Brecksville-Broadview Heights City School District can expect to have a negative cash balance by the end of fiscal year 2014, Treasurer/Chief Financial Officer Karen E. Obratil said during the in the .
Obratil presented the newest version of the district’s five-year financial forecast to the board on Monday. The district must submit a forecast to the state twice a year. The forecast is just a projection of expected costs and revenues and can change. And the forecast only includes the operating budget – projects like construction are separate.
But the bottom line for this forecast is that spending is going up and revenues are going down – even after all in the past few years. Here’s a quick look at some of the line items expected to affect the budget.
The biggest losses to revenue are expected to come from the state. The district is losing money this fiscal year and next because the sped up the phase out of the tangible personal property reimbursement and cut the public utility reimbursement. And while state funding actually went up a bit this year—the district is getting a small per-student stipend for being high-performing—the forecast accounts for decreases in state foundation funding in fiscal years 2014, 2015 and 2016. Those numbers will be dependent on the next state budget.
The district will also lose money after this fiscal year when the federal stimulus funds run out.
The biggest source of revenue for the district—about 67 percent—is from local real estate taxes. Millage that is voted on by taxpayers is expected to stay flat, in accordance with state law. “Inside” millage, which Obratil said is shared by school districts, cities and the county, can fluctuate a small amount based on property values.
The majority of the expenses are salary and benefits – salary and wages will account for about 64 percent of all spending in fiscal year 2012 and benefits will be nearly 22 percent. Obratil said that this percentage is on par with other districts. And spending on salaries is actually down a bit this fiscal year, but it is expected to go up in the following years because of a step deferral from this fiscal year to next.
The forecast assumes that staffing will remain at its current levels and does not include any base salary changes for accounting purposes only. Board Vice President Mark Jantzen noted that the forecast is not indicative of the board’s positions regarding future negotiations.
Other expenses are pretty minimal when it comes to the big picture. For example, purchased services, like tuition to other schools, is only 8 percent of the total budget. Supplies make up less than 3 percent of the budget.