Community Financial Report

Bethel-Tate Local School District

Fiscal Year Ending June 30, 2007

 

            Welcome,

The Bethel-Tate Board of Education is publishing this Community Financial Report in order to provide Bethel-Tate residents with basic financial information about the School District.  This report is intended as a community communication and education tool.  The pages ahead review School District financial resources and financial obligations with an eye toward the financial future.

 

            Thank you for your interest.

 

                  

 

                                                                                                  

 

Financial Update

 

 

 

Dear Bethel‑Tate Community Members,

 

Change and traffic tie‑ups are the norm in the Village of Bethel today. The community is changing. The rural roots of Bethel are fading into the past. However, our tax base is still predominately residential. Currently, our funds are under a watchful eye to ensure a balanced budget despite rising costs and a weakened economy. The District is containing costs by participating in purchasing consortiums for such things as supplies, and even health care benefits. We face limited financial resources in the near future. Yet, we keep our class sizes reasonable, strengthen teacher hiring and training practices and ensure a high level of staff and student accountability.  We continue to strive for Excellence.  We have 71% of our teachers at master’s degree level.  Additionally, as a way to continue to be prudent with our taxpayer’s money, we refunded our building bonds in 2006 resulting in a tax savings for homeowners and businesses of $322,500 over the next 17 years. 

 

You have probably read or heard about the school funding crisis in the state of Ohio. Over the past decade the Ohio Supreme Court has declared unconstitutional the state's method of funding Ohio's schools four times. Despite this, the system remains that way today. There is a disparity in what some schools spend on their students versus others. Ohio Department of Education data shows that Bethel‑Tate ranks as one of the lowest for Expenditure Per Pupil ($7,237) for fiscal year 2006‑2007 in the state. The state average is $9,343 for fiscal year 2006.  Bethel‑Tate has the lowest expenditures per pupil in the surrounding counties. Additionally, the Ohio Department of Education data shows that Bethel‑Tate ranks 81 (or 530th poorest) of Ohio's school districts for fiscal year 2003‑2004 (Rankings are from poor to rich with No 1 representing the poorest district).

 

Voters statewide are facing a record number of school district tax issues after the State of Ohio has cut money it pledged and flat-lined revenue. Based on Ohio Department of Education projections, two thirds of all school districts are expected to run out of money in the next several years.  Our situation is very similar to other districts, beginning when the state cut our funding by $91,000 in the spring of 2003. Currently, we are approx. 70% funded by the state. Expense wise, while our new high school and renovated buildings are wonderful, the additional square footage has to be heated, cooled and maintained. Additionally, there are the added costs of rising health care benefits, special education and utilities.

 

The per pupil state base cost support level was increased by 3 percent each of the current biennium (fiscal years 2008 and 2009). However, school expenditures are increasing at a much higher rate and thus local property taxes will be assuming a greater share of the school funding responsibility. Evidence is everywhere that Ohio's political leaders' have allowed the unconstitutional school funding system to go on.  228 school issues are on the November 2007 ballot, the most since 2004.  Various educational organizations across the state are showing support for the School Funding Amendment that is being proposed for the state constitution.  This amendment may show up on the ballot within the next year for Ohioans to vote on.

 

In June 2007, a biennial budget (House Bill 119) that allocated State aid for education for fiscal years 2008‑2009 was adopted by the Ohio General Assembly. No State budget is in place for other future forecast years. As a result, foundation funding levels for those fiscal years must be considered speculative.

 

Respectfully submitted,

 

Amy M. Wells, CPA, CBM

Treasurer/Chief Financial Officer

 

 

 

 

Dear Bethel-Tate Community:

 

On behalf of the Board of Education, it is with great pleasure that I welcome the students and staff of the Bethel-Tate Local School District back for the 2007-2008 school year. We trust it will be a year of rewarding experiences in education and personal growth.

 

I am honored to inform you the Bethel-Tate District employs some of the finest administrative and staff personnel in the State of Ohio. Many times, these highly motivated, highly dedicated, highly qualified individuals go far beyond expectations to motivate our children and meet the demands of quality education as illustrated by our “Excellent” district rating issued by the State of Ohio.

 

In an age when much is being asked of our children and staff, the Board of Education would also like to acknowledge and thank you, the parents and members of our community who have come along side to support, encourage and insure success. It is this ongoing collaboration of Bethel-Tate Local School District and Bethel-Tate community that will insure “Excellence in Education” in the future. We are truly blessed to live and serve in such a community and our children are the beneficiaries of our efforts.

 

Please take a moment to review the financial report provided by our Treasurer/CFO, Amy M. Wells. As is common for many districts in the state of Ohio, Bethel-Tate continues to struggle with state funding levels. Expenditures for maintaining quality education are increasing at a much higher rate than the state revenues being received. I can assure you in spite of any financial struggles; it is the mission of the Board of Education and district officials to provide the resources that are necessary and adequate to achieve excellence in education in a safe and healthy atmosphere. We continue to evaluate our district wide cost savings measures already in place for additional opportunities. Our commitment is to come to the Bethel-Tate community for additional funds only when all other options have been exhausted and we can no longer maintain quality education with the funds available.

