Marysville School officials have known for many years that the early 2020s would be the end of a golden era for the local district.
Solid state report card data and growth in programs were attained while the schools have stayed off the ballot for the most part. But, forecasts showed that new operating money would be needed heading into the second half of the decade.
Treasurer Todd Johnson said the district has been open about the fact that the need for a levy would materialize in 2022 or 2023. In fiscal year 2023, which is the current budget year, district expenditures are projected to outpace revenue by $3.7 million. Keeping the district in the black is $25 million in cash reserves, which will be chewed into annually until a new revenue stream is approved.
On the current path, projections show the district with a positive balance through fiscal year 2025, but cash reserves should be depleted in 2026.
Because of that, the district is asking voters to approve an 8.4-mill, five-year emergency levy that will generate about $9.6 million annually. The district had initially decided on a larger 9.9-mill ask, but reduced the amount after some resident pushback.
The levy on the May 2 ballot would cost a district homeowner $294 annually for every $100,000 of home value.
Officials originally felt an income tax might be a more attractive option for voters because it lessens the impact on senior citizens and the farm community. Focus groups, however, found that local voters felt more comfortable with a property tax levy.
“The feedback was ‘we understand a property tax and we want to stick with the property tax,’” Allen said.
The superintendent said that despite obvious advantages for senior, even older residents did not like the idea of an income tax.
“We thought it would be an interest for even our senior citizens, as an earned income tax for a school district that does not impact your pension,” Allen said. “…When we met with senior citizens, they didn’t trust it.”
District official believe in the message they are putting before voters, that the district provides a top-quality education, at a below average price. Support materials tout the fact that the district hasn’t approved “new money” levy in 15 years, referencing a 4-mill new money and 5-mill replacement levies approved by voters in 2008.
In 2019, voters approved a measure to allow an increase in capital improvement funds, equivalent to a reduction in bond collection, which then allowed money to be shifted over into operating funds. The move did not result in a net increase in taxpayer bills.
Officials point to a variety of cost saving measures that have allowed the district to operate lean for so long. Using mostly state funds to open the former high school as a new Early College High School created building capacity in the district’s higher grades, while the district eliminated two administrators, reduced office staff and instituted cost saving measures in the use of energy.
But one of the biggest drivers in the district’s ability to stay ahead of expenses for so many years was a taxing structure that has changed. The taxation of tangible personal property (TPP) brought in millions of dollars annually into the district.
The mechanism allowed the district to tax the inventory of large local employers, reaching a high of around $10 million in the late 2000s. But since then the state began to slowly eliminate TPP funding by $600,000 per year. It will be completely eliminated by fiscal year 2025.
“We were the 5th largest tangible personal property tax revenue district in the entire state,” Johnson said.
This district is also seeing growth of about 100 students per year. While the district has been making moves to find space for the students, such as renovating the former board office on Edgewood Drive into classroom space, the steady increase in pupils has forced the number of staff members to grow.
Levy Committee Chairman Steve Cox said some residents see growth in the schools as a negative byproduct of unwanted growth in the community. Punishing the students and schools for that growth by voting no on the levy looks at the issue in the wrong way, he said.
“I think it’s important to state that the school system here can only react to growth,” Cox said. “The school system does not drive growth. The school system doesn’t make that decision.”
According to a report earlier in the year, the district report card puts Marysville in the top 20% of Ohio districts in terms of performance, while spending $11,700 per pupil per year, 13% lower than the state average.
The per pupil ammount remains lower than average, in part, because Marysville’s collected effective millage sits at 20.171, barely above the state’s mandatory minimum of 20 mills.
The district has put in place a contingency plan that will be set in motion if the levy doesn’t pass in May. That will include a hiring freeze that will lead to an increase in class sizes, the elimination of TRI Academy, the elimination of school funded assistant coaches/advisors/directors, and the elimination of school funded extra/co-curricular travel and field trips.
The district has also announced the elimination of all day, every day kindergarten, in favor of part-time instruction if the levy fails. Officials say the move would be made because kindergarten teachers would be needed to help fill gaps in the elementary schools created by the hiring freeze.
If the levy fails in May, it would likely see the ballot again on Nov. 23. If the millage remained at 8.4, the positions and programs could be restored. There would be an option to return to the ballot at a reduced millage, but the enacted cuts would not be restored.
Johnson has said that if the levy should fail both times in 2023, it would come back again in 2024 at a substantial increase in amount, somewhere in the neighborhood of 13 mills.
“We can’t cut our way out of the need for a levy,” Johnson said in a previous school board meeting.