Highland, hit hard by state budget cuts, projected to be in deficit spending by June; staff cut, levy on the horizon

by Erica Peterson 

May 18 school board meeting 

Highland Local Schools stands to lose close to $1 million in funding, following the Ohio Legislature’s decision to slash the state’s education budget by $355 million. 

“Our district has lost 19 percent of its basic state aid, which translates to an immediate reduction of $913,304 by June 30, 2020,” said Superintendent Catherine Aukerman. “As a result of this cut, we begin deficit spending in June 2020.” 

According to the state, “The district seeing the largest reduction as a percentage of operating expenditures is Medina County’s Highland Local Schools at 2.83 percent, or $282 per pupil.” 

That’s because the state thinks Highland can adequately fund education with local funds, Aukerman said.

“The ability of school district to fund education locally was a key factor in determining how they would be affected by state spending reductions,” she said. “Highland’s considered a high wealth district, meaning by the state’s formula, our community has the capacity to fund their own local school district. So, we then receive less financial support from the state.” 

The cut will be mitigated some by the $138,000 Highland expects to receive from the CARES Act, but that still leaves the district with $777,000 in lost revenue by June 30, she said. 

That means the district’s response needed to be swift, Aukerman said. “We cannot wait to address this and make some spending reductions,” she said.

Effective immediately, the district will not replace staff members who retired or resigned this year, outside of state-mandated positions like some in special education.

Some of those positions include the superintendent’s secretary, the district’s gifted program coordinator, a Highland High School guidance counselor, a half-time computer teacher at the middle school, two classroom aides, an EOL (education online) tutor and a groundskeeper. A full-time secretary in the treasurer’s office has gone to part time. 

“Our goal was to replace those staff members,” Aukerman said. “To go without some of these key positions is going to have an impact on our school district and our students.” 

Also, all building budgets will be reduced by 25 percent from last year.

“We’re making reductions across the board,” she said. “That is probably $550,000 of immediate reductions that we’ve made through attrition. We’re not done.” 

She said the district may get to the point where “we would need to be reducing staff that are currently at each of our schools.” Since 80 percent of the district’s expenses are for staffing, that is where future cuts would have to be made, Aukerman said. 

She said a parent told her she hoped the cuts wouldn’t reach the classroom. Unfortunately, they will, she said, “because when we don’t replace people, class sizes get higher. There is an immediate impact on everything we do here.” 

Forecast and levy 

Treasurer Neil Barns presented the five-year forecast to board members, which they approved. Saying he’d never had a challenge like trying to predict the district’s financial future amid so many unknowns caused by the pandemic, the forecast predicts a $6 million drop in revenue by fiscal year 2024. 

Barns said he based his conservative projections on several factors, including an assumed uptick in property tax delinquencies and a slowdown in new construction growth due to the economic situation surrounding the pandemic.

It also assumes another $487,000 drop in state funding for fiscal year 2021 as well as the loss of casino tax revenue, which is projected to drop 40 percent for fiscal year 2021. 

The forecast also assumes a renewal levy is passed before November 2021, Barnes said.

Both Aukerman and school board members said the renewal is critical. “We cannot function without that renewal,” she said.

The district needs to make some “very tough decisions as to when that’s going to go on the ballot,” Aukerman said. “Again, that would be no new taxes, but the hardship on this five-year forecast just grows exponentially without that renewal.” 

Also, she said, the district communicated during the planning of the building project that it will need to go to the ballot soon for new operating money.

Acknowledging the timing is bad, Aukerman said the last time the district made such a request was May 2011. 

The district will need to have “some very difficult conversations” about both levy requests, she said. She expects decisions will be made in June about when to put the renewal on the ballot.

“And I think it’s fair to the community to try to lay out a plan for when we would expect to be on [the ballot] for new operating money,” Aukerman said.

Board President Dr. Norman Christopher said he thought the renewal levy “needs to be taken care of pretty urgently. … And then we can have a real conversation with the community about what the future looks like … and what the implications are for the next 18 months or so after that.”