehart did not include casino revenue as part of the economic forecast, and McKinniss warned the casino money may be deducted from the state share.

Board member Pat Gibson explained those attending the meeting that there is restricted money and unrestricted money and the two cannot be mixed. The restricted money is for “bricks and mortar” and cannot be used to pay personnel.

He also shared his thoughts on going to the voters with an operations levy.

“I have said publicly and privately that I won’t support going back to the voters until it is absolutely necessary,” Gibson said. “We have had to do some belt tightening, but we can’t price ourselves out of the market. For every student that leaves here, that is a student we probably won’t get back. We will have to look at programming, and like what Mr. Horner said  we may have to come back to the voters.”

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