Wednesday, February 22, 2006
The district is expected to be placed in fiscal watch by the state.
By HAROLD GWIN
VINDICATOR EDUCATION WRITER
YOUNGSTOWN -- The city school district is facing a $4 million year-end deficit.
Treasurer Carolyn Funk told the school board's finance committee Wednesday that there is little the district can do to avoid the red ink at this point.
The district may be able to take some money from its capital improvement, school supplies and other accounts to reduce the size of the deficit, but Youngstown should be prepared to be placed in the state's fiscal watch category, Funk said.
She said she will report the district's latest financial projections to the state and confer with state officials to determine what the district should do.
"What happened?" asked Lock P. Beachum Sr., chairman of the finance committee, noting that earlier projections had shown the district should have made it through this year without a deficit.
The fiscal crunch has been building, Funk said, adding that she has been continually cautioning the board about financial concerns.
Funk told the board in January that a state report issued that month on subsidy allocations showed that Youngstown will be getting $6.7 million less than anticipated this fiscal year.
Much of that was attributable to the loss of 380 schoolchildren whose families apparently just moved out of the city, she said.
How this happened
The state gives school districts a subsidy projection in October based on the previous year's enrollment and then revises those numbers in January, midway through the school year, Funk said, adding that the drop in subsidy revenue was unanticipated.
Open enrollment and the growing number of charter schools have been siphoning off Youngstown pupils, said Dr. Wendy Webb, superintendent. (About 3,000 Youngstown pupils chose those options this year.) The rising cost of fuel for buses, increases in costs for health insurance and other expenses also are factors that hit this year, she said.
The financial problem was compounded because the district hasn't been reducing staff in line with the reduction in enrollment, Funk said, explaining that staff levels were kept intact to reduce the size of classes and focus on getting the district out of academic emergency.
Beachum said he is concerned that the state will step in to tell Youngstown how to run its schools, a move that could cut the district to nearly minimum staffing requirements.
What's happening
Webb said the state appears to be taking a different approach to Youngstown's problems and has indicated a willingness to provide some financial resources to aid the district in getting out of academic emergency.
Just how much state assistance might be forthcoming isn't known yet, Webb said.
Beachum said the district needs to prepare for the 2006-07 fiscal year that begins July 1.
"We need to know where we are," he said, noting the board will be expected to make some tough decisions regarding staffing and programs.
Webb said she is preparing a cutback proposal that she expects to present to the board in early March. The financial picture is bleak, she said, adding that there are "no sacred cows" when it comes to looking at areas to be cut.
Youngstown needs to get control of its finances now, Beachum said, warning that the deficit could double next year if it doesn't.
gwin@vindy.com