Taxpayers in Middletown won’t see a school tax hike through 2020, school officials said Thursday.
The news was part of a five-year financial forecast for Middletown Schools during a special meeting of the school board.
Twice a year — in October and May — each of Ohio’s 613 public school districts are required by law to provide the state with five-year financial projections that show the school systems will maintain solvency.
Middletown’s latest projections show slight improvement from October’s and more importantly continue a strong trend in recent years of increasing financial health for the city schools, Randy Bertram, Middletown Schools treasurer, told the school board’s leadership.
Costs are down and the district’s bond rating from Moody’s private evaluation of Middletown’s finances has improved from a grade of “A minus stable” to “A minus positive.”
Moreover, said Bertram, whereas most Ohio districts spend from 70 percent to 80 percent on labor costs, Middletown is at 37 percent due to years of cost reductions, early retirement buyouts and outsourcing services, including maintenance and busing.
“The staffing numbers are way down due to the cuts and the new staff we’re hiring … came in at a much cheaper price,” he said.
Middletown’s annual operating budget is $75 million this school year and will drop to $71.3 million for the 2016-2017 school year. No budget shortfall is projected until 2020, when a $381,000 deficit in forecast, according to Bertram.
Prior to that year, the district is projected to have operating budget surpluses decreasing annually from $3.9 million in 2016 to $725,000 in 2019.
“It’s good to know we are on the right track and things are certainly looking better,” said Bertram, who also pointed out the state’s most recent biennium budget has been more generous with education funding for Middletown compared to previous state allotments.
Voters here last decided on a school tax hike when in May 2014 they barely approved a $55 million bond issue combined with a 0.26-mill permanent improvement levy. Such levy monies are not used for operational budgets but for infrastructure, and the district is building a new middle school and renovating its high school.
“I feel good about the numbers and where we are,” Middletown Board of Education President Chris Urso said after the presentation. “You always want to make sure you are using the taxpayers’ dollars as responsibly as possible.”