News: School District Eyes Tax Levy

CPS might seek emergency five-year increase

Aug 18, 2007 at 2:06 pm
Andy Houston

An Aug. 6 forum on a possible school levy for the Cincinnati Public Schools focused on long-term financial issues.

Saying the school district is in a fiscal crisis, the Cincinnati Board of Education is considering an emergency property tax levy for the Nov. 6 ballot. The tax hike would generate around $68 million annually and last for five years.

A 10-mill levy would cost the owner of a $100,000 home a little less than $300 in new taxes per year.

It's been almost seven years since Cincinnati voters approved a new operating levy for its public schools. Despite a five-year renewal levy passed in 2004 worth $65 million, Cincinnati Public Schools (CPS) is in danger of dropping deep into the red over the next few years.

The district could be facing a $79 million deficit by the summer of 2009 if no action is taken, according to CPS Treasurer Jonathan Boyd.

In order for a levy to appear on the Nov. 6 ballot, the school board must submit plans for the levy to the county auditor by Thursday. If that deadline is missed, the next opportunity for a levy would be March 2008. That would prevent proceeds from being collected until the beginning of 2009, putting CPS in an even deeper monetary hole, Boyd says.

The board held a public forum Aug. 6 on the possible levy.

"The most devastating thing with this is that the '08 and '09 budgets would be cut drastically," said board member Katherine Ingram. "We have two scenarios: one if it passes and one if doesn't. If it doesn't pass, we'll be that much more in the red regarding expenditures. ... The levy is necessary. I'd be shirking my responsibility to be against it."

However, even if the levy is passed, CPS' financial troubles wouldn't be over.

"I have many concerns that we could easily find ourselves in a troublesome situation," Boyd said. "My experience is that, in the past, there is almost always unforeseen events."

Boyd has forecasted a $16.4 million increase in operating revenues from now until June 30, 2012. Yet, this is coupled with a prediction of sizable expenditure increases in base salaries, employee benefits, contract services, supplies and equipment. The emergency levy would help cover these increased costs.

"It will keep the system alive," says board member John Gilligan. "That's the best that can be said for it."

Gilligan says he's in favor of passing a tax levy for CPS, "as I always am." But he isn't very optimistic about CPS' financial future.

"We're hard pressed for money, and we're in a rigid financial straightjacket," he says.

The source of the problem lies elsewhere, according to Gilligan, a former governor of Ohio.

"The state system is a mess," he says. "The Supreme Court of Ohio has declared that our method of raising money is unconstitutional multiple times."

Despite repeated orders from the court, the Ohio General Assembly has refused to replace the state's system of financing public schools primarily through local property taxes. Found unconstitutional because it creates inequalities in educational funding across the state, the system also hasn't kept up with the demands of education, Gilligan says.

"The most expensive public system in this country — barring health care — is education," he says. "Sixty years ago all you needed was a blackboard and some wooden benches, and you were set. Now you need computers and comprehensive teacher training programs. I would like for us to have a look at what other districts are doing, lay out for taxpayers the facts of life — what the real costs are and how we try to stretch the resources we have to cover our costs."

CPS Board President Eileen Reid said cost reduction won't work as the only response to financial problems. But financial problems sometimes create unexpected opportunities, she said.

"I'm not in favor of cutting, cutting, cutting," she said. "I want to look at how we do things and changing them to make things more effective for the children. I believe sometimes these type of opportunities allow us to create change and be more effective." ©