Treasurer warns HB 96 changes could cut Lakewood City Schools' state funding by millions; board told levy likely in 2026

District Treasurer Zeman told the Lakewood Board of Education on July 7 that the state biennial budget (House Bill 96) will change how the Fair School Funding Plan is applied and could reduce Lakewood City Schools' state funding by millions over the next two years.

Zeman said the governor signed HB 96 on June 30 with numerous vetoes, and the final conference‑committee language follows the senate's funding approach with some modifications. He cautioned that a combination of updated property/value input data and other formula elements could cut the district's state share of foundation funding and reduce transitional guarantees.

"The combination of the updating of the data used in the state local share calculation and the failure to update the base cost inputs led to a significant decrease in the state share for over 80% of Ohio school districts in the next biennium," Zeman told the board. He presented the district's estimate that the change could mean a potential loss of roughly $5.7 million in state funding over the forecast period under one scenario, and other provisions could create larger impacts in alternative scenarios.

Zeman summarized the budget pathway (governor proposal → House bill 96 → Senate amendments → conference committee → governor's signature) and outlined differences among the executive, House and Senate proposals that changed the district's projected outcomes. He said the conference committee reduced the proposed cash‑balance cap to 40% (with a sliding scale for districts under $10 million), but the governor later vetoed that cash‑balance limit—meaning the conference committee's $800,000 performance supplement is more likely to survive while the cash‑balance cap would not.

The treasurer gave several district‑level estimates from his analysis: a potential $5.7 million loss tied to base‑cost and state‑share changes, a possible $12 million loss over the forecast period because of cash‑balance limits in one conference proposal, and a separate $14 million flat‑formula loss scenario tied to a House proposal that would have cut funding tied to district cash balances. He characterized the net current outlook as improved from earlier proposals but still uncertain and requiring continued advocacy and monitoring.

Zeman also told the board the district is likely to pursue additional local operating revenue and said, "the district will most likely be seeking additional funding from the community in the form of an operating levy request in May 2026." He urged continued public engagement and noted the governor's remarks that "the future of Ohio is in our children," which he used to emphasize the stakes of state funding decisions.

Board members discussed the report and urged vigilance, noting other related proposals—such as changes to inside millage rules—that remain active in the legislature. There was no formal board action recorded on the budget analysis at the July 7 meeting; Zeman's report was presented as informational and will inform future planning.

Why it matters: The Fair School Funding Plan drives basic state funding for Ohio districts; changes to the inputs, state share calculation and guarantees can materially change local budgets. A multi‑million‑dollar reduction in state aid would increase pressure on local revenue sources and planning timelines, which is why Zeman signaled a likely May 2026 levy request.

Next steps: The treasurer's letter and analysis will be published with meeting materials; district officials said they will continue monitoring legislative action and refining revenue forecasts ahead of any ballot proposal.