School board seeks ‘bottom line’ on cuts

By Harold Gwin

The Youngstown board president said without state loans, no deficit would exist.

YOUNGSTOWN — Some city school board members want the district treasurer to “bottom line” what additional cuts are needed to balance the district’s budget — with or without the 9.5-mill levy on the November ballot.

“How much more do we need to cut to balance this budget?” Lock P. Beachum Sr. asked Treasurer William Johnson during a board finance committee meeting last week.

He asked Johnson to prepare a report showing where the district stands. That report should reflect the financial status both if the levy is passed and if it fails, he said, adding that the board needs the information by the next finance committee meeting in October.

Board member Anthony Catale agreed, saying the effort to find more reductions will also require efforts by others in the administration to pinpoint where cuts can be made.

Dr. Wendy Webb, superintendent, has said more cuts will be coming.

The school district was placed in fiscal emergency by the state in November 2006 when it began running a general fund deficit that reached $15 million that year.

The emergency status resulted in the state setting up a fiscal oversight commission to control district finances, and the commission will remain in place until that status is removed.

“We still have an elected responsibility,” Beachum said, explaining that the school board is determined to bring spending in line with revenue.

A five-year financial forecast prepared by the treasurer shows the Youngstown school district still spends more than it brings in, and that trend continues through 2013, the final year of the forecast, Beachum said.

The document shows revenue this year will total nearly $105 million but spending is pegged at nearly $118 million. In 2013, the numbers are $111 million for revenue and $113 million for expenditures.

“The debt is kind of what’s overpowering us right now,” Johnson told the committee, referring to the more than $25 million in solvency loans Youngstown has borrowed from the state to balance its budget for the last two years.

The district still owes $18 million of that debt to the state with $13.2 million to be repaid this year. Youngstown will likely have to borrow about $11 million more before the end of this year just to cover that payment, Johnson said.

The school board has made $26 million in spending cuts, including the elimination of about 450 jobs, over the past two years to help deal with the deficit.

“We’ve balanced our budget, aside from the debt,” said Shelley Murray, board president.

If the district didn’t have to repay the state loans, there would be no deficit, she said.That’s something the board is pursuing.

Members have written a letter to Gov. Ted Strickland asking if part or all of the remaining debt can be forgiven.

Johnson said the five-year forecast doesn’t include some possible financial changes, most notably the proposed 9.5-mill, four-year tax levy which would produce about $5.3 million a year in new revenue. If it is passed, the district can return to solvency by fiscal 2011 or 2012

The levy money would pay off the state loans, Murray said. Without the levy, “We continue to incur debt,” she said.

gwin@vindy.com