Building a new Powers Elementary will help green up the Amherst school system’s financial outlook through at least 2021.
District treasurer Barbara Donohue said Monday that with construction on the horizon, she has worked about $500,000 in annual savings into the budget.
The new PK-3 school, which has yet to be designed, will replace the current Powers and Harris elementary buildings. Combining grades under one roof on South Lake Street is expected to save costs on everything from energy to personnel.
Those savings are reflected in a new forecast from Donohue’s office to the Ohio Department of Education, showing the Amherst district’s financial projections for the next five years.
The catch: Voters could darken the district’s bright picture this May.
Issue 6 on the primary ballot calls for renewal of a 4.9-mill emergency operating levy that voters first passed back in 2012. It generates $2.6 million per year but is set to expire Dec. 31.
If the levy is renewed for another five years, the Amherst Schools will stay in the black “as long as the state doesn’t do anything stupid,” board of education president Ron Yacobozzi said.
If it fails, “we will go backward,” Donohue said.
“If we were to lose the revenue from this renewal levy, beginning in 2018 our expenses would exceed our revenue, which as you know is the beginning of a problem,” said superintendent Steven Sayers.
The school system is only required to try to predict its financial stability five years out — even that is tough, since state lawmakers change school funding policies all the time — but Sayers thinks Amherst will remain strong even longer.
He called passage of the renewal “the last piece in putting together a long-term plan” for financial success.
The levy costs taxpayers about $12.50 per month for every $100,000 worth of property they own. That could change, however, since the Lorain County auditor’s office is recalculating property values.
Depending on your personal situation, your tax bill could slide up or down. If your bill does rise, it doesn’t mean the school system is collecting more money, since levies ask for fixed amounts.
“When taxes do go up, it seems schools are the first thing people take a shot at. That’s not the case here,” Yacobozzi said.
Donohue said other factors are also bolstering the books.
For example, the district is seeing savings on health insurance premiums, and it recently got a $38,000 refund on gas purchases due to the mild winter weather (city hall is seeing similar savings to the tune of about $100,000 because it had to buy very little road salt this season).
All that help the forecast.
But the board of education hopes the savings also help its bond rating. Officials will travel next month to Chicago to make their case to Standard and Poor’s, which is among the world’s three big credit-rating agencies.
In a two-hour presentation, they’ll talk about the Amherst Schools’ finances, the flavor of the community, the priorities of the people who live here, and who the city fits into the puzzle that is Lorain County.
“They represent the investors and they want to be able to ensure the investors that this entity has the ability over time to pay back the debt,” Donohue said. “The more solid you are and the less risk you have, there’s better rates involved.”
If the school district can improve its credit rating by one rank, it will save a quarter percent of interest on the bonds it will sell to finance construction of the new Powers Elementary.
Every quarter of a percent saved equals $712,000.
The district’s current rating is AA-2, which Donohue said is excellent. But improving a rank would help make the district’s budget go much further, she said.
You can learn more about the Amherst school district’s finances and overall outlook during Sayers’ annual State of the Schools address. It’s scheduled for 6:30 on Tuesday, April 4 at the Steele High School cafetorium.
Jason Hawk can be reached at 440-988-2801 or @EditorHawk on Twitter.
RECOMMENDED FOR YOU