Berkshire Board Considers Future Tax Levies
Berkshire Board of Education Special Meeting - January 22, 2025
Meeting Details: The meeting was held 1/22/25 in the Auditorium of the Berkshire Local Schools complex, 14155 Claridon Troy Rd, Burton, Ohio 44021 at 6 pm. A video of the meeting is posted here. View the agenda online and any attached documents here by selecting the meeting tab and then the meeting date. The notation of minutes refers to the time posted on the video for the discussion of the item listed. At the time of this report, the video has been viewed 228 times.
Board Members Attendance: The following members attended: John Manfredi, President, Jody Miller, Vice President, and members Dan Berman, Linda Stone, and Bryan Wadsworth.
Staff Attendance: John Stoddard, Superintendent, and Beth McCaffrey, Treasurer
Meeting called to order at 6:00 pm
Pledge of Allegiance
Approval of Agenda - unanimously approved without discussion.
Minutes - None submitted for approval.
Public Participation/Public Comment - moved to after presentation
8:50 min New Business
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The Board met to discuss future tax levies, tax implications and additional revenue sources for the school district.
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Dr. Stoddard gave a PowerPoint presentation with a financial overview and possible steps forward.
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Dr. Stoddard started the financial review in 2017, the year he became Berkshire Superintendent. At that time, he and Mrs. McCaffrey developed a financial plan that would allow the district to achieve his “vision for instruction.” Initially, the plan centered largely around bringing in additional revenue from open enrollment. In 2017, the district was losing about $468,000 annually from open enrollment, because more students were leaving the school district than were coming in. In response, the school made strategic improvements to retain and attract students, such as increased hands-on learning and more direct advertising to both in-district and potential open-enrollment families.
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By 2019, the district had $140,000 in open enrollment income. In 2021, open enrollment income had increased to $660,000. In 2022, the State introduced a new funding formula eliminating the open enrollment incentive, capping revenue at the 2021 level. At the same time, Ohio implemented its voucher program. Initially, the voucher program didn’t affect district finances, as only 5 students participated. In 2023, 6 students participated. By 2024, the number was up to 69 students.
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Dr. Stoddard noted that vouchers are attached only to students who went to private, charter or non-public schools. No funding is attached to students coming to Berkshire. Voucher costs at the high school level are $8,500 per student. Later in the meeting, Mr. Manfredi noted that none of the 69 students had ever attended Berkshire schools, yet funding was still transferred.
Key Financial Challenges
Dr. Stoddard noted that the open enrollment change and the institution of the voucher program “blew up our business model.” In addition Dr. Stoddard stated that:
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Berkshire lost almost a million dollars in uncollected tax revenue from a public utility (Orwell-Trumbull Pipeline). Despite continuous requests to the County, the school still has not received an explanation as to why these monies haven’t been collected;
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Berkshire is still required to provide services to the private, charter and non-public schools, including transportation and auxiliary services like school psychologists;
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Preschool mandates require public schools to educate preschoolers with special needs. No State funding accompanies these students;
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There is a requirement to educate court-placed students. Two to four students a year are placed outside the district. The school must pay for the cost of educating these students, even if the student is placed out of state;
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There are curriculum mandates from the State, e.g. the Science of Reading curriculum, and these curriculum mandates often include training requirements for staff;
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According to Dr. Stoddard, a number of regulations drain resources and increase stress, including standardized testing, reporting and compliance, and audit requirements.
Stewardship of Taxpayer Dollars
Dr. Stoddard stated that the district has demonstrated strong stewardship of taxpayer dollars. He pointed to working with the USDA for a loan to build the new school. Berkshire is the only school in Ohio to ever have done that. The collaboration allowed the school to fund the construction through the USDA instead of going out to the bond market and getting legal counsel involved. This approach saved taxpayers over $4 million over the life of the loan.
Dr. Stoddard also said that, because they financed through the USDA, they were able to refinance in 2022; after refinancing, taxpayer millage rate dropped from 3.6 mils to 3.49 in 2023; in 2024, it dropped again to 2.6 mils. They are currently collecting at 2.5 mils. This is a clear demonstration of multiple efficiencies to taxpayers.
In addition, the Superintendent stated that the school doesn't have high year-end balances. He noted that they don’t hoard money, instead providing the best education at the lowest price.
Successes to Celebrate:
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Increasing test scores;
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Increased student services in such areas as mental health;
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Increased career education opportunities, e.g. new diesel tech and med tech vocational programs;
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Received 4-star district rating on the state report card
Dr. Stoddard indicated that all of these successes show that the educational model they have is working.
Where We Are Now
25:00 min Five-Year Forecast:
Without a PI levy, the school can’t offset expenses in the general fund. Dr Stoddard showed a chart that projects budget deficits in years 4 and 5.
Choices:
The school will need to find additional revenues or gut the current model.
Revenue generating areas:
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Early Childhood Learning Center: Without the Center, it would cost the district over a million dollars to educate the population of preschool students with special needs. The new facility will save money and also could generate up to $750,000 a year by bringing in outside district students;
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Grant writing: The school has hired a grant writer who’s already brought in revenue three times the amount of her salary in a short time.
29:20 min Other ways to generate revenue:
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Income Tax Levy
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Inside Millage Transfer
Options:
1. 4.9 Mill Operating Levy to get the district out of the $4,000,000 deficit projected in 5 years; the cost to taxpayers would be $171.50 per $100,00 of market value.
