Summary of Significant Forecast Assumptions Amanda-Clearcreek Local School District July 1, 2017 June 30, 2022 October 2017 Revenues: 1.010 Real Estate: This line item contains revenue collected from taxes levied by a school district by the assessed valuation of real property using effective tax rates for class I (residential/agricultural) and class II (business). The revenues are based on County Auditor s estimate, actual receipts and current and projected valuations. Revenues in this line item from Fiscal Year 2017 represent 17.2% of the district s total revenue. 2016 was a triennial update for Fairfield County. The forecast reflects a -0.2% decrease in residential valuations for 2017 and a decrease of 0.5% for 2018. The forecast also reflects a -0.3% decrease in agriculture for 2017. New Construction Class I valuations have increased slightly over the course of 4 years. These percentage increases and decrease follow historical trends for our community. Legislation passed a revamp of CAUV. This change will affect our agricultural valuations in 2019 with our county s reappraisal. CAUV is 54.37% of our agricultural valuations and it is estimated that there will be a -24% decrease in CAUV which equates to approximately a $7,559,193 decrease in valuations. The forecast represents a 96% collection rate on these taxes. Tax collection year 2016 had $122,895 in delinquencies. Real Estate receipts are forecasted at $3,113,018 for FY 2018 and $3,064,701, $3,072,451, $3,085,248 and $3,094,540 respectively for the following years of the forecast. 1.020 Public Utility Personal Property: This line item contains revenue generated from public utility personal property valuations multiplied by the district s full voted tax rate. The revenues are based on County Auditor certification. Revenues in this line item from Fiscal Year 2017 represent 1.1% of the district s total revenue. Tangible Personal Property Tax has been phased out. Public utilities personal property tax receipts are included in this line item along with Manufactured Homes Settlements. The forecast represents a 99.7% collection rate on these taxes. These receipts are forecasted at $192,453 for FY 2018, $194,367, $196,299, $198,250, and $200,222 respectively for the following years of the forecast.
1.030 Income Tax: Revenues in this line item from Fiscal Year 2017 represent 13% of the district s total revenue. Amanda-Clearcreek LSD passed a 1.5% Income Tax Levy in May of 2011 with collection beginning in Calendar Year 2012. The Income Tax was for five years with collections/obligation through Calendar Year 2016. The Department of Taxation Certification at the time of the levy was $1.9 million dollars in revenue. The forecast reflects that Amanda-Clearcreek saw the full impact of the income tax in FY 2016 with $2.5 million dollars in revenue. These increased amounts over the Department of Taxation certification indicate that the gross incomes in our community have grown. Income tax receipts are forecasted at $352,448 for FY 2018 and $0 respectively for the following years of the forecast due to the levy expiring. Several attempts were made to renew this levy, however they failed. A new levy is modeled in line 13.010 of the forecast due to the fact that we can no longer renew a levy that has expired. The new levy will be a 1.25% earned income tax, with a term of 5 years and will be on the November 2017 ballot. This will be the 2 nd attempt to pass a new levy as the 1 st new levy was placed on the ballot at the May 2, 2017 election and failed, however it failed by a more narrow margin. Without this levy revenue, it will become increasingly harder to balance the budget without further cuts. The district understands that this levy is crucial to the financial well-being and success of this district and community. 1.035 Unrestricted Grants-in-Aid: Unrestricted Grants-in-Aid funds are received through the State Foundation Program with no restrictions and are projected using the most current adopted State Budget. Revenues in this line item from Fiscal Year 2017 represent 55.5% of the district s total revenue. A decline in state funding beginning in FY 2016 was due to declining enrollment and declining state share of the core funding. Due to our Agriculture values drastically increasing at the last re-appraisal, the state views us as a richer district compared to other Ohio districts. Hence, the funding formula decreases our funding share. The forecast shows that our State share of core funding for FY 2015 was 67.2%; FY 2016 & FY2017 declined to 60.7% and continues to decline to 57.4% in FY 2018 & 2019 which is approximately a $286,868 decrease in core funding for our district in FY 2018. Looking at it per student; the state core funding per student is $6,010 and our district will only receive $3,452 per student. The district was formula funded in FY 2017, but will be on the Guarantee starting in FY2018 for this budget. The Guarantee status is based on the 2 nd year of the prior biennium. The district anticipated continued drops in the Core Aid State Share mainly due to the increased agricultural value alongside decreasing enrollment. Legislation has been approved to revamp CAUV and will affect our district during the tri-annual update in 2019. It is anticipated that the drop in agricultural values will change our district wealth, thereby lowering our district comparison with other districts that will have already had the decline in their valuations. This will hopefully cause our State share to rise as will not look richer than other districts as long as enrollment stays the same or increases. Casino revenue is also incorporated into this area and is forecasted at $74,448 in FY 2018. The Casino Revenue is paid out twice a year (Jan/Aug) but will not be an equal split. $49.50 per pupil is estimated for FY 2018. This is a direct payment from the Ohio Department of Taxation. Casino revenue is forecasted for all years of the forecast. Unrestricted Aid receipts are forecasted at $9,721,644 for FY 2018 and $9,725,040, $9,345,603, $8,938,231, $8,819,136 respectively for the following years of the forecast.