 

In closing, I would like to leave you with a quote by Eleanor Roosevelt who said, “You have to accept whatever comes and the only important thing is that you meet it with courage and the best you have to give.” We can’t be sure of all the challenges the Bethel-Tate Local School District will face in the future. One thing we can be sure of is together we’ll meet each challenge head-on with one common theme in mind, “What is in the best interest for the quality education of our children?”

 

Again, please take a moment to review the information provided. Your comments and questions are welcome.

 

Thank you for your continued support.

 

Sincerely,

 

 

Kevin G. McKee

President, Bethel-Tate Board of Education

 

 

 

5-Year Financial Forecast

Five-year financial planning is required of all of Ohio’s school districts.  The purpose of this planning is to determine whether or not the financial resources of Ohio’s school are sufficient to meet anticipated future needs.  Based on the current climate of education funding in Ohio, it appears that Bethel-Tate Local Schools has enough money to meet current basic expenditures for the next two years.  This places Bethel-Tate in a similar financial position as most other Clermont County school districts, according to forecast data filed with the Ohio Department of Education in October 2007.  Unless the State funding system changes, no Clermont County school district will be immune from seeking increased financial support from local taxpayers!

 

These charts take a look at the forecast financial positions of Bethel-Tate Local Schools and other Clermont County school districts.  Note later in this packet that for each school district in Clermont County, the share of educational costs paid by the State of Ohio decreases.

STATE OF THE DISTRICT

 

By Jim Smith, Superintendent

 

I am very pleased to report that Bethel-Tate schools have been rated one of the best 139 school districts in the state. That’s the number of excellent rated districts out of the 617 school districts in the state of Ohio. This makes the second year in the row to be rated excellent. We are one of two excellent rated districts in the county (Milford being the other). Bethel-Tate schools met twenty nine out of the thirty state indicators. Our closest competitor among the other Clermont County schools was Milford with 26. Most of the state indicators come from the Ohio Achievement Tests (grades 3-8) and the Ohio Graduation Test (grades 10-12). The other indicators are attendance and graduation rate. This year’s excellent rating is even more remarkable when you consider that the number of excellent schools dropped by 25% from the previous year. The reason: there were five new state tests that our students and teachers had never see before. That didn’t stop us. We were the only school district in the county to pass the new 5^th grade Ohio Achievement Test in social studies.

 

Our teachers, students, parents, administrators, board of education and support staff are focused on providing the best education possible at a remarkable price. Our annual per pupil expenditure is the lowest in the county ($7,237/student). Compare that to the highest at $9,612/student at New Richmond. It is hard to beat the best education at the lowest price. Congratulations to everyone for a job well done!

 

One of the big changes this year is the move to all day, everyday kindergarten from a half day model. Our kindergarten students now have twice the instructional time previously afforded. We hope to see the benefits of the additional time on task over the next few years. Considering the body of knowledge contained in the state academic content standards, the move to all day everyday kindergarten is a necessity.

 

It’s hard to believe that we’ve been in our new high school and remodeled buildings five years. We continue to focus on keeping our buildings clean and well maintained. It’s important to protect the investment made by this community back in 1999. We continue to upgrade our athletic facilities with new scoreboards installed for both baseball and softball. In addition, we were able to resurface our track and fix low spots in the north end. Our athletic facilities are amongst the best in the state.

 

Thank you for your support of Bethel-Tate schools. Without the support of our wonderful community, none of our successes would have been possible. If you have any questions, I am here to respond. My email address is smith_ja@betheltate.org or call me at 734-2271 extension 1000.

 

REVENUES

Taxpayers located in the Bethel-Tate community supplied twenty percent (20%) of the money needed to pay basic school operating costs during the 2006-2007 school year, a number expected only to increase over the next several years.  Those taxes came in the form of property taxes on homes, farms and businesses.  Most of the remaining money came from the State of Ohio through the State Foundation Program, a source of funds that has eroded dramatically in recent years.  The historic partnership between Ohio’s school districts and the state is withering away.  The only option remaining for school districts throughout Ohio, including Bethel-Tate is to seek new local taxes or to stop providing services routinely given in the past.

Where Does our Money Come From

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Where the money comes from:

 

v  The School District has a current budget of $13,875,400 in revenues for fiscal year 2007. Down $366,907 from fiscal year 2006.

 

v  The School District has three main revenue sources that account for 88% of the total revenues received for the District. All at the control of forces outside of the District!

