Ohio Auditor Dave Yost placed Medina County’s Cloverleaf school district in fiscal emergency Tuesday because the district cannot overcome a nearly $600,000 deficit this June. The following year, the deficit will balloon to $2.6 million.
The declaration means the district can borrow money from the state, but must submit all financial decisions — including whether to put a levy on the ballot — to a state commission for approval.
Within the next 15 days, a five-member commission will be formed to oversee Cloverleaf’s finances. The commission will have 120 days from its first meeting to devise a budget for the state superintendent to approve.
The Cloverleaf Board of Education saw the writing on the wall in November following the defeat of a 6.5-mill operating levy. The board asked the state Nov. 29 to place the district in fiscal emergency.
“Having cut $4 million from our budget in the last three years, I could not offer an acceptable plan to avoid a deficit at the end of this year,’’ Superintendent Daryl Kubilus Jr. said.
Teachers last year agreed to freezes in base pay and to forgo scheduled raises for experience and advanced academic degrees. They also agreed to pay 15 percent of their health insurance premium, Kubilus said. Nonteaching staff have made similar concessions.
Negotiations are up again this year, but any contract that increases personnel costs will need state oversight commission approval.
Cloverleaf, with an enrollment of about 3,000 students, is rated Excellent on the state report card.
“My board has taken the stance that we’ve cut a great deal,” Kubilus said. “When you start compromising your educational values, I think that’s where they draw that line in the sand. We’re at that point right now, and that’s part of the reason we’re in fiscal emergency.”
He said he is researching the state’s minimum standards for staffing and course offerings.
“From the state’s perspective, you don’t have to have athletics. There is an example of a minimum, no extracurricular activities,” Kubilus said.
But cutting that sort of thing could result in an exodus of students and the state aid that comes with them.
“If students are leaving your school district because you don’t have any athletics, well then you’re losing a great deal of money on students who are leaving,” Kubilus said. “I’ve seen first-hand students coming to us because of pay-to-participate fees being too high in their school districts. These are good kids, well-intentioned families that are coming here to avoid some of those fees, and I’m glad to take them. But I don’t want to see the opposite happen.”
Cloverleaf’s school board will not get final say in those decisions while the district remains in fiscal emergency.
The five-member board that will be in charge of the money will include representatives for the state school superintendent and the director of the Office of Budget and Management. The commission also will have a business person appointed by the governor, a parent with a child in the district appointed by the state superintendent and a business person appointed by the Medina County auditor.
To emerge from fiscal emergency, Cloverleaf will have to repay any loans to the state and be able to forecast five years without a deficit.
That could take a while.
After voters rejected levies several times, the state declared fiscal emergency for Springfield in 2007. That allowed the district to borrow nearly $2 million to balance its books. Last November, after nearly five years of state control of its financial decisions, the district was cleared for release from fiscal emergency.
John Higgins can be reached at 330-996-3792 or firstname.lastname@example.org. Read the education blog at http://education.ohio.com/.