MECHANICSBURG – Shortfalls in the Mechanicsburg Exempted Village Schools budget are anticipated beginning next school year, but a combination of cash reserves and levy dollars should keep the district out of the red.
The school board approved the district’s five-year forecast at its Oct. 12 meeting. The forecast is required to be developed every May and October by Ohio law.
The forecast predicts revenue will decrease from $9,394,488 in the current school year to $9,133,863 next school year. Revenue is estimated to decrease to $8,556,384 in the 2019-20 school year.
Revenue is estimated to decrease over the life of the forecast because of the uncertainty of state funding, according to the forecast assumptions document prepared by Mechanicsburg Treasurer Scott Maruniak. Tax revenue is estimated to decline.
Expenses are predicted to increase from $8,770,599 in the current school year to $9,490,630 next school year, according to the forecast. Expenses are estimated to increase to $11,132,444 in the 2019-20 school year.
Expenses will increase due to estimated salary increases for staff over the life of the forecast and increasing health care costs. Though the district saved money by moving to the Stark County Council of Governments insurance program, Maruniak estimates in the assumptions a 10 percent increase in health insurance costs for each school year from 2016-17 to 2019-20.
Another predicted cost will be the ongoing one-to-one computer purchases, which would be paid through the general fund. The computers are not eligible for Permanent Improvement levy dollars because they are not anticipated to last five years, a requirement to use those dollars.
The district is predicted to end the current school year with a $623,889 surplus and a shortfall of $356,767 next school year. The shortfall is estimated to grow to $2,576,060 in the 2019-20 school year, though that turns into a surplus of $127,586 once tax levy revenue is included.