 

¨       General Real Estate Property Taxes account for 18.6% of the budget. These monies are collected on all real estate within the School District. The School District community votes on the millage collected by the School District and with House Bill 920, reduction factors are applied to the millage to make sure the levies collect only the amount as originally voted on by the community even when the assessed values of the property go up.  The citizens of Bethel-Tate have voted on 29.6 mills over the years.  Additionally, there are 3.7 of the total 10 in-side mills (unvoted) applied to this District.  For a total of 33.3 mills.  However, because of HB 920 the District only collects on the minimum 20 mills.  This equates to approx. $2,074,800 per year in lost revenue.

 

Additionally, the District has reduced the millage on the OSFC building project by .85 mills over the past two years.  This tax revenue is used solely for the payment of the building bonds.  The District continues to work with the County Auditor’s office in efforts to reduce this millage further.

 

¨       Unrestricted Grants-in-Aid or Intergovernmental Revenue accounts for 68% of the budget. These monies are received from the State of Ohio in the form of School Foundation payments. The amount received is formula driven - depending heavily upon the student population and the assessed valuation of all property within the School District. There are also other calculated amounts added to and subtracted from the payments, (such as transitional guarantees, transportation, special education transportation, open enrollment tuition and deductions, community school deductions, and county educational service center deductions) to determine the final amount received each month.

 

¨       Tangible Personal Property Tax accounts for 1.6% of the budget. This tax is what the businesses within the School District had to pay each year on the machinery, equipment and inventory on site at their business at the end of the year.  This tax is being phased out.  The State has given us a property tax allocation “make up” but that amount only brings us back to the amount collected in fiscal year 2004.

 

v  The remaining 11.8% of the revenue received by the School District consists of interest received on investments, tuition received from other districts, pay-to-play fees, student fees, rental of buildings, donations and property tax allocations.

 

¨       Property Tax Allocations, 3% of the budget, include the homestead and rollback deductions you will see on your tax bill that the State “makes up” to the School District and the “make up” for the loss of the tangible personal property tax that is being phased out in fiscal year 2009.

 

 

 

EXPENDITURES

Meanwhile, the day-to-day operating costs continue to increase.  This is the result of increased operations, number of students and inflation.  Inflation in employee health benefits costs is especially troublesome for the schools as it is for other employers, public and private.  The cost of employee salaries and benefits were approximately 77% of total expenditures last school year (state average is 80-85%).  Most of the remaining costs paid last year were ones over which the Board of Education and administration have limited control.  Those costs included special education, utilities, tax collection fees imposed by the Clermont County and other basic expenses.  The School District operated with a bare bones budget last year, as reflected in the small share of money spent on supplies and capital equipment items.

 

Where Does our Money Go

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Where the money goes:

 

Ø  The School District has a current budget of $14,231,806 in expenditures for fiscal year 2007. Up $650,047 from fiscal year 2006.

 

Ø  Four expenditure classifications make up 94% of the current budget.

 

Þ      Personal Services account for 57% of the budget. This includes the salary and wages paid to all of the employees of the School District. Staffing salaries are average for the county and staffing costs are low per state averages (60-65%).

 

Þ      Employees’ Retirement and Insurance Benefits account for 20% of the budget. With rising health insurance costs changes in co-pays resulting in decreased premiums were made during fiscal year 2007.  These expenditures are tied to laws and employee labor contracts.

 

Þ      Purchased Services account for 13% of the budget. This includes all services the School District pays to outside sources. Tuition to outside districts and special education services mandated for our students continue to increase. Utilities costs have risen also adding to the increase in this part of the budget.

 

Þ      Materials and Supplies account for 4% of the budget. This includes all teaching materials for classroom activities, as well as, the supplies used to educate the students within the School District.

 

Ø  The remaining 6% of the budget includes capital outlay expenditures for equipment and furniture, intergovernmental expenditures for fees charged by the County Auditor and County Treasurer on the tax settlements, and debt payments for overages of the OFSC building project and transfers to properly account for expenditures related to other programs and activities, such as extracurricular and student activities. 

 

The School District must operate within the various codes and constraints put upon us by the State and within the budget based on the sources and uses listed above. We must adjust our budget for various factors throughout the year, including the increasing number of partially or unfunded mandates; such as No Child Left Behind, Highly Qualified Teachers, special education requirements, achievement tests, and core curriculum courses.

 

Our main goal is to provide the best possible education for our students in order to prepare them to be productive citizens once they leave our District. With your help and support we can continue to do this!

 

 

 

               

 

State financial support for Bethel-Tate schools has been falling in recent years.  In fiscal year 2005, State funding had fallen below 70% of the School District’s financial support towards the state set $5,565 cost per pupil.  In fiscal year 2007, Bethel-Tate spent $7,237 per pupil.       

 

The way the state’s school funding formula allocates money to Ohio’s schools is a legislative (or political) decision.  When you have concerns about how the State funding formula works, contact members of the Ohio General Assembly.  These are the people ultimately responsible for Ohio’s school funding formula.

 

Senator, Tom Niehaus; (614) 466-8082; tniehaus@mailr.sen.state.oh.us 

Representative, Danny Bubp; (614) 644-6034; district88@ohr.state.oh.us