Upper Scioto in ‘tight spot’ with finances

McGUFFEY — The new superintendent of the Upper Scioto Valley School District says the school is in a “tight spot” now, but is on the path of recovery.
Past decisions forced USV to lay off 15 employees over the past two years and should voters reject the renewal of an emergency levy set to expire at the end of 2013, more will come. But despite the cost reductions, the school is still faced with repaying inappropriate expenditures and large loan repayments left by the previous administration, said Superintendent Dennis Recker.
Former Superintendent Rick Rolston was terminated by the board in January.
Treasurer Stacy Gratz presented the board of education with an updated five-year forecast Monday evening. While most districts hope to go into the new fiscal year with at least 30 days operating money in reserve, said Gratz, USV will begin the new fiscal year on July 1 with only seven days’ worth of carryover.
The district’s expenses exceeded its revenue in 2010 and 2011, said Gratz. There was also large loans and money misspent, which now must be adjusted.
Money set back after the new school was built was legally set aside to be used on the future needs of the building, but was used in recent years for projects not approved by the Ohio School Facilities Commission. As a result, the general fund and farm fund are being forced to repay $233,000 to the OSFC fund to avoid citations by the state auditor’s office. The money had been put into the farm fund, which is now at a zero balance, and required $20,000 from the general fund.
Funds are still in reserve for any physical needs at on the farmland, said Gratz.
“That ground is one of the most valuable things we have,” noted board president Barry Campbell. The district received $222,000 in rent on the farmland last year, he said.
The bad financial news continued. The loan secured through HB 264 funding meant to be repaid through energy savings at the district is not returning enough to make the yearly payments and will take longer than the planned 15 years to repay.
The district is losing $182,000 to surrounding districts through open enrollment, said Recker.
In her five-year financial forecast for USV, Gratz said much hinges on the passage of a renewal emergency levy which is set to expire at the end of 2013. With the passage of the levy, the district will be in the black at the end of 2016. Without it, said Gratz, more reductions will be necessary.
“It is absolutely critical we pass that levy,” she told the board.
“We are getting hit hard,” said Recker. “Liability, debt retirement and open enrollment are killing us. We are in a tight spot right now, but we’ll get out of it.”
The superintendent in his first month on the job at USV outlined how the fiscal concerns are being handled. The district has overly spent in the area of administration, he said.
“We have taken the bull by the horns and whacked that pretty good,” said Recker.
Other cost-cutting practices have stabilized the district’s financial situation, he noted.
“Financially, we are recovering,” agreed Gratz. “We will create budgets and stick to them tightly.”
Not all the news was bad. Reappraisal values of property in the district increased and the refinancing of the district’s bonds will result in a savings of $306,051 to USV and will result in a reduction of taxes to residents of the district, said Gratz.
“It’s not a good picture,” said Recker. “We are really going to have to suck it up for the next few years.”

By DAN ROBINSON
Times staff writer

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Posted by Kenton Times on May 22, 2012. Filed under Local News,Recent Headlines. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry