Budget forecast predicts deficit to grow to $10.3M in five years

Despite the dismal projection, a levy isn't being considered, officials contend.
By TIM YOVICH
VINDICATOR TRUMBULL STAFF
HOWLAND -- The Howland School District has a projected deficit beginning the next fiscal year, according to its five-year financial forecast.
The forecast approved by the board of education Monday shows the district will run in red ink through 2010, beginning in fiscal 2007.
The district projects a $1.6 million deficit in 2007, a financial condition that will steadily increase to nearly $10.3 million in five years.
Superintendent John Rubesich said it's difficult to provide a five-year plan when the state passes only a two-year budget.
Board President Lori Kuszmaul said the school board has no intention of seeking a levy at this time because the financial situation is only a forecast.
District Treasurer Tom Krispinsky pointed out that voters approved a 5-mill levy in 2002 that generates $3 million annually.
Surplus eroded
However, $1.8 million to $2 million of the overall tax base has been eliminated, the treasurer explained, because of a reduction in tangible personal property valuation. The decrease has been at some of the larger companies in the district such as Delphi Corp. and WCI Steel Inc., and because of the closing of MCI Call Center in Niles.
"We're just taking it one year at a time," Rubesich said.
"We're in a spending freeze," he added, noting the building principals have done a good job in keeping spending down.
Krispinsky explained the district has been able to restrict spending by reducing staff and slowing down the increase in health-care costs.
In addition, Krispinsky said, House Bill 66 is eliminating tangible personal property taxes over the next five years. This year, the district is receiving about $4 million from those taxes.
The state will replace that tax revenue with other unknown revenue sources, Krispinsky said.
About 80 percent of the district's $27.8 million general fund budget goes toward employee wages and health care, the treasurer explained.
Negotiations will be getting under way in a couple of months for new contracts with employee unions. They are represented by the Howland Classroom Teachers Association and Ohio Association of Public School Employees.
Rubesich noted that although the fate of Delphi -- which has filed for bankruptcy -- isn't known, it may hurt an attempt to pass a levy. He explained that district voters have traditionally supported school levies, but may not in the future simply because they wouldn't be able to afford it.
yovich@vindy.com