Hamilton City Board approves four-year forecast as officials warn of flat state funding and enrollment declines

The Hamilton City Board of Education on Oct. 9 approved the district's required four-year general-fund forecast and heard a detailed presentation on the district's fiscal outlook that emphasized flat state revenue, continued enrollment declines and potential property-tax limits proposed at the state level.

District finance presenter Jeremy Fraser said the district expects roughly $117 million in general-fund revenue and about $122 million in general-fund expenditures for fiscal year 2026, producing an estimated deficit of about $4.7 million this year and a projected erosion of cash reserves in later years. "We are projecting a pretty flat revenue stream throughout the forecast period," Fraser said, citing a 0% assumed increase in the state's Fair School Funding Formula base cost and the possibility of a property-tax cap tied to CPI.

Board members and district leaders said the forecast is meant to be a conservative planning tool and that the district will continue weekly financial reviews and scenario modeling. Superintendent Blevins described the forecast as a tool the district uses to examine proposals and their long-term fiscal effects; she said the administration updates the forecast as legislative and enrollment data change.

Fraser and other staff highlighted three main drivers behind the projection: (1) reliance on state funding (about 75% of the district's revenue), (2) a continuing local enrollment decline and (3) legislative proposals that could cap property-tax growth. Fraser said the October forecast included a projected decline of about 40 students compared with the May projection and reduced assumptions for investment earnings. He also said Medicare reimbursement receipts had increased and noted a recent $1.4 million Medicare reimbursement check the district recorded.

On enrollment, district staff reported that while the district's residential student population has remained near earlier levels, more students are attending alternative options that shift state funding away from Hamilton City Schools. District analysis presented by staff member Mike Wright and others showed increases in students attending community and charter/online schools and in students using state scholarship/voucher programs (EdChoice and similar). Examples cited by administrators: Butler Tech enrollment in the district more than doubled in a single year after Butler Tech moved from selective admission to a lottery model, and community-school enrollment within the area rose materially over the past few years.

Fraser also explained a change in property-tax reimbursement tied to homestead credits: a recent local decision and legislative change reduced state reimbursement for a portion of county homestead tax relief. Fraser said the district had recognized roughly $864,000 in homestead reimbursements previously and that a recent county action required the district to remove about $280,000 of property-tax revenue from the fiscal-year projection.

Board members pressed for clarity about the underlying causes of revenue pressures and noted that some of the causes are decisions at the state level. Several members criticized recent state policy shifts, including the decision not to phase in higher base funding and the expansion of public funds for private-school scholarships. Board members described the forecast as conservative and cautioned that while the district has a sizable cash balance now, earlier action will lessen the scale of future expenditure reductions.

The board voted to approve the forecast; staff will submit the forecast to the state by the Oct. 15 deadline. The board also scheduled future review and continued monitoring during weekly management-cabinet meetings.

Votes at a glance - Approval of agenda: unanimously approved (Davidson, Kopas, Sprague, Baker — all recorded “yes”). - Approval of minutes: unanimously approved (Davidson, Kopas, Sprague, Baker — all recorded “yes”). - Building naming resolutions (Tim Reed Court at Garfield Middle School; Halcomb Family Blue Room at Virgil Swarm Stadium): unanimously approved (Davidson, Kopas, Sprague, Baker — all recorded “yes”). - Consent agenda: unanimously approved (Davidson, Kopas, Sprague, Baker — all recorded “yes”). - Approval of four-year forecast (required filing): unanimously approved (Davidson, Kopas, Sprague, Baker — all recorded “yes”).

The board scheduled its next meeting for Oct. 23, which will include a work session and business meeting; staff said they will continue to model scenarios and report back on enrollment, state legislative developments (including any property-tax reforms) and cost-savings options.