Consultant warns Marion Central that costs are outpacing revenues and urges immediate cuts or tax action

Dr. Rick Timbs, a financial consultant invited by the board, told the Marion Central School District Board of Education that the district faces a widening five‑year gap between revenues and expenses and should act now to avoid exhausting reserves.

Timbs said his team used district ST-3 submissions to the State Education Department, state aid runs, external audits, debt schedules and district interviews to build a multi-year picture. He told the board that foundation aid has effectively stagnated: Marion received $9.248 million in 2023–24, but the formulaic foundation aid would be about $6.3 million under current runs, creating an asset the state is temporarily honoring rather than a durable funding increase.

"The state is not coming to help you," Timbs said. He warned that modest projected increases proposed by the governor — a $94,335 bump in the example he showed — are "chump change" compared with rising salary, pension and health insurance costs that compound over time.

Timbs highlighted several fiscal pressures: rapidly escalating health insurance (projected to grow by millions over five years), rising contractual salary obligations and pension costs, the mechanics of the tax cap (which constrains local levy growth), and demographic shifts measured as TAPU (total aidable pupil units) that have reduced Marion's weighted aid base. He said the district’s combination of modest state aid growth and rising local costs leaves reliance on appropriated fund balances and reserves.

On capital and transportation, Timbs said zero‑emission bus mandates create a particular difficulty for small, rural districts. He noted zero‑emission buses can cost roughly two‑and‑a‑half times a diesel bus and that retrofitting transportation facilities and securing power hookups are expensive and time-consuming. "Costs associated with zero emission bus mandate currently unreachable. Waivers are needed," he said.

Timbs reviewed the district’s reserves favorably — describing prudent capital and workers'‑comp reserves — but said schedule-driven debt service and the upcoming loss of some building‑aid flows will create cyclical dips that can leave the budget tight in later years. Using a conservative revenue picture and expense escalators, his base scenario projected expenses rising substantially faster than revenues; a hypothetical immediate $1.2 million reduction in expenses would only modestly delay the onset of structural imbalance.

His recommendations to the board included: begin immediate, targeted expense reductions (emphasizing attrition and breakage where possible), reassess staffing and nonessential purchases, preserve cash flow, and consider the tradeoff between larger tax increases and smaller cuts (he noted that higher taxes reduce the scale of program cuts required). Timbs framed the decision as a balancing act: "The larger the tax increase, the smaller the cuts in expenses. The smaller the tax increase, the larger the cut in expenses."

Board members said they would review the detailed materials in a follow-up workshop and asked administration to refine assumptions on health‑insurance projections and cash‑flow timing. The board scheduled a workshop to go deeper into the assumptions and possible corrective actions.

The presentation and the workshop that follows give the board a formal five‑year fiscal baseline and a list of immediate steps to protect cash flow and preserve core programming.