District finance staff warns of multi-year deficits as property-tax rules shift
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Summary
Warren City School District finance staff presented a three-year fiscal forecast showing a projected $3.3 million gap this year, a falling state share of base funding and potential multi-million-dollar losses if county homestead/owner-occupied credits expand under new law.
Warren City — District finance staff told the Warren City School Board on Feb. 24 that the district faces a multi-year fiscal squeeze driven by flat local revenue, shrinking state aid and changes in property-tax law.
"Our revenues have been very flat and have actually decreased in some areas and will continue to decrease," said the district finance staff member who presented the three-year forecast. The presentation listed a general-fund beginning balance of $31,700,000, projected annual revenues of about $75,000,004 and projected expenditures of about $78,700,000, producing a projected $3.3 million deficit and a year-end general-fund balance in the neighborhood of $28,000,000.
The presenter told the board the district currently collects a 1.9-mill fixed-sum emergency levy that expires in 2026; collections will continue through 2027 but future renewal rules have changed. "They are allowing a one-time renewal, and it will be called a fixed-sum levy for five years," the finance presenter said, noting that the change will alter how the district can rely on that revenue beyond 2027.
Superintendent Mr. Shiro warned the board about other drivers of revenue pressure: the state has reduced several aid lines and the district lost a $2.3 million supplemental targeted-assistance allocation this fiscal year. "Overall, our state funding decreased $1,000,000 dollars from what is projected for this year from last year," the finance presenter said. He added that the state still uses 2022 data in base-cost calculations, which understates current salary and benefit costs.
The presenter also outlined a pending policy choice at the county level: state legislation now allows county commissioners to expand homestead and owner-occupied tax credits (a change that would not be reimbursed by the state). The district projection showed that an expanded credit could mean nearly $4 million in cumulative loss over four years to local taxing entities, including school districts.
Board members pressed only briefly during the presentation; Superintendent Shiro emphasized the district is looking at expenditure reductions such as trimming supplies and capital outlays by about 10% in nonessential areas to help preserve a positive cash balance through the forecast horizon.
Next steps: the board will consider the information while planning whether to pursue levy renewal options and will continue budget work with administration. The meeting later moved to routine business and then recessed to executive session on personnel matters.
Provenance: The forecast and levy discussion begins with the finance presentation (transcript excerpt: "So, we are required to do a forecast for the current fiscal year and 3..." SEG 163) and continues through the revenue and state-aid detail (excerpt: "Overall, our state funding decreased 1000000 dollars..." SEG 513).