2. Additional 0.5% earned income tax bringing the total income tax rate up to 1.5%. This would generate just under the $4 Million needed; the cost to taxpayers would be $250 per $50,000 of earned income.
3. 2.5 Mill PI levy would allow school to shift funding away from the general fund to help ease the deficit; the cost to taxpayers would be $887.50 per $100,000 of market value.
4. 2.5 Mill inside millage transfer from the general fund to the permanent improvement fund; the cost to taxpayers would be $87.50 per $100,000 of market value
Dr. Stoddard and Mrs. McCaffrey think the PI levy or inside millage transfer are the only reasonable possibilities.
31:30 min Dr. Stoddard discussed a chart that showed how the revenue would be spent. See video for more information.
34:00 min Questions
The Board asked the following questions of Dr. Stoddard:
Q. Why is an inside millage transfer allowed?
A. Ohio code allows this. School districts are required by Ohio law to collect 20 mills to support public education. Berkshire hasn’t passed an operating levy in so long that they are at the 20 mill floor. A transfer of 2.5 mills from the general fund to permanent improvement fund drops the school below the 20 mill floor. As a result, taxes would increase to raise collections back to the 20 mill floor.
Other school districts have transferred inside millage, but none were at the 20 mill floor.
Q. How many mills was the PI levy that was voted down?
A. 2.5 mills; the district collected at just under 1 mill this year.
Q. Does the projected budget include funds from the preschool?
A. It reflects some preschool funds, although it is not fully realized. Also, the budget doesn’t include potential additional grants.
Q. What is the average cost of a preschool student?
A. The cost varies, depending on the severity of a student’s disability. Outside placement can cost annually between $44,000 to $140,000 per student, depending on the severity of the special need. Students without disabilities pay tuition to attend preschool.
Q. How do we budget for costs associated with students with special needs?
A. It can be difficult to plan for, but they watch trends. Dr Stoddard feels they have a good handle on district’s needs now. He noted that the State contributes very little to those costs.
Q. What is the impact on students with special needs as they get older?
A. The longer a student is in the district, generally the better the outcomes they experience. If the school has students in preschool, then the school is in control of what they are learning, so that the student can be on a level playing field.
Mr. Manfredi stated from 2017 to today, the district sent very few kids with special needs outside the district unless they needed extra special services or if there was a court ordered placement outside the district. He noted that they built the Early Learning Center to keep kids on campus and not subject them to travel. The same is true for having their tech programs on or near campus which also cuts down on travel and allows students to take more classes.
Q. How does Berkshire’s staff-administrator-teacher ratio compare to other school districts in the county?
A. Dr. Stoddard didn’t have exact figures for the county, but statewide, the ratio is typically 1 administrator for every 200 students. Berkshire is right around the average. He emphasized that administrators provide a direct line of support to teachers and any reduction will impact teachers.
Mr. Manfredi noted that combining the schools onto a single campus allows the principals and assistant principals to help and support each other.
Q. How soon can they put a PI on the ballot and what kind of impact does that timing have on their financial outlook?
A. November is the soonest they can get a levy on the ballot. If it passes in November, the school could start collecting in 2026. If it doesn’t pass in November, the District would have little choice but to start making cuts.
Q. If they chose to do the inside millage transfer, how soon would the district get those funds?
A. Mrs. McCaffrey said they could get the funds in 2026. She also noted that, with the legislature potentially changing the school funding formula, it’s impossible to forecast a budget. The school has been frustrated by the lack of information from the county about the million dollar public utility tax delinquency, which had a big impact on their budget.
Additional discussion centered around:
Public Trust & Perception – The Board acknowledged the difficulty in deciding to raise taxes, but emphasized that last year’s PI levy failure leaves them no choice.
Several members and Dr. Stoddard stated that the community needs to understand the long-standing financial responsibility the district has shown, including the treasurer’s accolades and the state’s recognition. They noted that many voters assume mismanagement when schools request more funds and that the school needs to reach out to uninvolved voters to educate them about the school’s value.
State & County Funding Uncertainty – The potential for state budget cuts makes the district’s financial position even more precarious. Schools cannot count on the county collecting all funds owed or the state adjusting its funding model favorably.
Mr. Manfredi noted that Ohio House speaker Matt Huffman has proposed cutting $650 million from the State public school budget. This would result in a $500,000 cut to Berkshire’s budget. He wished that the State offered a “level playing field” when it comes to open enrollment and school vouchers.
Flexibility if State Funding Changes – If the financial landscape improves, the district wouldn’t be obligated to collect funds from a new levy, which might help persuade hesitant voters.
57:45 min Public Participation/Comments - No comments
1:07 min Next Steps
The Board unanimously approved a motion to authorize the Treasurer to take the necessary steps to hold a public hearing on February 10, 6:00 PM to potentially shift the inside millage. The vote was not a commitment to the transfer but a step toward gathering necessary information.
Mrs. McCaffrey noted that there would still be time for the necessary public hearings and advertisements should the Board opt instead to move forward with a new PI levy for the November ballot.
1:08 min Board Discussion
The next meeting will be February 10, 2025. It will be a special meeting to discuss a potential shift of inside millage. A regular meeting will follow at 7:00 PM. All meetings are at the Berkshire Board of Education Auditorium, 14155 Claridon Troy Road, Burton, Ohio 44021
No Executive Session
1:09 min Meeting Adjourned
Observer: Rooney Moy
Editor: Anne Ondrey
Reviewer: Gail Roussey
Date Submitted: February 10, 2025
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