When members of the Akron Board of Education meet today, they intend to set the tax rate they would ask voters to approve this fall, if they go to the ballot as expected with a pair of levies.
Board members will have options for a measure that will allow for the construction of a new North High School and for a second levy that would cover operating expenses for the district.
The North High School levy, if approved, would pay off an $85 million bond for construction over 35 years. It would cost $45.50 each year for the owner of a home with an appraised value of $100,000 and would bring in $4.4 million annually.
The operating levy could collect anywhere from $18.9 million to $25.7 million each year, depending on the tax rate board members approve. At the low end, it would cost $196 a year for the owner of a home with an appraised value of $100,000; at the high end, the annual cost for the same house would be $266.
Together, the annual cost for homeowners would be anywhere from $241.50 to $311.50 for someone with a $100,000 home, depending on which option the board chooses.
Board members will decide later this spring whether they’ll move forward with a request to voters in November to raise taxes, but the first step will be to decide how much they would seek.CFO hopes for decision Monday
“I want them to make a decision on Monday night. I hope they do,” said Steve Thompson, the district’s chief financial officer and treasurer. “People need to know. There’s a lot of things that are kind of hinging on what’s the ask.”
Thompson said in a Finance and Capital Management Committee meeting last Monday that he intends to ask the board to go to voters with two measures to be approved on the same vote — a 1.3 mill bond levy to build North High School and a 7.6 mill operating levy that would continue in perpetuity.
He will also present the option of a 6.6 mill or 5.6 mill operating levy at Superintendent Michael Robinson’s request, though Thompson said required cuts that are already planned for the district will be deeper if board members choose one of the lesser figures.
“If we’re going to reduce revenues at this point, we also have to reduce expenditures,” he said. “Ultimately, this is a board decision.”
Board members have long discussed the future of North High School and whether they could raise money to replace the building. Thompson recommended that the board consider a combination levy, pairing the two issues in one vote so voters couldn’t choose to support one but not the other.
The district, which forecast expenditures of $367.4 million this fiscal year, is overspending that forecasted budget by more than $4.5 million, according to its February financial report. Thompson said previously that regardless of whether a levy was approved by voters, the district would have to make more than $15 million in cuts to avoid having a negative cash balance in 2027.
Now, with the additional spending, those cuts could be as high as $20 million. The district has not yet publicly discussed where those cuts might come from but officials said they would need to happen before the next school year. Thompson said with the vast majority of the district’s dollars going to staff, “it would be hard to imagine you could cut the amount of money we need to reduce out of purchased services and supplies.”
The district still needs to put gas in buses, he said, and pay electric bills.
‘Status quo’ on budget won’t work – new levies would make impact on revenue collection
“The notion that we can stay status quo simply isn’t true,” Thompson said in the meeting. “Even with cuts and even with the levy passage, we still need to maintain a very, very tight budget in order to stretch these levies out.”
He said passing the new levies this fall, rather than in a later election, would “really, really make a significant impact” in terms of tax collections. State law says collections begin the January after a levy is passed, so a November approval would allow for collections from the new levy to start almost immediately, rather than wait more than a year until 2025. That extra year of income “would help us push the next levy way out,” Thompson said.
Now, the district is projected to begin dipping into its cash balance next year. Without a levy, the $104.5 million cash balance the district has on hand now would drop to $2.3 million by 2028 under the current five-year forecast.
If the levy with the highest proposed collection amount is approved next year, the district would still use some of its cash balance, but the forecast calls for $71.6 million to remain in 2028.
“I can assure the community that we’re being very fiscally tight,” Thompson said in the meeting. “We’re running a tight ship because we have to.”
How to calculate annual millage:
A mill is $1 of tax for every $1,000 of assessed value (35% of your appraised value). For example, the tax on a house that is appraised at $100,000 is $35 in tax per mill.
Example calculation of a simple tax bill:
$100,000 (appraised value) x 35% (.35) = $35,000 (assessed value)
$35,000 (assessed value) x 1 mill (.0010) = $35 in tax per mill
(Source: Ohio Department of Taxation)
