Forecast paints bleak picture for McDonald schools

The treasurer predicts deficits even if the district passes a levy in November.

By Mary R. Smith

McDONALD — The village school board approved a new five-year financial forecast filled with bad news.

The forecast approved Monday was provided by school Treasurer Brian Stidham, who noted he used the 2010 forecast done by the Local Government Services office of the state auditor’s office as a basis for his five-year projection.

He warned the board that an economic recovery is not going to be felt in the district until 2014.

The five-year forecast contains some changes in previously projected figures, including that the district cafeteria is $28,000 in the red. School board president Bob Jones Jr. said the board was told in the past the cafeteria was only $4,000 in the red. Stidham noted cafeterias typically run a deficit.

Stidham also said there may be some costs that come in lower for the district, noting that the audit done by the Local Government Services office was supposed to cost the board $20,000, but the bill came in at $12,000.

He noted that another five-year forecast will be done in May 2010 when the recovery plan designed by the state Financial Planning and Supervision Commission will be in place for the district. That state-mandated commission met for the first time Monday afternoon at the high school.

The commission approved a request for financial help for the district, and the state already has agreed to lend McDonald $2.1 million to relieve its projected debt for fiscal year 2010, which began July 1 of this year.

Commission members include: Jason Reckard, a parent; Ed Bush, a village resident and former Trumbull County auditor, appointed by Gov. Ted Strickland; Dr. Jackie Osborne of Lancaster, Ohio, chairman, appointed by the Ohio Department of Education; Paul Marshall of the Ohio Office of Budget and Management; and Rocky Tondo, village clerk, appointed by the mayor.

Stidham noted that Marshall said most school districts in Fiscal Emergency, such as McDonald, have been able to get out in three years, but he cautioned board members that because of the district’s lack of resources, and because McDonald is such a small district, it will likely take longer. The treasurer’s current projections show the district with the following deficits: $1.638 million in 2011, $3.02 million in 2012, $3.9 million in 2013 and $5.1 million in 2014.

These figures assume passage of a 4.9-mill, five-year emergency levy Nov. 3 to generate $260,000 a year.

The treasurer noted that the forecast likely will undergo “many changes.”

In related business, the board approved a $10.676 million budget for fiscal year 2010, which includes the $2.1 million loan from the state.