1.040 Restricted Grants-in-Aid: Restricted Grants-in-Aid are funds received through the State Foundation Program or other allocations that are restricted for specific purposes. They include revenues for career tech receipts and also include economically disadvantaged revenues. Catastrophic special education reimbursements are also located in this section. These reimbursements vary from year to year due to the number of special education students and their programming along with the State s allocation of funds for this pool. Revenues in this line item from Fiscal Year 2017 represent 2.3% of the district s total revenue. Restricted Aid receipts are forecasted at $253,044 for FY 2018 and $260,908, $258,325, $257,350, $255,889 respectively for the following years of the forecast. 1.050 Property Tax Allocation: Property Tax Allocation includes funds received for Tangible Personal Property Tax Reimbursement, Electric Deregulation and Rollback & Homestead payments. Tangible Personal Property Tax Reimbursement is the direct reimbursement of personal property taxes lost due to HB 66. These revenues are received directly from the state. Revenues in this line item from Fiscal Year 2017 represent 2.6% of the district s total revenue. Property Tax receipts are forecasted at $472,888 for FY 2018 and $473,031, $473,973, $474,763, $475,886 respectively for the following years of the forecast.
1.060 All Other Revenue: All Other Revenue includes all operating revenue sources not included in other lines; examples include open enrollment students in, Special Education tuition from other districts, fees, Medicaid settlements, earnings on investments, rentals and donations. Revenues in this line item from Fiscal Year 2017 represent 7.8% of the district s total revenue. Interest rates have been stagnant and low over the last few years but have slowly increased in the past year. We have seen a tiny increase in our CD interest. Open enrollment in is forecasted at $860,000 for FY 2018 with minimal decreases for the remaining years of the forecast. The decrease from prior year is forecasted due to the effects of the failed levy. Our district has had a steady loss of fees due to increased economically disadvantage and declining enrollment, however we forecasted the fees to stabilize in FY 2018. All Other Revenue receipts are forecasted at $1,465,158 in FY 2018 and $1,337,675, $1,327,675, $1,322,675, $1,322,675 respectively for the following years of the forecast. 2.060 Other Financing Sources: Other Financing Sources are forecasted at $0 for each year of the forecast.
