NEW MATAMORAS -Strategies to address Frontier Local Schools' financial woes could include passing a new levy, changing elementary schools to grade-specific buildings and even starting an online community school.
Those were some of the topics covered during a presentation of the district's five-year forecast at Monday's board of education meeting.
"We need to increase revenue or lower expenses," Treasurer Frank Antill said.
The forecast, required to be submitted to the Ohio Department of Education each October and updated by May, shows annual deficit spending of roughly $500,000 to $600,000 through fiscal year 2017.
Deficit spending was about $250,000 in the fiscal year just completed, but that number is expected to nearly double in the current fiscal year, due primarily to declining enrollment.
"We lost almost 65 students since last year," Antill said. "We draw most of our revenue from state aid, so fewer students means less money from the state."
The district anticipates receiving about $221,000 less in state funding this year as a result of the enrollment drop. A new school funding formula is expected to be introduced for the state's next biennial budget, and it's unknown what form that will take or how it will affect the money districts receive.
"We know pretty well what our money's going to be this year," Antill said. "Next year, I think everything's on the table."
Insurance costs are expected to rise, although that could depend in part on the outcome of the presidential election, Antill said, noting additional regulations set to go into place as a result of federal health care legislation Republicans have vowed to repeal.
The district's cash reserve stood at $1.6 million at the start of the current fiscal year July 1. It is expected to be $1.1 million by that time in 2013.
District officials have been criticized for considering closing Lawrence Elementary School while holding a seven-figure cash reserve, but Antill warned that won't last long. In fact, the board is expected to consider at its November meeting a 40-day cash reserve policy. That would require the district to keep about $800,000 on hand in case of emergency.
"(The) school district needs to have a safe harbor amount of money in its bank account," Antill said. "We're going to be at or near that sometime during, not this fiscal year, but the fiscal year after that."
Superintendent Bruce Kidder presented some options he said he'd like to explore to improve the district's financial outlook.
First, he plans to eliminate a yet-to-be-determined administrative position and cut one or two teaching positions through retirement. A tax levy needs to be on the ballot in 2013, although Kidder said he and Antill are still considering what type to recommend to the board. An earned income tax levy was overwhelmingly rejected by voters in 2011.
Kidder returned to another possibility mentioned during that campaign - assigning students to elementary schools based on their grade levels rather than geography.
"You no longer have any (kindergarten) to six numbers that are above 60," he said to residents at the meeting. "I don't know how I'm going to get people to do that because I know you love your neighborhood elementary schools.
"I don't need three teachers to teach 48 kids," he said.
As an example, he said one school could house first-through-third-graders and another fourth-through-sixth-graders, with kindergarteners split between them for at least the first year to keep class sizes small. That was the model he discussed last year when Lawrence's closure seemed assured before being staved off after a backlash from residents of that community.
On Monday, Kidder also mentioned three schools with two grade levels each and conceded an argument Lawrence supporters have made in the past.
"Lawrence Elementary is the cheapest building in this district to run, by far," he said, noting the school does not have air conditioning.
Closing one school and making the other two grade-level buildings would save an estimated $350,000, Kidder said.
"If for some reason you even went to this format, it's not going to save you forever. It's just going to slow it down," he said.
New revenue must accompany cuts to turn the situation around, Kidder said. In addition to a levy, he said the district would explore sponsoring its own online community school. He noted 24 students have transferred to online schools, something expected to cost the district $150,157.17 in state foundation money this year.
"We can pair up with companies that provide that service and run the school ourselves," Kidder said, noting there would also be a cost associated with that. "What I'm hoping is (students) would want a diploma from Frontier as opposed to a diploma from ECOT (the Electronic Classroom of Tomorrow)."
The board could choose to allow online enrollees to participate in sports and other extracurricular activities, he said.
But while online schools often allow enrollment beyond their geographic area, Kidder said he doesn't want to "play one school district against another." In fact, he said the idea of a consortium with other Washington County school districts and the Ohio Valley Educational Service Center has been brought up.
Antill also said the district and residents needed to lobby legislators to ensure schools received a portion of any revenue generated by increasing Marcellus and Utica shale drilling.
Board Vice President Jeff Knowlton said the district has to make changes because enrollment doesn't seem likely to turn around.
"Without a significant infusion of revenue into the district, we're going to have to make some more sacrifices," he said. "If we go to two grade-level buildings, I don't think we're very far from one grade-level building."