District provides 5-year forecast update

TIFFIN ---- At the Tiffin City Schools' Board of Education meeting Monday evening, the district's Treasurer Ryan Cook gave an overview of the district's updated 5-year forecast. "The five-year forecast is viewed as a key management tool and it should be updated periodically," Cook said. "It really drives not only board decisions but day-to-day management as well." Here are three important purposes or objectives of the five-year forecast: To engage the local board of education and the community in long-range planning and discussions of financial issues facing the school district. To serve as a basis for determining the school district's ability to sign the certificate required by O.R.C. §5705.412, commonly known as the 412 certificate. To provide a method for the Department of Education and Auditor of State to identify school districts with potential financial problems. "The district's revenue is made up of main sources: local and state funding," he explained. "Expenditures are primarily salary, wages, benefits, purchase services and supplies and materials." Approximately half of the district's revenue is received locally while about 50% is received from the state. However, the state is making changes with House Bill 187 and House Bill 33 that will affect those percentages. "Even though we do have a deficit spending in our forecast, we do have a positive cash balance," Cook said. "So, we'll be able to weather the storm. It's just our numbers are going to look radically different depending on the timing of settlements when they arrive." The settlements he is referring to will likely be affected by the passing of House Bill 187 and there is a strong likelihood in that scenario that settlements will not be received until May when they are normally received in February. House Bill 33, which is the state's budget is funded for the district for fiscal years 2024 and 2025 but not beyond fiscal year 2026, due to this, Cook has flat-funded fiscal years 2026 – 2028. The revenue growth for the district over the next 5 years is estimated to be a little less than 1% and expenditure growth is nearly 4%. The district is projected to go into a cash deficit by fiscal year 2028. "We're going to have to do something to increase our revenue," Cook explained. "We can't just rely on the state." The cash balance is projected to remain positive through fiscal year 2027 and the ending cash balance stays about 30-days' worth of reserves through fiscal year 2026. He explained that the goal for reserves is no less than 30 days and no more than 90 days. "It's more or less a guideline to help keep us on a path where we can avoid that negative cash balance down the road," he said. "We're not allowed to have anything less than zero, which we begin to cross as you look out there in fiscal year 2028. What happens at that point is I can't sign any long-term contracts. I can't sign the 412 certificate. If I do, it's a $10,000 violation personally, for me." Cook explained that the district is going to need to look at budget cuts, new revenue or a combination of both in the long run. He stated that the district has already begun to look at its options during work sessions. In conclusion, Cook said that plans for new revenue or a reduction should begin in 2024 so a plan can be developed to help avoid upcoming deficits. Following the overview of the 5-year updated forecast, Superintendent Ben Richards provided what the Superintendent Advisory Committee came up with for the master facility plan since the group first came together last year. The committee has landed on building a new high school up on top of the hill. The next thought is to build a new elementary school next to the middle school. This elementary school would house grades K-5. "What we are going to be doing moving forward is working to gain feedback from our community," Richards said. "We're going to be putting some Zoom meetings up, some in-person town halls, surveys, a variety of ways for people to provide feedback and input as to what they think about the plan." He then explained that the project would not be done in one fell swoop and could be done in segments. "I appreciate the work of the Superintendent Advisory Committee," he said. "They spent a lot of time looking at the data. I appreciate it." Richards then provided an update about the 2024 – 2025 district calendar. He said the district will be putting forth three very different calendars to parents, students and staff for feedback. The following action items were then approved: 8.1 - Approved the Schedule of Revenues, Expenditures and Changes in Fund Balances for the Fiscal Years Ended June 30, 2021, 2022, and 2023 Actual; Forecasted Fiscal Years Ending June 30, 2024, through 2028; and the Accompanying Summary of Forecast Assumptions, as exhibited. 8.2 - Approved the real estate purchase agreement with Nick S. Rohrs for the purchase of real property. 8.3 - Approved a change to the cost of employee dental coverage in the instance that two full-time staff members are married. The Board will pay 100% of the cost of the family dental insurance coverage, effective 11/1/2023. 8.4 - Approved the Kiefer USA proposal for synthetic running track resurfacing. 8.5 - Approved the Byrne & Jones Construction proposal for running track base work. The next meeting is scheduled for 6:30 p.m. Nov. 27, in the Tiffin Middle School cafetorium, 103 Shepherd Drive.