Reynoldsburg school board members have approved a new five-year financial forecast that not only demonstrates financial stability but also a positive fund balance that continues to delay the need for an operating levy, according to treasurer Tammy Miller.
“Even though expenditures begin to outpace revenues in fiscal year 2021, the cash reserves will enable the board of education to delay the need for an operating levy,” Miller said.
Miller’s department presented a more entertaining way for the community to view the five-year financial forecast on the district website at https://tinyurl.com/ybypvwxn. The video slide presentation includes a depiction of Miller and Superintendent Melvin Brown on a teeter-totter to demonstrate the need to “balance” students’ educational needs with school finances.
The fact they fall off and laugh in the video depicts the struggle, Miller said, but not the good news the forecast brings, which is that the budget “exceeds the goal of a positive cash balance through 2020.”
In fact, the forecast shows a positive cash balance through fiscal year 2023.
Actual revenues through fiscal year 2018, which ended in June, were $82,523,904 with expenditures at $74,745,510. The carryover cash balance was $31,096,967. Factoring encumbrances results in a fund balance for 2018 of $37,734,037.
Expenditures are predicted to exceed revenue by $2.7 million in fiscal year 2021, but because of a still healthy carryover cash balance in excess of $43.1 million, the fund balance is predicted to be at $39,299,455.
The forecast shows the deficit between expenses and revenue increases to $10.1 million in 2023, but the fund balance is predicted to be at about $22.9 million.
Miller said because revenues have outpaced expenditures by more than 10 percent in the last few years, the district has been able to shore up its cash reserves and set aside funds for future bus and technology purchases.
She said the technology fund was at $5.6 million July 1. With anticipated expenditures of $500,000 each year, Miller predicts that fund will last through 2024.
The bus-purchase fund was at $2.4 million on the same date and would pay for bus purchases through 2025, Miller said.
The district also has a capital projects fund, which had a $3.3 million balance July 1. That fund is used for building repairs.
On the expense side, district expenditures are led by salaries and benefits, expected to be at about $53.3 million in 2019, or 70 percent of the school budget, Miller said.
Purchased services, which include special education costs, community school deductions, utility expenses and College Credit Plus expenses, are expected to be at about $18.2 million in 2019, according to the forecast.
Miller said open enrollment continues to help boost the district’s bottom line.
“We began accepting open-enrollment students in 2013,” she said. “Currently, we have a little over 600 open-enrollment students, which generate about $3.67 million per year in revenue.
“This is equivalent to a 5-mill operating levy,” she said.
Voters last approved a 9.9-mill incremental levy in May 2010.
School board member Debbie Dunlap said the good financial report was not a surprise to her.
She said Miller updates the board on finances throughout the year.
“For several years, we have been very healthy and fiscally sound, even as we restored our art and music offerings in more recent years, and some other staffing and programs,” Dunlap said. “I am very proud to be a part of a district that has remained fiscally responsible for so many years, truly a team effort.”
She said while open enrollment continues to boost district finances, Reynoldsburg residents remain the top priority.
“As our enrollment increased in Reynoldsburg — which is a good thing — we have had to shift some of our current open-enrollment students in order to accommodate them this year, and had to turn away a handful at the elementary level,” Dunlap said.
The district’s open-enrollment policy makes clear that Reynoldsburg residents have a priority when it comes to district enrollment, so the number of open-enrollment students could begin to decrease.
“Some preliminary discussions have already begun as to how this will look and the impact it will have on our district finances,” Dunlap said. “If resident enrollment remains on the upswing, then we would have to turn away more open-enrollment students — and with them, the matching state dollars.”
Dunlap said if state funding were not capped, Reynoldsburg could make up the open-enrollment amount through state funds.
The district will not receive about $3.7 million in 2019 because of the funding cap, which limits Reynoldsburg to about $39 million per year, Miller said.