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Ohio House bill would cap school district cash reserves at 30%; Middletown leaders warn of local impacts
Summary
Treasurer Randy Bertram told the board that House Bill 96 would restrict local school cash reserves to 30% carryover at fiscal year end; Middletown’s policy targets a lower base and a higher cap, and staff warned the proposed cap could force levy requests, borrowing or loss of funding for the district.
Middletown City School District officials told the board April 28 that Ohio House Bill 96, the biennium budget bill approved by the House, contains a provision that would cap public‑sector cash reserves at 30% of general fund carryover.
Treasurer Randy Bertram said the bill originally contained a 25% cap that the House amended to 30% before approval. Bertram said the district’s own policy sets a 75‑day minimum (roughly a 20% carryover) and a higher band at 150 days (about 40%), giving the district operating flexibility. He said the statewide average carryover for Ohio school districts is about 45%.
Bertram warned that a 30% cap could force districts to return money to taxpayers through lower millage or rebate mechanisms and could prompt early levy requests. He estimated that, depending on the district’s year‑end cash balance, Middletown could face a reduction of roughly $6.5 million to $8 million in the coming tax cycle if a cap were applied and the state redirected excess carryover.
Board context: Bertram said the district holds cash reserves to cover weekly obligations while property tax revenue arrives biannually and to handle reimbursement timing for grant spending, such as periodic state reimbursements. He said grant payments and large reimbursement timing can deplete cash flow and that districts sometimes dip below carryover targets during the year. Reducing legally allowed carryover could increase the risk the district must borrow to cover short‑term obligations, reduce flexibility to manage unexpected costs and raise the odds of future levies.
Ending: The board was urged to contact state senators to oppose the proposed cap; board members said they would reach out to legislators and share materials with constituents.
