Loveland, Ohio – The first week of May, Ohio Governor Mike DeWine announced budget cuts to balance the State budget.
Due to the economic impact of COVID-19, Governor DeWine said that $775 million in reductions to Ohio’s General Revenue Fund are needed for the remainder of the Fiscal Year 2020 which ends on June 30.
DeWine said that Ohio is mandated to balance its budget each year, and in addition to identifying areas of savings, the following budget reductions will be made for the next two months:
- Medicaid – $210 million
- K12 Foundation Payment Reduction – $300 million
- Other Education Budget Line Items – $55 million
- Higher Education – $110 million
- All Other Agencies – $100 million
Loveland Magazine reached out to the Loveland City School District Treasurer Kevin Hawley asking him to comment on the impact of the State cutting revenue to the District.
Thank you for reaching out. I can confirm pieces of this information. For your convenience, I have attached the list from The Ohio Department of Education (ODE) outlining the data for all districts in the state of Ohio. (K-12_Education (2)-1) The amount of the state revenue reduction is $1,010,855. The percentage you are referencing is how much the reduction in revenue is to our ODE calculated overall operating expenditures as stated on the form attached. The percentage decrease of our state revenue for this year is just below 8% and is a decrease of 2% from our overall operating revenue.
The current state funding cuts are for this fiscal year (July 2019 – June 2020) and will be deducted in the next couple months on our last three state payments. School districts receive their annual state revenue in 24 payments, twice a month. We have been instructed that these payments will be taken out equally from our second May payment and both of our payments in June to finish out the fiscal year. At this point in time there is not clarification from the state of Ohio as to whether there will be further revenue cuts for next year. The state’s budget is primarily funded through sales and income tax and those numbers are announced monthly around the 10th of every month. I have not seen the April numbers at this point in time but my guess is that this current reduction is due to those numbers being much lower than projected pre-COVID. The May and June reports on sales and income tax revenue will be very revealing for how the state’s budget may be impacted next year and ultimately how that impacts K-12 education.
The Governor has stated that there is federal funding that may benefit local school districts. At the present time, there is approximately $300k in additional money through the state from the CARES Act. Ultimately, this will help with the reductions in state funding but does not close the gap.
We were anticipating news of potential revenue cuts from the state but were unsure of the size or which fiscal year it would impact. We are always evaluating ways to make our district more efficient and find ways to save and we will continue to do that work. Having just received the specific amount of the revenue cuts Wednesday morning (May 6) we were not factoring this decrease into the budget for next year’s planning and the Board of Education has not had the opportunity to discuss any potential cuts due to this. As we work through the overall financial impact and implications of this budget reduction, recently failed levy and other factors due to COVID-19 the Board will discuss if any future budget cuts are necessary.