As the New Albany-Plain Local School District began the new year, leaders continued to plan for the financial future of our district.
Change is inevitable when making a financial forecast for five years due to many variables, especially this year because of several factors that will create a positive effect for years to come.
State law requires a school board to submit a five-year projection of operational revenues and expenditures, along with assumptions used to make the projections, to the Ohio Department of Education prior to Oct. 31 of each year. Additionally, the board must update this forecast between April 1 and May 31 of each year to remain in compliance.
The Ohio Department of Education also encourages school districts to update their forecast whenever events take place that will significantly change it.
Now is the time for us to reassess the impact of the approval of Issue 42 -- a 1.25-mill permanent-improvements levy -- in November and its effect on the five-year forecast. The revenue generated from Issue 42 creates a need to account for revenue-and-expenditure changes within the district budget.
How has our five-year forecast changed?
As discussed at the Oct. 9 school board meeting, the board included $1.17 million in capital outlay in the event the permanent-improvements levy was not approved by voters. This capital outlay amount was added to the forecast in each of the five years because the capital needs had been identified and it was fiscally responsible to include them as expenditures within the forecast.
The board also discussed Oct. 9 a plan to eliminate those proposed expenditures from the forecast if the PI levy was approved by voters. We continue to be grateful to our taxpayers for approving the permanent-improvements levy Nov. 7.
After public discussions during scheduled meetings and based upon the recommendation of Superintendent Michael Sawyers and I, the school board has approved the transfer of $1.17 million from the current year general-fund budget to the permanent-improvements fund to allow roof repairs to begin this summer.
The proposed capital-outlay expenditures from general funds in all future years were eliminated and the five-year forecast now reflects a $5 million ending cash balance in the fifth year, up from $281,000 in the October 2017 forecast.
What does our forecast say about our district?
As required, the school board approved the five-year forecast Oct. 23. The forecast included $62 million in revenue and projected general-fund expenditures of $62.9 million in the current fiscal year. Based on projections in the forecast, we continue to have a positive ending cash balance each of the next five years, which the board and administration continue to strengthen and safeguard for taxpayers.
Based on the recommendation the superintendent and I developed, the school board approved the additional expenses from the five-year capital plan in the current year. Adding these additional costs to the forecast is the cause for expenses to outpace revenue in the current fiscal year.
Because the district begins to spend more than it brings in on an annual basis beginning in 2018, the administration continues to search for additional cost savings to eliminate deficit spending. Again this year, the school board approved the financial goal of reducing the current year budget by $609,000. The board and administration equally are committed to maximizing our resources to meet the academic and developmental needs of our students without additional general-fund resources from our taxpayers for several more years.
Take a deeper dive into our five-year forecast and read the district's comprehensive annual financial report and other documents at napls.us, under the "Treasurer" section.
Rebecca Jenkins is treasurer and chief financial officer for the New Albany-Plain Local School District.