The Olentangy Schools Board of Education approved the latest edition of its five-year forecast following a second reading during its meeting on May 26.
Intended to provide a roadmap of sorts for the district’s asset management, the document is updated biannually in November and again in the spring as a “living, breathing document,” according to Olentangy Treasurer Emily Hatfield. The forecast was presented for the first time during the May 12 board meeting.
“The methodology is that we take a look at our actual numbers for the current fiscal year and then apply trends and the current factors to project where we might be in the years outgoing,” Hatfield told the board during the May 12 meeting.
In November’s forecast, the district showed unreserved fund balances of $118,822,759 for fiscal year 2022, $127,474,231 in 2023, $124,461,011 in 2024, $108,260,719 in 2025, and $78,734,317 in 2026.
Olentangy’s informal policy is to maintain a cash reserve balance to cover two to three months of district operating costs. Once the balance dips below the two or three-month costs, the district then begins considering the next operating levy going to the ballot.
According to the November forecast, the district had 155 days worth of operating costs on hand in 2022, with that number dwindling down to 79 days by 2026. The district’s revenues versus expenditures were projected to have a positive balance of $16,720,643 and $8,701,472 in the first two years of the forecast before becoming a deficit of upwards of $29,476,401 over the final three years of projections.
As predicted in November, the updated revenues versus expenditures figures continue to project the district will begin spending above its revenues beginning in 2024 based on its current trajectory. Hatfield’s May 12 presentation showed a deficit of $8,873,829 in 2024, and the deficit is projected to grow to $39,408,812 in 2026.
Updated figures project the district to have an unreserved fund balance of $150,881,322 for the fiscal year 2022, $151835,836 in 2023, $142,912,007 in 2024, $116,300,012 in 2025, and $76,841,200 in 2026. The number of days of cash on hand to cover operating costs is projected at 198 in 2022 before dropping to 75 days by 2026.
Hatfield noted that the opening of the district’s 17th elementary school is factored into the district’s projections for fiscal year 2025. Originally, the opening of the school was being factored into the fiscal year 2026 of the forecast, but Hatfield said it seems the building will be needed sooner.
“Olentangy continues to grow at exponential rates,” Hatfield told the board last month. “Our state funding, while getting better … it still doesn’t keep up with our growth at the current pace. So, we continue to watch these figures and plan accordingly.”
During the district’s 2020 ballot campaign, residents were promised a three-year period during which the district would not come back to residents for more money. Hatfield said during last month’s meeting that the district is currently on track to go at least five years before the next levy is needed.
Asked by board member Kevin Daberkow how Ohio’s Fair School Funding Plan could affect the levy cycle, Hatfield said, “Olentangy would benefit from the Fair School Funding Plan being fully phased in, even if phased in through fiscal years 2024 and 2025. The importance of that is that it’s funding students where they are enrolled. So, for the first time, Olentangy would be able to have state funding come in at the volume of students coming in.”
Hatfield added the funding would bring in “another 16% year over year,” with the final year of phasing coming in fiscal year 2027.
“Our estimations show that that would be $50 million annually, each year,” she said.
Responding to a question from Daberkow about how impactful the additional funding would be, Hatfield called it “absolutely” a game-changer. “We’re talking about roughly 4-5 mills of property taxes that we wouldn’t have to ask our community for,” she said.
“It’s a big deal because that’s something (all Olentangy residents) can agree on,” Daberkow said of Hatfield’s comments. “There’s a lot of stuff we can all disagree on, but one thing we can all agree on is this is great news for everyone in our district.”
To view the forecast in full, visit www.olentangy.k12.oh.us/departments/treasurer/five-year-forecast.