Expenditures: 3.010 Personnel Services: Personnel services include employee salaries and wages, including extended time, severance pay, supplemental contracts, etc. Expenditures in this line item from Fiscal Year 2017 represent 46.2% of the district s total expenditures. The forecast reflects the current ACEA Union Contract & Teamster Contract that are settled through June 30, 2017. It also includes the newly created Support Staff contract that began July 1, 2016 and runs through June 30, 2019. The Support Staff agreement includes a reopener on salary and insurance only for 2017/2018 & 2018/2019 contract years. The district is currently in negotiations will all 3 unions. Due to budget reductions for FY 2018, the forecast reflects a 1% increase to salaries. For Fiscal Years 2019-2022, the forecast reflects a 2.5% increase to salaries. These percentages are placeholders only for salary increases and may need to be adjusted depending on revenue reductions. The Fairfield County ESC does a salary survey for Fairfield County Schools and disburses those survey results to the county schools. Our district has used this survey to become more competitive in hiring new teachers and retaining our current teachers. The Board approved staff reductions for FY 2018 which is reflected in the forecast. Reductions were made with classified, certified and administrative personnel due to declining enrollment and financial reasons. Administration continues to review student data and has found some staffing needs that will be looked at for FY 2019. 3.020 Employees Retirement/Insurance Benefits: Fringe benefit expenditures are made up of retirement for all employees, early retirement incentives, insurance, medicare, workers compensation, unemployment, and tuition reimbursement. Expenditures in this line item from Fiscal Year 2017 represent 17.9% of the district s total expenditures. Retirement, medicare and workers compensation expenses are based on projected salaries. The district is part of the South Central Ohio Insurance Consortium for medical, dental and vision insurances. Healthcare rate increases take effect each July. Beginning July 2017 there was a 9% increase in health benefits which includes healthcare fees established in the healthcare bill. The district saw a 9% increase in medical premium rates (which includes healthcare fees established in the healthcare bill) and a 20% increase in dental rates beginning July 2017. Health insurance is projected to increase 11% and 12% respectively for the following years of the forecast. With additional fees and taxes incorporated into the healthcare bill, the district s assumption is that the percentages will represent those additional amounts, therefore the increase in percentages. If we would have a bad insurance year, that would have a negative effect on the forecast. Likewise, if we have a good year, that would have a positive effect on the forecast. Health insurance is difficult to forecast especially with the delays in the Cadillac tax. The Cadillac tax portion of the healthcare bill has been delayed and the district continues working with our health consortium to monitor its development. The district will not be able to afford the tax and has begun looking into potential options for our district and staff. Our district has also seen an increase in enrollment in our medical and dental plans. Our assumption is that as other companies put enrollment restrictions on their health benefits, more of our employees will be forced to take our insurance instead of staying on their spouses insurance. Tuition reimbursement per the current ACEA union contract is set at $38,000 each year through Fiscal Year 2017. Administrative tuition reimbursement per Board Policy is also included in this area.
3.030 Purchased Services: Purchased service expenditures include amounts paid for personal services rendered by personnel who are not on the payroll of the school district along with other services which the school district may purchase including ESC costs, electricity, bus repairs, heating and cooling, natural gas, insurance, legal fees, community schools, open enrollments students out, pre-school ESC services and PT/OT services. Expenditures in this line item from Fiscal Year 2017 represent 26.9% of the district s total expenditures. Continuing in FY 2018, all other purchased services are forecasted to increase 5% in Fiscal Years 2017-2021 of the forecast. Due to ODE requirements on testing and the report cards, continued professional development for training purposes will be implemented for Fiscal Year 2018 to make sure the District is compliant. Special Education costs are rising as more services are needed to be compliant with IEP reports. Excess Cost tuition is estimated at $200,000 in Fiscal Year 2018 due to the age of our special education population in our district. There is an annual incremental increase of $25,000 reflected in Excess Cost Tuition. Open enrollment out for FY 2018 is estimated at $473,348 and $380,000 for community school tuition. Community School tuition will show a slight increase in FY 2019-2021. Adjustments for budget reductions are also included in the forecast. This area shows a savings of $58,602 for eliminating the Gifted Education teacher through the local ESC. The district has a plan for the implementation of the program in-house. Other savings include hiring our special education director in-house, taking over special education records management and housing special education units instead of contracting out those services. The district continues to re-evaluate contracts and agreements annually and strives to find savings when renewals and proposals.
3.040 Supplies and Materials: Expenditures for general supplies, instructional materials including textbooks and media material, bus fuel and tires, and all other maintenance supplies are included in this line item. Expenditures in this line item from Fiscal Year 2017 represent 3.6% of the district s total expenditures. Supplies and Materials reflect a 4% increase in FY 2018 and remain the same for each year of the forecast. Included in this forecast is $75,000 for Fiscal Years 2018-2022 for curriculum. With the change in administration, curriculum is being evaluated in FY 2018 and the $75,000 will be added to FY2019. A school-wide plan is being looked into for digital curriculums and materials due to the 1:1 technology project. Part of the budget reductions in this section is not renewing FirstClass email service, by changing over to Gmail and building budget reductions. 3.050 Capital Outlay: Capital Outlay includes expenditures for items having atleast a five-year life expectancy, such as land, buildings, improvements of grounds, equipment, computers/technology, furnishings and buses. Expenditures in this line item from Fiscal Year 2017 represent 2.7% of the district s total expenditures. The forecast reflects a purchase of 2 buses for Fiscal Year 2019 at a cost of approximately $200,000. Due to budget reductions for FY 2018, there will only be a purchase of 1 bus along with a single bus purchase in Fiscal Years 2020-2022. A school transportation van replacement is to be purchased in FY 2019 at a cost of $25,000 and another replacement in FY 2022. This rotation is needed as our bus fleet is older and the chemicals used on the roads during winter months are corroding the bottoms and sides of our fleet. The forecast follows the district s technology replacement plan along with the implementation of a 1:1 technology project. Currently our Middle School grades 6-8 are 1:1 with chromebooks. Next school year, the High School grades 9-12 will get their chromebooks. Additionally, $75,000 was cut from the technology replacement plan for FY 2018 with additional decreasing adjustments each year of the forecast. A TV/cable replacement project will be looked at for FY 2020 due to our aging equipment.
