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Mason City Schools board flags potential $24 million reallocation as House Bill 96 proposes 30% reserve cap
Summary
At its May 20 meeting the Mason City Schools board approved a spring update to its five‑year forecast and discussed how House Bill 96 — including a House proposal to cap cash reserves at 30% — could force the district to move roughly $24 million from the general fund to other funds if the measure becomes law.
At its May 20 meeting the Mason City Schools Board of Education approved a spring update to the district's five‑year forecast and spent substantial time outlining how state budget proposals in House Bill 96 could change district finances.
Treasurer Sean Bevan framed the forecast as a planning document and said the House version of HB 96 introduces "the concept of a reserve or a cap on the amount of cash reserves that ... can have. So currently, that reserve is 30% based on the house version." Bevan said the forecast currently models the possible effects of that proposal.
The five‑year forecast matters because, as Superintendent Dr. Jonathan Cooper explained, most of the district's operating dollars pay for staff: "if you look at our forecast, you'll notice that 83 to 85%, depending on the year of our budget, is spent on people. And so we are a service business. We don't produce widgets. We don't have inventory." Cooper and Bevan said a 30% cap would limit the district's flexibility and likely require moving funds out of the general operating fund into capital or debt service funds to comply with the cap.
Board members were given a timeline for the legislative process and the district's planning steps. Bevan summarized the timetable for HB 96: the senate finance committee public testimony was scheduled in late May, a sub bill was to be introduced June 3, amendments were due June 6, the senate vote planned for June 12, conference committee action in late June and a legal signature deadline of June 30. Bevan warned that the board's forecast shows a reallocation of about $24,000,000 if the House cap remains in the final bill; he emphasized that no reallocation has been made yet and that the forecast is a planning document.
Board members and administrators described two particular risks in HB 96. First, the reserve cap in the House version (30%) would force districts to move dollars into less flexible funds. Second, the state funding "guarantee" — a part of Ohio's school funding formula that currently keeps Mason's state aid from falling below prior levels — is being debated; Cooper said about $14.5 million of the district's roughly $36 million in state foundation funding this year comes from that guarantee. If the guarantee were removed or reduced, Cooper said, the district could lose substantial state revenue.
Administrators said their spring forecast models the House scenario but that the district is also monitoring other proposals. The county auditors' association has proposed a higher cap range (50%); board members described conversations with state senators and superintendents to influence the final text.
The board approved the spring five‑year forecast as a planning tool in a roll call vote; no funds were moved at the meeting. Bevan made clear the next steps are contingent on the final state budget: "No actions being taken tonight. All that we're doing is approving the planning document that we have." If the final HB 96 retains a low cap, Cooper said the board would need to vote in June on any reallocation of reserves.
The district pledged continued advocacy and outreach to state lawmakers while keeping the community informed of changes to the five‑year forecast and any required board actions.
Looking ahead, administrators said they expect fast movement in Columbus and urged community members to follow the process and contact legislators if they want to weigh in.
