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Akron could lose almost $45 million in worst case scenario

By John Published: April 12, 2010

The best case scenario for the next state budget isn't pretty either (minus $33.7 million for Akron Public Schools),  according to a handout Akron Public Schools treasurer Jack Pierson shared with the school board at tonight's meeting. Here's a quick rundown of the numbers.

The grim tidings come from the latest issue  ( April 8 )  of OASBO eNews, a publication of the Ohio Association of School Businesss Officials. Pierson said the projections are based on an analysis by Ohio Rep. Randy Gardner (R- Bowling Green) of what happens  in the state FY 2012-2013 budget if:

A. Federal stimulus dollars to stabilize state budgets (about $845 million) vanish as scheduled with no more aid from Washington.

B. The last phase of the income tax reduction (postponed for two years by HB 318 and worth about $844 million) finally kicks in.

C. Some one-time state revenue (about $270 million) disappears.

D. Gov. Ted Strickland's projections for new state revenue in the next biennium (just over a $1 billion) come to pass and schools get their full share (about $480 million). OASBO notes that the Office of Budget and Management has not yet released revenue assumptions for the next budget cycle.

That best case analysis would result in a nearly $1.5 billion whack to the state aid for schools from $6.5 billion (a 22.7 percent reduction).  The worst scenario assumes no new state revenue, which would mean a loss of nearly $2 billion in state aid for schools, a 30 percent cut.

Pierson said treasurers will have a better picture in May when the state knows what its tax collection looks like this year. The treasurers must update 5-year forecasts by May 31.

"While the data used in these assumptions are based on real possibilities, we believe these two predictions are extremely conservative and should be considered carefully," cautions OASBO.

Pierson sums it up like this: "Without new taxes, new federal spending or increased gambling revenue, state foundation aid to local schools can be expected to decline by between 22.7 percent and 30.1 percent on average in the next state budget, just 15 months from now."

Superintendent David James said such a cut would mean APS could offer nothing more than the required state minimum, but it couldn't even afford that if those cuts are realized.



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