4.300 Other Objects: Primary components for this expenditure line are membership dues and fees, county auditor/treasurer fees and state auditor fees, audit expenses and election expenses. Expenditures in this line item from Fiscal Year 2017 represent 1.9% of the district s total expenditures. Expenses for the State s assessment to cover the cost of collecting and distributing the income tax are included. Due to the fact that we have our income tax levy running again in the November 2017 election, we have added election costs to our forecast for FY 2018. Other object expenditures are projected to increase 3.5% each year of the forecast. 5.010 Operating Transfers-Out: Expenditures in this line item from Fiscal Year 2017 represent 0.8% of the district s total expenditures. Components in our 13 year old buildings will need to be replaced, therefore, $100,000 will be transferred to our PI Fund for these costs through FY 2022. Currently, our district does not have a PI levy. $35,000 is reflected in FY 2018 for parking lot seal and repair. The roof projects for the K-2 building and 3-12 building have been an ongoing issues since the campus was built. The district has had ongoing discussions with OSFC and a plan is being finalized to fix the roof of each building. The school district will have to cover the 15% percent of the cost of a shingle replacement (that is what our share was to build the campus). $561,275 was transferred for the district s share of the shingle replacement in FY 2015. It is estimated from OSFC that the district would have to pay for the roof project to change from shingle replacement to a metal roof at an estimated cost of $1,075,000. This amount was forecasted for FY 2017 but has now rolled over to FY 2018. There is a projected $20,000 extra-curricular transfer beginning in FY 2018 to help cover expenses and will remain the same for the remainder of the forecasted years. Pay-to-participate fees were increased for FY 2018 and the transfer was decreased from $50,000. There is a need to start replacing classroom and non-classroom furniture and flooring, therefore, $20,000 for Fiscal Years 2018-2022 is forecasted. Other projects that money will be transferred to PI include a bus compound update and a camera system replacement. 5.020 Operating Advances-Out: The forecast reflects no future advances. 5.030 All other Financing Uses: All Other Financing Uses expenditures are school district income tax refunds. All Other Financing Uses are forecasted at $0.
Conclusion The forecast is a result of input from the District Administration, Finance committee and the Board of Education. The district has hired a new Superintendent to lead our district. New staff include a curriculum director, High School principal, High School and Middle School counselors and several teaching and support staff. In November of 2016, the community turned down a 5 year, 1.5% earned income tax renewal. With the levy renewal failure, the Board placed a new 1.5% earned income tax levy on the May 2017 ballot. This levy also failed and a 1.25% earned income tax levy will be on the November 2017 ballot. The levy is essential to the operations of the school district and to be able to continue programs for our students. Due to the loss of the income tax revenue, the Board approved $1.2 million in budget reductions for FY 2018. The administration and Board will need to use this forecast as a planning tool to avoid continued deficit spending and plan accordingly if the levy is continues to fail. The district stopped collecting on a 2.00 mill Permanent Improvement levy in 2003. This forecast reflects that expenditures and transfers to the Permanent Improvement fund from the general fund are necessary for the maintenance and improvement of the school buildings and grounds. The district has been proactive to help offset increasing deficit spending. As contracts are coming up for renewal, the administration is looking at all aspects to see if these services are being fully utilized and looking for cost savings through proposals. Amanda-Clearcreek Schools is currently in negotiations with the 3 unions in our district. We are noticing slight improvement in the economy and we have had an increase in Agricultural property valuations. This has had a positive effect on property tax revenues and income tax revenues. Due to increased valuations and declining enrollment, our district went from 67.2% core state aid to 57.4% and is expecting it to further reduce with the next state budget. The District will continue to update the forecast on a regular basis.