Akron Public Schools has a $526,000 budget surplus this year instead of a projected $1.5 million deficit, but the district's good fortune isn't expected to continue, Treasurer Ryan Pendleton told the school board Tuesday afternoon.
Next year, the projections call for about a $3.3 million deficit, Pendleton said, if current trends like a declining enrollment and slow property tax growth continue. That deficit number balloons to $25 million in 2023, according to Pendleton's five-year forecast. In those cases, it won't be as easy to balance the budget.
"I don't know how long we'll be able to do that," Pendleton said.
Board members noted that could mean returning to the public with a request for new money, the first such ask since 2012.
"There will be a day that we will have to go to the public and seek a levy," board president the Rev. Curtis T. Walker said. "Now that day isn't tomorrow, but for sure, it's coming."
Last fall, Pendleton informed the board they might be looking at a deficit for the current school year. He attributed the slim surplus to smaller than expected healthcare costs.
The district currently has about 20,471 students, which is about 370 fewer than last year, but is projecting to lose only about 50 next year. This year's graduating class is unusually large, Pendleton said, and the class that will replace it in kindergarten is expected to be smaller.
Pendleton noted Akron is among 20 percent of Ohio's 611 school districts that receive state funding on a per-pupil basis. Caps on the amount of funds a district can receive, along with guarantees a district will receive at least a certain amount of money, impact the majority of other districts in the state.
"Every student counts real dollars for us, and makes that impact even greater," he said.
Even without a major projected loss in enrollment, Pendleton said one or two factors could be the difference in making up the gap or seeing the deficit grow.
"If we have a bad healthcare year, if we have one of those roofs or boilers go that's not within the budget, we will deficit spend next year," meaning the district would have to dip into its savings to balance the budget, he said.
The district has about $47 million on hand in case of emergencies, which is equivalent to about three months' of operating expenses. Any time the district discusses dipping into that fund, Pendleton said, it triggers talk of going to the public for additional dollars.
The district also has little funding available for capital needs, he said, due to the debt payments to the city for the 34 community learning center projects that replaced old and decaying school buildings. But not all schools were included in those improvements, and several across the district have needs, he said. To pay for every current need would be more than $10 million, he said.
Without additional revenue designated for big maintenance needs, the district could end up having to tap into the general fund budget, which pays for teacher salaries.
"That is a risk to the classroom and the programs we have in place," he said.
Contact Jennifer Pignolet at email@example.com, 330-996-3216 or on Twitter @JenPignolet.